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Saturday, August 11, 2018

week ending Aug 11

US GDP Turbocharged After Record Saving Rate Revision: Why That Could Be A Problem - Last week, the US Bureau Economic Analysis unleashed some statistical goalseek magic that would make Beijing thoroughly fabricated economic "data" blush for days: as part of the comprehensive GDP revision carried out every five years by the Commerce Department’s BEA, US economic history was rewritten and in a shocking development, the annual saving rate was revised higher by 1.6% on average since 2010, with the 2017 US savings rate doubling overnight, from 3.4% to 6.7%.  Putting these revisions into context, this revision to the saving rate over the prior 6 months is the largest on record, according to real-time data available from the St. Louis Fed since 1997.  Major revisions to national income (and consequently the saving rate) came from 3 sources of income: proprietors', dividend and interest income, as well as a tiny increase in employee compensation.  As BofA notes, the BEA incorporated the tabulations of sole proprietorship and partnership tax returns for 2016 which included new research by the IRS showing significant underreporting of income by nonfarm proprietors over time, causing a sizeable upward revision for proprietors' income starting in 2010.    In a Saturday note, Goldman chief economist Jan Hatzius quantified the implications of the higher saving rate for the consumer outlook and wrote that "taken at face value, our model implies that a declining saving rate could deliver a boost of as much as 0.8% to annualized real PCE growth over the next two years." Even under more conservative assumptions—which Hatzius writes may be warranted given the uncertainty around saving data, Goldman "now expects real consumption growth to slow more gradually than before, from 2.7% over the past year to 2.4% over the next year. "  What does this mean for GDP? Simple: it is revised sharply higher, with Goldman throwing in the towel on its warning of a sharp slowdown in economic growth in 2019 and 2020, and instead now expecting substantially higher growth as we continue drifting ever deeper into the second longest economist cycle in history.

 Key Measures Show Inflation increased YoY in July -- The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:  According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.2% (2.7% annualized rate) in July. The 16% trimmed-mean Consumer Price Index also rose 0.2% (2.3% annualized rate) during the month. The median CPI and 16% trimmed-mean CPI are measures of core inflation calculated by the Federal Reserve Bank of Cleveland based on data released in the Bureau of Labor Statistics' (BLS) monthly CPI report. Earlier today, the BLS reported that the seasonally adjusted CPI for all urban consumers rose 0.2% (2.1% annualized rate) in July. The CPI less food and energy rose 0.2% (3.0% annualized rate) on a seasonally adjusted basis.  Note: The Cleveland Fed released the median CPI details for July here.

Q3 GDP Forecasts --It's early in the quarter, but here are a few forecasts: From Merrill Lynch:  We continue to track 4.1% for 2Q GDP. Growth should ebb to a still-robust 3.4% in 3Q. [Aug 10 estimate].   And from the Atlanta Fed: GDPNow The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2018 is 4.3 percent on August 9, down from 4.4 percent on August 3. [Aug 9 estimate]  From the NY Fed Nowcasting Report: The New York Fed Staff Nowcast for 2018:Q3 stands at 2.6%. [Aug 10 estimate] CR Note: Since it is early, the range of estimates is wide.  These estimates suggest real annualized GDP in the 2.6% to 4.3% range in Q3.

Financial Health of U.S. Consumer Will Determine Severity of the Next Recession -- Pam Martens -  Approximately two-thirds of U.S. gross domestic product (GDP) derives from the consumer. Without financially healthy consumers, the economy cannot prosper. In a July 30 interview on the cable news channel, CNBC, Jamie Dimon, the Chairman and CEO of JPMorgan Chase, the largest bank in the U.S., said that “the consumer’s in good shape; their balance sheet’s in good shape.”On May 17 the Center for Microeconomic Data at the Federal Reserve Bank of New York released itsQuarterly Report on Household Debt and Credit which raised some notable questions as to whether Jamie Dimon actually has his finger on the pulse of the U.S. consumer.According to the report, “aggregate household debt balances increased in the first quarter of 2018, for the 15th consecutive quarter. As of March 31, 2018, total household indebtedness stood at $13.21 trillion,” which is $536 billion higher than it was at the end of the third quarter of 2008. That was when the country was ravaged by the worst financial crash since the Great Depression.The report further notes: “The flow into 90+ day delinquency for credit card balances has been increasing notably for the last year, while the flow into 90+ day delinquency for auto loan balances has been slowly trending upward since 2012.” Not paying your debt is typically not associated with a strong consumer balance sheet.Hiding in footnotes in the report is a subject that should be of concern to every engaged American – from both a humanitarian and economic standpoint. That subject is America’s young people who are crippled under student loan debt. According to the report, student loan debt grew by $29 billion in the quarter and stood at $1.41 trillion as of March 31, 2018. An alarming 10.7 percent of aggregate student debt was 90 or more days delinquent or in default. But that hardly captures the problem. The New York Fed provides this caveat: “…delinquency rates for student loans are likely to understate effective delinquency rates because about half of these loans are currently in deferment, in grace periods or in forbearance and therefore temporarily not in the repayment cycle. This implies that among loans in the repayment cycle delinquency rates are roughly twice as high.”

 CBO: Monthly Budget Review for July 2018 -- As expected, the deficit is increasing significantly. From the CBO: Monthly Budget Review for July 2018- The federal budget deficit was $682 billion for the first 10 months of fiscal year 2018, CBO estimates, $116 billion more than the shortfall recorded during the same period last year. Revenues and outlays were 1 percent and 4 percent higher, respectively, than in the same period in fiscal year 2017.As was the case last year, this year’s outlays were affected by shifts in the timing of certain payments that otherwise would have been due on a weekend. If not for those shifts, outlays and the deficit through July would have been larger, by roughly $40 billion, both this year and last year—but the year-to-year changes would not have been very different.CBO expects that the deficit, receipts, and outlays for fiscal year 2018 will be largely consistent with amounts in its adjusted April baseline, which were reported in An Analysis of the President’s 2019 Budget in May 2018. At that time, CBO projected a deficit of $793 billion, outlays of $4,131 billion, and receipts of $3,339 billion. Next year the deficit will probably be close to $1 Trillion (about 4.6% of GDP).

Federal deficit jumps 20 percent after tax cuts, spending bill | TheHill: The federal deficit jumped 20 percent in the first 10 months of the 2018 fiscal year, the Congressional Budget Office (CBO) reported Wednesday. Spending outpaced revenue between the beginning of the fiscal year, on Oct. 1, and July by $682 billion, $116 billion more than over the same period in the last fiscal year. The rising deficit is largely the result of the tax cuts President Trump signed into law at the end of last year, as well as a bipartisan agreement to boost spending, according to CBO. Tax revenues from individuals rose, even as revenues from corporate taxes dropped. The Trump administration has argued that the tax cuts would bring down the deficit, as economic growth led to higher tax revenue. The economy did expand in the second quarter by 4.1 percent. But economists have argued the growth would have to be much larger to reduce the deficit. The CBO projects that the deficit will reach $793 billion by the end of the year and approach $1 trillion next year. White House estimates have the deficit surpassing $1 trillion in 2019. Budget watchers have warned that interest payments — the amount the Treasury has to pay just to service the debt — are slated to become the fastest-growing annual expenditure. The CBO projects that in 30 years, the government will spend more on servicing debt than on Social Security or defense.

US Spending On Interest Hits All Time High As Budget Deficit Soars To $684 Billion (graphs) The US' spending problem is starting to become a major issue. According to the latest Monthly Treasury Statement, in June, the US collected $225BN in tax receipts - consisting of $110BN in individual income tax, $91BN in social security and payroll tax, $4BN in corporate tax and $20BN in other taxes and duties- a drop of 2.9% from the $232BN collected last July and a reversal from the recent increasing trend... ... and in July, the 12 month trailing receipt total was barely higher compared to a year ago, up just 0.4% Y/Y after rising as much as 3.1% at the end of 2017. Meanwhile Federal spending rose, up 9.9% from $275BN last July to $302BN last month.... where the money was spent on social security ($83BN), defense ($49BN), Medicare ($24BN), Interest on Debt ($35BN), and Other ($111BN)This resulted in a July budget deficit of $77 billion, in line with expectations, and a signification deterioration from the $43 billion recorded in July of 2017. The July deficit brought the cumulative 2018F budget deficit to over $684BN during the first 10 month of the fiscal year, up 28% over the past year.  This is the highest 12 month cumulative deficit since May 2013; as a reminder the deficit is expect to increase further amid the tax and spending measures, and rise above $1 trillion as soon as next year.Most Wall Street firms forecast a deficit for fiscal 2018 of about $850 billion, at which point things get... much worse. As we showed In a recent report, CBO has also significantly raised its deficit projection over the 2018-2028 period.  But while out of control government spending is clearly a concern, an even bigger problem is what happens to not only the US debt, which recently hit $21.3 trillion, but to the interest on that debt, in a time of rising interest rates. As the following chart shows, US government Interest Payments are already rising rapidly, and just hit an all time high of $538 billion in Q2 2018.  Interest costs are increasing due to three factors: an increase in the amount of outstanding debt, higher interest rates and higher inflation. Needless to say, all three are increasing; furthermore, a rise in the inflation rate boosts the upward adjustment to the principal of TIPS, increasing the amount of debt on which the Treasury pays interest, turbocharging the amount of interest expense. The bigger question is with short-term rates still just around 2%, what happens when they reach the mid-3% as the Fed's dot plot suggests it will?

Jamie Dimon Warns of 5% Treasury Yields - Not content with a previous warning investors should brace for U.S. yields of 4 percent, Jamie Dimon went one further at the weekend, suggesting 5 percent was a distinct possibility. The JPMorgan Chase & Co. chief executive officer said Saturday people should be prepared to deal with the benchmark 10-year bond yield at 5 percent or higher. “I think rates should be 4 percent today,” Dimon said Saturday at the Aspen Institute’s 25th Annual Summer Celebration Gala. “You better be prepared to deal with rates 5 percent or higher - it’s a higher probability than most people think.” The 3 percent level is still providing stiff resistance for the 10-year Treasury yield this year. It briefly rose through the mark last week before falling back for the fourth time this year. That’s despite a U.S. jobless rate below 4 percent, economic growth above 4 percent, and a rare surge in late-cycle government borrowing. Unease about the length of the economic cycle may be behind the stalled rise in yields. “The market is starting to look beyond the 2020 time-frame and pricing in some recession risk,” In addition, concerns about rising prices appear to be ebbing. In the U.S., the 5-year break-even rate, a gauge of inflation expectations, has fallen to just under 2 percent, down from this year’s high of almost 2.2 percent. Still, Dimon remained positive on the outlook for financial markets. The current bull market could “actually go for 2 or 3 more years” because the economy is still doing quite well and markets usually turn right before the economy, he said.

The Bond Market Doesn’t Control Anything; the Currency-Issuing National Government Does - The mistakes made by the public with regard to public debt (national debts) are threefold. In the first instance, the public relies heavily on politicians and the media to tell them what to think. Secondly, the assumption is that the national government is no different than a household, and so, if the government goes into debt it must earn enough income to pay off that debt with interest, or it will become insolvent. This mistake is known as “the Fallacy of Composition” wherein the person is assuming that what is true for them in their individual case (the micro-level) must also be true for everyone including the national government (the macro-level). Thirdly, the assumption is that treasury bonds are issued to conduct fiscal policy; that is, to fund deficit spending.  The truth of the matter is that, though they are not aware of it, much of the politics-following public is utterly unqualified to assess any information given to them by the media concerning treasury bonds and national debts. The media feeds them information based on false assumptions and the conclusion that the public reaches from these errant ideologically-driven foundations can be summarised by the following commentary: “We are 20 trillion in debt because both the Democrats and Republicans find it easier to spend in hopes of gaining votes then to show financial restraint. This is also a reflection of how many Americans handle their own finances. Future generations will pay for this dearly…”  As we can easily see, all three assumptions are present in the above comment:

  • 1.) The person follows politics to some degree and has been “educated” on the subject of public debt by the media and politicians.
  • 2.) The person clearly assumes that the US government’s finances are just like a household’s (fallacy of composition).
  • 3.) The person assumes that treasury bonds allow the US government to spend more than it earns.

If we follow this errant thinking to its totally absurd conclusion, we conclude that since most national governments have a national debt, and that since private debt levels are rising higher each year world-wide, then the whole world is in debt up to its eyeballs. We must then ask, “The whole world is in debt to whom?” and then the mass delusion reveals itself. Who can the entirety of the Earth’s human population, including corporations and governments, be in debt to?

 Mattis calls space a ‘developing war zone,’ mulls creating combatant command before Space Force --US Defense Secretary James Mattis says the Pentagon agrees with President Donald Trump on viewing space as a possible battlefield and is considering setting up a combatant command until the Space Force can be created. “We need to address space as a developing war-fighting domain, and a combatant command is certainly one thing that we can establish,” Mattis told reporters on Tuesday, adding that the Pentagon is “in complete alignment” with Trump’s concerns about protecting US assets in space.“We’re going to have to address it as other countries show a capability to attack those assets,” the secretary added. Asked whether he supported establishing a combatant command for space, Defense Sec. Mattis tells @LMartinezABC, "Absolutely. We need to address space as a developing war fighting domain." https://t.co/NBhiAY6KArpic.twitter.com/ocXqHr2F2J— ABC News Politics (@ABCPolitics) August 7, 2018Trump issued a directive in June to begin preparations for creating the Space Force as a separate branch of the US military, along with the Army, Navy, Air Force, Marines, and Coast Guard. Doing so will ultimately require an act of Congress, however.“We are working our way through all this,” Mattis said. “The vice president is kind-of the point man for the president on this, we are working daily with his office and with supporters on Capitol Hill and the relevant committees.”  Though Mattis was opposed to the idea of setting up a space force last year, he seems to have come around to Trump’s viewpoint that space “is a war-fighting domain just like the land, air, and sea.”

White House and Pentagon advance plan to create a Space Force --In a speech Thursday, Vice President Mike Pence promoted President Trump’s plan to create a “Space Force” as a sixth branch of the US military—on par with the Navy, Air Force, Marines, Army and Coast Guard—aimed at fighting wars in space.Pence called the initiative “an idea whose time has come” and stated the Trump Administration planned to have the branch operational by 2020. In his speech at the Pentagon, Pence called for Congress to supply an additional $8 billion for space security systems over the next five years.“The time has come to write the next great chapter in the history of our armed forces, to prepare for the next battlefield where America’s best and bravest will be called to deter and defeat a new generation of threats to our people, to our nation,” he said.In his typical chauvinist fashion, President Trump has said, “It is not enough to merely have an American presence in space; we must have American dominance in space.” The chest-thumping rhetoric conceals an inconvenient truth: the US manned space program is moribund rather than dominant, dependent on Russian rockets to send astronauts to the International Space Station. Many other nations have mastered the basic technologies associated with reaching space, which are now some 60 years old. Pence, in his inflammatory speech, said that “other nations are seeking to disrupt our space-based systems and challenge American supremacy in space as never before.” The vice president claimed China and Russia have transformed space into a warfighting domain, and stated, in a show of menace, “the United States will not shrink from this challenge.”

VP Pence Unveils Trump's Space Force; Will Cost $8 Billion Over 5 Years - Back in March, President Trump first introduced the idea of a US "space force", renewing a long-running debate that began almost 20 years ago whether the Pentagon’s space activities should be moved to a new command. Then in June, Trump explicitly called for the new branch to be created, despite resistance from the Air Force which oversees military space programs. Fast forward to today, when Vice President Mike Pence announced the first steps in the creation of a space force as a entirely new military branch. Speaking alongside Defense Secretary James Mattis at the Pentagon Thursday, Pence announced that "establishing the Space Force is an idea whose time has come." And while big questions remain - while the Pentagon has begun the process of establishing Space Force as a 6th branch of the U.S. military, only Congress has the power to establish a new branch of the military - one thing is clear: Trump's reorganization of US defense will cost a lot of money, and for the first time we learned just how much when Mike Pence said that the Trump administration will call on Congress to allocate $8 billion over the next five years to establish the U.S. Space Force as the sixth branch of the military. Vice President Mike Pence: The Dept. of Defense report on Space Force "represents a critical step toward establishing the Space Force as the sixth branch of our armed forces" and "identifies four actions that we will take to evolve our space capabilities" https://t.co/fiBQJMLc5w pic.twitter.com/BMJPRKfPLQ — ABC News Politics (@ABCPolitics) August 9, 2018 "It’s not enough to have an American presence in space," Pence said. "We must have American dominance in space. And so we will."

New round of US sanctions against Russia -- On August 8, the White House announced a new round of US sanctions against Russia under the bogus pretense of the so-called “Skripal case.” The announcement and the publication of another bill that envisions far-reaching sanctions have sent the ruble and Russian stock markets plummeting. Russian commentators have warned of a full-scale economic war breaking out between Russia and the US.The new sanctions involve a ban on exports of goods related to national security, including electronic devices and dual-purpose components. There is also some speculation that Russia’s biggest airline, Aeroflot, might be banned from flying to the US. The first round of the new sanctions is expected to take effect on August 22. Another round could be introduced in 90 days. The US government has earlier threatened to impose “crushing sanctions” on Russia this fall.The alleged poisoning of Sergei Skripal and his daughter Yulia with the Russian nerve gas “Novichok,” which was advanced as a justification for the new sanctions, was an imperialist provocation that has been used for months as a pretext for an escalation of the military build-up against Russia. Earlier this year, hundreds of Russian diplomats were expelled from the UK and other countries under this pretext. Yet, months after the alleged poisoning, the Skripals both are alive and well, and no proof for Russian involvement or the use of the “Novichok” nerve gas has been advanced.On Thursday, the Russian ruble fell to a two-year low of 66.5 rubles per dollar, and shares of companies such as the main national airline Aeroflot have plummeted. The shares of Russia’s biggest bank, Sberbank, fell by almost 8 percent on Wednesday.The announcement of the sanctions was an obvious attempt by the Trump White House to appease its right-wing critics from the Democratic Party and sections of the Republicans who have escalated their anti-Russian campaign after Trump’s meeting with Russian President Vladimir Putin in Helsinki, accusing the US president of “treason.”   With the new round of penalties, following earlier sanctions against Russian officials and businessmen this year, the Trump administration is yet again signaling its willingness to continue the established strategy of the Democratic Party and CIA, which for years have been pushing for a destabilization of the Putin regime through economic pressure and the bolstering of the right-wing “liberal” opposition under Alexei Navalny.

Russia Condemns New "Draconian" Sanctions, Weighs Banning Rocket Engines To US - A furious Russia condemned a new round of U.S. sanctions as "draconian" on Thursday and threatened to retaliate as news of the measures sent the ruble tumbling to two-year lows and sparked a wider asset sell-off over fears that Moscow was locked in a spiral of never-ending sanctions.“Such measures are absolutely unfriendly and can hardly be associated with the constructive - difficult but constructive - atmosphere at the last meeting of the two presidents,” Kremlin spokesman Dmitry Peskov said on a conference call.As reported yesterday, in the latest diplomatic attack launched by Trump, the U.S. State Department said on Wednesday it would impose fresh sanctions by the month’s end after determining that Moscow had used a nerve agent against a former Russian double agent, Sergei Skripal, and his daughter, Yulia, in Britain, something Moscow denies. The latest sanction announcement came just days after a bipartisan group of senators proposed a law mandating “crushing sanctions” - including on purchase of new sovereign debt and on big state banks - to punish Russia for election interference.As NBC first reported, the new sanctions would come in two tranches:

  • The first, which targets U.S. exports of sensitive national-security related goods, comes with deep exemptions and many of the items it covers have already been banned by previous restrictions.
  • The second and more serious tranche, activated after 90 days if Moscow fails to provide “reliable assurances” it will no longer use chemical weapons and allow on-site inspections by the United Nations or other international observer groups, could include downgrading diplomatic relations, suspending the state airline Aeroflot’s ability to fly to the United States and cutting off nearly all exports and imports.

The added sanctions could include a downgrading in diplomatic relations, blanket bans on the import of Russian oil and exports of “all other goods and technology” aside from agricultural products, as well as limits on loans from U.S. banks. The U.S. also would have to suspend aviation agreements and oppose any multilateral development bank assistance.

Russia to retaliate if Washington bans Aeroflot flights to US -- If the United States bans Russian state airline Aeroflot, Moscow has enough power to respond accordingly, Maksim Suraev, a member of the State Duma Committee on Transport and Construction, has said. Washington is planning to impose new sanctions on Russia over the poisoning of double agent Sergei Skripal and his daughter in the UK. Moscow categorically denies involvement in this crime, and is insisting on an open investigation.  The first package of sanctions bans exports of sensitive national security goods to Russia. The second part would come into force in three months unless Russia provides “reliable assurances” that it won’t use chemical weapons in the future, and agrees to “on-site inspections” by the UN. Among the possible restrictions included in the second round of sanctions would be ban of Aeroflot flights to the US.  “We can’t allow our company to get squeezed from the market. We can’t let Delta take Aeroflot’s place,” Suraev said.He also noted that the air communication between Russia and the United States will not cease in any case, since a third-country carrier may fill in the gap. “We will simply fly Lufthansa, or French companies,” the deputy explained. Shares in Aeroflot plunged 11 percent at the opening of the Moscow Exchange on Thursday, but have rebounded and were down five percent during afternoon trading. At the moment, only Aeroflot operates direct flights between Russia and the US. In March, American carrier Delta said it plans to stop its flights to Moscow.  Prior to this, the US airline made seasonal flights to Russia from late May to early September. Earlier, American Airlines and United Airlines stopped flying to Russia. In addition to sanctions tied to the Skripal investigation, a bill was submitted last week to US Congress with a whole range of anti-Russian measures, including sanctions against the new state debt of the Russian Federation and state-owned banks.

Russian PM: "New US Sanctions Would Be Declaration Of Economic War" -As diplomatic tensions again escalate between the US and Russia following the announcement of new sanctions against Moscow earlier this week by the Trump administration, Russia's prime minister Dmitry Medvedev warned the United States on Friday that Russia would regard any U.S. move to curb the activities of its banks as a declaration of economic war which it would retaliate against.Medvedev said Moscow would take economic, political or other retaliatory measures against the United States if Washington targeted Russian banks. "If they introduce something like a ban on banking operations or the use of any currency, we will treat it as a declaration of economic war. And we’ll have to respond to it accordingly – economically, politically, or in any other way, if required," Medvedev said during a trip to the Kamchatka region."Our American friends should make no mistake about it," he cautioned.Medvedev also noted that Russia has a long history of surviving economic restrictions and never caved in to the pressure in the past. "Our country had been living under constant pressure through sanctions for the last hundred years," Medvedev said, accusing the US and its allies of employing sanctions to undercut global competition. "Nothing has changed."  The Russian PM said that by targeting Russia’s gas exports to Europe, Washington wants to push its own LNG shipments to the continent. “It’s an absolutely nonmarket anti-competition measure aimed at strangling our capabilities.” Medvedev also pointed out that the US is simultaneously imposing tariffs on China. “The Chinese, obviously, don’t like it. No one does. And our goal is to resist all these measures.”  According to Reuters, Medvedev's statement reflects Russia's fears over the impact of new restrictions on its economy and assets, including the rouble which tumbled 6% of its value this week on sanctions jitters. With economists expecting the economy to grow by 1.8% this year, some fear that if new sanctions proposed by Congress and the State Department are implemented in full, growth would be almost cut to zero. On Wednesday, the State Department announced a new round of sanctions targeting Russian exports of dual-purpose electronics and other national security-controlled equipment, which will come into effect on August 22, and which pushed the Russian currency to two-year lows and sparked a wider sell-off over fears Russia was locked in a spiral of never-ending sanctions.

Russia threatens to ban sale of key rocket engines to US as row over ‘obnoxious’ sanctions intensifies - Russia has threatened to ban sales of a key rocket engine to the United States in response to new sanctions over the Skripal poisoning. Sergei Ryabukhin, head of the budget committee in the upper house of parliament, called the measures announced by the state department late on Wednesday the “most obnoxious and cynical behaviour on the market” and said Russia has the means to respond if leader Vladimir Putin wishes to do so.“The United States needs to finally understand that it's useless to fight with Russia, including with the help of sanctions,” he said.He said Russia could in particular stop exports to the United States of the RD-180 rocket engine, which powers the first stage of the Atlas 5 rocket made by Boeing and Lockheed Martin. Lawmakers in Washington had to partially roll back a 2014 ban on Russian engines in military and spy satellite launches due to US reliance on the RD-180. Since its introduction in 2002, the Atlas 5 has carried the top-secret X-37B space plane, the New Horizons probe that flew by Pluto and the Curiosity rover that has been exploring the surface of Mars.   It is slated to take astronauts to the International Space Station in its first manned flight in 2019 following several delays.The Russian state-owned producer of the RD-180 said late last month it had signed a contract to deliver six more engines to the United States through 2020. The new US sanctions will come into effect later this month and are designed to prevent Russian state companies from obtaining access to weapons, financial assistance or technologies related to US national security.US officials have said they will cause hundreds of millions of dollars in losses and target electronic devices and engines, among other technologies. They said a second round of even harsher sanctions would follow if Russia does not promise to stop targeting its citizens with chemical weapons, a pledge that Moscow is highly unlikely to make.

Fever Pitch – Kunstler - Those in the USA who have not been driven plumb insane by President Donald Trump are probably scratching their heads down to the subdural cavity this week with his imposition of more severe sanctions on Russia only a month after he went to Helsinki to repair tattered relations with Russia’s president, Mr. Putin. The official reason: payback for the poisoning in Wiltshire, UK, of Sergei Skripal, retired UK/Russia double agent, and his daughter Yulia.Really? For that? For a botched assassination with one of the world’s most potent military nerve agents which, by the way, failed to kill its victims. (Somebody please go inform the Russian military that they may have batch problems over at the nerve agent lab.) Oh, also, by the way, there’s less evidence that whatever-it-was on the Skripal’s doorknob, or in the bubble-and-squeak they ordered at that restaurant, came from Russia than from the UK’s own military poisons lab at nearby Porton Down.This new mystifying chapter in US foreign relations raises some beguiling questions. For instance: why exactly do we give a fuck about a Russian spy who sold out to the UK at the same moment in history that we (that is, the American public and their news media) hardly heaved a sigh over the joint US – Saudi bombing of a school bus in Yemen that killed 43 people, mostly children, this week?Want to see the dishonesty of The New York Times in action? Read this story from Thursday’s (Aug 9) paper about the school bus bombing. The lede says: “An airstrike from the Saudi-led coalition struck a school bus in northern Yemen on Thursday and killed dozens of people, many of them children….” Got that? A “coalition.” Guess what? Nowhere in the story does the Times explain that the US is part of that coalition. “The strikes were “carried out in accordance with international humanitarian law….” The Times concluded the story. Szh-yeah, I’m sure…. Our President, who I like to call the Golden Golem of Greatness for his role in restoring this limping nation to something like a 1947 Jimmy Stewart movie — all Christmas and kittens — might be accused of overplaying the sanctions blame-game in order to demonstrate to our own Deep State how much he doesn’t love Russia and its leader, Mr. Putin, a verified agent of Satan. Next thing you know, Mr. Trump will don evangelical robes and hurl bibles at a photo of Vladimir P on Don Lemon’s CNN show. That’ll get Ole Horseface Mueller off his back, won’t it? And those pesky Dem-Progs drooling for impeachment.

North Korea Nuke Launch Site Dismantling Progress "Goes Beyond Summit Commitment" --Amid desperate attempts by the neocons and their media lapdogs to disparage President Trump's agreements with North Korea's leader, claiming Kim is violating the terms, 38North has confirmed that not only is progress being made on dismantling its nuclear missile launch facilities, but "activity at the launch pad appears to go beyond that commitment." As we previously noted, these stories of supposed North Korean betrayal by NBC, CNN, and the Wall Street Journal are egregious cases of distorting news by pushing a predetermined policy line. But those news outlets, far from being outliers, are merely reflecting the norms of the entire corporate news system.The stories of how North Korea is now violating an imaginary pledge by Kim to Trump in Singapore are even more outrageous, because big media had previously peddled the opposite line: that Kim at the Singapore Summit made no firm commitment to give up his nuclear weapons and that the “agreement” in Singapore was the weakest of any thus far.That claim, which blithely ignored the fundamental distinction between a brief summit meeting statement and past formal agreements with North Korea that took months to reach, was a media maneuver of unparalleled brazenness. And big media have since topped that feat of journalistic legerdemain by claiming that North Korea has demonstrated bad faith by failing to halt all nuclear and missile-related activities.Which makes today's news from expert satellite imagery analyst Joseph Bermudez Jr even more notable. Commercial satellite imagery from August 3 indicates additional dismantlement activities are ongoing at the Sohae Satellite Launching Station since last observed. At the vertical engine test stand, used for testing and development of engines for ballistic missiles and space launch vehicles, the North Koreans have continued to tear down the steel base structure and appear to be removing fuel and oxidizer tanks from dismantled bunkers.

North Korea Accuses Senior Admin Officials Of Undermining Trump Peace Deal  - North Korea has slammed US officials for trying to undermine the North Korea denuclearization deal behind President Trump's back, according to the country's official news agency, KCNA.  Pyongyang pointed out that that in addition to taking "such practical denuclearization steps" as discontinuing its ICBM testing and dismantling nuclear facilities, they allowed the repatriation of US-POW/MIA remains. "We hoped that these goodwill measures would contribute to breaking down the high barrier of mistrust existing between the DPRK and the U.S. and to establishing mutual trust," reads the statement, "However, the U.S. responded to our expectation by inciting international sanctions and pressure against the DPRK."The U.S. is attempting to invent a pretext for increased sanctions against the DPRK by mobilizing all their servile mouthpieces and intelligence institutions to fabricate all kinds of falsehoods on our nuclear issue. They made public the "North Korea Sanctions and Enforcement Actions Advisory" and additional sanctions, and called for collaboration in forcing sanctions and pressure upon us even at the international meetings. -KCNAAnd all of this is being done despite President Trump's intention to negotiate in good faith, reads the statement. Now the issue in question is that, going against the intention of president Trump to advance the DPRK-U.S. relations, who is expressing gratitude to our goodwill measures for implementing the DPRK-U.S. joint statement, some high-level officials within the U.S. administration are making baseless allegations against us and making desperate attempts at intensifying the international sanctions and pressure. -KCNA"As long as the U.S. denies even the basic decorum for its dialogue partner and clings to the outdated acting script which the previous administrations have all tried and failed, one cannot expect any progress in the implementation of the DPRK-U.S. joint statement including the denuclearization."In other words, despite Trump's intentions - members of his administration are undermining the historic progress made in US-North Korea relations.

US-North Korean nuclear deal stalls amid growing recriminations  -The US and North Korea this week traded accusations in a further indication that the nuclear deal struck between US President Donald Trump and North Korean leader Kim Jong-un in June is stalling.In a brief joint statement, the two leaders had publicly committed to the complete denuclearisation of the Korean Peninsula. But the gulf between the two sides has become increasingly apparent over the past two months.Washington has interpreted the agreement as North Korea dismantling its nuclear and missile programs, giving up its nuclear arsenal and allowing intrusive inspections. Pyongyang has insisted that the US make step-by-step concessions, including easing sanctions and taking steps toward a formal peace treaty.The tensions were evident last month when US Secretary of State Mike Pompeo travelled to Pyongyang for negotiations. Following his departure, the North Korean foreign ministry issued a blunt statement denouncing Washington’s “unilateral and gangster-like demand for denuclearisation” and warning that trust between the two sides was now at a “dangerous” stage.The Vox website this week revealed that the Trump administration has demanded that Pyongyang hand over 60 to 70 percent of its nuclear warheads within six to eight months, either to the US or a third country. It is not known whether the US has offered anything in exchange. The website reported that North Korean negotiators had rejected the proposal multiple times over the past two months.Pompeo and his North Korean counterpart Ri Yong Ho shook hands during a brief encounter last weekend at a regional security forum in Singapore. However, Pompeo then suggested that North Korea’s continued work on nuclear programs was inconsistent with its pledge to denuclearise. Ri responded by declaring that North Korea had already made goodwill gestures, including a moratorium on nuclear and missile testing, and the dismantling of a testing site. Instead of responding in kind, he said, the US “is raising its voice louder for maintaining the sanctions” and is retreating “even from declaring the end of the war, a very basic and primary step for providing peace on the Korean peninsula.”

Washington Post Blames Iran For Trump’s Unilateral Sanctions Against It --Jason Rezaian was the Washington Post bureau chief in Tehran. In July 2014 he was arrested in Tehran for espionage and sentenced to prison. In a side deal to the nuclear agreement he was released in 2016 in exchange for Iranians held in the United States.  Rezaian now writes a Global Opinion column for the Post. His latest is headlined: I lived in an Iran under sanctions. Here’s what it’s like.  He lists a number of issues that sanctions will cause: the rial will fall further, some medicines will be difficult to get, there will be other shortages, black markets will reappear, a few will profit from them: That small but not inconsequential segment of the population will see its wealth balloon as it did in 2012 and 2013. There will be a disproportionate number of the most expensive luxury cars on Earth sitting in Tehran's perpetual traffic.Sounds like London or New York to me. Rezaian continues: Soon enough, well-connected officials and their families with access to the black markets will begin importing and selling goods at exorbitant prices, callously taking advantage of the misfortune that their cronies in government helped create. How, please, have the "cronies" in Iran's government "helped create" the new sanctions? Iran was fulfilling all is duties under the JCPOA agreement. It was solely Donald Trump who abrogated the UN endorsed deal despite the protests of all other signatories. While Rezaian pretends to be concerned about the Iranian people, he continues to put the blame on the wrong party:It is hard to discern on what planet Jason Rezaian lives. It must be the one where all nations and people bow to the unreasonable whims of some loudmouth in Washington DC. That is not planet Earth. Iran is not "stubborn". It demands its rights under the JCPOA. Iran is not a "pariah nation", the United States are. It was the U.S. that unilaterally abrogated the nuclear deal.

Hours Before Trump Restores Iran Sanctions, Rouhani Says "Open To Negotiations" - Hours before renewed sanctions on Iran are set to snap back tonight at 12:01 a.m. US Eastern time, Iranian President Hassan Rouhani has announced his country is "open to negotiations" while also calling on the European Union to urgently step up with practical action to save the 2015 nuclear deal.  His words, however, were generally couched in terms of a rebuke against "untrustworthy" Washington, saying Monday in an interview carried on state television: "Negotiations with sanctions doesn't make sense. They are imposing sanctions on Iranian children, patients and the nation." Rouhani referred to items like medicines and other basic living necessities, while the first round of sanctions are also set to target primarily automobiles, currency, and gold. Basic civilian safety related supplies will be impacted too as export or re-export commercial airplanes as well as services and parts will be banned. The second round of renewed sanctions are set to take effect on November 5, for which the US has pressured EU countries to cease receiving oil exports by this date.  Rouhani said Iran had "always welcomed negotiations" but that Washington would have to take clear steps to prove they can restore trust after reneging on the 2015 JCPOA. "If you're an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife." "How do they show they are trustworthy? By returning to the JCPOA." And in an apparent reference to recent protests that initially arose in early summer primarily over a collapsing economy, he lashed out: "They want to launch psychological warfare against the Iranian nation and create divisions among the people," Rouhani said. Rouhani's words, which could be taken as an ultimatum, are likely to leave the White House unmoved, which has ratcheted up the pressure in hopes that Iran will initiate renegotiations on Washington's terms.

Rouhani: Iran cannot talk to US while under sanctions -- US sanctions against Iran took effect on Tuesday, a move certain to worsen the lives of ordinary Iranians, as President Hassan Rouhani described the controversial reimposition as "psychological warfare".  In an early morning tweet, Trump said the new US penalties against Iran were "the most biting sanctions ever imposed"."In November they ratchet up to yet another level. Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!" he said.In defiance of the US, the European Union urged its companies to continue and even bolster trade with Tehran, despite American threats of sanctions against them for doing business.  EU diplomatic chief Federica Mogherini said the bloc, as well as Britain, France and Germany, deeply regretted Washington's move.  "We are determined to protect European economic operators engaged in legitimate business with Iran," she said. "We are encouraging small and medium enterprises, in particular, to increase business with and in Iran.”Mogherini noted the Iranian government had fully lived up to its commitments under the landmark 2015 nuclear agreement, which the administration of US President Donald Trump pulled out of in May. Rouhani told state television on Monday night that Iran had no intention of negotiating a new deal with the United States.  "If you're an enemy and you stab the other person with a knife, and then you say you want negotiations, then the first thing you have to do is remove the knife," he said. "They want to launch psychological warfare against the Iranian nation. Negotiations with sanctions doesn't make sense." "The Iranian regime faces a choice," Trump said in a statement. "Either change its threatening, destabilising behaviour and reintegrate with the global economy, or continue down a path of economic isolation." "I remain open to reaching a more comprehensive deal that addresses the full range of the regime's malign activities, including its ballistic missile programme and its support for terrorism."

Trump Warns Allies "Risk Severe Consequences" If They Violate Iran Sanctions - With the hours ticking by ahead of Washington's re-imposition of a slew of economic sanctions on Iran, President Trump has just released a statement confirming the narrative he would prefer Americans believe.  Just hours after the European Union issued a statement Monday ahead of when renewed US sanctions are set to snap back against Iran after midnight US Eastern time, saying it "deeply regrets" the sanctions and will take immediate action to protect European companies still doing business with Iran. Trump makes it clear that any violation (among America's allies) will not be tolerated..."The Trump Administration intends to fully enforce the sanctions reimposed against Iran, and those who fail to wind down activities with Iran risk severe consequences." The first set of sanctions will hit at the Iranian financial system, including Iranian government purchases of US dollars and its gold trade and government bond sales. The US' dominant role in the world's financial system means it has been able to pressure countries and companies into compliance, though China remains a key holdout."The JCPOA, a horrible, one-sided deal, failed to achieve the fundamental objective of blocking all paths to an Iranian nuclear bomb," Trump said Monday, defining that its policy as applying "maximum economic pressure on the Iranian regime." The US denies it is seeking regime change, but rather aims to "modify the regime's behavior," according to an administration official.A US administration official said the Iranian government was using financial resources freed up by the nuclear deal "to spread human misery." The US was seeking now to address the "totality of the Iranian threat" in the Middle East.

Trump’s Illegal Economic Sanctions Against Iran Start Up - Today, President Trump’s promised abjuration of President Obama’s hard-negotiated nuclear deal with Iran,the JCPOA, jointly agreed with Russia, China, UK, France, Germany, the EU, and the Security Council of the United Nations. All parties agree that Iran has held to the agreement, so Trump’s move is completely internationally illegal. His move is supported by exactly four other nations on the planet, and only them: Israel, Saudi Arabia, UAE, and Bahrain. It is clear that Trump has mostly done this to undo something Obama did, although he also very much likes pleasing the leaders of three of those nations,who have managed to get his ear. But it is not even obvious that the undoing of this agreement will actually help these nations, even though they clearly think so. The least important of them, Bahrain, might get a slight gain given that it is a majority Shia nation ruled by an oppressive Sunni elite.  Both the KSA and UAE view themselves as jousting with Iran in the Persian Gulf, although Iran has never invaded or militarily threatened either. They were not in danger, so they will not be better off.  As for Israel, their main concern seems to be Iranian support for Hezbollah in Lebanon (and Syria) and Hamas in Gaza, although Hamas is a Sunni group. Based on Trump’s own statement yesterday, these are the main things he seems to be concerned about. He wants Iranian support for those groups reduced. Maybe that will happen, but while in the past Hezbollah did carry out terrorist acts in many places (Buenos Aires, for example), it is a long time since describing them as “terrorist” has been at all accurate. They have long since become part of the ruling coalition in Lebanon.. And it should be kept in mind that prior to the 1982 Israeli invasion the Lebanese Shia were largely sympathetic to Israel, and there was no Hezbollah.  Now it must be recognized that Trump’s reimposition of economic sanctions will have an impact on Iran.  . The most prominent companies leaving Iran now are Total and Peugeot from France and Siemens from Germany, although apparently some smaller companies with little business in the US will continue. Another round of sanctions in November will target Iranian oil exports, although there is reason to believe many nations buying oil from Iran will continue to do so then. Nevertheless, for all its illegality, Trump’s reimposition of sanctions will almost certainly damage the already struggling Iranian economy, with demonstrations against the regime periodically breaking out there.

Iranian president denounces US 'psychological warfare' - Iranian President Hassan Rouhani said in a televised speech on Monday that the United States had launched "psychological warfare" against Iran in the aftermath of its withdrawal from a 2015 nuclear deal. "They want to launch psychological warfare against the Iranian nation and create divisions among the people," he said. Read more: US reimposes sanctions on Iran: What does that mean? Widespread protests against a deteriorating economy have erupted throughout Iran since US President Trump announced in May that he would withdraw the US from a 2015 nuclear deal with Iran and reintroduce sanctions that had been lifted as part of the deal. "America will regret imposing sanctions on Iran," Rouhani said. "They are already isolated in the world. They are imposing sanctions on Iranian children, patients and the nation."Fear of renewed sanctions has sparked a currency crisis and caused many foreign companies to pull their business out of Iran. The first wave of sanctions, which targets a variety of Iranian exports, the country's financial system and Iran's ability to enter the global financial system, entered force at midnight (0400 UTC) on Tuesday. A second wave of sanctions targeting Iran's lucrative energy sector is set to be reimposed in November. President Barack Obama, Trump's predecessor, agreed to suspend the sanctions in exchange for Iran's commitment to curtail its nuclear weapons program as part of the 2015 deal, also known as the JCPOA. But Trump repeatedly denounced the deal as ineffective in hampering Iran's nuclear weapons' ambitions and insufficient in containing Iran's aggressive foreign policy in the Middle East.

Trump Blasts "Anyone Trading With Iran Will Not Be Trading With The U.S." - At one minute after midnight, the first round of renewed U.S. sanctions on Iran took effect, and in one of his earliest tweets since the presidential campaign, at 5:30am EDT, a sleepless Trump blasted out the "official" US position on countries that ignore his just imposed sanctions: "The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level" Trump tweeted. In a warning to China, India, Russia, Turkey and many other nations which have said they will defy Trump's sanctions and continue to import Iran oil, Trump warned that "Anyone doing business with Iran will NOT be doing business with the United States." Then, pulling a page out of a John Lennon album, Trump explained "I am asking for WORLD PEACE, nothing less!"The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level. Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!— Donald J. Trump (@realDonaldTrump) August 7, 2018    As a reminder, on Tuesday, following an executive order signed by Trump, the U.S. imposed new restrictions intended to stop the purchase of dollar banknotes by Iran, prevent the government from trading gold and other precious metals and block the nation from selling or acquiring various industrial metals. The measures, which took effect at midnight in Washington, also targeted the auto industry and banned imports of Persian carpets and pistachios to the U.S.  At the same time, Europe condemned Trump's action saying it would block their effect for European companies. “We deeply regret the re-imposition of sanctions by the U.S., due to the latter’s withdrawal from the Joint Comprehensive Plan of Action (JCPOA),” according to a statement Monday from the foreign ministers of the U.K., Germany, France and the European Union. “Preserving the nuclear deal with Iran is a matter of respecting international agreements and a matter of international security.”

EU defiant in face of Trump threats over Iran -- Speaking in Wellington alongside New Zealand Foreign Minister Winston Peters on Tuesday, European Union High Representative for Foreign Affairs Federica Mogherini directly called on EU companies to defy US President Donald Trump.  Mogherini was responding to Trump's early-morning tweet threatening companies that did not adhere to renewed US sanctions on the Islamic Republic of Iran. In it, Trump warned: "Anyone doing business with Iran will not be doing business with the United States."  In her response, Mogherini said it was up to European companies to decide who they trade with. She voiced support for trade as an integral part of the Joint Comprehensive Plan of Action (JCPOA), commonly known as the Iran nuclear deal, in which Iran pledged to stop its nuclear program in return for the relaxation of sanctions and increased trade relations.  The JCPOA was signed by Iran, China, France, Russia, the United Kingdom, Germany, the EU and the United States in October 2015. Trump, who has called the JCPOA, "the worst deal in history," withdrew the US from it in May of this year. He reinstated harsh sanctions on Iran on Monday. Iran has accused the US of going back on its word and sowing economic unrest in the country. Mogherini says that Iran is continuing to uphold its end of the bargain and that the other signatories must also uphold theirs. "We are doing our best to keep Iran in the deal, to keep Iran benefitting from the economic benefits that the agreement brings to the people of Iran because we believe this is in the security interests of not only our region but also of the world."   She went on to say that Iranian-EU trade relations are, "a fundamental aspect of the Iranian right to have an economic advantage in exchange for what they have done so far, which is being compliant with all their nuclear-related commitments."

EU Threatens European Firms That Comply With Trump's Iran Sanctions - European firms that cut ties with Iran over new US sanctions which kicked in at Midnight might find themselves subject to sanctions of their own, warned an EU official. “If EU companies abide by U.S. secondary sanctions they will, in turn, be sanctioned by the EU," Nathalie Tocci, an aide to the EU’s foreign policy chief Federica Mogherini, told BBC Radio 4 on Monday, according to NBC News. The EU is helping Iran "In order to signal, diplomatically, to the Iranians that Europeans are serious" about trying to salvage the Iran nuclear deal - which President Trump pulled out of in May, sending former US Secretary of State John Kerry running around Europe and the UN to try and nurse his baby back together. At midnight Monday, the U.S. began targeting oil-rich Iran's automotive industry and civil aviation sector, as well as trade in gold and other metals in a set of punitive measures that had been eased under Trump’s predecessor, Barack Obama. Trump has called for a wholesale overhaul of Iranian regional policies, such as an end to its military support for the Syrian government and regional militant groups like Lebanon's Hezbollah. The 2015 pact did not curb these actions, one reason Trump has called the agreement "the worst deal ever." -NBC News Early Tuesday morning, President Trump tweeted "Iran sanctions have officially been cast," adding "Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!" German car manufacturer Diamler announced on Tuesday that it had halted its activities in Iran.  “We will continue to closely monitor the political developments, especially in connection with the future of the nuclear agreement,” the company said in a statement. And in June, Peugeot's parent company PSA took steps to suspend a joint-venture in Iran, while rival Renault also agreed to follow the US sanctions.  French oil giant Total has said it would quit a multibillion-dollar gas project if it cannot secure a waiver from the sanctions — a request the French government says had been rejected. -NBC News

 Trump menaces the world over Iran sanctions - As US sanctions on Iran “snapped back” into force, US President Donald Trump yesterday issued a blunt warning to countries and corporations around the world: “Anyone doing business with Iran will NOT be doing business with the United States.” The punitive measures follow the Trump administration’s decision in May to abrogate the 2015 nuclear deal with Iran, known as the Joint Comprehensive Plan of Action, or JCPOA. The unilateral US sanctions will ban trade with Iran of commercial aircraft, cars, precious metals, coal, aluminium and steel, as well as Iranian exports of carpets and pistachios. Washington is threatening to sanction any corporation internationally breaching the bans by blocking it from the US financial system. A second round of US sanctions is due to come into effect in November that will hit all foreign transactions of Iran’s central bank and its oil exports, which comprise the bulk of the country’s export earnings and underpin government finances.In his tweet yesterday, Trump declared, “these are the most biting sanctions ever imposed,” justifying his stance by absurdly declaring, “I am asking for WORLD PEACE, nothing less!” Under the banner of “peace,” the Trump administration is preparing for trade war and war—not only against Iran, but against all potential rivals to the US, including its European and Asian allies.Yesterday, the European Union’s (EU) “blocking statute” also came into effect, under which European companies have been instructed not to comply with US demands to cease business with Iran. Those that decide to pull out because of US sanctions will require EU authorization, and without it could face legal action from member states.Britain’s Foreign Office Minister Alistair Burt told the BBC that the “Americans have really not got this right.” While it was up to companies to decide whether to remain in Iran, he said Britain believed that the 2015 nuclear deal was important “not only to the region’s security but the world’s security.” Nathalie Tocci, an aide to the EU foreign policy chief Federica Mogherini, warned on BBC radio on Monday night: “If EU companies abide by U.S. secondary sanctions they will, in turn, be sanctioned by the EU.” She said that the measures were “necessary in order to signal, diplomatically, to the Iranians that Europeans are serious” about trying to maintain the Iran nuclear deal.

No Peace In Strengthening Iran Sanctions - President Trump is out of options.  So are his main vectors of information, the Israeli Firsters in his cabinet and family.  Israel, the U.S. and Saudi Arabia have lost the Syrian War and the ramifications of that are immense.Because by losing this war the U.S. has been revealed as a paper tiger incapable of imposing its will on a world which is rapidly recoiling from its dominance.Syria was the first time someone stood up and said, “No more.”  Putin’s dramatic intervention in Syria was supported by all the same people in Trump’s crosshairs today:  China, Iran and Hezbollah.  Eventually, Turkey realized the U.S. could not be trusted, so they are targeted for economic destruction as well. So, today’s impositions of new sanctions on Iran, the same playbook that Trump used against North Korea, is the only logical step on the path to the U.S. leaving the region. At a time when the optics are all about the U.S. acting in the most mad way imaginable, the reality is that intense bullying like this only comes from weakness.  Trump has no other cards to play. In October of 2015 I wrote in my then Newsletter for Newsmax: Syria is the U.S.’ Waterloo. And this failure, along with the Fed’s indecision, creates a clear moment of transition from one possible future to another. It marks the beginning of the Age of Russian Diplomacy and puts a period on post-Soviet Union turmoil.   Since then I’ve described Putin’s intervention in Syria as the moment the peak of the U.S.’s ability to project power was revealed to the world. Trump, this morning, thinks he’s going to make a liar out of me.  The problem is that this move could be seen two years ago when he became the nominee of the Republican Party. And, as such, preparations are in place to mitigate the worst of these sanctions.  These sanctions, it cannot be over-stated enough, are the result of the Bill Browder Operation to give government the power to sanction individuals and companies not just countries via the Magnitsky Act and its sequel. Putin didn’t have Magnitsky killed, Browder did.  Because Magnitsky was the most likely person, as one of Browder’s accountants, who could out Browder for who he was and what he’d done.The purpose of these sanctions is to ratchet up the level of financial control on global business by bypassing governments and go directly to the bottom line of the people who have the most to lose.  To get them to do the bidding of those with power at the expense of those they perceive as having none.But, as I pointed out on last night’s live stream, why does anyone think that Iran’s government is going to fall because the rial is in free fall when Venezuelans, who are literally starving to death, haven’t overthrown theirs?

Trump administration’s use of sanctions draws concern - February was a typically busy month for U.S. officials who announce government sanctions. One package of measures issued by the Treasury Department targeted North Korea, with dozens of ships, companies and other entities cited for shipping coal and fuel to the country in violation of previous sanctions. Before the month was over, sanctions had also been slapped on Colombian drug traffickers, smugglers of Libyan oil and individuals accused of sex abuse and recruiting child soldiers in Congo. More sanctions rained down on abettors of various terrorist groups in Pakistan, Somalia and the Philippines, plus Hezbollah in Lebanon. And the State Department added to its list of designated terrorist groups organizations in the Philippines, West Africa, Bangladesh and Burkina Faso.Most months nowadays, the United States issues a similar barrage of sanctions, as the Trump administration pursues an aggressive strategy of using economic tools instead of military might against foes.The sanctions that attract the most attention have been aimed at governments threatening U.S. national security interests, including North Korea, Iran and Russia. But increasingly, sanctions are being used to counter other kinds of destabilizing behavior. Sanctions have been around since the earliest years of the United States, but they have been used more frequently since the attacks of Sept. 11, 2001.  But the reliance on them has led to concerns that they are being overused as the foreign policy of first resort, hurting U.S. credibility among allies who complain that they are being forced to bow to U.S. policies and potentially undercutting the U.S. dollar. Administration officials dismiss the criticism, saying they have proved effective in convincing nations like Iran and North Korea to agree to negotiate their nuclear weapons programs. “When you think of the atrocities happening, and you know leaders are trying to steal the wealth of their citizens, how can you not cut them off from the financial system?”According to an analysis by the law firm Gibson Dunn, the administration blacklisted nearly 1,000 people and entities last year. That is 30 percent more than were added in President Barack Obama’s last year in office, and tripling the number blacklisted during his first year.

Trump's trade war hits the one thing that was working - energy exports to China: Russell (Reuters) - U.S. President Donald Trump claims that his tariffs on trade are “working big time”, but this ignores signs that the best hope the United States had for boosting exports to China is being crushed as Beijing clamps down on energy imports. One of Trump’s stated aims in launching tariffs against Chinese imports was to lower the trade deficit between the United States and China, which is in the region of $375 billion a year. The Trump administration has imposed tariffs on $34 billion of annual trade with China, with $16 billion more due to be implemented in coming days. China has matched the $34 billion and proposed charges on $60 billion more. In a potentially massive escalation, Trump has threatened to impose tariffs on over $500 billion of Chinese goods - virtually all of China’s annual exports to the United States. “Tariffs are working big time,” Trump said in a tweet on Sunday. “Every country on earth wants to take wealth out of the U.S., always to our detriment. I say, as they come, tax them.” The latest Chinese response included proposed tariffs on liquefied natural gas (LNG). The fuel now joins crude oil, certain refined products and coal on the list of U.S. imports that may be slapped with duties of up to 25 percent. But crude oil represented one of the few areas where China could have realistically increased its purchases from the United States. China was also the biggest market for U.S. crude producers, representing about 16 percent of total exports, while for China, U.S. imports were a measly 3.5 percent of the total. It’s likely that U.S. crude exporters will be able to find other buyers, but they may have to offer discounts or other incentives to build market share.

Trump’s Tariffs Push Electronics From China to Southeast Asia -- Electronics makers are preparing to shift more production to Southeast Asia as trade tensions with the U.S. make it less appealing to manufacture gadgets in China.  A number of Taiwanese firms that form a crucial plank of the global supply chain have in recent days signaled their intention to diversify away from the world’s No. 2 economy. Delta Electronics Inc., which supplies power components to Apple Inc., said Tuesday it’s making a $2.14 billion offer to buy out a Thai affiliate -- a precursor to expanding production there. Merry Electronics Co., which makes headphones for the likes of Bose, said it may move some of its production to the same country from southern China, depending on how the trade conflict pans out. Taiwan is home to some of the world’s largest contract manufacturers, including iPhone-assembler Foxconn. Cranking out goods under the labels of well-known brands, an increasing number in recent years had begun to move away from China to escape rising wages, a trend that a Washington-Beijing spat is now accelerating. New Kinpo Group, which makes everything from computer hardware to facial massagers in Thailand and the Philippines, told Bloomberg this month that Donald Trump’s offensive was spurring growing interest in its services.  “Taiwanese companies have invested in China in the past because of low labor costs. But as wages in China have been rising, some have begun an exodus to Southeast Asia,” Tsai Ming-fang, an economist at Taipei’s Tamkang University, said. “Trump’s tariffs are giving Taiwanese companies further incentives to move to Southeast Asia.” The numbers are starting to bear that out. Taiwan approved Chinese investments totaling $4.2 billion in the first six months, down 4.5 percent, while investments in Vietnam, Malaysia and India surged over the same period. Much depends on whether Trump makes good on threats to levy tariffs on an additional $200 billion of Chinese goods -- and eventually possibly all imports from the Asian country. But for many executives, the planning has already begun.

  Trump To Slap $16 Billion In New Tariffs On Chinese Imports Starting August 23 - Completing the latest round of tariffs pledged against China, the US Trade Representative announced on Tuesday (after the close of course) it will impose 25% tariffs on $16 billion-worth of Chinese imports starting August 23. The new round of tariffs completes Trump's previously disclosed threat to impose $50 billion of import taxes on Chinese goods. The first $34 billion-worth went into effect on July 6th.According to the USTR statement, customs will collect duties on 279 product lines, down from 284 items on the initial list; as Bloomberg notes, this will be the second time the U.S. slaps duties on Chinese goods in about the past month, overruling complaints by American companies that such moves will raise business costs, tax US consumers and raise prices.On July 6, the U.S. levied 25% duties on $34 billion in Chinese goods prompting swift in-kind retaliation from Beijing.Of course, China will immediately retaliate, having vowed before to strike back again, dollar-for-dollar, on the $16 billion tranche.The biggest question is whether there will be a far bigger tariff in the near future: as a reminder, the USTR is currently also reviewing 10% tariffs on a further $200 billion in Chinese imports, and may even raise the rate to 25%. Those tariffs could be implemented after a comment period ends on Sept. 5. President Donald Trump has suggested he may tax effectively all imports of Chinese goods, which reached more than $500 billion last year.Over the weekend, Trump boasted that he has the upper hand in the trade war, while Beijing responded through state media by saying it was ready to endure the economic fallout. Judging by the US stock market, which has risen by $1.3 trillion since Trump launched his trade war with China, which has crushed the Shanghai Composite, whose recent drop into a bear market has been duly noted by Trump, the US president is certainly ahead now, even if the market's inability, or unwillingness, to push US stocks lower has led many traders and analysts to scratch their heads. Full statement below:

 ‘We Are at the Limit’: Trump’s Tariffs Turn Small Businesses Upside Down - The Trump administration says tariffs on thousands of items from ball bearings to circuit boards are designed to counter what it sees as unfair trade practices that give Chinese firms a leg-up over their U.S. rivals. The U.S. has imposed 25% tariffs on $34 billion of Chinese imports, and on Tuesday finalized a list of $16 billion in Chinese imports that will be subject to 25% tariffs. U.S. officials have also said they are considering duties on $200 billion more. China has started to respond in kind and is threatening to impose tariffs on up to $110 billion of U.S. goods if Washington moves ahead.  The impact is now being felt particularly acutely by small businesses and startups. Broadly, this class of company, like others, feels good about the economy. But compared with larger operations, they have less ability to deflect higher materials prices or pass along new costs to customers.  Tariffs throw a wrench into pricing calculations and eat into profit margins. Smaller firms also are less able to shift production to other locations and have smaller reserves to draw on when times get tough.  Even those that benefit from a surge in domestic business are struggling to ramp up quickly enough to take advantage.  As a result, small firms selling all manner of goods, including high-tech light switches and the coated paper used to handle deli meats, are rethinking their strategies, suppliers, manufacturing locations and pricing.

Europe, Russia and China Defy Trump on Iran Sanctions - A further round of sanctions by Donald Trump against Iran went into effect Tuesday, but the president is failing to get buy-in from allies and rivals, who pledge to keep dealing with Iran. Chinese automakers are flooding into Iran to replace French car companies there.  China has pledged to pay no attention to the Trump threats. The European Union has signaled that it may impose substantial fines on European firms that pull out of Iran deals over fear of Trump’s unilateral U.S. Treasury Department sanctions. It is likely that smaller European companies that trade with Iran but have no relationship with the U.S. will continue their relationship with the Islamic republic, using euros and non-U.S. banks. But large firms, such as French oil giant Total S.A. and Renault, have signaled that they will get out of Iran to avoid American fines. It is hard to imagine them taking this risk or that EU fines could offset the threat of American ones. The U.S. has fined European banks billions for dealing with Iran in the years before the 2015 U.N. Security Council Iran deal. The European announcement is likely intended to reassure Iran of continued commitment to the Joint Comprehensive Plan of Action by the European Union member states, and to forestall an Iranian return to large-scale nuclear enrichment (which Iran maintains was for peaceful purposes). Russia may be happy with Trump in general, but his assault on the Iran deal is driving the Kremlin up the wall. Russia needs Iranian help in Syria, and its businesses want to invest in Iran to take advantage of the good feeling produced by the alliance. Russia is planning to invest $50 billion in Iranian oil and natural gas, and doesn’t welcome Trump interference in this plan. The Russian Foreign Ministry issued a statement that said, “We are deeply disappointed with US efforts to reinstate national sanctions against Iran.” It complained that “[t]his is a graphic example of Washington’s continued violation of UN Security Council Resolution 2231 and trampling upon the norms of international law.” Russia observed, “The JCPOA has completely proved its worth and efficiency. The [International Atomic Energy Agency] regularly confirms that Iran unfailingly honours its obligations. The Plan’s verification, control and monitoring measures are being carried out in full. This itself reliably attests to the peaceful nature of the Iranian nuclear programme.”

Chinese exports accelerate even as Trump escalates trade war (Reuters) - China’s exports surged more than expected in July despite U.S. duties and its closely watched surplus with the United States remained near record highs, as the world’s two major economic powers ramp up a bitter dispute that some fear could derail global growth. In the latest move by President Donald Trump to put pressure on Beijing to negotiate trade concessions, Washington is set to begin collecting 25 percent tariffs on another $16 billion in Chinese goods on Aug. 23. In a statement on its official website late on Wednesday, China’s commerce ministry criticized the U.S. move as being “unreasonable”, saying it had no choice but to adopt the same measure on an equal amount of American goods ranging from fuel and steel products to autos and medical equipment. Wednesday’s Chinese data provide the first readings of the overall trade picture for the world’s second-largest economy since U.S duties on $34 billion of Chinese imports came into effect on July 6. All the same, China’s exports for July rose a bigger than expected 12.2 percent year-on-year, showing little tariff impact for now and beating June’s 11.2 percent rise and analysts expectations in a Reuters poll for 10 percent growth. Of more direct consequence in the Sino-U.S. trade war, China’s surplus with the United States shrank only marginally to $28.09 billion last month from a record $28.97 billion in June. Washington has long criticized China’s trade surplus with the United States and has demanded Beijing cut it. Those demands could get even more strident if the yuan’s sharp drop in recent months raises the ire of the United States, which has in the past repeatedly criticized Beijing for manipulating its currency to gain an unfair trade advantage.

Canadians Begin Boycotting US Goods -- Exposing the growing backlash against Trump's trade policies, the WSJ writes that "ticked-off Canadians", angered by U.S. metals tariffs and Trump’s harsh words for their prime minister, are boycotting American products and buying Canadian. Take Garland Coulson, a 58-year-old Alberta entrepreneur, who admits that while usually he doesn't pay much attention to where the goods he buys are coming from, saying that "you tend to buy the products that taste good or you buy the products that are low in price where taste isn’t an issue", he believes the tariffs from Canada’s neighbor are a "slap in the face," and added that in recent he has put more Canadian products into his shopping cart. The push to " boycott America" and buy more Canadian products gained strength after the U.S. levied 25% tariffs on Canadian steel and 10% on aluminum starting June 1 and President Trump called Canadian Prime Minister Justin Trudeau “Very dishonest & weak” on Twitter following a Group of Seven meeting the following week. Canada in turn imposed retaliatory tariffs on some U.S. products, including foodstuffs such as ketchup, orange juice and yogurt.“People sort of feel that we’re getting a raw deal from the U.S. and we have to stick up for ourselves,“ said Tom Legere, marketing manager for Ontario-based Kawartha Dairy Ltd., which has seen more interest in its ice cream recently. ”And this is their way at the supermarket of trying to do so.”

Trump Is Giving Protectionism a Bad Name - While it might not seem like it now, President Donald Trump is a gift to free market-oriented economists and policymakers. His clumsy approach to protectionism has ignited a trade war that inevitably will harm the U.S. economy. When the pendulum inexorably swings the other way after the Trump fiasco, free trade ideology will return with a vengeance. This is a potential tragedy for left-leaning policy analysts who have long been concerned about the excesses of neoliberalism and argued for a more measured use of tariffs to foster local economic development. As such, it critical that we distinguish between Trump’s right-wing nationalist embrace of tariffs and the more nuanced use of this tool to support infant industries.As a development geographer and an Africanist scholar, I have long been critical of unfettered free trade because of its deleterious economic impacts on African countries. At the behest of the World Bank and the International Monetary Fund, the majority of African countries were essentially forced, because of conditional loan and debt-refinancing requirements, to undergo free market–oriented economic reforms from the early 1980s through the mid-2000s. One by one, these countries reduced tariff barriers, eliminated subsidies, cut back on government expenditures, and emphasized commodity exports. With the possible exception of Ghana, the economy of nearly every African country undertaking these reforms was devastated. This is not to say that there was no economic growth for African countries during this period, as there certainly was during cyclical commodity booms. The problem is that the economies of these countries were essentially underdeveloped as they returned to a colonial model focused on producing a limited number of commodities such as oil, minerals, cotton, cacao, palm oil, and timber. Economic reforms destroyed the value-added activities that helped diversify these economies and provided higher wage employment, such as the textile, milling, and food processing industries. Worse yet, millions of African farmers and workers are now increasingly ensnared in a global commodity boom-and-bust cycle. Beyond that cycle, they are experiencing an even more worrying long-term trend of declining prices for commodities. One of the consequences of the hollowing out of African economies has been the European migration crisis. While some of this migration is clearly connected to politics, war, and insecurity in the Middle East and Africa, a nontrivial portion is related to grim economic prospects in many African countries.

 New Details About Wilbur Ross’ Business Point To Pattern Of Grifting - Forbes -- A multimillion-dollar lawsuit has been quietly making its way through the New York State court system over the last three years, pitting a private equity manager named David Storper against his former boss: Secretary of Commerce Wilbur Ross. The pair worked side by side for more than a decade, eventually at the firm, WL Ross & Co.—where, Storper later alleged, Ross stole his interests in a private equity fund, transferred them to himself, then tried to cover it up with bogus paperwork. Two weeks ago, just before the start of a trial with $4 million on the line, Ross and Storper agreed to a confidential settlement, whose existence has never been reported and whose terms remain secret. It is difficult to imagine the possibility that a man like Ross, who Forbes estimates is worth some $700 million, might steal a few million from one of his business partners. Unless you have heard enough stories about Ross. Two former WL Ross colleagues remember the commerce secretary taking handfuls of Sweet’N Low packets from a nearby restaurant, so he didn’t have to go out and buy some for himself. One says workers at his house in the Hamptons used to call the office, claiming Ross had not paid them for their work. Another two people said Ross once pledged $1 million to a charity, then never paid. There are bigger allegations. Over several months, in speaking with 21 people who know Ross, Forbes uncovered a pattern: Many of those who worked directly with him claim that Ross wrongly siphoned or outright stole a few million here and a few million there, huge amounts for most but not necessarily for the commerce secretary. At least if you consider them individually. But all told, these allegations—which sparked lawsuits, reimbursements and an SEC fine—come to more than $120 million. If even half of the accusations are legitimate, the current United States secretary of commerce could rank among the biggest grifters in American history.

Trump Officials Were Warned That Family Separations Would Traumatize Children - There was an awkward quiet during the Senate Judiciary Committee’s hearing on family separations Tuesday. Richard Blumenthal, the Democratic senator from Connecticut, had asked the five officials seated before him to raise their hands if they believed that the Trump administration’s program of “zero tolerance” along the U.S. border had been a success. None of the officials, each representing a different agency involved the crackdown, moved. Blumenthal then asked them to raise their hands if they believed that the systematic separation of thousands of immigrant children from their parents had been a success. Again, stillness. Blumenthal then tried a third angle.“Who here can tell me who is responsible, which public official, which member of this administration, is responsible for ‘zero tolerance’?” he asked.Silence.“Can anyone tell me?” the senator asked again.“Nobody knows?” Finally, James R. McHenry, a top immigration official within the Department of Justice, noted that his boss, Attorney General Jeff Sessions, had signed the April 6 order making “zero tolerance” official border-wide. This was not news, but rather an acknowledgement of a publicly known fact. The government’s program of forcibly removing thousands of children from their parents, including toddlers and babies, was the result of conscious decisions made by specific Trump administration officials. Tuesday’s hearing added new data points to that story, with a career civil servant testifying that his office, tasked with providing care for minors in the immigration system, raised concerns with administration officials in the year leading up to “zero tolerance” becoming an official policy, warning that the separation of children from their parents would put the children at risk of serious psychological harm and that the system was not built to handle such an initiative. Additionally, officials testified that there was little warning within their respective agencies that “zero tolerance” was actually being implemented until it was imminent, or already happening.

Judge: Trump administration has ‘sole burden’ to locate migrant parents separated from children - A federal judge on Friday made clear that the Trump administration must locate hundreds of deported and released migrant parents who have been separated from their children at the border.  “The reality is that for every parent who is not located, there will be a permanently orphaned child,” U.S. District Judge Dana Sabraw said during a court conference by telephone. “And that is 100 percent the responsibility of the administration.” The Justice Department argued in a court filing Thursday that the American Civil Liberties Union, which represents plaintiffs in the case, should use its “considerable resources” to locate the parents.   Sabraw rejected that contention during the conference Friday. “The government has the sole burden and responsibility and obligation to make this happen,” he said. The reunification process is an ongoing effort set in motion by a June 25 order by Sabraw that required the administration to join families that had been split apart at the border.  The Justice Department said in a court filing Thursday that 1,979 children had been reunified with parents or sponsors, but 572 children had parents who were either deemed ineligible for reunification or “not available for discharge at this time.” Of the remaining separated children in federal custody, 410 had a parent outside the U.S., likely as a result of deportation or voluntary departure. Another 68 children had parents who were released into the U.S., but hadn’t been contacted yet. In the cases of 15 children, the parents’ locations remained “under case file review.” Of the deported parents, only 12 or 13 appeared to have been located, according to the court filing.  “I think we’ve come to a point in the reunification process where the stakes are perhaps the highest,” Sabraw said Friday. “For every parent who’s not located, there’s a real consequence here.”

 Trump administration plans to limit citizenship for 20 million legal immigrants --The Trump administration’s war on immigrants and the working class as a whole continues unabated with an NBC report Tuesday revealing the administration plans to change existing immigration rules to deny citizenship to legal immigrants who might have accessed any kind of public benefits prior to submitting their application.The plan to limit citizenship access to legal immigrants is part of fascistic White House senior advisor Stephen Miller’s broader anti-immigrant agenda. In its current version, the rule will affect over 20 million legal immigrants who have ever used—either for themselves or any household member—essential public benefits such as health insurance subsidies or food stamps. The rule vastly expands the power of the Department of Homeland Security to deny applications for permanent residency and citizenship.The rule does not need congressional approval because of the “public charge” clause in US Immigration law that was evoked by the Clinton administration in 1999 to target immigrants who were dependent on cash benefits from programs like Temporary Assistance for Needy Families. Now, the Trump administration is expanding the term “public charge” to include immigrants who use non-cash benefits such as Medicaid, the Child Health Insurance Program, the Supplemental Nutrition Assistance Program and many others.A spokesperson for the Department of Homeland Security told NBC: “The administration is committed to enforcing existing immigration law, which is clearly intended to protect the American taxpayer by ensuring that foreign nationals seeking to enter or remain in the US are self-sufficient. Any proposed changes would ensure that the government takes the responsibility of being good stewards of taxpayer funds seriously and adjudicates immigration benefit requests in accordance with the law.” The move shows the anti-working class character of the attack on immigrants. Last August, Trump endorsed a bill that aimed at drastically slashing legal immigration to the US. Proposed by Senators Tom Cotton (R-AK) and David Perdue (R-GA), the bill proposed to institute a “merit-based system to determine who is admitted to the country and granted legal residency green cards.” This system, if put in place, would slash legal immigration by 41 percent in the first year and eventually by 50 percent.

Stephen Miller's New Sinister Immigration Proposal - Donald Trump has been open about his hatred of immigrants. He began his presidential campaign by calling Mexican immigrants “rapists” and saying that America needs to build a wall to keep them out. Previously, he and his supporters defended these policies by claiming that they were focusing on undocumented immigrants, and not legal immigrants, who they claim “came the right way.”But the Trump administration has shattered this pretense by setting up adenaturalization task force, designed to strip citizenship from naturalized citizens convicted of even the most minor crimes. That hasn’t been enough, however, for vehemently anti-immigrant Trump adviser Stephen Miller.NBC News reports that the administration is now planning a proposal “that would make it harder for legal immigrants to become citizens or get green cards if they have ever used a range of popular public welfare programs, including Obamacare.” The move does not require congressional approval. Sources familiar with the situation told NBC that it is part of Miller’s grand plan. NBC points out that “Miller, along with several of his former congressional colleagues who now hold prominent positions in the Trump administration, have long sought to decrease the number of immigrants who obtain legal status in the U.S. each year.”The news organization notes that the move “would fall particularly hard on immigrants working jobs that don’t pay enough to support their families,” since the plan in its current draft would apply to those who have benefited from such programs as the Affordable Care Act, the Children’s Health Insurance Program and SNAP (food stamps).

 Marco Rubio Family Leave Plan Would Ask New Parents to Pick Between Retirement or Maternity Leave.- Senator Marco Rubio unveiled a family leave plan Thursday that would require new parents to pay for time spent with their infant children by borrowing from their Social Security retirement benefits early. The Economic Security for New Parents Act would allow parents to use their retirement benefits for up to 12 weeks, and would be paid back by delaying retirement for three to six months per child. In two-parent households, benefits are transferable among spouses."There's nothing we can do for our children that's better than allowing their parents to spend more time and be more involved in their lives, especially from their early days," Rubio said in an interview with CBS.But critics of the bill say that it unfairly penalizes families by making them chose between retirement or spending time with their infant children. If a woman has three children over the course of her life, her retirement could be delayed by a full year and a half. 

Our food system isn’t broken, but the farm bill is -- When I hear someone say “our food system is broken,” I think about my mom, who has farmed my whole life, and about my friends and the countless other farmers and ranchers who work hard every day to grow our food. The broken food-system narrative implicitly blames them for problems like environmental degradation, obesity, so-called “food deserts,” and the gutting of rural communities. But the sad truth is that our food system is working exactly how it was designed to, and right now, Congress is reconfiguring it to become even worse. What’s broken is the 2018 House Farm Bill, which passed in June with little news coverage. This is only the second time in history that Congress has considered a farm bill while Republicans control both the executive and legislative branches. The result is a bill that serves Washington’s fattest wallets and most powerful special interests. Its goal can be summed up as: Deregulate the rich and police the poor. While the national eye was focused on the bill’s punitive SNAP, or food stamp, work requirements, Agriculture Committee Chairman Rep. Mike Conaway of Texas and other Republican leaders worked hard to attack American family farmers. By drafting a more than 600-page behemoth that overwhelms even the world’s experts, the writers of this omnibus bill hid devastating legislation in plain sight. Why is this bill so bad? The House Farm Bill, which goes to conference committee with the version passed by the Senate, is a giveaway to corporate interests at the expense of programs that improve our environment and help family farmers. The National Sustainable Agriculture Coalition, which represents more than 100 grassroots agriculture organizations across the country, said that the bill “undermines decades of work by farmers and advocates to advance sustainable agriculture.” 

 DOJ Says Judge Ignored ‘Economics, Common Sense’ in Allowing AT&T-Time Warner Deal —The Justice Department argued Monday that a trial judge ignored “fundamental principles of economics and common sense” when he allowed AT&T Inc.’s T 0.90% acquisition of Time Warner Inc., as a host of new details about the antitrust trial became public for the first time. The government’s arguments came in a brief filed in federal appeals court, where the Justice Department continues to challenge the more than $80 billion cash-and-stock deal—even after the companies completed the transaction in June upon winning a six-week trial. U.S. District Judge Richard Leon had ruled for the companies, saying the government didn’t come close to proving its claims that the deal would yield higher prices and less competition in the pay-TV industry. But the Justice Department called the decision erroneous in its brief filed Monday with the U.S. Court of Appeals for the District of Columbia Circuit. The department said the judge ignored the fact that corporations will do what they can to maximize profits and instead accepted without reservation the testimony of defendants’ executives. AT&T responded quickly. “Appeals aren’t ‘do-overs,’” AT&T General Counsel David McAtee said in a statement. “After a long trial, Judge Leon weighed the evidence and rendered a comprehensive 172-page decision that systematically exposed each of the many holes in the government’s case. There is nothing in DOJ’s brief today that should disturb that decision.” The company is scheduled to file its own brief by Sept. 20. 

 Verizon lied about 4G coverage—and it could hurt rural America, group says - Verizon "grossly overstated" its 4G LTE coverage in government filings, potentially preventing smaller carriers from obtaining funding needed to expand coverage in underserved rural areas, a trade group says.The Federal Communications Commission last year required Verizon and other carriers to file maps and data indicating their current 4G LTE coverage. The information will help the FCC determine where to distribute up to $4.5 billion in Mobility Fund money over the next 10 years. The funds are set aside for "primarily rural areas that lack unsubsidized 4G," the FCC says.If Verizon provided the FCC with inaccurate data, the company's rural competitors might not be able to get that government funding."Verizon's claimed 4G LTE coverage is grossly overstated," the Rural Wireless Association (RWA), which represents rural carriers, told the FCC in a filing yesterday.The FCC allows carriers to challenge other carriers' data, but the rural providers say they face great expense in trying to gather the necessary evidence."Verizon should not be allowed to abuse the FCC challenge process by filing a sham coverage map as a means of interfering with the ability of rural carriers to continue to receive universal service support in rural areas," the RWA wrote. The RWA asked the FCC to investigate Verizon's claimed coverage.

Hacking the US mid-terms? It's child's play -- Bianca Lewis, 11, has many hobbies. She likes Barbie, video games, fencing, singing… and hacking the infrastructure behind the world’s most powerful democracy.   “I’m going to try and change the votes for Donald Trump,” she tells me. “I’m going to try to give him less votes. Maybe even delete him off of the whole thing.” Fortunately for the President, Bianca is attacking a replica website, not the real deal. She’s taking part in a competition organised by R00tz Asylum, a non-profit organisation that promotes “hacking for good”. Its aim is to send out a dire warning: the voting systems that will be used across America for the mid-term vote in November are, in many cases, so insecure a young child can learn to hack them with just a few minute’s coaching. "These are the websites that are very important because they report the election results to the public,” explained Nico Sell, the founder of R00tz Asylum. “They also tell the public where to go to vote. You could imagine if either of these two things were changed, the chaos that would ensue.” Hacking the real websites would be illegal. So instead, Ms Sell’s team created 13 sites that mimicked the real websites, gaping vulnerabilities and all, for 13 so-called “battleground" states - parts of the country where the vote is expected to be tight.  Over the course of a day, 39 kids aged between 8 and 17 took the challenge - 35 of them succeeded in bypassing the trivial security. Pranks ensued. At one time the site told us 12 billion votes had been cast. Later, we were told that candidate “Bob Da Builder” was the victor.

‘The most bizarre thing I’ve ever been a part of’: Trump panel found no widespread voter fraud, ex-member says WaPo -Maine Secretary of State Matthew Dunlap, one of the 11 members of the commission formed by President Trump to investigate supposed voter fraud, issued a scathing rebuke of the disbanded panel on Friday, accusing Vice Chair Kris Kobach and the White House of making false statements and saying that he had concluded that the panel had been set up to try to validate the president’s baseless claims about fraudulent votes in the 2016 election. Dunlap, one of four Democrats on the panel, made the statements in a report he sent to the commission’s two leaders — Vice President Pence and Kobach, who is Kansas’s secretary of state — after reviewing more than 8,000 documents from the group’s work, which he acquired only after a legal fight despite his participation on the panel.Before it was disbanded by Trump in January, the panel had never presented any findings or evidence of widespread voter fraud. But the White House claimed at the time that it had shut down the commission despite “substantial evidence of voter fraud” due to the mounting legal challenges it faced from states. Kobach, too, spoke around that time about how “some people on the left were getting uncomfortable about how much we were finding out.”Dunlap said that the commission’s documents that were turned over to him underscore the hollowness of those claims: “they do not contain evidence of widespread voter fraud,” he said in his report, adding that some of the documentation seemed to indicate that the commission was predicting it would find evidence of fraud, evincing “a troubling bias.” In particular, Dunlap pointed to an outline for a report the commission was working on that circulated in November 2017. The outline included sections for “Improper voter registration practices,” and “Instances of fraudulent or improper voting,” though the sections themselves were blank as they awaited evidence, speaking to what Dunlap said indicated a push for preordained conclusions.

Trump (Again) Admits His Son Met With Russian Lawyer To Get Dirt On Clinton -  It was a tweet that set off a storm. Was President Trump admitting to collusion between his campaign and Russia? Was he stipulating that the now notorious June 2016 Trump Tower meeting arranged by his son Donald Trump Jr. really was all about getting dirt on Hillary Clinton from a Kremlin-linked Russian lawyer and not adoption issues as President Trump had earlier claimed?"  This was a meeting to get information on an opponent, totally legal and done all the time in politics - and it went nowhere," the president tweeted early Sunday. He concluded the tweet by saying, "I did not know about it!" Fake News reporting, a complete fabrication, that I am concerned about the meeting my wonderful son, Donald, had in Trump Tower. This was a meeting to get information on an opponent, totally legal and done all the time in politics - and it went nowhere. I did not know about it! — Donald J. Trump (@realDonaldTrump) August 5, 2018 While Trump and his legal team insist there was nothing illegal and "no collusion," Trump's apparent-tweeted admission on Sunday was, it turns out, also nothing new. It's the very talking point the president and his aides settled on more than a year ago, after their initial claim that the meeting was just about adoptions didn't hold up. It has been widely reported that the Trump Tower meeting and statements from the president and his son about that meeting are being examined as part of special counsel Robert Mueller's investigation into Russian interference in the 2016 election and possible connections to the Trump campaign. "I think from a practical standpoint most people would've taken that meeting. It's called opposition research, or even research into your opponent," Trump said at a news conference in July 2017 when asked why his son would take the meeting rather than alert the FBI. "That's very standard in politics. Politics is not the nicest business in the world, but it's very standard where they have information and you take the information."  Trump went on to say that nothing came from the meeting. A few days later, Trump tweeted the same defense.  Political operatives on both sides of the aisle quickly said, no, they wouldn't have taken a meeting with a foreign operative and would have reported the offer to authorities.

US Senate Calls On Julian Assange To Testify - Julian Assange has been asked to testify before the US Senate Intelligence Committee as part of their Russia investigation, according to a letter signed by Senators Richard Burr (R-NC) and Mark Warner (D-VA) posted by the official WikiLeaks Twitter account. The letter, delivered to Assange at the Ecuadorian embassy in London, reads in part "As part of the inquiry, the Committee requests that you make yourself available for a closed interview with bipartisan Committee staff at a mutually agreeable time and location." BREAKING: US Senate Intelligence Committee calls editor @JulianAssange to testify. Letter delivered via US embassy in London. WikiLeaks' legal team say they are "considering the offer but testimony must conform to a high ethical standard". Also: https://t.co/pPf0GTjTlp pic.twitter.com/TrDKkCKVBx— WikiLeaks (@wikileaks) August 8, 2018   Wikileaks' says their legal team is "considering the offer but testimony must conform to a high ethical standard," after which the whistleblower organization added a tweet linking to a list of 10 Democratic Senators who demanded in late June that Assange's asylum be revoked in violation of international law: Of note: https://t.co/pAFas2fgKn — WikiLeaks (@wikileaks) August 8, 2018

Rick Gates says he committed crimes with former Trump campaign chief Paul Manafort -- Rick Gates, the star witness in special counsel Robert Mueller's fraud and conspiracy trial against former Trump campaign chairman Paul Manafort, took the stand Monday to testify that he committed crimes with his former business partner.In a blow to the case being laid out by Manafort's defense team, Gates then told prosecutors that he had been directed by Manafort to report overseas income as loans as a way to lower his taxable income.Since their opening statement last week, Manafort's lawyers have sought to blame Gates for breaking finance laws, framing him as a liar who abused Manafort's trust and embezzled millions of dollars from him.Gates, clad in a blue suit and sporting an uncharacteristically clean-shaven face, did admit in court that he stole hundreds of thousands of dollars from Manafort by filing false expense reports.But while sitting just a few feet from Manafort, Gates testified that Manafort had worked with him to commit financial crimes, including filing false tax returns. Manafort had directed him to commit other crimes, Gates said, such as not disclosing foreign bank accounts and omitting information from a court deposition. He listed 15 foreign entities that he said were not reported to the government. Gates told prosecutors that the money in those accounts came from Manafort's work as a consultant and lobbyist in the Ukraine for ex-leader Viktor Yanukovych and his pro-Russian Party of Regions.

 Manafort lawyer attacks deputy's lies -Lawyers for ex-Trump aide Paul Manafort have told a court that his deputy led a "secret life" and told so many lies he could not keep track of them all.Mr Manafort's defence team was cross-examining his former right hand man, Rick Gates, who is now star witness for the prosecution.Gates told the court on Monday that Mr Manafort ordered him to commit fraud.This is the first criminal trial to come from the Department of Justice-led inquiry into alleged Kremlin meddling. Mr Manafort's legal team set about attacking Gates' credibility on Tuesday, day six of the trial.Defence attorney Kevin Downing asked about the witness' co-operation with special counsel Robert Mueller, who is leading the Russia probe."When did you start providing false and misleading information to the special counsel's office?" he began, pointing to the fact that Gates had lied to investigators before entering his guilty plea."Have they confronted you with so many lies that you can't remember?" he added.In the middle of questioning, Mr Downing asked: "There was another Richard Gates, isn't that right? A secret Richard Gates?" Gates responded that he had had an extramarital affair over 10 years ago."As part of your secret life, did you have a flat?" Mr Downing asked. "Is that what they call an apartment in London?" Gates acknowledged he had maintained a place in London for two months, and listed luxury hotels as a business expense for those trysts. Prosecutors provided emails on Tuesday between Mr Manafort and Gates that appeared to show the two had moved money through a foreign bank account in Cyprus.

 Manafort team attacks ‘secret life’ of star witness Rick Gates -- Ex-Trump aide Paul Manafort's lawyer has told a court his deputy led a "secret life" and told so many lies he could not keep track of them all. Mr Manafort's defence team was cross-examining his former right-hand man, Rick Gates, who is now star witness for the prosecution. Gates told the court on Monday that Mr Manafort ordered him to commit fraud. This is the first criminal trial to come from the Department of Justice-led inquiry into alleged Russian meddling. Mr Manafort, 69, has pleaded not guilty to bank fraud and tax fraud. Gates, 46, struck a plea deal with prosecutors in February, admitting two charges of conspiracy and lying to the FBI. The case arises from the pair's consultancy work for Russian-backed Ukrainian politicians. Mr Manafort's legal team sought to undercut Gates' credibility on Tuesday, day six of the trial. Defence attorney Kevin Downing asked about the witness's co-operation with special counsel Robert Mueller, who is leading the Russia probe. "After all the lies you told you expect this jury to believe you?" Mr Downing asked Gates. "I'm here to tell the truth," the witness replied. "Mr Manafort had the same path. I'm here." The defence lawyer pointed out Gates had lied to investigators before entering his guilty plea. "Have they confronted you with so many lies that you can't remember?" Mr Downing added. The defence lawyer also pressed Gates on his adultery. "There was another Richard Gates, isn't that right?" Mr Downing asked. "A secret Richard Gates?" The witness responded that he had had an extramarital affair over 10 years ago. Gates acknowledged keeping a flat in London for two months during those trysts, and listing luxury hotels as a business expense. He also said he had possibly submitted personal expenses to President Donald Trump's inaugural committee for his work on the election campaign. And he conceded he had penned a fraudulent letter to prospective investors for a movie project.

Rick Gates admits to stealing nearly $3 million from Paul Manafort to fund an extramarital affair, and the defense tries to cast a political shadow over the trial in a tense Day 6 — Rick Gates, Paul Manafort's former right-hand man, admitted Tuesday that he cheated Manafort out of millions of dollars to fund an extramarital affair. Gates' admission came as he was testifying against Manafort in a high-stakes criminal trial, in which prosecutors have charged Manafort with over a dozen counts related to tax fraud, bank fraud, and a failure to report foreign bank accounts. Gates was initially a codefendant with Manafort, but he struck a plea deal with prosecutors working for the special counsel Robert Mueller, and he is the prosecution's star witness in the Virginia case against Manafort. On Tuesday, Manafort's attorney Kevin Downing grilled Gates in a lengthy cross-examination. "There was another Richard Gates, isn't that right?" he asked. "A secret Richard Gates?" Lowering his voice, Gates then admitted that he'd had "another relationship" a decade ago, apparently referring to an extramarital affair. Gates added that the affair took place in London for about two months. He said he embezzled money from Manafort to fund the affair, which included flying first class, staying in high-end hotels, and keeping a separate apartment in London. On Monday, Gates admitted to embezzling "several hundred thousand" dollars from Manafort by falsifying expense reports that were reimbursed by some of the offshore accounts prosecutors say were controlled by Manafort. On Tuesday, Gates said the money he used to fund his affair came from bonuses. Earlier in the day, prosecutors showed emails to the jury between Manafort and Gates that appeared to confirm Gates' testimony that Manafort sought to commit tax and bank fraud by moving money his consulting firm made from Ukraine through multiple offshore accounts located in Cyprus. Gates said there were "hundreds" of those emails. In one email — subject line "Payments" — Gates proposed transferring money from one of Manafort's shell companies to their political consulting group, Davis Manafort Partners International. "Unless you approve otherwise," Gates wrote. Manafort responded: "This works. Proceed as you lay it out below."

Banker who OK'd Manafort loan sought Cabinet post: Ex-employee -- Stephen Calk, the chief executive officer of The Federal Savings Bank in Chicago, expedited approval of a mortgage loan to Paul Manafort and wanted the onetime Trump campaign chair to help him get a job as Treasury secretary or housing secretary, a former bank employee testified Friday.The witness, Dennis Raico, said that the bank took just one day to approve a $9.5 million loan for Manafort that was secured by properties he owned in New York and Virginia. Raico, who testified under a grant of immunity because he feared prosecution, said that in his three years at the bank he had never seen a loan approved so quickly. The bank also approved a separate $6.5 million loan to Manafort.On Nov. 11, 2016, after Trump was elected president, Calk called Raico and asked him to pass along a message to Manafort about his interest in a cabinet position, Raico said. Raico didn’t call Manafort, however, because “it made me very uncomfortable,” he said.Manafort is on trial in Virginia on charges of bank fraud and tax fraud. He has pleaded not guilty. The case is being prosecuted by the office of the special counsel appointed to investigate Russian interference in the 2016 U.S. election.Prosecutors allege that Manafort lied about his finances when he was applying for the loans from The Federal Savings Bank. But they have also suggested that Calk granted the loans with the expectation that he would be granted a job in the Trump administration, and that he inquired about being named Army secretary. For its own part, the $265 million-asset bank has portrayed itself as a victim of Manafort’s fraud, and has stated that it will decline to comment during the trial.

Donald Trump’s Campaign Is Writing Out Strange Checks -  Pam Martens - One would think that if you are the President of the United States and the subject of a criminal investigation; and your former campaign chief is currently on trial for tax evasion and bank fraud; and your former personal attorney for a decade had his office, hotel room, home and safety deposit box raided by the FBI – you would make sure that your campaign committee would be crossing every T and dotting every I so that you didn’t land in more hot water. Over the past year and a half, Trump’s campaign committee has paid over $1 million to Trump-related businesses. It is apparently allowing Trump Tower in New York to charge the campaign rent. FEC records show $627,371 was paid to Trump Tower Commercial LLC and earmarked as “rent.” More than $100,000 was paid to the Trump International Hotel in Washington D.C. for lodging, catering, etc.; over $38,000 to Trump Restaurants; and $30,800 to Trump Plaza LLC. But here’s where things get really weird. Trump’s campaign account paid The Trump Corporation a total of $173,131 in eight checks that ran from June 2017 through May 4, 2018. Each check was designated as “legal consulting.” But the Trump Corporation is not a law firm. How can it provide legal advice to a campaign?May 2018 is when Rudy Giuliani announced that Michael Cohen was no longer Trump’s attorney. That is the same month that the “legal consulting” checks stopped being paid to The Trump Corporation. But Michael Cohen is not a campaign attorney and the giant law firm, Jones Day, was already being paid to represent the campaign. The same FEC records show that Jones Day received $2,891,015 from the Trump campaign account for legal work.It is illegal to spend campaign funds for personal use, interpreted by the FEC as payments for expenses “that would exist irrespective of the candidate’s campaign or responsibilities as a federal office holder.” Four payments totaling over $21,000 were made to 40 CPS Associates LLC. That’s the owner of 40 Central Park South, a luxury apartment building in Manhattan. The payments began on January 17, 2018 at $7,225 (which may be one month’s rent and a security deposit) and continued thereafter at $3500 each month, through May, the cutoff of the FEC records currently available. They are designated as “rent.” The rents in this building can be quite steep. According to Curbed New York, Lady Gaga rented an apartment there in 2013 and was shelling out $22,000 a month. Why does a Presidential campaign need an apartment in a building known as a “celeb haven.” For that matter, why does it need an apartment at all?

Stone Cold: Mueller Wins Key Legal Challenge To His Authority As Special Counsel Jonathan Turley -- For over a year, there has been an ongoing debate over the constitutionality of the appointment of Robert Mueller as Special Counsel.  The claim is that Mueller constitutes a “principal officer” who should be nominated by President Trump and confirmed by the Senate.  Instead, defenders claim Mueller is an “inferior officer” who does not require such a process. Chief Judge Beryl Howell of the United States District Court for the District of Columbia just gave Mueller an impressive legal victory in an opinion that swept aside this and two other fundamental challenges to the Special Counsel.  The decision came as part of the grand jury investigation into Trump confidant Roger Stone. The challenge was brought by the aide to Stone, Andrew Miller. His able counsel pressed three attacks on the Mueller’s authority under the Appointments Clause of the Constitution, U.S. CONST. art. II, §2, cl. 2.  First, they claimed that the Special Counsel is a principal rather than inferior officer. If Mueller is a principle officer, he must be nominated by Trump and confirmed by the Senate.  Second, they argued that  no statute authorized the Special Counsel’s appointment. Finally, they argued that Rosenstein lacked authority to appoint Mueller.  It was the first argument that has attracted the most academic interest but Mueller swept the table on all three challenges.   The clause guarantees care and accountability in the selection of these powerful individuals.  This concern was magnified for many in the appointment of Robert Mueller, who has been criticized by Trump and others as having conflicts of interest in his position.  Indeed, when Mueller was appointed, I expressed surprise that he was even on the list and I have maintained that both Mueller and Rosenstein have conflicts.  However, I supported the appointment of a Special Counsel and I believe Mueller should be allowed to finish his work unimpeded.

DOJ Ordered To Preserve Comey Email Records - The Department of Justice has been ordered by a federal court to preserve federal records from the personal email accounts of former FBI Director James Comey, following a joint motion by the Daily Caller and Judicial Watch to compel the preservation.  Via Judicial WatchIn the motion, Judicial Watch argued that “there is reason to be concerned that the responsive records could be lost or destroyed.” Judicial Watch pointed out that in June 2018, the DOJ’s Inspector General stated, “We identified numerous instances in which Comey used a personal email account (a Gmail account) to conduct FBI business.” The Justice Department, in response to Judicial Watch’s concerns, sent Mr. Comey a letter asking him to preserve records but refused to make the letter available and opposed a preservation order.In granting the motion for a preservation order, the court ruled:[T]he Court will allow [the DOJ] until September 28, 2018 to complete its review and release of any responsive, non-exempt records to Plaintiffs. That being said, [the DOJ] is also ORDERED to make rolling productions between today and September 28, 2018, at reasonable intervals, of any records that are reviewed and found to be responsive and non-exempt.***In order to avoid any possible issues later in this litigation, the Court will GRANT [Judicial Watch’s] Motion. [The DOJ] is ORDERED to take all necessary and reasonable steps to ensure that any records that are potentially responsive to either of the Plaintiffs’ FOIA requests located on former Director Comey’s personal e-mail account are preserved. Although it contends that such an order is unnecessary, [the DOJ] has not explained why this preservation order would prejudice Defendant or cause any undue burden.

GOP Activist Investigating Hillary Clinton's Lost Emails Found Dead - Apparent Suicide By Black Plastic Bag – Republican activist Peter Smith was found dead in his hotel room in May 2017 in Rochester, Minnesota. The hotel staff found Smith with a black plastic bag on his head. He was trying to obtain Hillary Clinton’s lost emails. Mueller and Congressional investigators have interviewed Smith’s acquaintances several times. Our sources say there is much more to this story. The Wall Street Journal reported: Peter W. Smith, a Republican political activist and financier from Chicago who mounted an effort to obtain former Secretary of State Hillary Clinton’s emails from Russian hackers, died on May 14 after asphyxiating himself in a hotel room in Rochester, Minn., according to local authorities. He was 81 years old. Mr. Smith’s body was found by a hotel clerk in the Aspen Suites hotel, located across the street from the Mayo Clinic, according to a Rochester Police Department report. An associate of Mr. Smith said that he had recently visited the clinic. A representative for the facility wouldn’t confirm if Mr. Smith was a patient. Mr. Smith died about 10 days after an interview with The Wall Street Journal in which he recounted his attempts to acquire what he believed were thousands of emails stolen from Mrs. Clinton’s private email server. He implied that Lt. Gen. Michael Flynn, then serving as the senior national security adviser to presidential candidate Donald Trump, was aware of his efforts……The police report said Mr. Smith was found by a hotel clerk with a plastic bag around his head attached tightly with black rubber bands. Mr. Smith “left documentation on why he committed suicide, medical records, his written obituary, and life insurance” on a table in his room, the report said.

 New Emails Reveal Steele Had "Extensive" 2016 Contacts With #4 DOJ Official While Compiling Dossier - The former British spy who used Kremlin sources to assemble a Clinton-funded anti-Trump dossier, which the Obama administration used to spy on the Trump campaign, had extensive contacts with the Department of Justice's #4 official before and after the FBI opened its Trump-Russia probe in the summer of 2016, according to new emails recently turned over to Congressional investigators. That official, Bruce Ohr, was demoted twice after the DOJ's Inspector General discovered that he lied about his involvement with opposition research firm Fusion GPS co-founder Glenn Simpson - who employed Steele. Ohr's CIA-linked wife, Nellie, was also  employed by Fusion as part of the firm's anti-Trump efforts, and had ongoing communications with the ex-UK spy, Christopher Steele as well.  In short, Steele was much closer to the Obama administration than previously disclosed, and his DOJ contact Bruce Ohr reported directly to Deputy Attorney General Sally Yates - who approved at least one of the FISA warrants to surveil Trump campaign aide Carter Page.Steele and the Ohrs would have breakfast together on July 30 at the Mayflower Hotel in downtown Washington D.C., while Steele turned in installments of his infamous "dossier" on July 19 and 26. The breakfast also occurred one day before the FBI formally launched operation "Crossfire Hurricane," the agency's counterintelligence operation into the Trump campaign. “Great to see you and Nellie this morning Bruce,” Steele wrote shortly following their breakfast meeting. “Let’s keep in touch on the substantive issues/s (sic). Glenn is happy to speak to you on this if it would help.”Calendar notations and handwritten notes indicate Ohr followed up on Steele’s offer and met with Simpson on Aug. 22, 2016. Ohr’s notes indicate Simpson identified several “possible intermediaries” between the Trump campaign and Russia.One was identified as a “longtime associate of Trump” who “put together several real estate deals for Russian investigators to purchase Trump properties.” Another was a Russian apparently tied to Carter Page, Ohr’s note of his Simpson contact indicated. Steele offered Ohr many other theories over their contacts, including a now widely discredited one that the Russian Alfa Bank had a computer server “as a link” to the Trump campaign, Ohr’s notes show.

Former Trump Lawyer Michael Cohen Under Investigation for Tax Fraud - The legal pressures facing Michael Cohen are growing in a wide-ranging investigation of his personal business affairs and his work on behalf of his former client, President Trump. In previously unreported developments, federal prosecutors in New York are examining whether Mr. Cohen committed tax fraud, people familiar with the investigation said. Federal authorities are assessing whether Mr. Cohen’s income from his taxi-medallion business was underreported in federal tax returns, one of the people said. That income included hundreds of thousands of dollars received in cash and other payments over the last five years, the person said. Prosecutors also are looking into whether any bank employees improperly allowed Mr. Cohen to obtain loans for which he didn’t provide adequate documentation, people familiar with the matter said. In particular, federal investigators are looking closely at Mr. Cohen’s relationship with Sterling National Bank—which provided financing for Mr. Cohen’s taxi-medallion business—including whether Mr. Cohen inflated the value of any of his assets as collateral for loans, according to people familiar with the matter. Convictions for federal tax- and bank-fraud may carry potentially significant prison sentences, which could put additional pressure on Mr. Cohen to cooperate with prosecutors if he is charged with those crimes, according to former federal prosecutors. Evgeny Freidman, a taxi-medallion manager who worked with Michael Cohen, in 2009. Photo: Neilson Barnard/Getty Images .As part of the inquiry into Mr. Cohen’s relationships with banks, federal authorities have been investigating whether Mr. Cohen made misrepresentations or false statements on loan applications, people familiar with the matter said. Meantime, federal prosecutors subpoenaed Mr. Cohen’s former accountant, Jeffrey A. Getzel, who was responsible for preparing many of Mr. Cohen’s financial statements submitted to banks, people familiar with the matter said. Mr. Getzel also served as an accountant for Evgeny “Gene” Freidman, a taxi-medallion manager who worked with Mr. Cohen, according to public court records. Mr. Freidman is cooperating with federal prosecutors in the investigation, according to people familiar with the matter. Mr. Cohen’s lawyer, Lanny Davis, declined to comment “out of respect for the ongoing investigation.” Mr. Cohen has previously denied any wrongdoing.

Witness In Mueller Probe Held In Contempt Of Court For Refusing To Testify - A federal judge held a witness in special Counsel Robert Mueller's probe of Russian interference in contempt of court for refusing to testify before a grand jury. According to the Washington Post, District Chief Judge Beryl Howell made the ruling on Friday after a sealed hearing to discuss Andrew Miller’s refusal to appear before the grand jury. Miller is a former aide to longtime Trump confidant Roger Stone. After the hearing, Miller’s lawyer Paul Kamenar said Miller was “held in contempt, which we asked him to be in order for us to appeal the judge’s decision to the court of appeals.” Howell stayed her order while Miller’s legal team appeals the judge’s decision. Earlier this month, Miller fought and lost a court battle to quash a subpoena after a judge issued a 93-page opinion saying Miller must testify before the grand jury. According to the WaPo, the chairman of the National Legal and Policy Center, Peter Flaherty, a conservative nonprofit that is funding Miller’s legal fight, said Miller had refused to appear before the grand jury in response to a subpoena. Miller is in Missouri, Flaherty said. When a subpoenaed witness refuses to testify before a grand jury, that person can be held in contempt. In some cases, such a contempt finding can lead to a witness being sent to jail until the person agrees to testify. 

Dianne Feinstein Was An "Easy Mark" For China's Spy: Sperry -- Dianne Feinstein - vice chair of the Senate Judiciary Committee and a ranking member on the Senate Intel Committee, was an "easy mark" for the Chinese spy who operated within her inner-circle for two decades, reports journalist Paul Sperry in the New York PostA Chinese-American who doubled as both an office staffer and Feinstein’s personal driver, the agent reportedly was handled by officials based out of the People’s Republic of China’s consulate in San Francisco, which Feinstein helped set up when she was mayor of that city. He even attended consulate functions for the senator. -New York Post  According to Feinstein, the staffer was fired "immediately" after the FBI warned her five years ago that Chinese intelligence had infiltrated her office. Feinstein claims he had "no access to sensitive information" and that he was never charged with espionage.  That said - FBI officials warned Feinstein in June of 1996, after the staffer began working for her, that the agency had detected efforts by the Chinese government to seek favor with the Senator - possibly in the form of illegal and laundered campaign contributions. Feinstein was on the East Asian and Pacific affairs subcommittee of the Foreign Relations Committee at the time.  That warning was right on the money, notes Sperry:  One Chinese bagman, Nanping-born John Huang, showed up at Feinstein’s San Francisco home for a fundraising dinner with a Beijing official tied to the People’s Bank of China and the Communist Party Committee. As a foreign national, the official wasn’t legally qualified to make the $50,000-a-plate donation to dine at the banquet. After a Justice Department task force investigated widespread illegal fundraising during the 1996 Clinton re-election campaign, Feinstein returned more than $12,000 in contributions from donors associated with Huang, who was later convicted of campaign-finance fraud along with other Beijing bagmen. The DNC and the Clinton campaign had to return millions in ill-gotten cash. -New York Post Despite the jig being up, Beijing still received an extension of its favored trade status, "thanks in part to Feinstein," who in turn embarked on a campaign to minimize China's human rights abuses.

Butina Case: Neo-McCarthyism Engulfs America - The United States Department of Justice would apparently have you believe that the Kremlin sought to subvert the five-million-member strong National Rifle Association (NRA) by having two Russian citizens take out life memberships in the organization with the intention of corrupting it and turning it into a mouthpiece for President Vladimir Putin. Both of the Russians – Maria Butina and Alexander Torshin – have, by the way, long well documented histories as advocates for gun ownership and were founders of Right to Bear Arms, which is not an intelligence front organization of some kind and is rather a genuine lobbying group with an active membership and agenda. Contrary to what has been reported in the mainstream media, Russians can own guns but the licensing and registration procedures are long and complicated, which Right to Bear Arms, modeling itself on the NRA, is seeking to change.Maria Butina, a graduate student at American University, is now in solitary confinement in a federal prison, having been charged with collusion with Torshin and failure to register as an agent of the Russian Federation. It is unusual to arrest and confine someone who has failed to register under the Foreign Agents Registration Act of 1938, but she has not been granted bail because, as a Russian citizen, she is considered to be a “flight risk,” likely to try to flee the US and return home. It is to be presumed that she is being pressured to identify others involved in her alleged scheme to overthrow American democracy through NRA membership. Indeed, in any event, it would be difficult to imagine why anyone would consider the NRA to be a legitimate intelligence target. It only flexes its admitted powerful legislative muscles over issues relating to gun ownership, not regarding policy on Russia. In short, Butina and by extension Torshin appear to have done nothing wrong. Both are energetic advocates for their country and guns rights, which they appear to believe in, and Butina’s aggressive networking has broken no law except not registering, which in itself assumes that she is a Russian government agent, something that has not been demonstrated. To put the shoe on the other foot, will every American who now travels to Russia and engages in political conversations with local people be suspected of acting as an agent of the US government? Once you open the door, it swings both ways.

Activist publishes 11,000 WikiLeaks Twitter direct messages | TheHill: An activist has published 11,000 direct messages on Twitter between the WikiLeaks account and a group of its supporters. The direct messages were published by Emma Best on her own website. Her Twitter account states that she is a journalist on the East Coast. Best has been critical of WikiLeaks and has advocated for government transparency. Some of the direct messages were previously published, but this is the first time all of the direct messages have been posted. The messages show that WikiLeaks wanted the GOP to defeat Democratic nominee Hillary Clinton in the 2016 presidential election. "We believe it would be much better for the GOP to win," the WikiLeaks account states to a supporter named "Emmy B" in one of the messages from 2015. Another Twitter message from the WikiLeaks account describes Clinton as a "bright, well-connected, sadistic sociopath." WikiLeaks had been accused of bias against Democrats during the presidential race because of its release of hacked documents from the Democratic National Committee. Critics believe that the documents released by the group were consistently helpful to President Trump's campaign. Best said in an exchange with the website Motherboard that she released the messages because she wanted to show how WikiLeaks was working with other online entities to shape public discussions.

The New York Times defends Sarah Jeong after racist tweets come to light - The New York Times found itself at the center of a controversy last week when racist tweets posted between 2013 and 2015 by Sarah Jeong, a new member of the paper’s editorial board, began circulating online. The Times defended Jeong, as did several of her ostensibly left-wing colleagues and supporters.The posts in question are indefensible, a series of vitriolic tirades against white people. Jeong, who is Asian-American, tweeted with apparent relish, “Oh man it’s kind of sick how much joy I get out of being cruel to old white men.” In another tweet, she wrote, “Dumbass fucking white people marking up the internet with their opinions like dogs pissing on fire hydrants.” A third tweet consists simply of “#CancelWhitePeople.” There are others. Had Jeong made the same comments about any other group, had she publicly fantasized about the sick joy derived from her cruel treatment of “old African-American men,” for example, her career would be over and the very paper that hired her would be dragging her name through the mud. But Jeong engaged in a form of racism entirely permissible, and even quite lucrative, in the pseudo-left circles in which she moves and for which the Times speaks. In a statement defending Jeong, the Times explains that she has been the victim of online harassment as a young Asian woman. “For a period of time,” writes the Times, “she responded to that harassment by imitating the rhetoric of her harassers.” After “candid conversations,” the statement goes on, Jeong came to see things differently: “She regrets it, and the Times does not condone it.”  Jeong followed up with her own statement, writing on Twitter,  “I engaged in what I thought of at the time as counter-trolling. While it was intended as satire, I deeply regret that I mimicked the language of my harassers. These comments were not aimed at a general audience, because general audiences do not engage in harassment campaigns. I can understand how hurtful these posts are out of context, and would not do it again.” The cover story presented by Jeong and the Times is simply not credible. Nothing about these tweets reads like satire. They are racist comments that contain all the viciousness one has come to expect from those affluent, upper-middle class layers obsessed with race and gender. The New York Times plays a leading role in disseminating and legitimizing such views.

Twitter Suspends Black Conservative For Changing NYT Bigot's Tweets From "White" To "Jewish" And "Black" --In response to the New York Times' decision to stand by their most recent hire - open bigot Sarah Jeong, who really hates white people, men (especially white men), and cops - black conservative Candace Owens carried out a thought experiment we mentioned last week in which we replaced the word "white" with "black" to illustrate Jeong's animus. A sample of Jeong's controversial tweets:

    • Dumbass fucking white people marking up the internet with their opinions like dogs pissing on fire hydrants— sarah jeong (@sarahjeong) November 29, 2014
    • Are white people genetically predisposed to burn faster in the sun, thus logically being only fit to live underground like groveling goblins— sarah jeong (@sarahjeong) December 24, 2014
    • 1) white men are bullshit
      2) no one cares about women
      3) you can threaten anyone on the internet except cops  — sarah jeong (@sarahjeong) January 1, 2015

In response, Owens - communications director for activist group Turning Point USA, simply replaced "white" with Jewish and Black, then condensed Jeong's statements into several tweets, for which the Twitter police banned her for 12 hours:

Americans Are Begging The Government And Corporations To End Free Speech - This week, internet giants like Facebook, Youtube, Spotify and others banned the notorious Alex Jones and InfoWars from their platforms, and the purge is enjoying widespread support among the left, which has made a reputation for itself as intolerant of differing opinions (last year, for example, a group of Antifa protesters beat one of our own Anti-Media reporters and destroyed his camera equipment at a rally simply because he was filming). In Jones’ case, Facebook cited hate speech, though this stance seems inconsistent considering the platform has caught flack for allowing anti-semitic content. This lack of principle doesn’t matter to many left-wing partisans, though, as long as someone they find reprehensible is silenced - even as others with far better reputations are banned from other platforms (to clarify, Anti-Media does not endorse Infowars in any way, nor do we consider them to be a legitimate news outlet).  At the same time, however, the right is proving equally open to banning speech and news outlets they dislike. A recent poll from Ipsos found  43 percent of Republicans advocate giving the president, and thereby the government, the power to shut news outlets down. The president, too, has fantasized about doing so: Disdain for journalists is palpable at Trump rallies, and popular right-wing commentator Milo Yiannopoulos recently called for the assassination of journalists (before claiming the comment was just a joke). Adherents to both sides of the false dichotomy are increasingly okay with silencing speech and ideas that conflict with their own.   Worse still, companies like Facebook, Google, and Youtube, which is now owned by Google, are aligned with intrusive government agencies and policies that regulate speech and expression on the internet.  At the same time, public opinion is creating demand for these kinds of crackdowns. It may be true that Facebook is a “private” platform, but the reality is that whether it’s Facebook banning Jones or Disney firing Guardians of the Galaxy director James Gunn, who was critical of conservatives, they are, at least in part, responding to the public’s intolerance of ideas and opinions that don’t align with their own — and this intolerance is directly linked to people’s views on government and politics.

 Apple Vows iPhones Do Not Listen In On Users... But Its Apps Are Another Story - In the aftermath of numerous reports that Amazon's Alexa speakers were "accidentally" listening in, and in some cases recording the conversations of their owners, on Tuesday Apple responded to US lawmakers whether its iPhones invade users' privacy and listen in on conversation without their consent: Apple's response: a resounding "no", and added that it does not allow third-party apps to do so either, after lawmakers asked the company if its devices were invading users’ privacy. Representatives Greg Walden, Marsha Blackburn, Gregg Harper and Robert Latta wrote to Apple’s chief executive Tim Cook and Alphabet chief executive Larry Page in July, citing concerns about reports that smartphones could “collect ‘non-triggered’ audio data from users’ conversations near a smartphone in order to hear a ‘trigger’ phrase, such as ‘Okay Google’ or ‘Hey Siri.’" In a letter to Walden, an Oregon Republican who chairs the House Energy and Commerce Committee, Apple said iPhones do not record audio while listening for Siri wakeup commands and that Siri does not share spoken words. Apple also vowed that it requires users to explicitly approve microphone access and that apps must display a clear signal that they are listening, which of course . "We believe privacy is a fundamental human right and purposely design our products and services to minimize our collection of customer data," Apple executive Timothy Powderly wrote in the leter to Walden. "The customer is not our product, and our business model does not depend on collecting vast amounts of personally identifiable information to enrich targeted profiles marketed to advertisers." Which is great for Apple, because virtually every other social media's business model depends on precisely that. The letters, in which lawmakers cited reports suggesting third-party applications had access to and used ‘non-triggered’ data without users’ knowledge, followed congressional hearings in April into Facebook Inc’s privacy practices, which included testimony by its CEO Mark Zuckerberg, Reuters reported. Apple declined to comment beyond its letter, which was seen by Reuters.

Living in the Age of the Big Lie | IndustryWeek -- We live in an era of unprecedented public dishonesty, blurring the lines between fact, opinion and noisy speculation. This is bad for America and American business: Democratic capitalist societies require truth and transparency for their institutions to remain viable. Of course, there is nothing new about politicians and propagandists spreading disinformation and promoting “alternative facts.” Technological improvements in printing led to pamphlet wars in 16th and 17th century Europe that facilitated the rapid spread of political deceit. In the mid-20th century, Nazi Germany and Soviet Russia elevated the official use of lying to new levels to manipulate the disgruntled and sow confusion and fear among the public.  Yet we’ve reached a new pinnacle. Today we live in the Age of the Big Lie, where in the words of historian Deborah Lipstadt, “No fact, no event, and no aspect of history has any fixed meaning or content.” Earlier this year, Science published a study of fake news on Twitter over a 10-year-period and found 126,000 dishonest tweets, which altogether were retweeted more than 4.5 million times. According to the analysis, false stories reach 1,500 people six times quicker, on average, than true stories.  Contemporary technology not only allows the spread of misinformation and disinformation farther and faster than ever before, but it also creates opportunities for dishonesty never before possible. We’re not just talking about Russian troll factories hoodwinking Facebook. Modern snake oil hucksters can convincingly adapt technology to sway public opinion—this spring writer/actor Jordan Peele and Buzzfeed demonstrated just how easy this is by producing a bogus video of former President Obama insulting his successor. All this has created the potential for an American cultural crisis of distrust, authoritatively captured in two recently published analyses.  In “Truth Decay,” the RAND Corporation lays the blame for the deteriorating role of facts and data in public life on four primary causes:

1. The rise of social media
2. An overtaxed educational system that cannot keep up with changes in the “information ecosystem”
3. Political and social polarization
4. And—perhaps due to all of these factors—the increasing tendency of individuals to create their own subjective social reality, otherwise known as “cognitive bias.”

Facebook to Banks: Give Us Your Data, We’ll Give You Our Users  - Facebook has asked large U.S. banks to share detailed financial information about customers as it seeks to boost user engagement.. The social-media giant has asked large U.S. banks to share detailed financial information about their customers, including card transactions and checking-account balances, as part of an effort to offer new services to users. Facebook increasingly wants to be a platform where people buy and sell goods and services, besides connecting with friends. The company over the past year asked JPMorgan Chase & Co., Wells Fargo, Citigroupand U.S. Bancorp to discuss potential offerings it could host for bank customers on Facebook Messenger, said people familiar with the matter.Facebook has talked about a feature that would show its users their checking-account balances, the people said. It has also pitched fraud alerts, some of the people said. Data privacy is a sticking point in the banks’ conversations with Facebook, according to people familiar with the matter. The talks are taking place as Facebook faces several investigations over its ties to political analytics firm Cambridge Analytica, which accessed data on as many as 87 million Facebook users without their consent.Facebook has told banks that the additional customer information could be used to offer services that might entice users to spend more time on Messenger, a person familiar with the discussions said. The company is trying to deepen user engagement: Investors shaved more than $120 billion from its market value in one day last month after it said its growth is starting to slow.

Facebook Asking Major US Banks To Share User Data - Facebook has asked several large US banks to share detailed financial information about their customers, including checking account balances and card transactions, as part of a new push to offer new services to its users, according to the Wall Street Journal. Facebook increasingly wants to be a platform where people buy and sell goods and services, besides connecting with friends. The company over the past year asked JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and U.S. Bancorp to discuss potential offerings it could host for bank customers on Facebook Messenger, said people familiar with the matter. -WSJFacebook's new feature would show people their checking account balances, as well as offer fraud alerts, according to the WSJ's sources, while the banks are apparently waffling over data privacy concerns.The negotiations come as the social media giant has fallen under several investigations over data harvesting, including its ties to political analytics firm Cambridge Analytica, which was able to gain access to the data of as many as 87 million Facebook users without their consent. One large bank withdrew from talks due to privacy concerns, according to the Journal, however Facebook swears that they're simply trying to enhance the user experience and won't use any banking data for ad-targeting. Facebook has told banks that the additional customer information could be used to offer services that might entice users to spend more time on Messenger, a person familiar with the discussions said. The company is trying to deepen user engagement: Investors shaved more than $120 billion from its market value in one day last month after it said its growth is starting to slow. Facebook said it wouldn’t use the bank data for ad-targeting purposes or share it with third parties. -WSJ

Banks won't 'like' this offer from Facebook -- Facebook is making an offer that's easy for banks to refuse.  According to a report Monday in the Wall Street Journal, the social media giant wants banks to share sensitive customer information and in return, Facebook will use that data to develop features in its chat platform to offer those same bank customers the ability to check account balances or receive fraud alerts. Wells Fargo, JPMorgan Chase, Citigroup and U.S. Bancorp were all reportedly approached.  But there's a big problem — those banks, and most others, already provide such abilities to their customers. While the pitch is supposed to be enticing, bank executives say they see little benefit to it, particularly when compared to the potential drawbacks, including heightened data privacy and regulatory scrutiny concerns. “You’ve got huge confidentiality issues,” said Brian Schmitt, CEO of the $539 million-asset SouthCrest Bank in Atlanta. “We would be opening a can of worms there.”At least part of the problem is a reputational one. Facebook has seen its image plummet during the past few years for its role in helping Russia meddle with the 2016 presidential election and its failure to secure customer data, such as in the recent Cambridge Analytica scandal in which as many as 87 million users had their personal information shared. While Facebook is promising bankers that it won't use any financial data for ads or share it with third parties, that is unlikely to pass muster with compliance officers, executives and regulators.

Facebook Opens Door to More Federal Probes by Asking Banks for Data - Pam Martens - Facebook is beginning to resemble one of those frat boys at a boozy party who keeps asking guys to punch him in the stomach to prove his masculinity. At a time when it’s under scrutiny on multiple continents for sharing its users’ personal information without their consent, it has decided to ask big U.S. banks to share their customers’ financial transaction information with Facebook, according to a report yesterday in the Wall Street Journal.The Journal reported that “The social-media giant has asked large U.S. banks to share detailed financial information about their customers, including card transactions and checking-account balances, as part of an effort to offer new services to users.”Three of the banks mentioned, JPMorgan Chase, Citigroup and Wells Fargo, have been serially in trouble with Federal regulators for abusing their customers. The idea that these Wall Street banking behemoths might now partner with Facebook to potentially add financial privacy violations to their roster of misdeeds, or open the door to identity theft, is sure to open fresh Federal probes.  An added commentary on the morality of our times lies in the fact that the shares of Facebook actually spiked on the news, closing the day up 4.45 percent. According to the quarterly report (10Q) that Facebook filed with the Securities and Exchange Commission (SEC) on July 26, it is being sued in state and federal courts and is in the cross hairs of government investigators “in the United States, Europe, and other jurisdictions.” The company told the SEC this: “Beginning on March 20, 2018, multiple putative class actions and derivative actions were filed in state and federal courts in the United States and elsewhere against us and certain of our directors and officers alleging violations of securities laws, breach of fiduciary duties, and other causes of action in connection with the misuse of certain data by a developer that shared such data with third parties in violation of our terms and policies, and seeking unspecified damages and injunctive relief. We believe these lawsuits are without merit, and we are vigorously defending them.Zuckerberg has now reached the tender age of 34 years old. His company is publicly traded with a market value of $536 billion as of the close of trading yesterday. Its shares are held in public pensions and mutual funds held in tens of millions of Americans’ 401(k) plans and children’s college tuition plans.It’s past time for Congress and Federal regulators to be the grownups in the room.

 Blowback: UniCredit Becomes First Major Corporation To Sever Ties With Facebook Over Ethics - Facebook has lost a major advertiser, UniCredit SpA, which has severed all ties alleging that the social media giant hasn't acted ethically, reports Bloomberg - which notes that "other large companies" may follow suit.  CEO Jean Pierre Mustier says the bank maintains that Facebook hasn't acted properly, and the Italian financial group will no longer have any type of business relationship with the Menlo Park, CA company.  Mustier was referring to business activities including advertising and marketing campaigns, a spokesman for UniCredit said. The bank currently has a swath of Facebook accounts -- which are regularly updated. –Bloomberg Facebook has come under intense scrutiny for failing to safeguard user data amid the Cambridge Analytica data harvesting scandal, revealed in March by The Guardian and The New York Times. The data from up to 87 million users, and possibly more, was found to have been "harvested" via the psychological profiling app "Thisisyourdigitallife" - which was created by two psychologists (one of whom currently works for Facebook), and was specially designed to collect and share information.  Despite Facebook's attempts at damage control, UniCredit says they're done with the social media giant - and there have been others. Unilever UV and Sonos Inc. have also threatened to pull ads.  In late July, Facebook’s shares fell over 20 percent after second-quarter revenue showed the first signs of user disenchantment in the midst of public scandals over privacy and content. The company has been under fire following revelations that personal information on as many as 87 million users ended up in the hands of Cambridge Analytica, a political consulting firm that worked on Donald Trump’s presidential campaign. Mozilla Corp., which develops the Firefox web browser, said in March it would pause its ads from appearing on Facebook as a result. -Bloomberg

Koch Advances Its Wall Street Playbook, Gutting the Office of Financial Research - Pam Martens - As we have previously reported, there is indisputable documentation that Charles Koch, the fossil fuels billionaire who sits at the helm of Koch Industries, is in charge of the de-regulatory agenda in the Trump administration through a web of front groups.More proof came yesterday. Reuters announced that the Trump administration had “formally told” around 40 staff members of the Office of Financial Research (OFR) that “they will lose their jobs as part of a broader reorganization of the agency….” Reuters also reported that the agency’s budget has already been cut by 25 percent “to around $76 million.” Imagine having only $76 million to police an industry where just one of the big Wall Street banks, JPMorgan Chase, had profits of $8.32 billion in its last quarter.Charles Koch has long understood that if you can’t repeal the legislation that created the Federal agency, get your lackies in Congress to gut its funding and gut its staff.The OFR was created under the Dodd-Frank financial reform legislation of 2010 to issue public research reports and keep the Financial Stability Oversight Council (F-SOC) informed on emerging threats that have the potential to implode the financial system — as occurred in 2008 in the worst financial crash since the Great Depression.Two of OFR’s most important research findings are that Wall Street remains dangerously interconnected (SeeFinancial System of U.S. Rests on Health of Just Five Mega Banks) and that the Federal Reserve has left the country at financial risk by using the wrong design for its stress tests. (See Treasury Drops a Bombshell: Fed’s Stress Tests Get It Wrong.) Congress has failed to address either of these critical areas.  Why would a fossil fuels conglomerate care about policing of the financial services industry? Because Koch Industries also has a vast commodities trading operation called Koch Supply & Trading with offices in Houston, New York City, Wichita, Mexico City, London, Geneva, Singapore, and Shanghai. According to its website, it trades crude oil, refined products and derivatives, metals, interest rates and currency futures, among other things. Being able to operate off the radar screen of the prying eyes of Federal regulators is part of its highly profitable business model. But gutting OFR’s budget and sacking its staff is not the full agenda. Putting one of its loyalists in charge of the agency completes the picture. With little fanfare, on June 18 President Donald Trump nominated Dino Falaschetti, chief economist of the House Financial Services Committee for Chairman Jeb Hensarling, to become the Director of the OFR…

 How Trump's trade war with China could hurt commercial lenders -- It’s too early in the trade wars for banks to be suffering, but the Trump administration’s tariffs on steel and other imports almost certainly will inflict pain on the middle-market and small businesses that make up most commercial borrowers.  Trump’s 25% tariffs on steel that took effect this spring, and his recent threats to impose additional tariffs on other goods from China, have led dozens of U.S. companies to issue warnings about how their operations will be affected. The heavy equipment manufacturer Caterpillar, for example, said on July 30 that its costs will rise by $200 million in the second half of the year. Most regional and community banks do not provide financing to companies of that size, but they have vast exposure to their suppliers and vendors, several lenders and analysts said. Those banking clients include trucking and transportation companies, distributors and the manufacturers of parts used in larger products.  If the U.S. and China continue to engage in retaliatory tariffs, those smaller companies will get hit, said Bill Fink, head of commercial credit management at the $312 billion-asset TD Bank.  Fink and others declined to predict how long it would take the tariffs to hurt bank lending. But if they last long enough, the impact will eventually be felt by smaller suppliers. “We were surprised that none of the banks reacted to it [during second-quarter earnings calls], with the exception of Comerica,” Winter said. “But there is a real risk that there’s a delayed impact from it.” Curtis Farmer, president of the $72 billion-asset Comerica, said that middle-market customers of the Dallas bank “remain cautious.” About 53% of Comerica’s loan book is in commercial-and-industrial loans. “Probably the greatest source of caution right now relates to … what may or may not happen on the tariff side of the house,” Farmer said during a July 17 call. “The markets we’re in — Michigan, California and Texas — all have some economic reliance on trade.” The most vulnerable are suppliers or vendors to companies that import raw materials from China and derive most of their sales in the U.S., Winter said. That is because they would pay the tariff on Chinese imports, which could be 10% or 25%, depending on what the White House decides.

HSBC customer was on U.S. list of suspected weapons traffickers -- An HSBC customer may have used a credit card to traffic in weapons of mass destruction, the bank said in a securities filing Monday.  The unnamed customer used the HSBC card to make 12 payments between April and June, the bank said in its second-quarter 10-Q report.  The account “was subsequently closed and exited during the second quarter.” It did not say how much the payments were worth; the transactions generated “no measurable gross revenue or net profit,” the filing said.  The account holder was designated under Executive Order 13382, the filing said. That order targets the assets of individuals deemed complicit in the proliferation of weapons of mass destruction; it bans U.S. citizens and companies from doing business with those people.HSBC has reported a similar problem before. In its 2017 annual report, the bank admitted to clearing a $370,000 payment in the first quarter by someone flagged under Executive Order 13382 before freezing the account in question.

Resurgent payments fraud heightens ID challenge for banks - Verifying identities continues to be a tricky proposition for banks as cybercriminals diversify and increase their attacks — especially when it comes to wire transactions.Payments fraud hit a record high in 2017, with 78% of all organizations affected, according to a report from the Association of Financial Professionals and J.P. Morgan. Wire fraud was the second-most prevalent in that category (check fraud was No. 1).Wire fraud losses are averaging about $63,000 per incident and can run as high as $1 million dollars, according to the security blog frankonfraud.com.“It’s really becoming a huge issue for banks across many of their channels,” said Thomas Cronkright, president and CEO of the fintech firm CertifID, which provides digital security services. “And in direct channels in particular, when they are providing loans for collateral-based lending, the challenge is they are funding to a third party. So how do you trust that the wiring information has been received from the third party is accurate?” Cronkright said over the past 18 months this has become a particular issue in real estate transactions; in fact Cronkright — who owns a title company — was a victim of such fraud and lost $180,000, which spurred him to create CertifID.

Cybersecurity compliance deadline looming, says NY regulator - Financial companies regulated by New York State Department of Financial Services have less than a month to comply with another round of cybersecurity rules, the agency’s head warned Wednesday. The state’s financial services superintendent, Maria Vullo, said companies must be in compliance with a third phase of cybersecurity requirements, including encryption and heightened data breach protection, by Sept. 4. The requirements are part of a larger cybersecurity regulation mandate that began in March 2017, marking New York as the first state in the nation to issue such prescriptive laws.   “New York stepped into the void and took decisive action to ensure appropriate minimum standards protecting financial institutions’ data systems, including consumers’ sensitive personal information,” Vullo said in a press release. “These new protections, which include encryption, access controls and audit trails, add crucial tools to the regulation’s prior requirements in protecting the institutions and consumers.”

Banks explore a safe deposit box for cryptocurrencies -- Jamie Dimon once called bitcoin a “fraud” but later walked back those comments and said he was too hard on the concept of cryptocurrencies.Like Dimon, a growing number of banks appear to be warming up to the idea of building businesses that serve the digital currency world. It is an area that most banks have thus far ignored.JPMorgan Chase, Northern Trust, Goldman Sachs and several other banks are developing new products to hold cryptocurrencies in custody, according to the companies and various media reports. Like safe deposit boxes, these custody services would help bitcoin investors defend against theft.If the products materialize, they could help large banks accomplish two tasks—generate a new revenue source and avoid being left behind in an emerging sector of finance. Still, banks have their work cut out for them, said William Stern, a banking attorney at Goodwin Procter.“Banks have deep risk management experience, but crypto is new and there are other players out there at the forefront of developing this new technology,” Stern said.

 Bitcoin Whale's Bad Trade Leaves Counterparties Holding the Bag -- A massive wrong-way bet on Bitcoin left an unidentified futures trader unable to cover losses, burning counterparties and threatening to dent confidence in one of the world’s largest cryptocurrency venues. The long position in Bitcoin futures listed on OKEx, a Hong Kong-based exchange, had a notional value of about $416 million, according to an OKEx statement on Friday and data compiled by Bloomberg. OKEx moved to liquidate the position on Tuesday, but the exchange was unable to cover the trader’s shortfall as Bitcoin’s price slumped. Because OKEx has a “socialized clawback” policy for such instances, it will force futures traders with unrealized gains this week to give up about 18 percent of their profits. While clawbacks are not unprecedented at OKEx, the size of this week’s debacle has attracted lots of attention in crypto circles. The episode underscores the risks of trading on lightly regulated virtual currency venues, which often allow high levels of leverage and lack the protections investors have come to expect from traditional stock and bond markets. Crypto platforms have been dogged by everything from outages to hacks to market manipulation over the past few years, a period when spectacular swings in Bitcoin and its ilk attracted hordes of new traders from all over the world. The exchange, which only identified the problem trader by the ID number 2051247, said the position was initiated at 2 a.m. Hong Kong time on July 31 “Our risk management team immediately contacted the client, requesting the client several times to partially close the positions to reduce the overall market risks,” OKEx said. “However, the client refused to cooperate, which lead to our decision of freezing the client’s account to prevent further positions increasing. Shortly after this preemptive action, unfortunately, the BTC price tumbled, causing the liquidation of the account.” The exchange said it injected 2,500 Bitcoins -- worth about $18 million at current prices -- into an insurance fund to help minimize the impact on clients.

 People are paying close to $100,000 for rare 'Magic: The Gathering' cards that they compare to early bitcoin investments and predict will one day be worth millions - "If the Black Lotus gets $70,000 tonight, it'll be worth millions in about 20 years," Bryan Goldberg told me last week over the phone.Goldberg — a tech entrepreneur and self-described geek who owns a stable of media sites including Bustle, Elite Daily, and now Gawker.com— is predicting the outcome of an eBay auction underway for the Black Lotus, the most powerful card from the trading-card game "Magic: The Gathering."At the time of our conversation, bids for the coveted Black Lotus hover around $60,000. Goldberg is betting that the price will balloon by $10,000 in just a few short hours. If his call is right, Goldberg estimates that the Black Lotus' value will compound many times over in the coming years. By 2038, he predicts, it will be worth a minimum of $1 million."Magic: The Gathering" isn't a new trend or an emerging fad like CryptoKitties. The wizardry-inspired card game came out in the early '90s and precedes Pokémon by about three years. The people who play it are "nerds, geeks, and people who grew up as nerds and geeks," Goldberg said. Today, many of those same "nerds and geeks" are tech-savvy millennials who spend thousands of dollars on select cards from their beloved game."In my childhood, I was completely absorbed by it," Goldberg said. "The game today is the best it's ever been. It's a wonderful game. It's not just fun to play — there's so much nostalgia for it."Goldberg says he invests in the cards for the same reason he's bought up companies or bitcoin: He thinks it's going to make him a lot of money. "I think it will double or triple my money many times over," Goldberg said. The payoff, he says, will be similar to investments in cryptocurrencies like bitcoin or ether, with the potential to make early investors extremely wealthy.

 The Blockchain Has Inaugurated A Golden Age Of Criminality - Cryptocurrencies have also been a godsend to financial fraudsters, as a generation of would-be Jordan Belforts have flocked to these poorly understood collections of computer code to use as the subject of an endless series of pump-and-dump scams. The Wall Street Journal published an investigation this weekend into the so-called pump groups that have popped up on semi-anonymous social media networks like Telegram, which are set up with the explicit purpose of organizing pump-and-dumps using dozens of thinly traded cryptocurrencies. Following a similar exposes in The Outline and Buzzfeed earlier this year, the Journal purports to have identified “175 pump and dump schemes involving 121 different digital coins, which show a sudden rise in price and an equally sudden fall minutes later.”What sets these scams apart from the pump-and-dumps of yore is that the victims of these crimes appear largely to be people who are looking to perpetrate this fraud on others. Instead of pushing shady penny stocks by convincing wide-eyed grandmas that a crappy dot-com company will be the next AOL, crypto pump-and-dumps are explicit pyramid schemes, in which the victims think they are not the patsies, but in on the scam.The Outline’s Paris Martineau describes the typical pump and dump process as “surprisingly well-organized.” The pump groups leaders will provide instructions to group members, including the time of the pump, the “target” inflation price and how the signal to begin the pump will be sent. “As it grows closer to pump o’clock, organizers will send out a flurry of reminders and inspiring messages in order to, well, pump up the troops,” writes Martineau. What is particularly fascinating about the reporting on these scams is that journalists have no trouble finding would-be scammers who know that they probably the true target of the fraud. Rather than being a forum where crypto traders can conspire to defraud an unsuspecting public, these forums are the fraud. “They are 90 percent a scam to take money and the ones at the top will always win,” Brad Spann, an active member of a number of the most popular pump groups, tells The Outline. Despite realizing the severe information asymmetry that exists between himself and the group organizers, Spann and other group members come back time and again for the same reason that gamblers sit at the roulette table, even when they know the odds are against them.

CFPB to collaborate on fintech issues with foreign regulators - The Consumer Financial Protection Bureau is joining a cooperative of global regulators intended to bring more international collaboration to the regulation of fintech firms.The bureau on Tuesday announced the creation of the Global Financial Innovation Network for regulators to discuss joint policy work and offer a cross-border product testing process for innovation-focused companies."The network will seek to provide a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale new ideas," the CFPB said in a press release. "It will also create a new framework for cooperation between financial services regulators on innovation-related topics."The CFPB said is it working in collaboration with 11 financial regulators and "related organizations." It is the only U.S. regulator involved in the network so far.  The CFPB released the network's 21-page consultation document as the group seeks input on its mission statement, proposed functions and where the network should prioritize its work. The CFPB said "interested parties" in the U.S. can provide feedback to the agency's Office of Innovation.

Who's on first? The confusing state of federal fintech regulation — Federal agencies have recently rolled out a series of efforts aimed at collaborating more on fintech regulation, but one key question remains: Who is taking the lead? At least three agencies have made a claim on the fintech sector, with two doing so just in the past week. A fourth agency is potentially waiting in the wings. The Office of the Comptroller of the Currency announced last week that it would create a federal special-purpose bank charter for fintechs, a move that could effectively make it the national fintech regulator. But just a week later, the Consumer Financial Protection Bureau announced it was forming a global network of regulators to help guide fintech firms, a network that did not yet include the OCC or other U.S. agencies. The Commodity Futures Trading Commission, meanwhile, has already started its own international effort at fintech coordination, and the Federal Deposit Insurance Corp. has a potential claim to the space through its industrial loan company charter, which three fintechs have attempted to acquire.

Wall Street Journal Parrots SEC’s Excuses for Big Delays in Whistleblower Payouts - naked capitalism by Yves Smith - The Wall Street Journal has just published a story on how the SEC is way behind on paying whistleblowers awards for information submitted to the agency under a program established as part of Dodd Frank reforms. The impetus for the initiative was that the SEC had ignored Harry Markopolos’ warnings of the Bernie Madoff Ponzi scheme. Congress tried to assure that the agency didn’t have a disincentive to paying whistleblowers by establishing a separate pot of money for the awards that is outside the SEC’s budget. While the Journal does do a service of sorts in outing that the SEC is way behind on processing whistleblower award claims, it then misleads the public and Congress by not taking a hard look at the SEC’s excuses for this poor performance. The spin starts with the headline: SEC Whistleblower Payouts Slow Amid Deluge of Reward Seekers. In other words, the reader is to believe the agency’s delays are due to it being overburdened by way too many pesky claimants. We’ll discuss in more detail later that the SEC is almost certainly accurate in saying it does get lots of claims. But many of them are obviously spurious or otherwise invalid and could be dispatched quickly with clerical-level staff if the agency were serious about the program. Worse, it gives air cover for the SEC’s proposed gutting of the whistleblower program, some of which look to be a violation of statue, by parroting the agency’s claims that they will help speed award processing. The article’s subhead states: “Agency proposes ways to speed up decisions that now take more than two years to make”. In fact, those measures are ones the SEC can implement now and do not require any rule changes. That raises the question as to why the agency has and continues to sit on its hands regarding whistleblower claim processing. In other words, the SEC appears to have thrown these unnecessary “speed it up” tweaks in to provide air cover for the ones that do represent actual changes. As we discussed at length in an earlier post, those have the effect of substantially weakening the program and thwarting Congressional intent. That isn’t our opinion. SEC Commissioner Kara Stein, in her dissent, described how the many of the proposed changes to the whistleblower program violate Dodd Frank and hence are not permissible as SEC rules, which can only promulgate statute, not vitiate it.

SEC Inquired About Tesla CEO Musk’s Tweets —U.S. regulators are asking Tesla Inc. whether Chief Executive Elon Musk was truthful when he tweeted that he had secured funding for what would be the largest-ever corporate buyout, people familiar with the matter said.Officials at the Securities and Exchange Commission want to know whether Mr. Musk had a factual basis for tweeting Tuesday that the going-private transaction was all but certain, with only a shareholder vote needed to pull it off, the people said. The SEC’s inquiries, which originated from the agency’s San Francisco office, suggest Tesla could come under an enforcement investigation if regulators suspect that Mr. Musk’s statement was misleading or false. It couldn’t be learned on Wednesday whether the agency had opened a formal enforcement investigation. An SEC spokesman declined to comment. Tesla didn’t respond to a request for comment. Under U.S. law, companies and corporate officers can’t give shareholders misleading information about meaningful company events. Mr. Musk also could be in trouble if regulators develop evidence that he made a statement aimed at goosing his company’s share price.

 SEC Is Probing Musk's "Going Private" Tweet To Determine If He Lied - With Elon Musk refusing to name any of the parties from whom he has allegedly "secured funding" after launching a huge short squeeze in Tesla yesterday with his now infamous Tesla "going private" series of tweets, it was only a matter of time before the regulators - who have so far stubbornly ignored Tesla - started asking questions.According to the WSJ, that time is now, because the SEC has inquired with Tesla about Elon Musk’s announcement that he may take the company private "and whether his claim was factual", or in other words, whether Musk lied when he said he had secured financing.The regulator also asked why the disclosure which kept people glued to twitter for hours was made on the social network rather than in a regulatory filing, and whether the firm believes the announcement complies with investor-protection rules.According to the WSJ, the SEC inquiries - which originated from its San Francisco office so it will be relatively easy to visit the Fremont office - suggest Tesla could come under an enforcement investigation if regulators develop evidence that Musk’s tweet was misleading or false. “Frankly, the bigger issue is going to be whether the information is correct or not,” said Ira Matetsky, a partner at Ganfer & Shore in New York, who outlined questions the SEC might ask. “When Musk tweeted this, was he saying this was something that was definitely going to happen? Something that might happen? How would a reasonable investor interpret that and was it consistent with the facts as they existed at the time?” - BBGAnd while it is mostly semantics, so far it remains unclear if the SEC had opened a formal enforcement investigation based on the answers it received from the company.

 Stock buybacks will hit $1 trillion in 2018 - US corporations will buy back their own stock at a record clip of $1 trillion this year, according to an analysis issued by Goldman Sachs on Monday. The Wall Street giant attributed the surge in share repurchases to booming corporate profits and Trump’s $1.5 trillion tax cut for corporations and the wealthy, which was passed by Congress and signed into law last December. In a note to investors, David Kostin, chief equity strategist at Goldman, gushed that investors were likely to see the impact of the buybacks in higher share prices and fatter stock portfolios very quickly.The scale of the buyback spree is massive. Second-quarter 2018 stock repurchases are up 57 percent from the same period a year earlier. In the tech sector, the year-over-year increase is 130 percent.The surge in stock buybacks comes in the midst of record or near-record sales and profits. Among Standard & Poor’s 500 firms, second-quarter sales rose by 12 percent and earnings per share increased by 24 percent as compared to the same period of 2017. Fifty-six percent of companies surpassed the financial projections of market experts and economists. Trillions of dollars are being squandered on inflating stock prices and the fortunes of the CEOs and big investors who overwhelmingly control the assets, by means of financial manipulations such as buybacks, dividend increases, and mergers and acquisitions.Meanwhile, the real wages of US workers, whose mostly low-paid and back-breaking labor, along with that of millions of their class brothers and sisters around the world, is the source of all wealth and the profits extracted by the capitalists, continue to decline. Last week, the Labor Department reported that US wages in July rose by a paltry 2.7 percent year-over-year, while consumer prices officially rose by 2.9 percent, resulting in a net decline in workers’ purchasing power.

The Swiss National Bank Now Owns $87.5 Billion In US Stocks After Q2 Tech Buying Spree - In the second quarter of 2018, one in which the global economy was shaken by the rapid escalation of Trump's trade war, and in which central banks were one after another hinting at their own QE tapering and rate hiking intentions to follow in the Fed's footsteps, what was really taking place was another central bank buying spree meant to boost confidence that things are now back to normal, using "money" that was freshly printed out of thin air, and spent to prop up risk assets around the world by recklessly buying stocks with no regard for price or cost. Nowhere was this more obvious than in the latest, just released 13F from the massive hedge fund known as the "Swiss National Bank." What it showed is that, just like in the prior quarter, and the quarter before that, and so on, the Swiss central bank went on another aggressive buying spree and following a modest selloff in the first quarter which was a mirror image of the SNB's buying spree during Q1 2017 - the Swiss central bank boosted its total holdings of US stocks to $87.5 billion, up 6.6% or $5.4 billion from the $82.0 billion at the end of the first quarter, and just shy of their all time high.  On a share basis, the SNB added some 33.659 million shares to its total holdings of US stocks, which at the end of Q2 stood at 1.320 billion. Some notable observations: in the second quarter, after the SNB printed money out of thing air, it then added 4.85 million shares of AT&T, 673K shares of MSFT, 305K shares of AAPL, 272K shares of FB, 46K shares of AMZN, 423K shares of XOM. And according to some calculations, the SNB's portfolio now generates over $1 billion worth of dividends, or as @SheepleAnalytics notes, "they print money and we ship them our profits."

New York Congressman Collins Arrested On Insider Trading Charges - Republican Congressman Chris Collins, representing upstate New York and one of Trump's top defenders on Capitol Hill, surrendered to the FBI on Wednesday morning on securities fraud-related charges, NBC News reported. Collins, 68, faces insider trading charges along with his son, Cameron Collins, and Stephen Zarsky, the father of Cameron Collins' fiancée, according to the U.S. Attorney's Office in the Southern District of New York. The case is related to Innate Immunotherapeutics, an Australian biotech company, on which the elder Collins served on the board. The U.S. Attorney for the Southern District of New York scheduled a news conference to announce announce the insider trading charges against Collins. Collins, one of Donald Trump's early supporters in his bid for president, is expected to appear in federal court later Wednesday in Manhattan, NBC reported. The three-term incumbent represents New York's 27th Congressional District, which includes suburbs of Buffalo and Rochester, and is up for re-election in November. He has raised more than $1.34 million in his campaign war chest, according to the latest Federal Election Commission filing. At the crux of the Collinses' alleged scheme is the passing along information about a failed drug trial so the family and in-laws could cut their losses (per Aaron Blake). 

Trump Set To Seize Stake In China-Owned Building In Midtown Manhattan: Report --In what would mark an abrupt and serious escalation of the US-China trade and currency war - if true - is a report from the NY Post according to which the Trump administration, as part of a crackdown on certain US investments made by Chinese companies, is set to seize a majority stake in 850 Third Ave. The stake is owned by HNA, the reeling, quasi-insolvent Chinese conglomerate whose Chairman died in a freak accident in Italy one month ago, and its US partner in the building is desperate to save it.  The "strike" on the HNA building, which is located between East 51st and 52nd streets, has been in the works for months according to the Post and "is believed to be the first move by the Trump White House since Congress on Aug. 1 approved expanded authority of CFIUS — the Committee on Foreign Investors in the United States."“This is coming from the White House,” said a source said of the seizure that could ultimately force the sale of HNA’s stake in the 575,000-square-foot building. As a reminder, as part of the CFIUS expansion, it now has purview over foreign real estate interests.Under the purview of the CFIUS authority, a "security pretext" needs to exist for direct government involvement, and in this case the seizure is tied to a "specific national security concern": the NYPD’s 17th Precinct is located on the ground floor on the south side of the building. Officers from that precinct, at times, are detailed to protect Trump Tower.The 58-year-old building, once removed by CFIUS from Chinese hands, sources said, will be placed in a trust. A trustee will then be appointed, and it may eventually be sold — although no sales process is underway. While HNA could fight the seizure in a court battle that could take years to sort out, Post sources said.

What FHFA scandals mean for agency's future, GSE reform - The Federal Housing Finance Agency has faced a barrage of negative headlines lately, from a sexual harassment pro of Director Mel Watt to a court ruling declaring the agency's leadership structure unconstitutional.  But will the flood of bad news affect policy related to oversight of Fannie Mae and Freddie Mac?Analysts say the biggest impact of all the attention — albeit negative attention — may be to elevate the profile of an agency that despite its relative obscurity poses significant personnel and policy questions that the administration will have to address sooner or later.  "It’s kind of turning D.C.’s attention to the future of housing finance a little bit more than it has been for some time,” said Ed Mills, a policy analyst at Raymond James. Last month, a three-judge panel for the U.S. Court of Appeals for the Fifth Circuit ruled that the agency's leadership structure, in which a single director is shielded from presidential firing unless there is cause, violates the Constitution. But a more explosive story broke 10 days later in a report by Politico about an investigation into allegations that Watt, an Obama appointee whose term ends in January, made inappropriate sexual advances toward an employee. On Aug. 2, Politico also reported an investigation into the FHFA's inspector general, Laura Wertheimer, for allegedly taking steps to undercut her office's oversight of the agency in response to pressure from Watt. Mills and others said the effects of the recent scandals on the agency's current leadership — and how it handles the conservatorships of the government-sponsored enterprises — are likely limited, mainly because Watt is near the end of his term and attention has already begun to shift to who his successor will be. “If we were at a different point in the five-year term, I think that there would be more of a window for legislative consideration of the FHFA’s governance structure, but given that we’re a few months and possibly even less from President Trump getting to tap the next head of the FHFA, I seriously doubt that either chamber of Congress is likely to focus on this issue,” 

 Fannie Mae, Freddie Mac could need $78B in crisis: FHFA — The mortgage giants Fannie Mae and Freddie Mac could require as much as $78 billion in bailout money in the event of a serious financial crisis, according to stress test results released Tuesday by the Federal Housing Finance Agency. The government-sponsored enterprises would need to draw between $42.1 billion and $77.5 billion from the Treasury Department under the test's "severely adverse" economic scenario, depending on how the enterprises treat their deferred tax assets, the agency said in its report. Under the terms of the senior preferred stock purchase agreements, the GSEs would retain between $176.5 billion and $212 billion under their funding commitment from Treasury.  The projected draw is lower than the estimate from last year, when regulators reported that the GSEs could need nearly $100 billion in a new crisis. In 2016, the agency said that they would need just under $126 billion. The Dodd-Frank Act requires federally regulated financial companies with total assets of more than $10 billion to conduct annual stress tests to assess their ability to withstand an economic crisis. Last year, the FHFA and Treasury agreed to let Fannie and Freddie retain capital buffers of $3 billion each, rather than letting that number fall to zero — the first time the bailout arrangements had been changed in five years. The agency had said this amount would cover the mortgage giants' expected losses from last year's tax overhaul.  Despite the limits on the capital buffers maintained by Fannie and Freddie, the agency said it conducts annual stress tests "in order to provide insight into risk exposure and potential sources of losses in the prescribed conditions," according to the report.  The FHFA said two important factors contributed to losses under the scenario: an increase in the provision for credit losses due to the projected decline in home prices and the impact of a global market shock on trading securities and available-for-sale securities.

Wells Fargo faces probe on low-income tax credit purchases Wells Fargo’s purchase of low-income housing tax credits is being probed by federal government agencies.  The agencies, which the company didn’t identify, are looking into the way Wells Fargo “purchased, and negotiated the purchase of, certain federal low-income housing tax credits in connection with the financing of low-income housing developments,” the San Francisco-based bank said Friday in a filing.  This disclosure marks the latest federal inquiry into Wells Fargo’s conduct. Incorrect fees in the firm’s wealth management unit, inconsistent pricing in the foreign-exchange business, and employees improperly altering documents in the wholesale unit are among other government inquiries at the bank.In February, the Federal Reserve slapped Wells Fargo with a punitive growth ban, in effect until the bank cleans up its act to the regulator’s satisfaction. Chief Executive Officer Tim Sloan has said the bank is committed to making the changes necessary to enhance operational and compliance risk.  The lender said in Friday’s filing that “reasonably possible” legal charges could be as high as $2.2 billion beyond reserves as of June 30. That’s down from $2.6 billion in the previous quarter.

Wells Fargo says hundreds of customers lost homes because of computer glitch -CNN -  Hundreds of people had their homes foreclosed on after software used by Wells Fargo incorrectly denied them mortgage modifications. The embattled bank revealed the issue in a regulatory filing this week and said it has set aside $8 million to compensate customers affected by the glitch.The same filing also disclosed that Wells Fargo (WFC) is facing "formal or informal inquiries or investigations" from unnamed government agencies over how the company purchased federal low-income housing tax credits. The document states the probes are linked to "the financing of low income housing developments," but does not offer further details.Reuters first reported news of investigations and mishandled mortgage modifications on Friday.Wells Fargo said the computer error affected "certain accounts" that were undergoing the foreclosure process between April 2010 and October 2015, when the issue was corrected.About 625 customers were incorrectly denied a loan modification or were not offered one even though they were qualified, according to the filing. In about 400 cases, the customers were ultimately foreclosed upon.A spokesperson for the bank "there's not a clear, direct cause and effect relationship between the modification" denials and foreclosures, but confirmed customers who were denied modifications lost their homes.

It Just Doesn’t Let Up with Wells Fargo - Wolf Richter - Friday afternoon, when no one was supposed to pay attention, Wells Fargo filed its 10-Q quarterly report with the SEC. It’s under “Note 13: Legal Actions,” which starts on page 122 and drags on for four small-print pages. “Note 13” contains Wells Fargo’s long rap sheet of disclosed ongoing government investigations and law suits in alphabetical order. The new item is on page 123:Various unnamed government agencies – it didn’t disclose how many agencies or which agencies – are probing a new matter related to how the bank does business, this time its use of low-income housing tax credits (LIHTC), which is a multi-billion-dollar business for Wells Fargo. Wells Fargo was exceedingly parsimonious with how much it disclosed about this “inquiry” by unspecified “federal government agencies”:Federal government agencies have undertaken formal or informal inquiries or investigations regarding the manner in which the Company purchased, and negotiated the purchase of, certain federal low income housing tax credits in connection with the financing of low income housing developments.That’s all it said about the inquiry. But the numbers are not inconsequential. As of June 30, the bank carried $10.4 billion in low-income housing tax credit investments on its books.  “We invest in affordable housing projects that qualify for the LIHTC, which is designed to promote private development of low-income housing,” it says in the section that discusses these investments on page 99. And it adds: “These investments generate a return mostly through realization of federal tax credit and other tax benefits.”The LIHTC, created under the Tax Reform Act of 1986, hands out incentives (paid for by taxpayers) to the private sector to fund the development or rehabilitation of housing aimed at low-income Americans. “Tax credits” means that Wells Fargo saves this amount dollar-for-dollar on its income taxes and thus increases by that amount its after-tax net profit.Wells Fargo did not say what it was doing in its LIHTC business that aroused the curiosity and/or ire of “federal government agencies,” but typically with these Wells Fargo revelations, it starts out small and then snowballs. So here is my summary of Wells Fargo’s rap sheet of ongoing “matters” under “Note 13: Legal Actions.”

Wells Fargo Apologizes After "Accidentally" Foreclosing Hundreds Of Homes -- Six months after the Fed Slammed Wells Fargo with unprecedented sanctions - no more total asset growth until it cleans up its act - because of a pattern of consumer abuses and other lapses, that list grew over the weekend when the firm said it may have improperly foreclosed on 400 home loans.As The Mercury News reports, Wells Fargo says a company mistake contributed to hundreds of foreclosures because it miscalculated customers’ eligibility for mortgage modifications.The bank said in a filing Friday the error caused about 625 customers to be denied, or not offered, loan modifications they otherwise qualified for. Foreclosures were completed in about 400 of the cases.The customers had been using federal programs that helped families at risk of losing homes. Spokesman Tom Goyda says there’s no breakdown of where the foreclosures occurred.The error in the bank’s underwriting tool lasted from 2010 until it was fixed in late 2015, an internal review found.The American Banker adds that the company accrued $8 million in the second quarter to remediate customers that may have been affected by an automated miscalculation of attorneys' fees between April 13, 2010, and Oct. 20, 2015; and it may pay out more in the future."To the extent issues are identified, we will continue to assess any customer harm and provide remediation as appropriate," Wells said in the filing. Cowen & Co. analyst Jaret Seiberg wrote Monday in a note that “Wells Fargo is not making it easy for the Federal Reserve to lift the asset growth cap," adding that “we don’t know how the Federal Reserve could lift the cap this year. And lifting it next year could become a problem if the Democrats retake the House in November as we expect.”

Senate Dem demands Wells Fargo explain error that led to 400 foreclosures — A Democratic member of the Senate Banking Committee is calling on Wells Fargo to explain a mistake that led to hundreds of customers being denied mortgage adjustments, leading many to lose their homes to foreclosure. On Friday, Wells Fargo disclosed a software mistake that miscalculated eligibility for loan modifications, causing roughly 625 homeowners to be denied a mortgage adjustment. Roughly 400 of those customers later lost their homes to foreclosure. Sen. Brian Schatz, D-Hawaii, questioned the bank’s $8 million compensation fund for homeowners hurt by the errors, which occurred between April 2010 and October 2015. “Foreclosures increase financial insecurity and economic hardship, they cause stress and trauma, and they can lead to related health problems,” Schatz said in a letter to Wells Fargo Chief Executive Timothy Sloan and Board Chair Elizabeth Duke. “It is hard to imagine how Wells Fargo’s estimate of $8 million for remediation would come close to remunerating impacted customers.” The error occurred in a tool Wells uses to determine whether a customer qualified for a mortgage loan modification pursuant to the requirements of government-sponsored enterprises, like Fannie Mae and Freddie Mac, and the Treasury Department’s Home Affordable Modification Program. “The news of this loan modification error is just the most recent incident in two years of negative developments that show a pattern of consumer harm at Wells Fargo,” Schatz said. Schatz noted that beyond Wells Fargo opening as many as 3.5 million fake accounts in customers' names, the bank has charged 570,000 customers for auto insurance they did not need, leading to 20,000 customers having their cars seized. He said the bank “illegally repossessed” over 800 service members’ cars, “wrongly fined” 110,000 mortgage clients, sold brokerage customers “dangerous investments they did not understand,” overcharged small businesses for credit card transactions, and “deceptively sold” customers add-on products, such as pet insurance and legal services. Schatz is also asking the bank to explain the timeline for how it discovered the loan modification error, how it acted on the incident and what further remediation measures it intends to take. He asked Wells why it announced a plan to increase its common stock dividend of 10% and buy back $24.5 billion of stock, rather than using the funds to increase consumer remedies or invest in internal controls.

Fake employer mortgage fraud widespread in California, Fannie warns --  A mortgage scam in California where fraudsters provide fake employer information on loan applications is more widespread than originally suspected, Fannie Mae said in a new fraud alert.Fannie warned lenders about the scam in May, when it was first identified in Southern California. The new alert expands the scope of the fraud to Northern California and also adds 10 alleged fake companies being used on the fraudulent loan applications.It's unclear whether the geographic reach of the scheme has spread since the initial warning or if it was occurring statewide to begin with. However, the fake employers have been found in loan applications taken between 2015 and 2018."If one of these entities is disclosed as the borrower's place of employment, exercise due diligence in reviewing the entire loan file," Fannie Mae advises in the alert. "Lenders must exercise caution in these situations and take appropriate steps."

Treasury urges mortgage sector to embrace digital tech — The Treasury Department's recent report on how to regulate nonbanks drew praise not just from tech startups but also from mortgage industry insiders. In addition to recommendations for a new federal fintech charter and that regulators pull back from payday lending rules, the report contained a section that might be music to a mortgage banker's ears, including support for the industry's automation efforts and another call to soften the use of the False Claims Act against lenders.The report discussed ways to accelerate adoption of electronic promissory notes — or eNotes — in federal mortgage programs, as well as automated appraisals. “My sense right now is that the industry is really at a tipping point in terms of adoption of digital mortgage or e-mortgage technologies,” said Michael Fratantoni, chief economist for the Mortgage Bankers Association. “The technology is there, the industry desire is there, but there are some regulatory hurdles and the Treasury report identified some of them.” Treasury endorsed the use of electronic promissory notes at Ginnie Mae, the Federal Housing Administration and the Federal Home Loan banks, noting that the FHA would first need the budget to do so. The department still uses an older mainframe-based operating system, and officials have emphasized the desperate need for technology upgrades.  But one challenge is that while Fannie and Freddie accept e-mortgages, Ginnie Mae does not, although it has outlined a plan to eventually adopt the technology.  The Home Loan banks also do not currently lend against eNotes, and Treasury recommended that they work toward a goal of “accepting eNotes on collateral pledged to secure advances.”

MBA: Mortgage Applications Decreased in Latest Weekly Survey -- From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey - Mortgage applications decreased 3.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 3, 2018.... The Refinance Index decreased 5 percent from the previous week to its lowest level since December 2000. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 2 percent lower than the same week one year ago. ...The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) remained unchanged at 4.84 percent, with points remaining unchanged at 0.45 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.

Mortgage application volume keeps tumbling - Mortgage applications declined for the fourth consecutive week as interest rates remained at high levels.The overall index fell 3% after dropping 2.6% a week ago, according to the Mortgage Bankers Association. On an unadjusted basis, the index also fell 3% from last week.The refinance index led the overall waning of applications by falling 5% for the week ending Aug. 3. This marks the index reaching its lowest point since December 2000. The refinance share of application activity decreased to 36.6% from 37.1% the week prior.The purchase index fell 2% both on seasonally adjusted and unadjusted bases since last week. It was also 2% lower year-over-year.  "Despite recent data indicating a strong U.S. economy and job market, including signs of wage growth, overall mortgage applications fell," Joel Kan, the MBA's associate vice president of economic and industry forecasting, said in a press release. "Housing continues to be hampered by the lack of homes for sale and crimped affordability."Adjustable-rate loan activity went back down to 6.3% from 6.4% of total applications. The share of applications for Federal Housing Administration-guaranteed loans stayed static at 10.4%, Veterans Affairs-guaranteed loans inched up to 10.6% from 10.5%, while U.S. Department of Agriculture/Rural Development held again at 0.8%.The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) held constant at 4.84%. The average for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) fell two basis points to 4.74%.The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA rose to 4.83% from 4.78%. The average for 15-year fixed-rate mortgages decreased, going to 4.26% from 4.29%. The average contract interest rate for 5/1 ARMs fell to 4.07% from its historic highest point of 4.17%.

Could California Flame Out? -  The phone rang early the other day. “Well, our center’s still standing,” my partner said. “The fire’s only a couple blocks from us, the whole town of Lakeport’s been evacuated. I think we’ll be ok, but it’s out of control.” That fire is still raging as of this writing, the town is empty, the stores are closed, our shopkeepers are suffering daily losses that, while nothing compared to the loss of life and home that California’s wildfires are claiming, will never be recovered.  Not so very long ago I thought that global warming was a tragedy of epic proportions, but that it would have at least a few winners: Southern California might become truly unbearable, but Eureka would be the next Laguna Beach. I was wrong again. Writing in the New York Times about Montana, Sara Vowell summarized it like this, “Here in the Mountain West, there are no longer four seasons, only two: winter and wildfire.”  In California, we pay the highest taxes in America. No other state has a base sales tax as high as our 7.25% nor does any state match our top marginal income tax rate of 13.3% (Hawaii’s a distant second at 11%). One resigned pundit called it a “Shangri-La tax,” the price we must pay to live in the Golden State. And thanks to what passes for political brilliance in Congress, Shangri-La became way more expensive as of January 1st when the Republicans eliminated the deductibility of state income taxes at the federal level, smacking the high-tax Democratic states they already had no chance of winning. All things being equal (they never are), a rich liberal will pay another 6.5% or so in federal taxes for the privilege of living in California this year. Thus far, the vast majority of us are staying put, tax increases notwithstanding. According to the Legislative Analyst’s Office, the California Legislature’s non-partisan fiscal advisor, California lost about a million residents to other states from 2007 to 2016 (5 million in, 6 million out), a low population loss by historic standards. Of interest – and not surprising given our cost of living – the out-migration was greatest among the least educated. In contrast, the state had net positive in-migration among the affluent ($110,000 plus annual incomes) and those with graduate school levels of education.

CoreLogic: House Prices up 6.8% Year-over-year in June - Note: The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA). From CoreLogic: CoreLogic Reports June Home Prices Increased by 6.8 Percent, Millennials Identify Affordability as Biggest HurdleCoreLogic® ... today released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for June 2018, which shows home prices rose both year over year and month over month. Home prices increased nationally by 6.8 percent year over year from June 2017 to June 2018. On a month-over-month basis, prices increased by 0.7 percent in June 2018 compared with May 2018, according to the CoreLogic HPI. Looking ahead, the CoreLogic HPI Forecast indicates that the national home-price index is projected to continue to increase by 5.1 percent on a year-over-year basis from June 2018 to June 2019. On a month-over-month basis, home prices are expected to be flat from June to July 2018. The CoreLogic HPI Forecast is a projection of home prices that is calculated using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.“The rise in home prices and interest rates over the past year have eroded affordability and are beginning to slow existing home sales in some markets,” said Dr. Frank Nothaft, chief economist for CoreLogic. “For June, we found in CoreLogic public records data that home sales in the San Francisco Bay Area and Southern California were down 9 and 12 percent, respectively, from one year earlier. Further increases in home prices and mortgage rates over the next year will likely dampen sales and home-price growth.” CR Note: The CoreLogic YoY increase has been in the 5% to 7% range for the last few years.  This is near the top end of that range.  The year-over-year comparison has been positive for over six consecutive years since turning positive year-over-year in February 2012.

In expensive cities, rents fall for the rich — but rise for the poor - U.S. cities struggling with soaring housing costs have found some success in lowering rents this year, but that relief has not reached the renters most at risk of losing their housing. Nationally, the pace of rent increases is beginning to slow down, with the average rent in at least six cities falling since last summer, according to Zillow data. But the decline is being driven primarily by decreasing prices for high-end rentals. People in low-end housing, the apartments and other units that house working-class residents, are still paying more than ever. Since last summer, rents have fallen for the highest earners while increasing for the poorest in San Francisco, Atlanta, Nashville, Chicago, Philadelphia, Denver, Pittsburgh, Washington and Portland, Ore., among other cities. In several other metro areas — including Los Angeles, Las Vegas, Houston and Miami — rents have risen for the poor and the rich alike. The ongoing increase in prices for low-end renters poses a challenge for city officials who have vowed to lower housing costs for working-class residents already struggling with tepid wage growth in the U.S. economy. City officials have said a boom in luxury housing construction would cause rents to fall for everyone else, arguing that creating new units for those at the top would ease competition for cheaper properties. In part based on that theory, cities have approved thousands of new luxury units over the past several years, hoping to check high rents that have led more than 20 million American renters to be classified as “cost burdened,” defined as spending more than 30 percent of one’s income on housing. But although some advocates say the dividends could still pay off for low-income renters, others say more direct government action is needed to prevent poor residents from being forced out of their cities or into homelessness. They have called for the federal government to help construct more affordable units, or offer greater rental assistance for poor families. 

 The New Housing Crisis: Shut Out Of The Market - Ten years after the housing collapse during the Great Recession, a new and different housing crisis has emerged. Back then, people were losing their homes as home values crashed and homeowners went underwater. Today, home values have rebounded, but people who want to buy a new home are often priced out of the market. There are too few homes and too many potential buyers.Home construction per household is now at its lowest levels in nearly six decades, according to researchers at the Federal Reserve Bank of Kansas City. This isn't just a problem in San Francisco or New York, where home prices and rents have gone sky-high. It is also a problem in midsized, fast-growing cities farther inland, like Des Moines, Iowa; Durham, N.C.; and Boise, Idaho. In Boise, an analysis by the U.S. Department of Housing and Urban Development showed there is a demand for more than 10 times the number of homes being built right now.  We asked our audience to weigh in on their own searches for affordable homes. We heard from hundreds of people across the country who attested to hard times finding a house and prices that were rarely affordable. They wrote about being priced out of urban areas, and out of the neighborhoods in which they wanted to buy. Bidding wars were lost for homes in Michigan, Seattle and North Carolina. Student loan debt is making it impossible for a couple in New Orleans and a family in Portland to save for a down payment.

Betsy DeVos’s summer home deserves a special place in McMansion Hell -- Two weeks ago, somebody untied Secretary of Education Betsy DeVos’s $40 million yacht from its mooring. It got me thinking about another opulent display of wealth owned by DeVos: her 22,000-square-foot nautical-themed summer mansion, located in Holland, Michigan. Just a few more years of climate change and it’ll be floating too. My mission for the past three years as the creator of the architectural humor blog McMansion Hell has been to unpack what makes mansions like DeVos’s so terrible, from both an architectural and social standpoint. It’s bad enough that we have a president who oversaw a massive redistribution of wealth toward the already wealthy through tax breaks. Trump official and fellow rich person DeVos just rolled back Obama administration loan forgiveness rules for students defrauded by for-profit colleges. It’s unsurprising that she doesn’t want to forgive the student loan debts of those defrauded by for-profit colleges considering that she got her net worth of more than $1 billion from her husband’s company, the multilevel marketing giant Amway, which is often described as a cult. Meanwhile, her brother Erik Prince owns the Blackwater firm, which essentially sells mercenaries. As we can see, we are not dealing with nice people. As someone who owes tens of thousands of dollars in student loan debt, getting paid to make fun of DeVos’s tacky seaside decor is one of few ways to both feed myself and make myself feel better. With that, I’d like to dedicate this essay to all of the public school teachers who taught me how to write.

"A Stealth Mortgage On Your House" - The Reality Of The Looming Pension Crisis - Money manager Rob Arnott and finance professor Lisa Meulbroek have run the numbers on underfunded pension plans and come up with an interesting – and highly concerning – new angle: That they impose a “stealth mortgage” on homeowners. Here’s how the Wall Street Journal reported it today: The Stealth Pension Mortgage on Your House Most cities, counties and states have committed taxpayers to significant future unfunded spending. This mostly takes the form of pension and postretirement health-care obligations for public employees, a burden that averages $75,000 per household but exceeds $100,000 per household in some states. Many states protect public pensions in their constitutions, meaning they cannot be renegotiated. Future pension obligations simply must be paid, either through higher taxes or cuts to public services.Is there a way out for taxpayers in states that are deep in the red? Milton Friedman famously observed that the only thing more mobile than the wealthy is their capital. Some residents may hope that they can avoid the pension crash by decamping to a more fiscally sound state.But this escape may be illusory. State taxes are collected on four economic activities: consumption (sales tax), labor and investment (income tax) and real-estate ownership (property tax). The affluent can escape sales and income taxes by moving to a new state—but real estate stays behind. Property values must ultimately support the obligations that politicians have promised, even if those obligations aren’t properly funded, because real estate is the only source of state and local revenue that can’t pick up and move elsewhere. Whether or not unfunded obligations are paid with property taxes, it’s the property that backs the obligations in the end.When property owners choose to sell and become tax refugees, they pass along the burden to the next owner. And buyers of properties in troubled states will demand lower prices if they expect property taxes to increase.It doesn’t matter if we own or rent; landlords pass higher taxes on to tenants. Nor does it matter if properties are mortgaged to the hilt or owned outright. In time, unfunded pension obligations will be reflected in real-estate prices, if they aren’t already. A state’s unfunded liabilities are effectively a stealth mortgage on private property. Think you can pass your property on to your heirs? Only net of the unfunded pension obligations.

Leading Index for Commercial Real Estate Increases in July  --From Dodge Data Analytics: Dodge Momentum Index Increases in July The Dodge Momentum Index moved 1.4% higher in July to 169.8 (2000=100) from the revised June reading of 167.3. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. In July, the commercial component of the Momentum Index grew by 3.3%, while the institutional component fell 1.5%. The headline Momentum Index has risen steadily since its slippage during the third quarter of 2017. Stronger economic growth and the support from still-healthy real estate market fundamentals (occupancies and rents) have contributed to these gains for construction projects at the planning stage, which have yet to be restrained by the uncertainty arising from higher material costs and higher interest rates.This graph shows the Dodge Momentum Index since 2002. The index was at 169.8 in July, up from 167.3 in June.  According to Dodge, this index leads "construction spending for nonresidential buildings by a full year". This suggests further growth into 2019.

Update: Framing Lumber Prices Fall from Record Highs, Up 20% Year-over-year --Here is another monthly update on framing lumber prices.   Lumber prices declined in July from the recent record highs, but are still up sharply year-over-year.This graph shows two measures of lumber prices: 1) Framing Lumber from Random Lengths through July 27, 2018 (via NAHB), and 2) CME framing futures. Right now Random Lengths prices are up 15% from a year ago, and CME futures are up about 23% year-over-year.  There is a seasonal pattern for lumber prices. Prices frequently peak around May, and bottom around October or November - although there is quite a bit of seasonal variability. Tariffs on lumber, steel and aluminum are impacting housing costs.   And rising costs - both material and labor - are headwinds for the building industry this year.

Bankruptcy filings surge among older Americans - For an increasing number of older Americans, life in retirement is the diametric opposite of the “golden years.” Instead of being comfortably cushioned by a pension and Social Security, a significant section of the senior population faces dwindling income, vanishing pensions, inadequate savings, mounting health care costs and rising debt. Debt collectors are visiting them at their low-paying jobs or knocking at their door. A new study by the Consumer Bankruptcy Project finds that this “perfect storm” of adversity is translating into desperation. “When the costs of aging are offloaded onto a population that simply does not have access to adequate resources, something has to give,” the study states, “and older Americans turn to what little is left of the social safety net—bankruptcy court.”The research documented in “The Graying of US Bankruptcy: Fallout for Life in a Risk Society,” finds that the rate of people 65 and older filing for bankruptcy is three times what it was in 1991. The same age group also accounts for a far greater share of all bankruptcy filers. The study suggests that this surge in filings by seniors is being driven by a three-decade-long shift of financial risk from the government and employers to individuals.Seniors must wait longer for full Social Security benefits (age 70 rather than 65), defined benefit pensions have been replaced with 401(k)s, and older people are spending more out of pocket for medical care not covered by Medicare. Stagnant and declining incomes, job loss and the inability to find a decent-paying job to make ends meet are compounding the problem. Many seniors are one illness, accident or income drop away from financial ruin.The Consumer Bankruptcy Project, in operation since 1981, is currently led by the authors of the study: Deborah Thorne, University of Idaho; Robert M. Lawless, University of Illinois; Pamela Foohey, Indiana University and Katherine Porter, University of California, Irvine. The project, financed by their universities, collects and analyzes court records of bankruptcy filings. Their latest study is based on sample personal bankruptcy cases and questionnaires filled out by 895 filers, ages 19 to 92. Excerpts from the questionnaires give a glimpse of the respondents’ precarious personal and financial situations.

"Their Wealth Has Vanished": Baby Boomers File For Bankruptcy In Droves - An alarming number of older Americans are being forced into bankruptcy, as the rate of people 65 and older who have filed has never been higher - at three times what it was in 1991, while the rate of bankruptcies among Americans age 65 and older has more than doubled, according to a new study by the The Bankruptcy Project.  Older Americans are increasingly likely to file consumer bankruptcy, and their representation among those in bankruptcy has never been higher. Using data from the Consumer Bankruptcy Project, we find more than a two-fold increase in the rate at which older Americans (age 65 and over) file for bankruptcy and an almost five-fold increase in the percentage of older persons in the U.S. bankruptcy system. The magnitude of growth in older Americans in bankruptcy is so large that the broader trend of an aging U.S. population can explain only a small portion of the effect.  The median senior filing bankruptcy enters the system $17,390 in debt, vs. an average net worth of $250,000 for their non-bankrupt peers.  According to the study, a three-decade shift of financial risk from government and employers to individuals is at fault, as aging Americans are dealing with longer waits for full Social Security benefits, 401(k) plans replacing employer-provided pensions and more out-of-pocket spending on items such as health care.   “When the costs of aging are off-loaded onto a population that simply does not have access to adequate resources, something has to give,” the study says, “and older Americans turn to what little is left of the social safety net — bankruptcy court.”“You can manage O.K. until there is a little stumble,” said Deborah Thorne, an associate professor of sociology at the University of Idaho and an author of the study. “It doesn’t even take a big thing.”The data gathered by the researchers is stark. From February 2013 to November 2016, there were 3.6 bankruptcy filers per 1,000 people 65 to 74; in 1991, there were 1.2.Not only are more older people seeking relief through bankruptcy, but they also represent a widening slice of all filers: 12.2 percent of filers are now 65 or older, up from 2.1 percent in 1991.The jump is so pronounced, the study says, that the aging of the baby boom generation cannot explain it.Although the actual number of older people filing for bankruptcy was relatively small — about 100,000 a year during the period in question — the researchers said it signaled that there were many more people in financial distress. –NYT

Retail Collapse: Here Are 2018's 57 Biggest Store Closings --Closed storefronts are typical in American cities across shopping malls that once flourished in commercial zones of suburbia are now empty and abandoned. As the retail apocalypse deepens, more than 3,800 stores are expected to close across the country this year. Department stores like Kmart, Macy’s, Sears, and JCPenney, and retailers including Best Buy, Payless, BCBG, Abercrombie & Fitch, and Bebe have decided to close dozens of locations. A new report by real estate research firm Reis noticed that shopping malls had not been the empty since 2012, CNBC reported. The vacancy rate at regional and super-regional malls in the U.S. reached 8.6 percent in the second quarter of 2018, up from 8.4 percent in the prior quarter. The increased vacancy rate is simultaneously occurring while online retailing giant Amazon continues to acquire a more significant share of the consumption pie.According to Reis, the vacancy rate of malls could significantly jump over the next several years. Even Credit Suisse believes 25 percent of shopping malls will shut their doors by 2022. As shoppers move online and mall traffic declines, NJ Advance Media has provided a complete and  startling list of the 57 biggest retail chains shuttering storefronts as of recent:

 US Credit Card Debt Shrinks For Only Second Time Since 2013 As Student, Auto Loans Hit All Time High - One month after a near record surge in consumer credit driven by a spike in credit card debt, the US consumer went into mini hibernation to start the summer, when total consumer credit rose by just $10.2 billion, far below the $15 billion estimate, bringing the consumer credit - both revolving and non-revolving - total to $3.908 trillion. And while non-revolving credit, i.e. student and auto loans, maintained its monthly ascent in line with the historical trend, growing by $10.4 trillion, the surprise was the unexpected shrinkage in revolving, or credit card debt, which declined by $185 million in June; this was only the second drop in US credit card debt since 2013, with March of 2018 the only other recent decline. And while the shrinkage in credit card debt will prompt some questions about the resilience of the US consumer as the US economy entered the summer, the recent dramatic upward revision to personal savings notwithstanding, one place where there were no surprises, was in the total amount of student and auto loans: here we got the latest quarterly update for Q2 and, as expected, both numbers hit fresh all time highs, with a record $1.532 trillion in student loans outstanding, an increase of $8 billion in the quarter, auto debt also hit a new all time high of $1.131 trillion, an increase of $18 billion in the quarter.

BLS: CPI increased 0.2% in July, Core CPI increased 0.2% -- From the BLS:The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in July on a seasonally adjusted basis after rising 0.1 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.9 percent before seasonal adjustment. The index for shelter rose 0.3 percent in July and accounted for nearly 60 percent of the seasonally adjusted monthly increase in the all items index. The food index rose slightly in July, with major grocery store food group indexes mixed. The energy index fell 0.5 percent, as all the major component indexes declined.The index for all items less food and energy rose 0.2 percent in July, the same increase as in May and June. … The all items index rose 2.9 percent for the 12 months ending July, the same increase as for the period ending June. The index for all items less food and energy rose 2.4 percent for the 12 months ending July; this was the largest 12-month increase since the period ending September 2008.

July 2018 CPI --Well, for two months in a row, non-shelter core inflation has been near a 2% annualized rate.  That's something.  If it's a trend, then maybe the Fed isn't ahead of the curve in their efforts to tighten up. I still expect this to increase the Fed's confidence about rate hikes, leading to overtightening.  In fact, today the yield curve has flattened on the news.  Interestingly, market estimates of Fed hikes have pulled back slightly.  I might have expected the short end of the curve to move up while the long end moves down.

Consumer Price Index: July Headline at 2.95% - The Bureau of Labor Statistics released the July Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 2.95%, up from 2.87% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 2.25%, up from the previous month's 2.26% and above the Fed's 2% PCE target.  Here is the introduction from the BLS summary, which leads with the seasonally adjusted monthly data: The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in July on a seasonally adjusted basis after rising 0.1 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.9 percent before seasonal adjustment.  The index for shelter rose 0.3 percent in July and accounted for nearly 60 percent of the seasonally adjusted monthly increase in the all items index. The food index rose slightly in July, with major grocery store food group indexes mixed. The energy index fell 0.5 percent, as all the major component indexes declined. The index for all items less food and energy rose 0.2 percent in July, the same increase as in May and June. Along with the shelter index, the indexes for used cars and trucks, airline fares, new vehicles, household furnishings and operations, and recreation all increased. The indexes for medical care and for apparel both declined in July.  The all items index rose 2.9 percent for the 12 months ending July, the same increase as for the period ending June. The index for all items less food and energy rose 2.4 percent for the 12 months ending July; this was the largest 12-month increase since the period ending September 2008. The food index increased 1.4 percent over the last 12 months, and the energy index rose 12.1 percent. [More…]  Investing.com was looking for a 0.2% MoM change in seasonally adjusted Headline CPI and 0.2% in Core CPI. Year-over-year forecasts were 3.0% for Headline and 2.3% for Core.  The first chart is an overlay of Headline CPI and Core CPI (the latter excludes Food and Energy) since the turn of the century. The highlighted two percent level is the Federal Reserve's Core inflation target for the CPI's cousin index, the BEA's Personal Consumption Expenditures (PCE) price index.

FAO Food Price Index posts sharp drop in July. - Global agricultural food commodity prices fell sharply in July, as all the major traded items posted notable declines, led by dairy and sugar.  The FAO Food Price Index averaged 168.8 points, 3.7 percent below their June level, the biggest monthly drop since late last year. The index had been steadily rising in 2018 until June.  The FAO Food Price Index is a measure of the monthly change in international prices of a basket of commodities.  The FAO Dairy Price Index led the slide, declining 6.6 percent, with butter and cheese quotations dropping faster than those for whole and skim milk powders. The FAO Sugar Price Index fell 6 percent to a nearly three-year low, largely driven by improved production prospects in India and Thailand, both important sugar-producing countries. Expectations of lower output in Brazil, the world's largest producer and exporter, limited the fall in international sugar prices.  The FAO Cereal Price Index declined 3.6 percent from June and is now below its year-ago level. Export quotations for wheat, maize and rice all declined, although wheat and maize values edged higher towards the end of July.  The FAO Vegetable Oil Price Index was 2.9 percent lower, its sixth consecutive monthly decline, and is now at its lowest level since January 2016. Part of the July slide was driven by spill-over weakness from the soybean market, which is affected by the trade dispute between China and the United States of America. Rapeseed oil values trended upwards, however, buoyed by improved demand from biodiesel producers and negative crop prospects in the European Union.  The FAO Meat Price Index declined 1.9 percent from its June value, which was revised up in the wake of higher beef export prices from Brazil due to a truck drivers' strike.

Early Look at 2019 Cost-Of-Living Adjustments and Maximum Contribution Base -- The BLS reported this morning:  The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 3.2 percent over the last 12 months to an index level of 246.155 (1982-84=100). For the month, the index was unchanged prior to seasonal adjustment. CPI-W is the index that is used to calculate the Cost-Of-Living Adjustments (COLA). The calculation dates have changed over time (see Cost-of-Living Adjustments), but the current calculation uses the average CPI-W for the three months in Q3 (July, August, September) and compares to the average for the highest previous average of Q3 months. Note: this is not the headline CPI-U, and is not seasonally adjusted (NSA).  In 2017, the Q3 average of CPI-W was 239.668. Last year was the highest Q3 average, so we have to compare Q3 this year to last year.This graph shows CPI-W since January 2000. The red lines are the Q3 average of CPI-W for each year.Note: The year labeled for the calculation, and the adjustment is effective for December of that year (received by beneficiaries in January of the following year). CPI-W was up 3.2% year-over-year in July, and although this is very early - we need the data for August and September - my current guess is COLA will probably be close to 3% this year, the largest annual increase since 2012. The contribution base will be adjusted using the National Average Wage Index. This is based on a one year lag. The National Average Wage Index is not available for 2017 yet, but wages probably increased again in 2017. If wages increased the average of the last three years, then the contribution base next year will increase to around $132,000 in 2019, from the current $128,400.   Remember - this is an early look. What matters is average CPI-W for all three months in Q3 (July, August and September).

July Producer Price Index: Core Final Demand Up 0.1% MoM -- Today's release of the July Producer Price Index (PPI) for Final Demand came in at 0.0% month-over-month seasonally adjusted, down from last month's 0.3%. It is at 3.3% year-over-year, down from 3.4% last month, on a non-seasonally adjusted basis. Core Final Demand (less food and energy) came in at 0.1% MoM, down from 0.3% the previous month and is up 2.7% YoY NSA. Investing.com MoM consensus forecasts were for 0.2% headline and 0.2% core.Here is the summary of the news release on Final Demand:The Producer Price Index for final demand was unchanged in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.3 percent in June and 0.5 percent in May. On an unadjusted basis, the final demand index increased 3.3 percent for the 12 months ended in July.In July, a 0.1-percent rise in the index for final demand goods offset a 0.1-percent decline in prices for final demand services.The index for final demand less foods, energy, and trade services moved up 0.3 percent in July, the same as in June. For the 12 months ended in July, prices for final demand less foods, energy, and trade services climbed 2.8 percent. More… The BLS shifted its focus to its new "Final Demand" series in 2014, a shift we support. However, the data for these series are only constructed back to November 2009 for Headline and April 2010 for Core. Since our focus is on longer-term trends, we continue to track the legacy Producer Price Index for Finished Goods, which the BLS also includes in their monthly updates.As this (older) overlay illustrates, the Final Demand and Finished Goods indexes are highly correlated.

US Producer Prices Tame in July -- A measure of business inflation showed signs of moderating in July. The producer-price index, a measure of the prices businesses receive for their goods and services, was flat in July from a month earlier, the Labor Department said Thursday. A core measure of prices, which excludes the volatile food and energy categories, was up 0.1% in July from the prior month. Rising oil prices and improved demand from U.S. consumers and businesses have helped push the annual index for overall prices higher over time. Even that measure took a pause at 3.3% in July after clocking in at 3.4% in June. The producer-price report also specifically tracks intermediate demand prices, or the cost charged for goods and services sold to businesses as inputs in production. This is an indicator of cost pressures building in the pipeline for many businesses, which can be a precursor to broader inflation. On a monthly basis, prices for processed goods for intermediate demand were unchanged. That gauge is up nearly 7% from a year earlier, well outpacing prices for final demand, but matching the June rate. “Since we’ve seen them ease back a little bit over the past couple of months, I think it is going to be a pretty gradual pickup in the underlying pace of inflation,” Still, pipeline price pressures are elevated and could translate into a further pickup in consumer prices if businesses choose to pass along cost increases.

Econoday Economic Report: PPI-FD August 9, 2018: Wholesale inflation pressures were surprisingly subdued in July, with producer prices for final demand remaining unchanged after advancing 0.3 percent in June and 0.5 percent in May, as a 0.1 percent rise in the index for final demand goods offset a 0.1 percent decline in prices for final demand services. Producer prices less food & energy moved up just 0.1 percent, also below most expectations, though prices excluding food, energy and trade services did show some pressure by rising 0.3 percent, the same as in June and at the top of the range of analysts' expectations. The flat monthly reading for overall producer prices pulled down the year-on-year rate by 0.1 percentage points from the prior month to 3.3 percent, while the year-on-year rate for prices excluding food and energy also fell back by 0.1 percentage points to 2.7 percent. Only prices excluding food, energy and trade services registered an increase in the year-on-year gain, which rose to 2.8 percent, up 0.1 percentage points from the level in June. Factors pulling down the overall inflation reading featured a 0.5 percent drop in energy prices after a 0.8 percent rise in June. Electric power prices fell 1.6 percent on the month, gasoline was down 0.1 percent, natural gas prices fell 0.5 percent, and the price of heating oil fell 3.9 percent. Pulling down the overall index and the services component were prices in trade services, reflecting margins received by wholesalers and retailers, which fell by a sharp 0.8 percent in July following increases of 0.7 percent in June and 0.9 percent in May. The drop in services prices was the first monthly decline since December, and among products was led by retail margins for fuels and lubricants, which fell 12.7 percent. In contrast, prices for guestroom rental rose 3.9 percent.The 0.1 percent increase in prices for final demand goods was the same as in June, and led by a 0.7 rise in prices of pharmaceutical preparations. Also moving higher were prices for eggs, fresh fruits, motor vehicles and liquefied petroleum. Conversely, prices for energy, meats, and nonferrous scrap decreased. Foods prices as a whole continued to decline though at a much slower pace, with final demand prices falling 0.1 percent after a 1.1 percent drop in June. Lastly, personal consumption prices, which some analysts regard as a preview of the CPI (reported tomorrow morning and expected to show a 0.2 percent monthly gain), were down 0.1 percent in July after rising 0.3 percent in June and 0.5 percent in May. 

Wholesale Sales Slump In June (graphs) Wholesale Trade Sales were hit with a double-whammy, revised notably lower in May and dropping 0.1% MoM in June. Wholesale inventories rose a modest 0.1% MoM leaving inventories-to-sales flat on the month. Expectations were for a 0.2% rise in June after a 2.5% gain in May but the entire curve dropped with a 0.1% drop in June after a revised lower 2.1% gain in May... Inventory growth slowed in June... On a YoY basis, both sales and inventory growth slowed... The scale of June's data shifts suggests very modest shifts in GDP forecasts (if at all)

US June wholesale inventories revised higher (Reuters) - U.S. wholesale inventories were slightly higher in June than previously reported, with sales posting their biggest drop in five months. The Commerce Department said on Thursday wholesale inventories edged up 0.1 percent instead of being unchanged as it reported last month. Stocks at wholesalers rose 0.3 percent in May. They increased 5.1 percent year-on-year in June. The component of wholesale inventories that goes into the calculation of gross domestic product - wholesale stocks excluding autos - gained 0.2 percent in June. There was an outright inventory liquidation in the second quarter. As a result inventories subtracted a full percentage point from gross domestic product in the April-June quarter. The economy grew at a 4.1 percent annualized rate during that period, the fastest in nearly four years. Against the backdrop of strong domestic demand, businesses are likely to boost stocks of goods, which should underpin production at factories. Economists expect a significant contribution from inventory accumulation to GDP growth in the third quarter. In June, wholesale auto inventories fell 1.2 percent after declining 1.5 percent in May. Machinery inventories increased 0.8 percent after May’s 1.7 percent surge. Stocks of farm products tumbled 6.5 percent after dropping 2.6 percent in May. Sales at wholesalers dipped 0.1 percent in June, the largest drop since January, following a 2.1 percent jump in May. At June’s sales pace it would take wholesalers 1.25 months to clear shelves, unchanged from May. 

Annual Vehicle Sales: On Pace to decline slightly in 2018  -- The BEA released their estimate of July vehicle sales. The BEA estimated sales of 16.68 million SAAR in July 2018 (Seasonally Adjusted Annual Rate), down 3.1% from the June sales rate, and down slightly from July 2017.Through July, light vehicle sales are on pace to be down slightly in 2018 compared to 2017.This would make 2018 the sixth best year on record after 2016, 2015, 2000, 2017 and 2001.My guess is vehicle sales will finish the year with sales lower than in 2017 (sales in late 2017 were boosted by buying following the hurricanes). A small decline in sales this year isn't a concern - I think sales will move mostly sideways at near record levels. As I noted last year, this means the economic boost from increasing auto sales is over (from the bottom in 2009, auto sales boosted growth every year through 2016).This graph shows annual light vehicle sales since 1976.     Sales for 2018 are estimated based on the pace of sales during the first seven months.

U.S. Heavy Truck Sales up 13% Year-over-year in July The following graph shows heavy truck sales since 1967 using data from the BEA. The dashed line is the July 2018 seasonally adjusted annual sales rate (SAAR). Heavy truck sales really collapsed during the great recession, falling to a low of 181 thousand in April and May 2009, on a seasonally adjusted annual rate basis (SAAR). Then sales increased more than 2 1/2 times, and hit 480 thousand SAAR in June 2015. Heavy truck sales declined again - probably mostly due to the weakness in the oil sector - and bottomed at 364 thousand SAAR in October 2016. With the increase in oil prices over the last year, heavy truck sales increased too.Heavy truck sales were at 464 thousand SAAR in July, down from 485 thousand SAAR in June, and up from 409 thousand SAAR in July 2017.

AAR: July Rail Carloads Up 3.5% YoY, Intermodal Up 6.9% YoY -- From the Association of American Railroads (AAR) Rail Time Indicators. Graphs and excerpts reprinted with permissionAll things considered, U.S. rail traffic did well in July 2018. Total originated carloads were up 3.5%, or 35,208 carloads, compared with July 2017. That’s the fifth straight year-over-year monthly gain.…Intermodal volume in July on U.S. railroads was up 6.9%, the largest percentage increase in 19 months. 2018 will be another record year for intermodal. This graph from the Rail Time Indicators report shows U.S. average weekly rail carloads (NSA).  Light blue is 2018.  Rail carloads have been weak over the last decade due to the decline in coal shipments.U.S. railroads originated 1,048,293 carloads in July 2018, up 3.5%, or 35,208 carloads, over July 2017. Weekly average total carloads were 262,073 in July 2018, the most for July since 2015. July’s 3.5% gain is the fifth straight year-over-year monthly increase; four of those increases were more than 3%. The second graph is for intermodal traffic (using intermodal or shipping containers): U.S. intermodal originations totaled 1,108,142 containers and trailers in July 2018, up 6.9%, or 71,782 units, over July 2017. Average weekly intermodal volume in July 2018 was 277,036 units, easily the most ever for July.

 Weekly Unemployment Claims: Down 6K - Here is the opening statement from the Department of Labor: In the week ending August 4, the advance figure for seasonally adjusted initial claims was 213,000, a decrease of 6,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 218,000 to 219,000. The 4-week moving average was 214,250, a decrease of 500 from the previous week's revised average. The previous week's average was revised up by 250 from 214,500 to 214,750. [See full report]  This morning's seasonally adjusted 213K new claims, down 6K from the previous week's revised figure, was better than the Investing.com forecast of 220K.   Here is a close look at the data over the decade (with a callout for the past year), which gives a clearer sense of the overall trend in relation to the last recession.

BLS: Job Openings "Little Changed" in June --Notes: In June there were 6.662 million job openings, and, according to the June Employment report, there were 6.564 million unemployed. So, for the third consecutive month, there were more job openings than people unemployed. Also note that the number of job openings has exceeded the number of hires since January 2015. From the BLS: Job Openings and Labor Turnover Summary The number of job openings was little changed at 6.7 million on the last business day of June, the U.S. Bureau of Labor Statistics reported today. Over the month, hires and separations were little changed at 5.7 million and 5.5 million, respectively. Within separations, the quits rate was unchanged at 2.3 percent and the layoffs and discharges rate was little changed at 1.2 percent. ... The number of quits was little changed in June at 3.4 million. The quits rate was 2.3 percent. The number of quits was little changed for total private and for government.  The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS. This series started in December 2000. Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for June, the most recent employment report was for July.Note that hires (dark blue) and total separations (red and light blue columns stacked) are pretty close each month. This is a measure of labor market turnover.  When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.Jobs openings increased slightly in June to 6.662 million from 6.659 million in May. The number of job openings (yellow) are up 9% year-over-year. Quits are up 7% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for "quits"). Job openings are at a high level, and quits are increasing year-over-year. This was a strong report.

More Job Openings Than Unemployed Workers For Third Consecutive Month - There was a surprising development back in June, when that month's JOLTS report revealed a curious, if welcome for the US economy, inflection point: for the first time in reported BLS data, the number of US job openings surpassed the number of unemployed workers.Fast forward two months, when as the BLS reported last Friday, the number of unemployed workers increased from 6.0 million to 6.3 million (after hitting 6.6 million in July). The question was whether this increase would also reverse this Opening-Unemployed trend. However, as the just released June JOLTS report revealed, for the third month in a row the number of job openings stayed above the total number of unemployed workers, as May's 6.638MM job openings number was revised higher to 6.659MM, yet which rose modestly again to 6.662MM in June which was once again  comfortably above the 6.280MM unemployed workers. This means that June was the third consecutive month in which the number of job openings was higher than the number of unemployed Americans. In other words, in an economy in which there was a perfect match between worker skills and employer needs, there would be zero unemployed people at this moment (which of course is not the case.) According to the BLS, the number of job openings increased in educational services (+20,000) but decreased in transportation, warehousing, and utilities (-84,000). The number of job openings was little changed in all four regions. Adding to the exuberant labor picture, while job openings remained above total unemployment, the number of total hires also remained just shy of a new record, at 5.561 million in June, down slightly from 5.747 million in May, and on the verge of an all time high. The number of hires s increased in finance and insurance (+31,000). According to the historical correlation between the number of hires and the 12 month cumulative job change (per the Establishment Survey), either the pace of hiring needs to drop, or else the number of new jobs will rise significantly in the coming months.Meanwhile, last month's biggest surprise, the record number of Americans quitting the job - the so-called "take this jobs and shove it" indicator which shows worker confidence that they can leave their current job and find a better paying job elsewhere - dipped modestly in June, from a record 3.480MM to 3.402MM, but still just shy of a record print, with the BLS reporting that biggest number of quits in educational services (-14,000). Putting all this in in context

  • Job openings have increased since a low in July 2009. They returned to the prerecession level in March 2014 and surpassed the prerecession peak in August 2014. There were 6.7 million open jobs on the last business day of June 2018.
  • Hires have increased since a low in June 2009 and have surpassed prerecession levels. In June 2018, there were 5.7 million hires.
  • Quits have increased since a low in September 2009 and have surpassed prerecession levels. In June 2018, there were 3.4 million quits.
  • For most of the JOLTS history, the number of hires (measured throughout the month) has exceeded the number of job openings (measured only on the last business day of the month). Since January 2015, however, this relationship has reversed with job openings outnumbering hires in most months.
  • At the end of the most recent recession in June 2009, there were 1.2 million more hires throughout the month than there were job openings on the last business day of the month. In June 2018, there were 1.0 million fewer hires than job openings.

Real wages decline YoY, while real aggregate payrolls grow - With the consumer price report this morning, let's conclude this weeklong focus on jobs and wages by updating real average and aggregate wages. Through July 2018, consumer prices are up 2.9% YoY, while wages for non-managerial workers are up 2.7%. Thus real wages have actually declined YoY: In the longer view, real wages have actually been flat for nearly 2 1/2 years: Because employment and hours have increased, however, real *aggregate* wage growth has continued to increase: Real aggregate wages -- the total earned by the American working and middle class -- are now up 25.8% from their October 2009 bottom. Finally, because consumer spending tends to slightly lead employment, let's compare YoY growth in real retail sales, measured quarterly (red), with that in real aggregate payrolls (blue): Here's the monthly close-up on the last 10 years: Since late last year real retail sales growth has accelerated YoY, so we should expect the recent string of good employment reports to continue for at least a few more months.

GM threatens of plant shutdowns and layoffs as car sales fall -- The United Auto Workers and General Motors are reportedly collaborating to close one or more of the company’s five remaining car assembly plants and throw thousands more workers onto the unemployment lines as car sales continue to fall. Overall sales for the company were up, driven by sales of its line of SUVs and pickup trucks. However, passenger car sales continue to fall. In May, overall domestic car sales were down by over 11 percent. Sales of General Motors’ popular Chevrolet Cruze fell by over 26 percent from 51,265 in the second quarter of 2017 compared to just 37,836 in the second quarter of this year. The Cruze is manufactured at the company’s Lordstown, Ohio assembly plant, and is one of the plants that could possibly close according to press speculation. In June, the company eliminated its second shift at Lordstown, impacting 1,500 workers. Many of those workers had 20 years service with General Motors. In January, 2017 the company eliminated the third shift, laying off 1,500 workers at the time.In the months before laying off the second shift at Lordstown, the United Auto Workers entered into an agreement with the company to hire temporary workers from a subsidiary of General Motors, GM Subsystems LLC, at wages starting as low as $9.00 an hour, to fill many jobs at the plant such as maintenance and forklift drivers. Four other assembly plants could face possible shutdown according to press speculation including passenger car plants located in Kansas City, Kansas and Lake Orion, Detroit-Hamtramck, and Lansing, Michigan. Three out of the five car assembly plants are working just one shift. In all, the five plants are working at just 37 percent of capacity, meaning 1.3 million more cars could be made each year at the plants. A veteran worker at the Lordstown plant spoke about the threat to close more GM plants. “It will hit this area hard, in particular Youngstown. I am tired of GM bullying us around. I have seen this plant go from 15,000 workers down to 1,200. Overall, General Motors’ sales were up 4.6 percent for the second quarter, driven by sales of SUVs and pickup trucks. But rather than shift production to its car plants, the company has been able to boast production at its SUV and truck plants with the assistance of the United Auto Workers enforcing overtime and increased and unsafe line speeds. Several of GM’s truck and SUV plants are working three shifts at 105 percent of capacity.

Missouri referendum vote kills “right-to-work” law -- Tuesday’s primary election in the state of Missouri including a referendum vote on the “right-to-work” law enacted by the Republican-controlled state legislature in 2017 and signed by Republican Governor Eric Greitens. The law was massively repudiated, with 67 percent voting to overturn it and only 33 percent voting to uphold it.  The two-to-one margin was a surprise to union officials who organized the petition drive to force the referendum, and a shock for the state Republican Party, which controls both houses of the legislature by wide margins, as well as the governorship. It is notable that the landslide defeat of the legislation came in a primary where slightly more voters chose Republican ballots than Democratic ballots—an indication that large numbers of workers who voted Republican also voted against the right-to-work law. The Missouri State AFL-CIO mounted the petition drive last year to collect the 100,000 signatures needed to place the “right-to-work” referendum on the ballot. The drive won widespread support among working people, with more than 300,000 signing the petition, far more than the number required. The campaign leading up to the referendum vote was even broader, involving visits to more than 800,000 homes and more than 1,000 workplace meetings. There is no question that in the Missouri referendum, hundreds of thousands of workers saw the right-to-work law as an attack on their rights by big business and responded accordingly. It was an expression of the more general shift to left among working people, expressed in the wave of teachers’ strikes, the overwhelming strike votes by workers at UPS, and the widespread opposition to the Trump administration’s persecution of immigrants and refugees.

 Separate is still unequal: How patterns of occupational segregation impact pay for black women - On average, in 2017, black women workers were paid only 66 cents on the dollar relative to non-Hispanic white men, even after controlling for education, years of experience, and geographic location. A previous blog post dispels many of the myths behind why this pay gap exists, including the idea that the gap would be closed by black women getting more education or choosing higher paying jobs. In fact, black women earn less than white men at every level of education and even when they work in the same occupation. But even if changing jobs were an effective way to close the pay gap black women face—and it isn’t—more than half would need to change jobs in order to achieve occupational equity. Figure A plots the “Duncan Segregation Index” (DSI) for black women and white men, overall and by education, based on individual occupation data from the American Community Survey (ACS). This is a common measure of occupational segregation, which, in this case identifies what percentage of working black women (or white men) would need to change jobs in order for black women and white men to be fully integrated across occupations. Values of the DSI can range from 0 percent (complete integration) to 100 percent (complete segregation). As shown in Figure A, there has been little progress on reducing occupational segregation between black women and white men since 2000. From 2000 to 2016 (latest data year available), the DSI only changed from 59 percent to 56 percent. This means that on average, 56 percent of black women (or white men) would need to change occupations in order to achieve occupational equity, or full integration of these two groups in the workforce.  Given that differences in education and skills influence the sorting of workers into specific jobs, we also present estimates of the DSI by education level in Figure A. These estimates reveal that there is less occupational segregation between black women and white men at higher levels of education. In 2016, the DSI for black women and white men with a high school diploma or less was 62 percent, while for those with 1–2 years of college the index decreases marginally to 60 percent. Although the DSI is 19 percentage points lower for those with advanced degrees than for those with a high school education or less, no matter how much education a black woman invests in, there is still an extremely high probability that she will not be employed in the same job as a similarly educated white man.

 A New UPS Union Contract Shows How Online Shopping Is Dragging Down Delivery Jobs -  Pretty soon there may be a new kind of delivery driver working alongside Ken Smith at his UPS facility in Tempe, Ariz. ― drivers who do pretty much the same work, only for less pay and over the weekend. Smith’s union, the Teamsters, is negotiating a new five-year collective bargaining agreement with UPS that will cover a whopping 260,000 workers. The tentative agreement that’s been reached would create a new class of “hybrid” drivers who would have two duties: sorting packages at UPS facilities and delivering them out on the truck. Their work week would include Saturdays and likely Sundays as well. The new classification would grant some relief to harried drivers like Smith who want to avoid weekend work and help UPS become more nimble in the hyper-competitive age of Amazon. But it comes with a big catch. The new employees would work on a lower pay scale than current full-time drivers, starting and topping out at lower hourly rates. They also wouldn’t enjoy the same limits on forced overtime, opening them up to long work weeks. The way Smith sees it, those factors would essentially make the new drivers second-class within the union and potentially drive down the standards for everyone over the long term. “What’s the job worth if there’s a guy next to me making six bucks less an hour? This devalues the job of a driver,” said Smith, a 22-year UPS veteran. “We should be pulling everyone else up, which is allegedly what unions helped do in the past.” This new classification of worker has stirred intense debate among UPS workers, many of whom aren’t pleased their union may create what they consider a two-tier work system. Both the union and UPS have recently hosted nationwide calls with drivers trying to sell members on the contract. Although a date has not been set, it’s likely Teamsters members would vote on the tentative agreement sometime within the next two months.  

Construction workers building UPS super-hub in Indianapolis walk off job -- A video of a wildcat walkout by construction workers building a new UPS super-hub in Indianapolis went viral after its posting last Tuesday. In a testament to the growing radicalization and dissatisfaction of the working class it has been shared almost 100,000 times and has received about 3 million views on Facebook at the time of this writing.  Antoine Dangerfield, a contracted welder who shot the video, was fired shortly after publishing it. UPS and representatives from the construction contractor reportedly offered him $250 to take it down, an offer that he refused.  The workers were predominantly Hispanic and, according to Dangerfield, walked out because of the actions of a racist supervisor who he said would photograph and record workers. According to Dangerfield, workers would warn each other whenever he approached. After a confrontation in which some workers refused to translate at a safety meeting, he fired several people, prompting the remaining workers to walk out. In an attempt to contain anger and minimize the significance of what happened, the construction contractor fired the supervisor. Conversely, Dangerfield, who did little more than film the event, also lost his job.This walkout occurred despite the attacks by Immigration and Customs Enforcement (ICE), still fresh in workers’ memory, and the xenophobia being promoted up by the ruling class internationally.  In June, ICE staged raids on an Ohio meatpacking plant as part of an attempt to terrorize the immigrant population and intimidate the working class more broadly, seeking to whip up an atmosphere of xenophobia. ICE agents armed to the teeth pulled workers out of the plant, separated native-born and immigrant workers, and arrested those who were unable to provide papers.

 Over 130 immigrant workers arrested in ICE raids in Minnesota and Nebraska --Immigration and Customs Enforcement (ICE) and the Department of Homeland Security (DHS), in collaboration with a broad assortment of other federal, state and local police agencies, carried out a massive, coordinated series of raids in Northern Nebraska and Southern Minnesota Wednesday to detain and deport immigrant workers on the fraudulent pretext of defending workers from exploitation and abuse by their employers.The operation, targeting primarily agricultural workers, represents a significant escalation of Trump’s reign of terror and comes in the midst of ongoing efforts by the Democrats and the bulk of the corporate media to play down the administration’s war on immigrants. Instead, the Democratic Party continues to focus its efforts on seeking to whip up hysteria against Russia and attack Trump as a stooge of Russian President Vladimir Putin.All workers must be warned that the ongoing and escalating series of workplace raids are test runs for attacks on native-born as well as immigrant workers, as the government builds its repressive apparatus in preparation for mass working-class struggles. The entire working class must mobilize to demand a halt to the attack on immigrants and the dismantling of the Gestapo-like immigration agencies ICE and Border and Customs Protection (BCP).Beginning Wednesday morning and lasting into the afternoon, between 350 and 400 agents of various security agencies arrived at roughly a dozen workplaces in full military-style gear, demanding immigration documents before detaining at least 14 employers on fraud, wire fraud and money laundering charges, along with 134 workers. The raids were concentrated in the town of O’Neill, Nebraska, located 160 miles northwest of Omaha. The operation was one of the largest in the 15-year history of the Department of Homeland Security, which claimed the raids were the culmination of a months-long investigation into a scheme involving identity fraud, wage theft and physical abuse inflicted on the workers by the business owners, whom DHS claimed were targeted in the operation. Workers swept up in the raids were supposedly going to be processed and released unless prior criminal convictions warranted the initiation of deportation proceedings, in which case they would remain in ICE custody.

Black Chicagoans Blast "Con Man" Mayor Emanuel Amid Record Shooting Spree, Ask Trump For Help --77 people were shot last week in Chicago, 9 fatally, but the rate of shootings has accelerated aggressively today as 'HeyJackass' reports "30 shot in 3 hours is the most shot in the least amount of time we’ve recorded in 5+ years. The previous record was July 4-5, 2016 w/ 29 shot in 6 hours." Amid this carnage, ABC7Chicago reports that, police said there was a "trauma lockdown" at Stroger Hospital with only immediate family members of victims are being allowed in the emergency room. A spokeswoman for Stroger Hospital disputes the police account. "Over the past 24 hours, Stroger's trauma unit received an unusually high volume of patients. At no time did Stroger go on bypass or 'lockdown' its trauma unit," the spokeswoman said. "We are asking the families of trauma patients to limit visitation at this time to immediate family members only so staff may focus on patient care. " But, judging by the protests this week - that will shock the mainstream media narrative out of much of America - Chicagoans (particularly black inner city citizens) are furious at Mayor Rahm Emanuel's impotence and are asking President Trump for help. As Fox News reports, demonstrators took to the streets of Chicago this week to call for the resignation of Mayor Rahm Emanuel (D), blasting his administration for failing to curb the city's gun violence epidemic.Protesters expressed their outrage over the lack of economic development on the South and West Sides of the city, compared to the North Side, as gang violence continues to plague their neighborhoods."Rahm Emanuel is a con man. His whole job is to keep black folks divided," one man told Fox News' Gianno Caldwell, who covered the march.One woman said Thursday that Emanuel "doesn't care about anybody" except his own neighborhood and his own family, while another woman said Emanuel seems to care more about illegal immigrants in the city."African-Americans, we're citizens, and our ancestors built this country," she told Caldwell, whose younger brother survived a shooting last year that killed his best friend.

Tennessee carries out first execution in nearly a decade --Tennessee executed Billy Ray Irick on Thursday in the first execution in the state in nearly a decade. Irick, 59, was convicted and sentenced to death for the brutal 1985 rape and murder of 7-year-old Paula Dyer in Knoxville. He spent more than three decades on death row. Irick’s attorneys had argued both that their client should not be put to death because he suffered from severe mental illness, and that one of the drugs to be used in his lethal injection could cause severe pain. There is evidence that Irick did indeed suffer a torturous death. Journalists witnessing the execution reported that the blinds between the witness room and the death chamber were opened at 7:26 p.m. local time. Asked if he had any final words, Irick at first said “No,” and then said, “I just want to say I’m really sorry and that, that’s it.” The lethal injection drugs then began to flow. A minute later, the Associated Press (AP) reported, his eyes closed and snoring and heavy breathing could be heard. At 7:34 p.m. there was “coughing, huffing and deep breaths,” and an attendant called out to him and grabbed his shoulder to check for consciousness. According to the Death Penalty Information Center (DPIC), federal public defender Kelley Henry said Irick exhibited signs of pulmonary edema (fluid filling the lungs) during the execution, which took more than 20 minutes. She said media witnesses reported that “Mr. Irick ‘gulped for an extended period of time,’ was ‘choking,’ ‘gasping,’ ‘coughing,’ and that ‘his stomach was moving up and down.’” Henry described Irick moving his body, including his head, after the attendant’s consciousness check. “This means that the second and third drugs were administered even though Mr. Irick was not unconscious,” Henry said. This suggests that the first drug, midazolam, did not sufficiently sedate Irick, making the second two drugs in the protocol extremely painful. After Irick’s coughing and huffing, according to the AP, he was not making any noise and “began to turn dark purple.” He was pronounced dead at 7:48 p.m. By many accounts, Irick suffered from severe mental illness. According to Knoxville TV station WBIR, he was an uncontrollable child who was regularly tied up and beaten by his parents. As a young child he underwent psychological evaluation for what a teacher described as “extreme behavioral issues.”

 West Virginia Impeaches Entire State Supreme Court, Will Return To Trial By Combat During Changeover, Probably -- Up here in “liberal elite” land, the news that West Virginia impeached all of their state supreme court judges was met with some skepticism. It is a dramatic move, from a state not known for its thoughtful consideration of public policy. My elitist, kneejerk reaction upon reading the headline was that West Virginia threw the baby out with the moonshine, probably because a few judges refused to grant the right of prima nocta to some coal baron. But, you know, one of the things that liberal elites like to do is read, and when you read why the West Virginia House Judiciary Committee passed 14 counts of impeachment against their remaining state supreme judges, it kind of looks like trying to remove the whole lot of them was the only right thing to do. Each judge is charged with maintaining an “unnecessary and lavish” lifestyle “amid an atmosphere of entitlement.” Again, that doesn’t sound like it would get a judge impeached in a “real” state, until you get to the specific allegations. From the ABA Journal: All four justices are accused of overspending on office renovations, and failing to establish policies for the use of state resources, including cars and computers.Among the four justices is Allen Loughry, who was suspended without pay before he was indicted in June on federal charges that include fraud, lying to federal agents and trying to influence the grand jury testimony of a court employee.The other justices named in the impeachment articles are Chief Justice Margaret Workman and Justices Robin Davis and Beth Walker. The criminal charges against Loughry are based on allegations that he used a government vehicle and credit card to buy gas on personal trips, lied about his involvement in pricey renovations at the court, and used a state-owned antique desk at his home. He is charged in eight draft articles of impeachment, the most of any justice.

Eleven children rescued from New Mexico compound after ‘we’re starving’ note  - Eleven children were rescued by police after they were discovered living in squalid conditions in a makeshift compound in rural northern New Mexico in the United States. Taos County Sheriff’s officials said the children, ranging in age from one to 15, were removed from the compound in the small community of Amalia 233km north-east of Albuquerque and in an isolated high-desert area near the New Mexico-Colorado border. Three women, believed to be the mothers of the children, were detained and later released. Sheriff Jerry Hogrefe said they were “the saddest living conditions and poverty” he has seen in 30 years on the job. He said that other than a few potatoes and a box of rice, there was little food in the compound, which consisted of a small travel trailer buried in the ground and covered by plastic with no water, plumbing or electricity. The starving children were handed over to state child-welfare workers. Sheriff Hogrefe said two men were arrested during the search, which came amid a two-month investigation in collaboration with authorities in Clayton County, Georgia, and the FBI. He said FBI agents had surveilled the area a few weeks ago but did not find probable cause to search the property. Siraj Wahhaj was detained on an outstanding warrant in Georgia alleging child abduction and Lucas Morten, was jailed on suspicion of harbouring a fugitive.

Suspect arrested at New Mexico compound was training children for school shootings, officials say - The suspected child abductor found last week with 11 children and four other adults at a squalid New Mexico compound had trained at least one of the minors to use an assault rifle in preparation for a school shooting, prosecutors said in court documents filed on Wednesday. The children, who officials have said were between the ages of 1 and 15, were taken to the compound by some adults for the purpose of receiving weapons training for future acts of violence, the documents said.Siraj Ibn Wahhaj, who was wanted on suspicion that he had abducted his 3-year-old son, was arrested along with four other adults after Taos County officials raided the barren property in the midst of scrubland in Amalia, N.M., on Friday. Prosecutors are asking that all four adults, who are each charged with 11 counts of felony child abuse, be held without bail. They are Lucas Allen Morten, 40, who prosecutors said was in joint control of the property and have charged with harboring a felon because they said he was knowingly giving aid to Siraj Wahhaj; Hujrah J. Wahhaj, 37, a sister of Siraj Wahhaj; Subhannah A. Wahhaj, 35, another sister; and Jany N. Leveille, 35. The women are believed to be the mothers of some, if not all, of the children.A judge ordered the group to be held without bond on Wednesday.The arrests were the culmination of a months-long search for the missing child, Abdul-Ghani Wahhaj. The young boy was not among the 11 children found at the property, and investigators are working to identify a child’s remains that they say they found in the area after getting a second search warrant. The search for Abdul-Ghani began nine months ago in Jonesboro, Ga., where his mother told police that her husband had taken him to a park and never returned. The boy was encephalopathic, had trouble walking, suffered from seizures and required an emergency medication that the father did not have, his mother told police, according to a report in the Clayton News-Daily from December. Abdul-Ghani and his father had been seen that month traveling through Alabama with several other children and adults. They had been involved in an accident and given an officer who helped them the impression that they were going to New Mexico for camping.

"Heavily Armed" Muslim Extremists Arrested In NM; Trained 11 Children To Commit School Shootings - Authorities looking for a missing 4-year-old Georgia boy say his father and another man were training nearly a dozen children at a remote New Mexico compound to commit school shootings with assault rifles, reports AP.  While police didn't find the toddler, Abdul-ghani Wahhaj - who went missing in December in Jonesboro, Georgia - authorities discovered 11 other children ranging in age from 1 to 15 years old held in "the saddest living conditions and poverty I have seen," while the remains of a boy were also found on the compound which have not yet been positively identified by medical examiners. Authorities say the father of the 3-year-old told the mother that he wanted to perform an exorcism on the child, and that he was bringing the boy to a park after which he never returned.  Siraj Ibn Wahhaj, 39, and Lucas Morten were operating the makeshift compound in Amalia, New Mexico, and were described as "heavily armed and considered extremist of the Muslim belief" by Taos County Sheriff Jerry Hogrefe said in a statement posted to the agency's Facebook page on Saturday.  Sheriff Hogrefe said authorities surveiled the compound and decided to obtain a search warrant immediately after a Georgia investigator forwarded a message from someone at the compound who reportedly said they were starving and needed water.  On Friday morning, August 3, 2018, eight members of TCSO’s Sheriff’s Response Team (SRT) were assisted by four members of the State OSI unit when they executed the search warrant. The “all day” operation went without major incident or any injuries, but when encountered both men initially refused to follow verbal direction and Wahhaj who was held up inside the compound was heavily armed with an AR15 rifle, five loaded 30 round magazines, and four loaded pistols, including one in his pocket when he was taken down. Many more rounds of ammo were found in the makeshift compound that consists of a small travel trailer buried in the ground covered by plastic with no water, plumbing, or electricity – “But what was most surprising, and heartbreaking was when the team located a total of five adults and 11 children that looked like third world country refugees not only with no food or fresh water, but with no shoes, personal hygiene and basically dirty rags for clothing.”  “The message sent to a third party simply said in part, ‘We are starving and need food and water,’” Hogrefe said. “I absolutely knew that we couldn’t wait on another agency to step up and we had to go check this out as soon as possible.” While the suspects initially refused to surrender to authorities, they later taken into custody without injury. Three women believed to be the children's mothers were initially released after questioning Friday but were later arrested on charges of neglect and child abuse after further investigation, according to Police.

Arizona teachers return to classrooms with limited gains and broken promises -- Arizona teachers, who conducted the largest of the statewide walkouts last spring, are now returning to the classroom still woefully underpaid. The promises of Republican Governor Doug Ducey and the Arizona Education Association (AEA) that the strike’s settlement would mean a ten percent pay increase for all educators this year—and 20 percent by 2020—have already been broken. The scope of the massive betrayal of the powerful strike movement in Arizona is becoming painfully apparent.In the aftermath of the six-day strike, the state legislature approved a $306 million increase to education funding, a pitifully inadequate amount in light of the past decade of systematic budget cuts. When the strike erupted, Arizona was spending a whopping $1.1 billion less than it did in 2008 on public education, having cut per-pupil spending by a shocking 36.6 percent. Under the new measures, districts are receiving starkly varying increases via a complicated formula, further compounding the effects of failing to fully fund schools. Rural schools have been severely shortchanged, with three districts reporting drops in average pay. Meanwhile teachers are reporting pay increases well below the promised rate: at Littlefield Unified, teachers received a 3 percent increase; Patagonia Public Schools 3.5 percent; and Santa Cruz Elementary 4 percent. Santa Cruz will give its maintenance staff a mere 2 percent pay increase. Other districts are reportedly refusing to give the pay hikes to new hires.  An analysis by the Arizona Republic showed 56 districts unable to increase teacher salaries by the promised 10 percent. In a letter to staff explaining this fact, Phoenix Union Superintendent Chad Gestson said the state's allocations were enough for only 6.7 percent raises and limited the number of teachers eligible for the award. Only 17 teachers, 1 percent, in PUSD will receive the 10 percent raise this year.Arizona teacher pay is so low that that even were educators to receive a 20 percent bump, they would still remain below the median pay for educators nationally! According to the Nogales International, other school workers currently at the state minimum wage of $10.50 will see a negligible pay increase to $12 an hour by 2020, with an annual “step increase” of 1.5 percent.

Mass exodus of South Carolina teachers continues --  With the 2018-2019 school year scheduled to begin on August 20 in South Carolina, the state is facing the prospect of an even greater shortage of teachers than at the start of the previous school year. Poor working conditions and salaries far below the national average have driven teachers away for years in what has been called a “mass exodus” from the state and, in many cases, from the profession.The average salary for South Carolina teachers is $48,769, close to $10,000 below the national average. The starting salary for new hires was until recently $30,113. The 2018-2019 state budget will give them a raise, bringing their salary to a still inadequate $32,000.In addition to low pay for teachers, overall funding for schools is criminally low. State law mandates $2,959 in per pupil spending each year. The state has failed to meet that requirement for almost a decade. During the 2017-2018 school year, per pupil spending by the state stood at $2,425. The new budget for 2018-19 adds $60 per pupil. With 727,513 students anticipated during the 2018-2019 school year, that amounts to about 345 million legally mandated dollars the schools will not receive.  A study published in January by the Center for Educator Recruitment, Retention and Advancement (CERRA) found that by the end of the 2016-17 school year, 6,705 teachers left their jobs. While some went to work in other South Carolina school districts, about 4,900 of these teachers were no longer teaching in any South Carolina school. Twenty-two percent of first-year teachers left at some point during or at the end of their first year and are no longer working in South Carolina public schools. The 2017-2018 school year opened with 550 teaching positions vacant statewide, an increase of 16 percent over the year before. CERRA reports that one third of those vacant teaching positions were concentrated in the Pee Dee region where many districts “have high rates of teacher turnover and extreme levels of poverty.” This region is home to many of the districts which make up South Carolina’s notorious “Corridor of Shame,” a poverty-stricken area along Interstate 95 where the schools are literally falling apart and receive even less funding than other parts of the state.

School-Shooting Insurance Is A Real Thing - And Its On the Rise -School shootings in the United States have become so ubiquitous that while legislators continue to try to "ban guns" – the effect of which has resulted in no meaningful legislation and seemingly no prevention of incidence – insurance companies like McGowan Program Administrators are stumbling onto an unfortunate realization: school shooting insurance is necessary and in demand. They have written over 300 of these policies already.  The Wall Street Journal reported in an article out on August 2 that local schools, private schools and some universities are starting to purchase what is called "active-assailant" insurance for peace of mind:“It at least gives us some peace of mind that, in the event of horrible tragedy, we can begin to put things in place,” said Lance Erlwein, treasurer of Belpre City Schools, a district of 1,000 students in southeastern Ohio, which purchased a plan last year that includes a $25,000 death benefit per victim and trauma counseling. “Fifteen years ago who would have ever thought you would need something like this. It’s awful that schools have become the target.”If this insurance isn’t a direct byproduct of the growing number of active shooter incidents in the United States, it's probably also helped along by the media's intent to vigorously cover such incidents and harp on them for days, sometimes weeks, after they occur.While the ideas of armed security in schools and better mental health checks to prevent such incidents continue to be written off by most mainstream politicians, schools and universities are faced with a brutal reality of having to assess the liability of an active shooter situation, should it occur, on their grounds.  As the Wall Street Journal noted, the cost for such incidents – which include not only things like funerals and counseling, but also liability from lawsuits - is enough to make these institutions want to consider this type of insurance. More than 150 children and adults have been killed in school shootings since 1990, according to a Wall Street Journal review. Scores more were either injured or traumatized by the incidents.

Social media posts could ruin your college dreams, lawyer warns - RT -- Merely following Alex Jones on Twitter almost cost one teen a college admission. Another lost his scholarship over a Facebook message about the 2016 election. Anything you post can and will be used against you, a lawyer tells RT.   “It’s absolutely troubling what some of the colleges are doing,” attorney Bradley Shear, who specializes in social media cases, told RT. Many universities are hiring monitoring companies that comb the social media lives of applicants, even going so far as to spy on their search histories and internet activity. “This is a very problematic situation,” Shear said. “It’s a very big problem and it’s only getting worse.” Top universities are increasingly using social media tracking firms to screen and reject applicants - simply for following the "wrong people." In this case - @RealAlexJoneshttps://t.co/EnhzNeeW0Upic.twitter.com/IWx406e08d— Keith Lee (@associatesmind) August 8, 2018 Shear shared a story about one client of his, a 17-year-old who was asked in his college admission interview why he followed Alex Jones on Twitter. Last week, half a dozen platforms banded together to ban, block and delete the accounts of Jones and his InfoWars show. The teen had never liked or retweeted any of Jones’s content – his “transgression” was merely following the conspiracy theorist on Twitter, Shear explained. The way he tackled the case was by going to the college and arguing the admissions interviewer displayed improper political bias.  Another client wasn’t so lucky, losing a $250,000 scholarship and admission to “one of the most prestigious universities in the world” over an emoji and like on a Facebook post related to the 2016 presidential election.

UCLA Makes Students Pay Classmates To Promote "Social Justice" - The University of California-Los Angeles has hired 18 students at $13 per hour to combat “social injustices” and “privilege and oppression” following a semester-long recruitment campaign.   Hosted by the UCLA Intergroup Relations Program, the Diversity Peer Leaders project is a year-long internship during which students facilitate workshops on social justice issues in exchange for leadership training and compensation from UCLA. According to the job application, each DPL is paid $13 an hour in exchange for working 30-45 hours during each of UCLA’s four academic quarters, including summer.  If all students put in just 30 hours per quarter, the program would cost at least $28,080 annually, but if all the DPLs were to work the maximum hours, the cost would rise to at least $42,120 per year. Reached by Campus Reform, a UCLA spokesman did not dispute these estimates, but stressed that the program is funded by the school’s Students Services Fee, rather than tuition or taxpayer dollars. That $376 per term fee is not optional, costing each student $1,128 every academic year. Over a four-year degree, the fee amounts to at least $4,512 - more if a student takes longer to graduate. UCLA student Arik Schneider mocked the DPL program as “a project of the Department of Redundancy Department,” asserting that “all the goals of this project seems to already be facilitated by multiple other programs, groups, and systems” on campus. Schneider - who is also the Chairman of the school’s Young Americans for Liberty chapter - also criticized the way that UCLA requires students to fund the program.  “Students should only be forced to subsidize programs which are necessary. It is the perfect example of the worst of Big Government, Big Bureaucracy. It does nothing and turns into a bottomless pit for money,” Schneider told Campus Reform.  The money could be spent elsewhere, he suggested.

Conservative Students Feel Pressure To Self-Censor To Succeed On Campus - A new study reveals that conservative college students cope with left-leaning professors by self-censoring during class discussions and parroting their professors’ political views on homework assignments.  The study, “Students’ Religiosity and Perceptions of Political Bias: Some Empirical Lessons for Sociology Professors,” was led by Jeremiah Wills, a political science professor at Queens University of Charlotte in North Carolina. To learn about conservative students, Wills and his team surveyed 394 students at Wayne State University using an online questionnaire. Survey questions were designed to gauge students’ political stance, and whether that stance impacts students’ behavior in class. For example, students were asked to report if they felt the need to “censor their own political beliefs to preserve their grade” and if, while doing homework, they “feel obligated to incorporate their professors’ beliefs rather than their own.”  The study is the first of its kind to “document a link between religious and conservative and moderate students’ perceptions of political bias in the classroom and their reactions to such perceived biases,” Wills noted during an interview with Campus Reform. However, Wills asserted that more research needs to be done.  “We simply do not know how often this happens or how many students have such negative experiences in the classroom. This needs to be established by additional research,” he noted. “That these undesirable student experiences happen at all, however, is problematic.” If students feel the need to censor themselves, Wills warns, this may “derail” the learning experience.

Colleges: A Force For Evil | Zero Hedge -  Many of the nation’s colleges have become a force for evil and a focal point for the destruction of traditional American values. The threat to our future lies in the fact that today’s college students are tomorrow’s teachers, professors, judges, attorneys, legislators and policymakers. A recent Brookings Institution poll suggests that nearly half of college students believe that hate speech is not protected by the First Amendment. Of course, it is. Fifty-one percent of students think that it’s acceptable to shout down a speaker with whom they disagree. About 20 percent of students hold that it’s acceptable to use violence to prevent a speaker from speaking, over 50 percent say colleges should prohibit speech and viewpoints that might offend certain people.  Contempt for the First Amendment and other constitutional guarantees is probably shared by the students’ high school teachers, as well as many college professors.Brainwashing and indoctrination of young people has produced some predictable results, as shown by a recent Gallup Poll. For the past 18 years, Gallup has asked adults how proud they are to be Americans. This year, only 47 percent say they are “extremely proud,” well below the peak of 70 percent in 2003. The least proud to be Americans are nonwhites, young adults and college graduates. The proudest Americans are those older than 50 and those who did not graduate from college. The latter might be explained by their limited exposure to America’s academic elite. Johnetta Benton, a teacher at Hampton Middle School near Atlanta, was recorded telling her sixth-grade students, “America has never been great for minorities.”In a tirade, she told her class: “Because Europeans came from Europe … you are an immigrant. You are an illegal immigrant because you came and just took it. … You are an immigrant. This is not your country.”  At the same school, students were given a homework assignment that required them to write a letter asking lawmakers for stricter gun control laws.

"Revolutionary" Professors Allow Students To Pick Their Own Grades -- A literature class at Davidson College this fall will usecontract grading,” allowing students to pick ahead of time their grade for the class and the workload they need to complete to earn it. The offer is posed by Professor Melissa Gonzalez for her Introduction to Spanish Literatures and Cultures course, SPA 270, at the private liberal arts college in Davidson, North Carolina. She is one of several professors across the nation who allow this pick-your-own grade method, billed as a way to eliminate the student-professor power differential and give students control of their education. But critics contend it is just another example of how colleges coddle students from the harsh realities of the real world, which includes competition and goal expectations. As for Gonzalez, she argues there is “a strong pedagogical rationale for contract grading” in an Aug. 1 email to students obtained by The College Fix. “It can help students focus on learning more than on grades, and therefore make more progress in their learning, with less anxiety.” Gonzalez did not respond to repeated email requests for comment from The College Fix. “I aim to foster classroom environments that are radically democratic and empower intellectual risk-taking,” Gonzalez states in her profile on the school’s website. In her email, Gonzalez urged her former students to sign up for SPA 270, indicating that only two students have enrolled thus far and the class is in danger of being canceled.  Gonzalez is a Hispanic Studies professor who also teaches in the Gender and Sexuality Studies department. In her email, she told students they could “sign a contract indicating the work that they will do in order to earn that grade.” “At the end of the semester, if the student completed the specific work they said they would, at the satisfactory level, they receive the grade they planned to receive,” her email states.

For Many College Students, Hunger Can ‘Make It Hard To Focus In Class’ As students enter college this fall, many will hunger for more than knowledge. Up to half of college students report that they were either not getting enough to eat or were worried about it, according to published studies.“Food insecurity,” as it’s called, is most prevalent at community colleges, but it’s common at public and private four-year schools as well. Student activists and advocates in the education community have drawn attention to the problem in recent years, and the food pantries that have sprung up at hundreds of schools are perhaps the most visible sign.Some schools are also using the Swipe Out Hunger program, which allows students to donate their unused meal plan vouchers, or swipes, to other students to use at campus dining halls or food pantries.  Those “free dining passes have given me chances to eat when I thought I wouldn’t be able to,” one student wrote to the program. “I used to go hungry and that would make it hard to focus in class or study. [The passes] really helped my studying and may have helped me get my GPA up.”Pantries and food passes are good band-aids, but more system-wide solutions are needed, advocates say.   Part of the disconnect may stem from a misperception about what today’s students are really like, said Katharine Broton, an assistant professor in educational policy and leadership studies at the University of Iowa who has published research on food and housing insecurity in colleges. Many of them don’t fit the profile of a “typical” student who attends a four-year institution full time and doesn’t have a job, Broton said. Rather, about 40 percent of students today are working in addition to going to school, and nearly 1 in 4 are parents.

Another consequence of high college costs: Foreclosure - The high cost of college may have exacerbated the foreclosure crisis. That’s according to a study published earlier this week in the journal Demography.The study from researchers at New York University and Cornell University found that between 2005 and 2011 a 1% increase in college attendance among 19-year-olds from median-income households correlated with 19,000 additional foreclosures the following year.“College expenses are so high that some families are finding creative ways to make ends meet,” said Peter Rich, a professor of policy analysis and management at Cornell and one of the authors of the study. “When the economy contracts that can really make them vulnerable and financially overextended,” he said. The study adds another dimension to the large body of evidence indicating that high college costs are affecting family finances and the economy more broadly. The high levels of student debt families often have to assume to afford college is delaying homeownership among young people, changing the calculus of retirement among baby boomers and exacerbating the racial and gender wealth gaps, other research indicates.The latest study also suggests that growing college costs may have played a role in one of the most devastating financial events in recent memory: The foreclosure crisis. After accounting for the increase in subprime lending and the depressed labor market during the study period, the researchers found there were still additional foreclosures taking place and their data indicates those are related to families stretching financially to afford colleges.They speculate the stretching happens in two ways, Rich said. Some families may have leveraged their home equity to help pay for college and, when the economy contracted, they couldn’t afford their payments any longer. In other cases, families, faced with the choice of making a mortgage payment or a tuition payment during tough economic times may have prioritized the tuition payment. “Some may have chosen were going to send our child to college, that’s more important,” Rich said.

Deceased and still in debt: the student loans that don't get forgiven -- In 2005, Sean Bennett took out a student loan with Sallie Mae, in 2010 he graduated from college and in 2011, when Sean was 23 years old, he died in a car accident. At first, Sallie Mae sent out a letter of condolence to Sean’s parents explaining that they had a policy of forgiving debt if the recipient dies before they have repaid. Their policy of debt forgiveness is available on their website but it’s also in a file which Sean’s parents have meticulously maintained. Five years went by as Sean’s family tried to rebuild their lives without a son and a brother. Then, in 2017, the guarantors of Sean’s student loan (friends of the family who have asked not to be named here) received a bill for $48,824.82. At the bottom of the letter, a breakdown of the amount owed – $39,605.55 for for the principal plus $9,219.27 in unpaid interest and unpaid fees. At the top of the letter, there was a name neither Sean’s guarantors nor his family had ever heard of: Navient.  Sallie Mae split into two companies in 2014 – Sallie Mae and Navient – and the latter has lucrative contracts to collect payments on behalf of banks, government and other lenders. Navient became responsible for Sean’s student loan as well as 12m others but the company soon ran into trouble. In 2017, a lawsuit filed by the Consumer Financial Protection Bureau alleged that Navient “systematically and illegally [failed] borrowers at every stage of repayment”. The accusations were important for the one in four student loan borrowers with debt managed by Navient. A report, published by the Brookings Institution analyzed data on the $1.3tn of US student loan debt and found that nearly 40% of borrowers could default on their student loans by 2023.  Accusations against Navient include abusive interest charges, hurting disabled military veterans by making inaccurate reports to credit companies about them and making repayments harder than necessary. But perhaps the firm’s future looks brighter. The Trump administration has repeatedly sought to curtail the Consumer Financial Protection Bureau, which filed the lawsuit against Navient, most recently in a proposal to cut the Bureau’s budget by a quarter. Such attacks were probably anticipated – immediately after the election, Navient’s stock jumped from $13 to $18.  It’s not clear how many other deceased students Navient is chasing for money but the company’s short history has been riddled with controversy. Last year alone, 6,708 federal complaints were filed about the company, in addition to 4,185 private complaints – more than any other student loan lender.

 Coroner sent letters to doctors whose patients died of opioid overdoses. Doctors’ habits quickly changed -- Addressed directly to the doctor, the letter arrived in a plain business envelope with a return address of the San Diego County medical examiner’s office.  Its contents were intended, ever so carefully, to focus the physician on a national epidemic of opioid abuse — and his or her possible role in it. “This is a courtesy communication to inform you that your patient [name, date of birth inserted here] died on [date inserted here]. Prescription drug overdose was either the primary cause of death or contributed to the death,” the letter read.In the blandest of clinical language, the “courtesy communication” went on to inform the doctor of how many medication-related deaths the San Diego County medical examiner sees each year (between 250 and 270). It offered five prescribing tips (or “evidence-based interventions”) proven to help lower overdose death rates. And it steered the doctor to an online program designed to help medical professionals who are “dedicated to avoiding prescribing controlled substances when they are likely to do more harm than good.”The letters — signed by San Diego County’s chief deputy medical examiner, Dr. Jonathan Lucas, who has since become Los Angeles County’s chief medical examiner — were part of an experiment to gauge how to reduce the prescribing of drugs implicated in fatal overdoses. At a time when legally prescribed opioids and other medications are claiming 174 lives a day in the United States, the research aimed to test a new way to get physicians to rethink their prescribing habits.

Italy’s U-turn on mandatory vaccination shocks the scientific community - An amendment from Italy's anti-establishment government that removes mandatory vaccination for schoolchildren is sending shock waves through the country's scientific and medical community. It suspends for a year a law that requires parents to provide proof of 10 routine vaccinations when enrolling their children in nurseries or preschools. The amendment was approved by Italy's upper house of parliament on Friday by 148 to 110 votes and still has to pass the lower house. The law had originally been introduced by the Democratic Party in July 2017 amid an ongoing outbreak of measles that saw 5,004 cases reported in 2017 -- the second-highest figure in Europe after Romania -- according to the European Centre for Disease Prevention and Control (ECDC). Italy accounted for 34% of all measles cases reported by countries in the European Economic Area, the center said.Italy's Five Star movement and its coalition partner, the far-right League, both voiced their opposition to compulsory vaccinations, claiming they discourage school inclusion.League leader and Interior Minister Matteo Salvini said in June that the 10 obligatory vaccinations, which include measles, tetanus and polio, "are useless and in many cases dangerous, if not harmful," according to ANSA news agency."I confirm the commitment to allow all children to go to school," he added. "The priority is that they don't get expelled from the classes."

Angry people are more likely to overestimate their intelligence, study finds - Angry people tend to think they’re smarter than they actually are, according to new psychology research in the journal Intelligence.“In a recent project I examined the relationship between anger and various cognitive functions. I noticed from the literature review that anger differs significantly from other negative emotions, such as sadness, anxiety or depression. Anger is more approach oriented and associated with optimistic risk perception and generally optimistic bias,” said study author Marcin Zajenkowski of the University of Warsaw.“I was wondering whether people with high trait anger would manifest a bias in perception of their abilities and competence. Specifically, I tested whether high anger leads to positive intelligence illusion.”In two studies, with 528 participants in total, the researchers found that people who confessed to having a quick temper tended to also overestimate their intelligence.The participants completed a measure of their proneness to anger, rated their own intelligence on a 25 point scale, and then took intelligence tests.“Individuals with high trait anger have a tendency to overestimate their abilities, i.e. thinking that they are smarter than they actually are. This part of anger is associated with narcissistic illusions,” Zajenkowski told PsyPost.Though anger was associated with overestimating one’s intelligence, it was unrelated to one’s actual level of intelligence. “Our study examined only trait anger, that is dispositional tendency to experience anger. However, future studies may explore whether temporary experience of state anger also leads to biased perception of their abilities,” Zajenkowski said.

UToledo chemists discover how blue light speeds blindness -- Blue light from digital devices and the sun transforms vital molecules in the eye's retina into cell killers, according to optical chemistry research at The University of Toledo. The process outlined in the study, which was recently published in the journal Scientific Reports, leads to age-related macular degeneration, a leading cause of blindness in the United States. "We are being exposed to blue light continuously, and the eye's cornea and lens cannot block or reflect it," Dr. Ajith Karunarathne, assistant professor in the UT Department of Chemistry and Biochemistry, said. "It's no secret that blue light harms our vision by damaging the eye's retina. Our experiments explain how this happens, and we hope this leads to therapies that slow macular degeneration, such as a new kind of eye drop." Macular degeneration, an incurable eye disease that results in significant vision loss starting on average in a person's 50s or 60s, is the death of photoreceptor cells in the retina. Those cells need molecules called retinal to sense light and trigger a cascade of signaling to the brain. "You need a continuous supply of retinal molecules if you want to see," Karunarathne said. "Photoreceptors are useless without retinal, which is produced in the eye." Karunarathne's lab found that blue light exposure causes retinal to trigger reactions that generate poisonous chemical molecules in photoreceptor cells. "It's toxic. If you shine blue light on retinal, the retinal kills photoreceptor cells as the signaling molecule on the membrane dissolves," Kasun Ratnayake, a PhD student researcher working in Karunarathne's cellular photo chemistry group, said. "Photoreceptor cells do not regenerate in the eye. When they're dead, they're dead for good."  

Pediatricians Warn Against Using Plastic Numbers 3, 6, 7 -  The next time you use a plastic container or bottle, you might want to look at the little number inside the triangle recycling symbol. In a report issued last month, the American Academy of Pediatrics (AAP) said that plastics with the recycling codes 3 (phthalates), 6 (styrene) and 7 (bisphenols) should be avoided unless they are labeled as "biobased" or "greenware," which do not contain these chemicals. The AAP also warned that plastic should not be heated in microwaves or placed in dishwashers, as the heat can cause chemicals to leach into food.The AAP's report, published in the August issue of Pediatrics, adds to a growing body of evidence that plastic not only negatively impacts the environment, it can also negatively impact human health."Rapidly accumulating scientific evidence suggests that certain chemicals added during the processing of foods and those that may come into contact with food as part of packaging or processing may contribute to disease and disability," the authors wrote."More than 10,000 chemicals are allowed to be added to food in the U.S., but the Food and Drug Administration (FDA) is unable to ensure all of those chemicals are safe," they added.As AlterNet reported, plastic No. 3—used in plumbing pipes, clear food packaging, shrink wrap and more—contains the phthalate DEHP, which has endocrine-disrupting properties. Plastic No. 6, aka Styrofoam, can leach styrene, a suspected carcinogen, especially in the presence of heat. Finally, plastic No. 7—or hard plastics—is likely to leach bisphenol A (BPA) and/or biphenol S (BPS), which are known endocrine disruptors.  The AAP said children are at particular risk when they are exposed to these chemicals.

CDC: West Nile Virus Detected in 36 States - The U.S. Centers for Disease Control and Prevention (CDC) said that the West Nile virus has been discovered in 36 states.The virus, most commonly transmitted to humans via a mosquito bite, has been found in many states, including New York, Texas, and California.“Mosquito-borne diseases overall are increasing,” CDC spokeswoman Kate Fowley told The Weather Channel on Aug. 1. “Of the mosquito-borne diseases, West Nile virus is the most common one in the continental United States.”The CDC issued its latest update on West Nile on July 24, saying that there have been “39 cases of West Nile virus disease in people [that have] been reported.”Meanwhile, Iowa health officials said on Aug. 3 that a woman in her 80s died from West Nile, although that wasn’t reflected in the CDC’s last report.  “West Nile virus is in Iowa,” said the Iowa Department of Public Health’s Dr. Ann Garvey in a statement. “This death related to West Nile is tragic and reminds us to protect ourselves and our families from mosquitoes. Until the state’s first hard frost, whether it’s for work or play, being outside means there’s a risk for West Nile virus.” The agency says that cases of West Nile virus “occur during mosquito season, which starts in the summer and continues through fall.” It adds that there “are no vaccines to prevent or medications” to treat the virus, but most infected people don’t have symptoms. But “about 1 in 5 people who are infected develop a fever and other symptoms,” the agency said. “About 1 out of 150 infected people develop a serious, sometimes fatal, illness.” The Iowa Department of Public Health added that people should avoid outdoor activities at dusk and dawn when mosquitoes are most active. “Eliminate standing water around the home because that’s where mosquitoes lay eggs. Empty water from buckets, cans, pool covers and pet water dishes. Change water in bird baths every three to four days,” officials said.

U.S. Faces a Rise in Mosquito ‘Disease Danger Days’ - To examine the role temperature is playing in disease transmission from mosquitoes, Climate Central analyzed the number of days each year in the spring, summer, and fall with an average temperature between 61 degrees and 93 degrees Fahrenheit. This is the range for transmission of diseases spread by mosquitoes of the Aedes or Culex type. Of the 244 cities analyzed, 94 percent are seeing an increase in the number of days, indicating a heightened risk for disease transmission, or “disease danger days.” Diseases spread by mosquitoes are known as “vector-borne diseases,” as they are spread by an infected agent that serves as the “vector.” There are nine diseases carried by Aedes and Culex mosquitoes reportable to state and territorial health departments in the U.S. — seven of these nine diseases have already been transmitted in the U.S. Both types of mosquitoes transmit West Nile virus, with cases in all 48 continental states since its introduction to the U.S. in 1999. Aedes mosquitoes also carry other dangerous diseases such as dengue, Zika, chikungunya, and Yellow Fever, while Culex mosquitoes also transmit St. Louis Encephalitis and Eastern Equine Encephalitis viruses. These diseases are more often found in U.S. territories (like Puerto Rico) than in the continental U.S., but there has been limited transmission of Zika, dengue and chikungunya viruses in Texas, Florida and Hawaii. And while these diseases may not always be life-threatening or even present symptoms, there can be serious consequences without proper medical care. In addition to needing the proper climatological factors for the mosquito to survive and transmit disease, there needs to be the establishment of the disease in the first place — having the proper climatic conditions, a critical density of mosquitoes, and the conditions for the sustained cycle of disease transmission itself. And, in order to transmit disease, a mosquito must bite twice — once to acquire the disease themselves, and a second time to pass it on. The largest number of these twice-biting mosquitoes were produced at 75 degrees Fahrenheit. Regardless of mosquito type, there's an elevated risk of disease transmission when temperatures are between 61 degrees and 93 degrees Fahrenheit. Climate Central analyzed the number of days with temperatures in the risk zone during spring, summer and fall. Of the 244 cities, 94 percent (229 cities) have an increasing number of disease danger days.

New Tick Species Spreads in U.S. for First Time in 50 Years -- An invasive tick species was found to have spread to an eighth state Tuesday, when the Maryland Department of Natural Resources announced one was found on a deer in Washington County, The Washington Post reported.The tick, known as the Asian long-horned tick, scientific name Haemaphysalis longicornis, is the first new tick species to enter the U.S. in 50 years, The New York Times reported Monday.In Asia, the species carries a disease that kills 15 percent of those infected, but no human diseases have been linked to the species in the U.S. since it was first found in New Jersey last August.Since then, it has spread to New York, Arkansas, North Carolina, West Virginia, Virginia and, most recently, Pennsylvania and Maryland.    The Asian long-horned ticks have two distinctive characteristics, Live Science reported. First, females can reproduce asexually, laying as many as 2,000 eggs after feeding, according to the Pennsylvania Department of Health, which is enough to start a new population wherever they hatch, the U.S. Department of Agriculture says.Second, the ticks' large numbers mean they can suck livestock to the point of anemia, or even death.  A New Jersey woman who had been shearing her sheep came into the public health department of Hunterdon County with ticks, mostly nymphs, on her arms and legs, entomologist Tadhgh Rainey told The New York Times."I thought she'd have a few," Rainey said. "But she was covered in them, easily over 1,000 on her pants alone." When Rainey drove to inspect the sheep a month later, he noticed the animal was weak from the loss of blood. The ticks were finally correctly identified by Rutgers University entomologist Andrea Egizi, who has since tested more than 100 found in New York and New Jersey.

An Army of Deer Ticks Carrying Lyme Disease Is Advancing and and Here’s Why It Will Only Get Worse --Maine’s invasion came early this year. In recent hotbeds of tick activity—from Scarborough to Belfast and Brewer—people say they spotted the eight-legged arachnid before spring. They noticed the ticks—which look like moving poppy seeds—encroaching on roads, beaches, playgrounds, cemeteries and library floors. They saw them clinging to dogs, birds and squirrels.  By May, people were finding the ticks crawling on their legs, backs and necks. Now, in midsummer, daily encounters seem almost impossible to avoid. Maine is home to 15 tick species but only one public-health menace: the blacklegged tick—called the “deer” tick—a carrier of Lyme and other debilitating diseases. For 30 years, an army of deer ticks has advanced from the state’s southwest corner some 350 miles to the Canadian border, infesting towns such as Houlton, Limestone and Presque Isle.    “It’s horrifying,” says Dora Mills, director of the Center for Excellence in Health Innovation at the University of New England in Portland. Mills, 68, says she never saw deer ticks in her native state until 2000.  The ticks have brought a surge of Lyme disease in Maine over two decades, boosting reported cases from 71 in 2000 to 1,487 in 2016—a 20-fold increase, the latest federal data show. Today, Maine leads the nation in Lyme incidence, topping hot spots like Connecticut, New Jersey and Wisconsin. Deer-tick illnesses such as anaplasmosis and babesiosis—a bacterial infection and a parasitic disease similar to malaria, respectively—are following a similar trajectory.  The explosion of disease correlates with a warming climate in Maine where, over the past three decades, summers generally have grown hotter and longer and winters milder and shorter.  It’s one strand in an ominous tapestry: Across the United States, tick- and mosquito-borne diseases, some potentially lethal, are emerging in places and volumes not previously seen. Climate change almost certainly is to blame, according to a 2016 report by 13 federal agencies that warned of intensifying heat, storms, air pollution and infectious diseases. Last year, a coalition of 24 academic and government groups tried to track climate-related health hazards worldwide. It found them “far worse than previously understood,” jeopardizing half a century of public-health gains.

Court orders ban of top-selling pesticide, says EPA violated law, ignored scientific studies – A federal appeals court ruled Thursday that the Trump administration endangered public health by keeping a widely used pesticide on the market despite extensive scientific evidence that even tiny levels of exposure can harm babies' brains. The 9th U.S. Circuit Court of Appeals in San Francisco ordered the Environmental Protection Agency to remove chlorpyrifos from sale in the United States within 60 days. A coalition of farmworkers and environmental groups sued last year after then-EPA chief Scott Pruitt reversed an Obama-era effort to ban chlorpyrifos, which is widely sprayed on citrus fruit, apples and other crops. The attorneys general for several states joined the case against EPA, including California, New York and Massachusetts. In a split decision, the court said Thursday that Pruitt, a Republican forced to resign earlier this summer amid ethics scandals, violated federal law by ignoring the conclusions of agency scientists that chlorpyrifos is harmful. "The panel held that there was no justification for the EPA's decision in its 2017 order to maintain a tolerance for chlorpyrifos in the face of scientific evidence that its residue on food causes neurodevelopmental damage to children," Judge Jed S. Rakoff wrote in the court's opinion. Michael Abboud, spokesman for acting EPA Administrator Andrew Wheeler, said the agency was reviewing the decision, but it had been unable to "fully evaluate the pesticide using the best available, transparent science." EPA could potentially appeal to the Supreme Court since one member of the three-judge panel dissented from the majority ruling.

Court Rebukes EPA, Orders Ban on Pesticide That Harms Kids’ Brains - In a scathing opinion, a federal court on Thursday ordered the U.S. Environmental Protection Agency (EPA) to ban chlorpyrifos, a toxic pesticide linked to brain damage in children. The ruling by the Ninth Circuit Court of Appeals nullified the decision last year by then-EPA Administrator Scott Pruitt to cancel the agency's proposal to ban chlorpyrifos—an insecticide that in small doses can harm children's brains and nervous systems—from use on food crops.  Pruitt's reversal of the proposed ban came a few weeks after he met with the CEO of Dow Chemical Company, the world's largest manufacturer of chlorpyrifos, according to The Associated Press.In the Ninth Circuit's opinion, released Thursday morning, District Judge Jed Rakoff blasted the EPA's actions, stating that there "remains no justification for the EPA's 'continued failure to respond to the pressing health concerns presented by chlorpyrifos,' which has now placed the agency in direct contravention" of federal laws regulating food and pesticides."Today's court decision is a huge victory for public health, especially that of children," said Melanie Benesh, legislative attorney for the Environmental Working Group. "By requiring the EPA to finally ban chlorpyrifos, the Ninth Circuit is ensuring that the agency puts children's health, strong science and the letter of the law above corporate interests." The Ninth Circuit decision orders the EPA to revoke all tolerances and cancel all registrations for chlorpyrifos within 60 days.

Trump Admin Reverses Ban on 'Bee-Killing' Pesticides in National Wildlife Refuges - The Trump administration has lifted an Obama-era ban on the use of genetically modified crops andpesticides linked to bee decline in certain national wildlife refuges where farming is allowed, Reuters reported Saturday.  In a memo signed Aug. 2, U.S. Fish and Wildlife Service Principal Deputy Director Gregory J. Sheehan said the move was necessary to provide adequate food for waterfowl."There may be situations, however, where use of GMO crop seeds is essential to best fulfill the purposes of the refuge and the needs of birds and other wildlife," Sheehan wrote.Boosting waterfowl populations dovetails with the interests of sportspeople who hunt ducks and other birds, and Interior Secretary Ryan Zinke has made expanding hunting on national lands a priority, Reuters reported.But environmental groups argue the decision comes at the expense of other species. "Industrial agriculture has no place on public lands dedicated to conservation of biological diversity and the protection of our most vulnerable species, including pollinators like bumble bees and monarch butterflies. The Trump administration's approval to use toxic pesticides and genetically modified crops is an insult to our national wildlife refuges and the wildlife that rely on them," President and CEO of Defenders of Wildlife Jamie Rappaport Clark said in a statement. The pesticides in question, neonicotinoids, have been banned in the EU after research linked them to the decline in the populations of bees and other pollinators. Defenders of Wildlife further noted that the populations of game birds like geese and ducks are currently doing fine without the help of genetically modified crops.

Trump administration lifts ban on pesticides linked to declining bee numbers --  The Trump administration has rescinded an Obama-era ban on the use of pesticides linked to declining bee populations and the cultivation of genetically modified crops in dozens of national wildlife refuges where farming is permitted. Environmentalists, who had sued to bring about the two-year-old ban, said on Friday that lifting the restriction poses a grave threat to pollinating insects and other sensitive creatures relying on toxic-free habitats afforded by wildlife refuges. “Industrial agriculture has no place on refuges dedicated to wildlife conservation and protection of some of the most vital and vulnerable species,” said Jenny Keating, federal lands policy analyst for the group Defenders of Wildlife. Limited agricultural activity is authorized on some refuges by law, including cooperative agreements in which farmers are permitted to grow certain crops to produce more food or improve habitat for the wildlife there. The rollback, spelled out in a US Fish and Wildlife Service memo, ends a policy that had prohibited farmers on refuges from planting biotech crops – such as soybeans and corn – engineered to resist insect pests and weed-controlling herbicides. That policy also had barred the use on wildlife refuges of neonicotinoid pesticides, or neonics, in conjunction with GMO crops. Neonics are a class of insecticides tied by research to declining populations of wild bees and other pollinating insects around the world. Rather than continuing to impose a blanket ban on GMO crops and neonics on refuges, Fish and Wildlife Service deputy director Greg Sheehan said decisions about their use would be made on a case-by-case basis. Sheehan said the move was needed to ensure adequate forage for migratory birds, including ducks and geese favored and hunted by sportsmen on many of the nation’s refuges. US interior secretary Ryan Zinke, whose department oversees the Fish and Wildlife Service, has made expansion of hunting on public lands a priority for his agency. 

Pesticide Food Poisoning Suspected as 10 Die After Funeral in Peru - Tragedy struck a funeral in Peru when 10 guests died after eating food that the health minister suspected had come into contact with insecticides, BBC News reported Wednesday. Fifty-two guests were sickened at the funeral, which took place Monday in the southern Andean region of Ayacucho, CNN reported."People were poisoned by the food," Health Minister Silvia Pessah told TV Perú Tuesday, according to Peru Reports. "It could be that an insecticide was in contact with the food."The food appeared to have been specifically contaminated with a chemical family, commonly used in pesticides, called organophosphates, Pessah told local broadcaster RPP, according to Reuters.Twenty-one of those sickened are seriously ill, local hospitals told BBC News.The two oldest sons of the man being mourned were among the dead, as were the father and 12-year-old nephew of the mayor of the town where the funeral took place, San José de Ushua."The whole village has been poisoned. I can't grasp it yet—I have lost my family. It's a huge tragedy, thank God I'm alive," Mayor Iván Villagomez Llamoca told BBC News. The victims ranged in age from 12 to 78, and several of the sickest guests were airlifted to a hospital in the capital of Lima, CNN reported. The source of the poisonings is suspected to be a meat stew served at the funeral, according to BBC News. Initial tests by the health department turned up insecticides in the food, but public prosecutors have taken samples of the food and drink served for additional testing, CNN and Reuters reported. A UN report published last year found that 200,000 people around the world die from pesticide poisoning every year, Al Jazeera reported.

First Monsanto-Roundup Cancer Trial Goes To Jury In San Francisco -- In a historic first, a California Jury is now deliberating whether Monsanto's Roundup weed killer gave a school groundskeeper terminal cancer, after lawyers for both sides delivered their closing arguments on Tuesday.  Groundskeeper Dewayne Johnson is one of more than 5,000 plaintiffs across the United States who claim Monsanto’s glyphosate-containing herbicides, including the widely-used Roundup, cause cancer. His case, the first to go to trial, began in San Francisco’s Superior Court of California four weeks ago. –Reuters On Tuesday, Johnson's attorney Brent Wisner urged jurors to hold Monsanto liable and slap them with a verdict that would "actually change the world" - after arguing that Monsanto knew about glyphosate's risks of cancer, but decided to ignore and bury the information.  Monsanto is a unit of Bayer AG following a $62.5 billion takeover by the German multinational conglomerate. Monsanto's attorneys deny the allegations and refuted expert testimony relied on by Johnson and others as unreliable, claiming it does not satisfy any scientific or legal requirements.  “The message of 40 years of scientific studies is clear: this cancer is not caused by glyphosate,” said George Lombardi, attorney for Monsanto. In September, 2017 the US Environmental Protection Agency (EPA) concluded that glyphosates were not likely carcinogenic to humans, based on a decades-long assessment. In 2015, the World Health Organization (WHO)'s cancer arm issued an opposite statement - warning that glyphosate was "probably carcinogenic to humans."  If Monsanto is found liable, the jury can tack on punitive damages on top of more than $39 million in compensatory damages demanded by Johnson.  Johnson’s case, filed in 2016, was fast-tracked for trial due to the severe state of his non-Hodgkin’s lymphoma, a cancer of the lymph system that he alleges was caused by Roundup and Ranger Pro, another Monsanto glyphosate herbicide. Johnson’s doctors said he is unlikely to live past 2020. A former pest control manager for a California county school system, Johnson, 46, applied the weed killer up to 30 times per year. –Reuters   Documents released in August of 2017 led to questions over Monsanto's efforts to influence the news media and scientific research and revealed internal debate over the safety of its highest-profile product, the weed killer Roundup.  As the New York Times noted last year, new internal emails, among other things, reveal ethical objections from former employees to "ghost writing" research studies that were pawned off as 'independent' analyses.

Monsanto ordered to pay $289m damages in Roundup cancer trial - Chemical giant Monsanto has been ordered to pay $289m (£226m) damages to a man who claimed herbicides containing glyphosate had caused his cancer. In a landmark case, a Californian jury found that Monsanto knew its Roundup and RangerPro weedkillers were dangerous and failed to warn consumers. It's the first lawsuit to go to trial alleging a glyphosate link to cancer. Monsanto denies that glyphosate causes cancer and says it intends to appeal against the ruling. "The jury got it wrong," vice-president Scott Partridge said outside the courthouse in San Francisco. The claimant in the case, groundskeeper Dewayne Johnson, is among more than 5,000 similar plaintiffs across the US. Correspondents say the California ruling is likely to lead to hundreds of other claims against Monsanto, which was recently bought by the German conglomerate Bayer AG. Mr Johnson was diagnosed with non-Hodgkin's lymphoma in 2014. His lawyers said he regularly used a form of RangerPro while working at a school in Benicia, California. 

Monsanto Slammed With $289 Million Verdict In Historic 'RoundUp' Cancer Lawsuit -- A San Francisco Jury awarded $289 million in damages to a former school groundskeeper, Dewayne Johnson, who said Monsanto's Roundup weedkiller gave him terminal cancer. The award consists of $40 million in compensatory damages and $250 million in punitive damages.  Johnson's trial was fast-tracked due to the severe state of his non-Hodgkins lymphoma, a cancer of the lymph system he says was triggered by Roundup and Ranger Pro, a similar glyphosate herbicide that he applied up to 30 times per year. His doctors didn't think he'd live to live to see the verdict. Johnson testified that he had been involved in two accidents during his work in which he was doused with the product, the first of which happened in 2012. Two years later, the 46-year-old father of two was diagnosed with lymphoma - which has covered as much as 80% of his body in lesions.  Monsanto says it will appeal the verdict.  “Today’s decision does not change the fact that more than 800 scientific studies and reviews -- and conclusions by the U.S. Environmental Protection Agency, the U.S. National Institutes of Health and regulatory authorities around the world -- support the fact that glyphosate does not cause cancer, and did not cause Mr. Johnson’s cancer,” Monsanto Vice President Scott Partridge said in a statement.

Potato Company Simplot Licenses DowDuPont’s Gene Editing Tech - The agricultural company J.R. Simplot Company, one of the largest potato producers in the world, struck a deal with the developers of a specific gene editing technology. That tech will allow Simplot to precisely edit the genomes of crops for various reasons: longer shelf life, drought resistance, aesthetic changes like a potato that doesn't brown when it's cut and exposed to oxygen.The developers are DowDuPont, Harvard and MIT; the technology is a form of CRISPR, which is a technology that allows gene editing. With gene editing, an organism's genome can have bits deleted or added very easily. Interestingly, a few months ago, the USDA announced that it would not be regulating CRISPR-edited organisms the same way it does for other GMOs. The rationale there is that CRISPR is more like an accelerated form of selective cross-breeding. (Not everyone agrees that this is the right approach.)Anyway, the deal allows Simplot, which actually produces food, to use this intellectual property in a fairly broad sense, experimenting to find out what best to do with it. None of the actual developers of the technology are in the food business, so they've licensed the tech to a company that is.  Simplot, based in Idaho, developed the frozen French fry and quickly became the dominant supplier of fries to fast food chains. Since then, the company has branched into seed, fertilizer, mining, cattle and all kinds of other categories broadly within agriculture. (It does not have a good agricultural record; in one example, the company dumped selenium from mines into Idaho waterways, causing two-headed trout.)

Inside the Very Big, Very Controversial Business of Dog Cloning --It has been more than two decades since the world collectively freaked out over the birth of Dolly the Sheep, the first-ever mammal cloned from an adult cell. The media jumped on the fear implicit in creating genetic replicas of living beings: Time featured a close-up of two sheep on its cover, accompanied by the headline “Will There Ever Be Another You?”Jurassic Park, meanwhile, was terrifying audiences with cloned T. rexes and velociraptors that broke free from their creators and ran amok, eating lawyers and terrorizing small children. But over the years, despite all the Jurassic sequels, the issue faded from the public imagination, eclipsed by the rapid pace of scientific and technological change. In an age of gene editing, synthetic biology, and artificial intelligence, our dread of cloning now seems almost quaint, an anxiety from a simpler, less foreboding time. Then, last March, Barbra Streisand came out as a cloner. In an interview with Variety, the singer let slip that her two Coton de Tulear puppies, Miss Violet and Miss Scarlett, are actually clones of her beloved dog Samantha, who died last year. The puppies, she said, were cloned from cells taken from “Sammie’s” mouth and stomach by ViaGen Pets, a pet-cloning company based in Texas that charges $50,000 for the service. Barbra Streisand is not alone. At a South Korean laboratory, a once-disgraced doctor is replicating hundreds of deceased pets for the rich and famous. It’s made for more than a few questions of bioethics.

You Can Hoard, But You Can’t Hide (Svalbard’s Broken Freezer) -- “When we built the seed vault, there was not even discussion of the permafrost,” Hege Njaa Aschim, the press representative of the organization that oversees the project, told me. But the weather last winter, she said, was “like a Norwegian summer.” “We didn’t come up with the term doomsday vault,” Cary Fowler, the mastermind of the seed vault, told me. “The idea there was to provide an insurance policy, so if anything were to happen to those other facilities, it wouldn’t be an extinction event.”   Destruction of seed biodiversity is one of the worst crises and crimes of corporate agriculture. The proprietors of Svalbard – the agrochemical cartel and the governments that serve it – all want the total death of humanity and the Earth. For the ecology, agronomy, and human freedom it’s essential that we the living people breed our own necessary organic crops and sustain and expand a decentralized network of seed saving and seed exchange. You won’t hear this in the corporate media. There you’re far more likely to find the hagiography of Svalbard, the “doomsday vault” which is going to save us all, the seed bank which in crisis is going to enable Monsanto and the Gates Foundation to continue to “feed the world” even though so far all they’re doing is starving it. Svalbard is part of the system dedicated to centralized corporate control of all genetic diversity and committed to the destruction of agroecology, participatory breeding, networked seed sharing and conservation. Consider who controls the Svalbard project: Bayer/Monsanto, the Gates Foundation, Syngenta, DuPont, USAID, the CGIAR, the World Bank, all dedicated to totalitarian technocracy.

Your Chicken's Salmonella Problem Is Worse Than You Think - Americans love chicken, but it doesn’t always love us back. We eat way more of it than any other meat, and it triggers more foodborne disease outbreak-related illnesses than any other food, according to a recent report from the Centers for Disease Control and Prevention. The main reason it makes people sick is because it carries salmonella.  According to data released in June, more than a third of the country’s slaughterhouses are currently failing to meet safety standards developed to try and prevent salmonella contamination on the chicken we buy. For years, the US Department of Agriculture’s Food Safety and Inspection Service’s salmonella-testing program focused on carcasses—whole chickens that have been slaughtered, plucked, and cleaned but not yet cut into parts. But consumers generally buy their chicken in parts—80 percent of the chicken sold in the United States has been broken into wings, drumsticks, etc. And the agency’s data showed that rates of salmonella contamination tend to be much higher on parts than on whole carcasses. So in 2016, the agency began regularly testing randomly selected chicken legs, wings, and breasts from slaughterhouses for salmonella, establishing a “maximum acceptable” rate at 15.4 percent for parts sampled at the end of a slaughterhouse’s kill line. 35 percent of the nation’s 154 large chicken-slaughter facilities failed to meet the inspection service’s standard in testing. As of June 30, 2018, according to the FSIS’s latest report, 35 percent of the nation’s 154 large chicken-slaughter facilities—which churn out the vast majority of the drumsticks, thighs, and breasts shrink-wrapped on supermarket meat counters—failed to meet the inspection service’s standard for chicken parts testing that took place over the previous 64 weeks.   Given that fully a third of our big slaughter facilities are out of compliance, it’s not surprising to learn that the mechanism for enforcing the standard is pretty vague. “FSIS does not assess fines,” an agency spokeswoman told me. When a facility gets category 3 status, the FSIS notifies the poultry company and it is “expected to consider these data in their food safety system and take action,” she said. If the company fails to take corrective actions after 90 days of being notified, she added, the agency “will determine whether additional enforcement action is needed.”

CDC Breeds Fear Over Salmonella in Backyard Chickens. Here’s the real risk. The video at top of the CBS article is a three-minute feel-good piece about the joys of keeping chickens, even in more populated areas.But the article is about a salmonella “outbreak” from backyard chickens affecting–gasp–44 states! 212 people have gotten sick from their backyard chickens since February. The article estimates that about 1% of American households keep chickens. That means 1.26 million households in America keep chickens. The average household has 2.58 people in it. So somewhere around 3.25 million people are exposed to backyard chickens. That means .006% of people who live in a home with backyard chickens have of caught salmonella. Less than one-tenth of one percent of people who live amongst backyard chickens have been sickened by them this year. Just one out of every 15,330 people who keep backyard chickens has caught salmonella. The risks hardly seem newsworthy. And in fact, the general population has a much higher rate of contracting salmonella. With a million cases in the U.S. per year, you have a one in 320 chance of catching salmonella from store bought eggs and meat. I certainly don’t object to good information about staying healthy while raising livestock. A lot of people who keep chickens on a small scale are new to it. Simply washing your hands after handling chickens will likely help you avoid any trouble.But the same goes for other animals–the CDC also warns of 9 salmonella cases stemming from pet guinea pigs.Another interesting thing to note is that the distribution of baby chicks is still pretty centralized. Many chicks sold at feed stores come from large hatcheries. But the centralized food industry is one of the biggest problems relating to foodborne illness in the first place. So is the problem keeping chickens in your backyard, or is the problem sourcing those chickens from one of a handful of hatcheries? The problem with these kinds of alarmist articles is that they could end up curbing an overall more healthy behavior.  They imply that it is safer to just keep buying the same old mass-produced eggs and meat from the store. But in reality, this is more likely to get you sick than keeping your own chickens for eggs.

The poop of 100K cows may be to blame for that deadly romaine E. coli outbreak - Manure from a high-density cattle farm that holds upward of 100,000 cows may have been the source of a deadly Escherichia coli strain that found its way onto romaine lettuce and caused a massive outbreak earlier this year. That’s according to a new hypothesis announced this week by the Food and Drug Administration.  The outbreak spanned from March to June, ultimately sickening 210 people in 36 states. Of those stricken, 96 were hospitalized, 27 suffered kidney failure, and five died.   The bacterium behind the outbreak was a particularly nasty strain of Shiga toxin-producing Escherichia coli O157:H7 that produces only Shiga toxin type 2 (Stx2), the more toxic of two types of toxins E. coli tends to carry. Stx2 causes cell death, triggers immune responses, and leads to the destruction of red blood cells, which can damage the kidneys. Such Shiga-toxin producing E. coli are shed from the guts of animals (particularly cattle) and are spread by feces.   Traceback investigations by federal authorities linked the illnesses to romaine lettuce grown in the Yuma region of Arizona. Further work found that the outbreak stain was present in canal water running along farms. That pointed experts to the idea that tainted canal water was used for irrigation, literally showering crops with deadly germs.  In the new update, the FDA notes that a Concentrated Animal Feeding Operation (CAFO) is located nearby to a cluster of romaine lettuce farms. Such high-density farms are notorious for causing water quality issues. Thus, poopy runoff from the CAFO may have contaminated the canal water, which then made its way onto vegetables directly through irrigation or some other indirect route.  The FDA plans on releasing a detailed environmental assessment report when it’s done with the investigation.

Smithfield Foods Ordered to Pay North Carolina Residents Near Hog Farm  —A federal jury awarded more than $470 million to six neighbors who live near a hog farm run by a contractor for pork giant Smithfield Foods Inc., the third lawsuit in a row the company has lost over odor and noise created by hog farming.  U.S. Sen. Thom Tillis said the lawsuit and similar pending cases against Smithfield in North Carolina pose a threat to agriculture nationwide. At a round table on the lawsuits at the state fairgrounds Friday, he pledged to hold hearings and potentially introduce legislation to protect farmers from being sued over smells, dust and other byproducts of producing food.   It is a clash between rural and urban values, said Hugh Weathers, South Carolina’s agriculture commissioner. The juries in U.S. District Court for the Eastern District of North Carolina have been chosen from the Raleigh area, but the lawsuits concern farms roughly 100 miles away in the southeastern part of the state. “They do not have an understanding of what we do,” Mr. Weathers said. “They just see the results on the table.” The lawsuit is the third in a series of complaints brought by 500 rural North Carolinians who live near Smithfield contractors storing urine and manure in open pools.  In April, a jury awarded $50 million to 10 families in Bladen County. That amount was reduced to $3.25 million to align with state caps on damages. In June, a different jury awarded $25 million to a couple in Duplin County. The amount was reduced to $630,000 because of the state cap. Friday’s award will be reduced to $94 million. Smithfield has said the lawsuits pose an existential threat to its business in North Carolina and to the state’s $2.9 billion hog industry. Smithfield owns the vast majority of the 8.9 million hogs produced here. Smithfield and the plaintiffs  declined to comment, citing a gag order issued in June.  Environmental activist Naeema Muhammad said Smithfield should implement more modern and environmentally sound methods of storing waste. “Why can’t they make a change in these lagoons and make life easier on everybody?” she said.

Feral hogs cause $2.5 billion in damage a year, so the government is boosting efforts to fight them - The U.S. Department of Agriculture estimates feral swine costs about $1.5 billion in damage annually, although experts at the University of Georgia suggest the cost maybe closer to between $2 billion to $2.5 billion. The damage to agriculture is estimated at just under $1 billion annually. In response to the problem, Congress provided $20 million in funding in 2014 for the USDA's Animal and Plant Health Inspection Service to create a national feral swine eradication program. That amount was increased by the Trump administration to $30.5 million. The House version of the 2018 farm bill added about $100 million over five years toward wild pig eradication efforts and a control pilot program. However, funding hasn't been finalized as the House is in the middle of conference negotiations with the Senate.  According to the USDA, there are more than 5 million feral swine in at least 39 states. In the early 1980s, they were found in only 17 states. The wild pigs came to North America with the Spanish explorers in the 1500s. A different variety, Russian boars, were later introduced in Texas in the 1930s.  The feral hogs don't have many natural predators and are popular for recreational hunting, which may help explain why they have spread to so many states. Wild pigs not only tear up farm fields but can contaminate water supplies and represent disease threats to humans, livestock and other wildlife. The intelligent animals also destroy golf courses and property around homes.At the same time, the rogue pigs compete with other animals for food and can decimate native wildlife by getting into nests, eggs and preying on various species, including turtles, birds and reptiles. The feral swine also have been known to eat deer fawns if they find one.

 A tribe in India just sent us this letter about tigers -- Deep in the Indian jungle, elders in an indigenous tribe called the Chenchu gather to write a letter to the outside world.   The Chenchu are going through this trouble to talk to you because they are afraid. Lately, the government has been trying to get them to leave the jungle. They live on what has been declared a tiger reserve.  “Without us, the forest won’t survive, and without the forest, we won’t survive,” the Chenchu say in their letter.   The government says tigers need a human-free environment to flourish. It's true that tigers have faced a lot of trouble from humans over the past few decades. In the 70s, there were only 2,000 tigers left in India. But the link between tribal people and declining tigers is fuzzy at best. Poaching, logging and agriculture have been eating into tiger territory lately, while tribal people have been living in harmony with tigers for thousands of years.  “If a tiger or a leopard kills our cattle, we don’t feel disappointed or angry,” the Chenchu continue. “Instead, we feel as if our brothers have visited our homes and they have eaten what they wanted.” In fact, the Chenchu may keep tigers and other forest plants and animals alive. When indigenous people are in an area, poachers steer clear and companies can’t just come in and use it for resources.  The Chenchu “consider themselves to be the eyes and ears of the forest,” explained Sophie Grig, a senior researcher at Survival International, an organization that campaigns for indigenous people’s rights. Grig is currently working with the Chenchu. “All the tribal people we’ve talked to in India say, ‘If you remove us, the forest will be destroyed’,” Grig told me. “And actually, if you look around at where there is still forest in India, it’s pretty much where the tribal people are. Once they go, that’s when the companies come in, and it gets sold off for timber.” In fact, Grig says the Indian government is currently looking into harvesting uranium in the area that the Chenchu people currently live. So, you know … Coincidence? I reached out to the Indian Ministry of the Environment, but they declined to comment.

Orca Mother Still Carrying Her Dead Calf 17 Days Later -- Tahlequah—a southern resident killer whale whose heartbreaking story has captured attention around the world—has been carrying her dead calf for more than two weeks now.Ken Balcomb of the Center for Whale Research told The Seattle Times that the mother orca has pushed the carcass for a 17th straight day for more than 1,000 miles as of Thursday.But Balcomb said Tahlequah might drop the calf soon because its body is starting to deteriorate. A recent image shows that its intestine and blubber has been exposed. The baby whale was born near Victoria, British Columbia on July 24 and was seen alive and swimming with its mother, referred by scientists as J35, and other members of its "J" pod. The newborn died half an hour after its birth.

Thousands of Farmed Salmon Escape Into the Wild -- The CBC reports that between 2,000 and 3,000 farmed salmon escaped the confines of Cooke Aquaculture's Newfoundland location, and are now somewhere in the wild.Salmon farms like Cooke's, called "open pen" farms, place large nets around an area of ocean and raise very high densities of fish to market size. Cooke told the CBC that a rope came undone in two places, opening up large holes in the net which allowed the salmon to escape into the open ocean.Cooke did not, according to the CBC, alert anyone to the breach until local fishermen began noticing farmed salmon in their catch, raising fears that the company is not forthright enough with its mistakes. Cooke says that it is now, with the partnership of the provincial Department of Fisheries and Land Resources, attempting to round up the lost fish.Escapes of farmed salmon into the wild are not uncommon; as a matter of fact, this isn't even the first time that this specific company has faced this issue. In August of 2017, Cooke's west coast operation also suffered a breach of Atlantic salmon, this time into the northern Pacific. Escaped farmed fish are not an insignificant problem. Farmed fish are much more likely than wild to be infected with various parasites and viruses, a natural product of being crammed into a smaller space with more fish, which they can then transmit to wild fish.  Farmed fish also pose the same risks as any other introduced species, potentially outcompeting native fish for food and spawning grounds. Speaking to NPRabout the August 2017 breach, the director of the Wild Fish Conservancy Northwest, Kurt Beardslee, called the breach "an environmental nightmare."

Maryland: 'We're drowning in Pennsylvania's garbage’ --  Heavy rains and flood waters that flowed into the Chesapeake Bay in July might have exposed a serious problem along Maryland’s border: Pennsylvania.  Record rains carried tons of sediment and debris over the Conowingo Dam, which regulates flow from the Susquehanna River coming out of Pennsylvania five miles upstream. The five days of rains from July 22 to 27 were so intense that the river ran three feet above flood stage, forcing Exelon — the power company that operates the dam — to open 20 flood gates. Flows at the dam exceeded 300,000 cubic feet per second, a rate not seen since Tropical Storm Lee in 2011.  As the gates opened, trash, wood, plastic, and other objects came spilling out into a mass thick enough that it completely surrounded boats and docks miles downstream. Sediment containing polluted suburban and agricultural runoff also poured out.    “To be blunt, we’re literally drowning in Pennsylvania’s trash, and I have a huge problem with that,” said Peter Franchot, Maryland’s comptroller. Last week, Maryland Gov. Larry Hogan complained about the debris, pointed to Pennsylvania as one of the culprits in the pollution, and called the situation “an economic and ecological crisis” before a meeting of the Maryland Board of Public Works. State officials said trees, tires, and garbage were floating in the bay, creating a hazard. They have also pointed fingers at Exelon.

Baltimore Set To Be First Major US City to Ban Water Privatization - naked capitalism by Jerri-lynn Scofield - (video & transcript) The Real News Network story analyzes the Baltimore city council’s decision to reject the privatisation fairy as a solution to fix the city’s troubled water and sewage system. Supporters of the charter amendment say that privatization would result in job loss and rate hikes because corporations have only one motive: profit and not the public good.

 Toxic red tide is making Floridians sick — and angry -- In South Florida this summer, one ecological scourge has piled on top of another. First came the red tide, a flotilla of microorganisms that dyed the sea rust and eventually stretched out along 100 miles of the Gulf Coast. Oxygen-starved fish, eels, dolphins and turtles littered beaches, in numbers too vast to count. In one marina, so many fish went belly up that they appeared to pave a walkway across the water. The foul siege reached from Sarasota nearly to the tip of Florida by early June, when ecological insult No. 2 arrived. A green film ofcyanobacteria appeared, as it regularly does in summer, in vast Lake Okeechobee. But this year the bacteria also spilled over into rivers and canals, which carried the toxic green sludge east to the Atlantic Ocean and west to the Gulf of Mexico. Already distressed Floridians gagged on the noxious odor, and more than a dozen people reportedly went to local emergency rooms after coming into contact with the contaminated water. Some wept as beloved manatees expired, bloated and tinted a ghastly green.One tourist warned on TripAdvisor: “Ground Zero — Polluted, dirty, unhealthy beach — STAY AWAY!!!” And the top experts on toxic algae blooms said they had no idea when the onslaught would end.The twin emergencies have hurt Florida’s tourist-driven economy, spurred calls for greater controls on fertilizers and other pollutants that fuel the fresh-water algae blooms and led to recriminations in the races for governor and the U.S. Senate.The combination of a wave of dead sea life from the red tide and the sickly stench from the blue-green algae, which can drift several blocks away from the water, is hard for locals to ignore. “Many people will tell you that this is the worst they have ever seen,” said Jacylin Bevis, a reporter with WBBH-TV, the NBC affiliate in Fort Myers. “It’s our entire south Florida coastline with the red tide and then with the blue-green algae on the rivers and canals." The siege mentality has been exacerbated, because Floridians don’t feel they can turn to their regular refuge in broiling summers. “Living in South Florida in the summer and not having the beach as option is not a great place to be,” Bevis said.

Florida gutted water quality monitoring – as killer algae increased - When Florida Sea Grant director Karl Havens, who is a well-regarded expert on water and has studied pollution all over the world, began hearing about a deepening algae bloom in his own backyard in Lake Okeechobee this summer, he struggled to find information that could tell him what was going on. State scientists sample water in the lake, but too infrequently to track rapidly evolving algae blooms. Instead, Havens had to rely on satellite images that were taken on sunny days when clouds don't get in the way. "No one is out on the lake collecting water samples of the bloom," he said last month. "We're flying blind." And not for the first time. Over the last decade, as the state fought federal efforts to protect water, shrunk its own environmental and water-management agencies, and cut funding to an algae task force, monitoring for water quality has plummeted. While one crisis after another hit Florida, state and federal funding that paid for a massive coastal network with nearly three decades of information dwindled from about 350 stations to 115, according to Florida International University's Southeast Environmental Research Center. That included Pine Island Sound, which is ground zero for the worst of the current red-tide fish kills and is where sampling was halted in October 2007, and shutting down a 49-station network that was across the Florida Shelf and started in 1995.  In 2014, the state cut funding to about 30 percent of the stations in Biscayne Bay where half the seagrass has died in the last six years. The feds also scaled back: In 2012, the Environmental Protection Agency dropped 43 stations in the Florida Keys National Marine Sanctuary where a mysterious coral disease is threatening reefs. 

Worst red tide bloom in over a decade kills hundreds of marine mammals along Florida's west coast --The ongoing toxic algae bloom is considered to be the longest red tide outbreak for the Gulf of Mexico in over a decade, and officials say it will most likely last until 2019.  High concentrations of toxic algae, known as blooms, have affected at least 120 miles of the peninsula’s Gulf of Mexico coast since November 2017. Officials say nearly 300 sea turtles have died because of the toxic bloom. Pelicans, manatees and a whale shark have also washed ashore since this unprecedented bloom started. Not only does red tide affect marine life, but it also poses health risks to beachgoers along the west coast of Florida. Red tide blooms produce toxic chemicals that can affect both marine organisms and humans. The Florida red tide organism, known as K. brevis, produces brevetoxins that can affect the central nervous system of fish and other vertebrates, causing these animals to die. Wave action can break open K. brevis cells and release these toxins into the air, leading to respiratory irritation.  For people with severe or chronic respiratory conditions, such as emphysema or asthma, red tide can cause serious illness.  The release of nutrient-laden water from Lake Okeechobee, combined with high temperatures have triggered this toxic algae bloom unlike anything southwest Florida has ever seen.

Are toxic chemicals in our drinking water? Statewide testing should let us know - North Carolina’s leading university science researchers will try to find out if water supplies in the state have been contaminated with toxic compounds like GenX, an unregulated chemical discovered in the Cape Fear River last year. The study will lay the groundwork for long-term monitoring of changes in the state’s water quality. If researchers find there is a threat, they will try to determine how much of an impact it has and find ways to protect public health. State environmental regulators looking into the presence of GenX in the Cape Fear River determined the Chemours chemical company discharged it from its factory south of Fayetteville. GenX is a chemical used to make non-stick cookware and other products. The state Department of Environmental Quality issued notices of regulatory violations and has asked a judge to impose stronger measures requiring the company to eliminate or reduce air and water contamination. As The News & Observer reported earlier this year, a federal class-action lawsuit contends Chemours knew the chemical was dangerous but secretly dumped it into nearby waters anyway. And an environmental group has sued the state environmental agency alleging it has not exercised its authority to order the company to immediately halt the pollution without going to court.

Trump officials push states to take power over more waterways | TheHill: The Trump administration is encouraging states and tribes to take over responsibility for environmental permitting in some water bodies that have traditionally been under federal power. The Army Corps of Engineers issued a memo last week that seeks to clarify when the Army Corps and the Environmental Protection Agency (EPA) can grant states permitting power under the Clean Water Act. The agencies, which jointly enforce the Clean Water Act, are allowed to give states authority over waterways like streams and wetlands for pollution permitting, subject to continued federal oversight. States cannot oversee permitting for major waterways like rivers and ports.Officials said the memo is part of President Trump’s efforts to improve infrastructure development. The Clean Water Act provision at issue, Section 404, requires permits for projects that would dredge or fill water bodies, like building bridges and levees. “This action supports this administration’s dedication to infrastructure by providing states and tribes the clarity they need to better balance their environmental protection mission with their economic development goals,” Ryan Fisher, the principal deputy assistant secretary of the Army for civil works, told reporters Tuesday. 

Flood Thy Neighbor: Who Stays Dry and Who Decides? — Just after Christmas 2015, police showed up at the Starling Community Trailer Court in Arnold, Missouri, and told residents to get out. There was no time to stack sandbags, no time to pack. The big one was coming. Sarah Quinn raced to help her grandmother and great-grandparents get to safety.   By the time the river crested, Wolfner’s clubhouse was under 11 feet of water, Brundick and Ammann’s bungalow was uninhabitable, and Quinn’s grandmother lost everything.  “Her sofa, her chair, her deep freeze, washer, dryer, bed, mattress, all of it,” Quinn said. “All of her books that she’s collected over the years … nothing could be saved.” They were the lucky ones. The flood killed at least 20 people in the Midwest and broke records along the Meramec. It was a once-in-a-generation flood — or so they thought, until it happened again 16 months later. Only one city escaped the destruction. Valley Park, just upstream of Fenton, stayed dry during both floods, safe behind a ring of dirt and concrete — a $50 million levee designed by the U.S. Army Corps of Engineers. When rivers flood now in the United States, the first towns to get hit are the unprotected ones right by the river. The last to go, if they flood at all, are the privileged few behind strong levees. While levees mostly are associated with large, low-lying cities such as New Orleans, a majority of the nation’s Corps-managed levees protect much smaller communities, rural farm towns and suburbs such as Valley Park.But why Valley Park? It wasn’t the biggest city or largest employer along the Meramec. Its neighboring towns all had homes and industry in harm’s way, too. But after almost a century of planning to protect all these communities, the federal government built a single 3-mile levee, shielding the low-lying area of just one town.Exploring why that happened offers a window into the nation’s flawed approach to controlling rivers, in which — an investigation by ProPublica and Reveal from The Center for Investigative Reporting found — life-and-death decisions are dictated less by sound science than by economics, politics and luck.

Deadly flooding displaces more than 120,000 in Myanmar; Heavy Rain to persist into next week - Recent monsoon downpours have caused significant flooding across Myanmar, killing at least 16 people and displacing more than 150,000 others.Three of the fatalities were soldiers that were swept away in floodwaters during a rescue operation, according to the country's Disaster Management Department.The number of deaths and those displaced may be higher as flooding has delayed the arrival of rescue teams to some of the most impacted areas.Daily downpours have inundated much of coastal and southern Myanmar since the start of last week and little change is expected in the coming days. In the hard-hit region of Bago, around 70 schools have been forced to close during the recent flooding. Around 12,000 hectares (30,000 acres) of farmland has been damaged or destroyed countrywide by flooding over the past week, according to the Myanmar government. Flooding will remain a major concern this week as the heaviest monsoon rainfall remains centered across Myanmar, Bangladesh and northeast India.Anyone in flood-prone areas should remain on alert for possible evacuations and heed all warnings issued by government officials.Additional rainfall of 150-300 mm (6-12 inches) will be widespread across western and southern Myanmar through the middle of the week. The additional rainfall will cause already overflowing dams to suffer more strain and could result in levee failures causing new rounds of disastrous flooding.

Death toll continues to climb from Laos dam disaster --The official death toll has risen to 33, one week after the $1.2 billion joint-venture Xe-Pian Xe Namnoy hydropower dam collapsed in southern Laos’s Attapeu province, sending five billion cubic metres of water sweeping through 13 rural villages. Laotian government authorities have warned, however, that unknown numbers victims could be buried in deep mud and debris or were carried away by the deluge.Government officials claim that 98 people are missing but deputy secretary of Attapeu’s provincial committee, Meenaporn Chaichompoo, told Al Jazeera last week that over 1,120 people are still unaccounted for. Survivors suggest that the death toll is far higher than official figures and that up to 300 people could have been killed. It was the second dam collapse in Laos in the past year.Bounna Eemchanthavong, 61, told the media that about 650 people lived in his village before it was devastated but only 65 of them had been found at local shelters.Tran Van Bien, 47, a resident from Ban Mai village said that he was told to evacuate just two hours before the dam collapsed on Monday evening. He described how he had to rush to his neighbour’s home with his family as his home was destroyed by the floodwaters, “We were on the roof of that house the whole night, cold and scared. At 4 a.m. a wooden boat passed and I decided to send my wife and my kid out.”Another survivor, Silam, a 25-year-old mother of two, said that she did not receive any government warning that the dam was about to collapse. She received a last minute phone call from one of her relatives telling her to run to higher ground as the water hit a nearby rice field. While water levels have receded in the Attapeu province, 6,000 remain homeless and up to 25,000 residents across the border in Northern Cambodia have been forced to evacuate their homes and villages as the floodwaters moved down stream.

Puerto Rico Acknowledges Hurricane Maria Death Toll 20 Times Larger Than Official Number - The U.S. government’s abject failure to come to Puerto Rico’s aid in the wake of Hurricane Maria has been well-documented. But in a preliminary draft of a report to Congress stressing the need for more federal aid to the island, the government of Puerto Rico finally acknowledged what neither it nor the Trump administration has previously confirmed: over 1,400 people died as a result of the hurricane, over twenty times the government’s official number of 64. The New York Times reports: Hurricane Maria cut through the island on Sept. 20, knocking out power and initially killing about a dozen people. The government’s official count eventually swelled to 64, as more people died from suicide, lack of access to health care and other factors. The number has not changed despite several academic assessments that official death certificates did not come close to tallying the storm’s fatal toll. But in a draft of a report to Congress requesting $139 billion in recovery funds, scheduled for official release on Thursday, the Puerto Rican government admits that 1,427 more people died in the last four months of 2017 compared with the same time frame in the previous year. The figures came from death registry statistics that were released in June, but which were never publicly acknowledged by officials on the island.“Although the official death count from the Puerto Rico Department of Public Safety was initially 64, the toll appears to be much higher,” page 28 of the draft read, adding in another section: “According to initial reports, 64 lives were lost. That estimate was later revised to 1,427.” The report also said that in the aftermath of the hurricane, estimates of deaths ranged from 800 to 8,500 “from delayed or interrupted health care,” a reference to a July study in the New England Journal of Medicine.  All of this language appears to have been scrubbed from the report that’s currently online, but it can be found in the Wayback Machine archive of the report dated to August 8. Times reporter Frances Robles tweeted on Tuesday night that she had seen the final language of the report and that “the government hedges its language a bit,” and that the wording she read came from the “July 9 draft version of this recovery report that the government released for comments,”

 Ocean temperature off San Diego coast is warmest in 102 years of measurements --Last week, the water off the San Diego coast was the warmest it has been since measurements began. On Thursday, the temperature of the Pacific Ocean at Scripps Pier was 78.6 degrees. That, in itself, was a record. Then it broke the record again Friday when it climbed to 78.8 degrees. Scripps scientists maintain sea-surface temperature records back to August 1916. Before last week, the warmest temperature on record was 78.4 degrees in July 1931. A blog post on the Scripps website describes that period as being “unusually warm.” Seventy-nine degrees is crazy-warm for Southern California waters, but compared with the bathwater off the coast of Florida, it’s chilly. The coastal Atlantic water around Miami is typically 85 degrees in the first half of August. The Gulf Stream is responsible for the bathlike water off the East Coast, but on the other side of the continent, the ocean currents flow from the cold north. Water temperature on the West Coast tends to be too cold to swim in — comfortably, at least — without a wet suit. If you ran into the ocean on a San Diego beach right now, though, it would feel more like the water off the Virginia coast. It’s not just the water off the coast that’s running much warmer than normal. “The ocean region off Southern California has been experiencing anomalously warm temperatures for the past week and other observational networks farther off the coast have reported record or near-record temperatures as well,” Scripps says.

Drought declared in entire state of New South Wales - Australia's most populous state, New South Wales (NSW), is now entirely in drought, officials have confirmed. A dry winter has intensified what has been called the worst drought in living memory in parts of eastern Australia. NSW produces about a quarter of Australia's agricultural output. It was officially listed as "100% in drought" on Wednesday. The state and federal governments have provided A$576m (£330m; $430m) in emergency relief funding. "There isn't a person in the state that isn't hoping to see some rain for our farmers and regional communities," said NSW Minister for Primary Industries Niall Blair. Farmers have told harrowing stories of failing crops, severe water shortages and being unable to feed livestock. Some have spent up to A$10,000 per truckload of hay just to feed their animals, according to Prime Minister Malcolm Turnbull. "It's like you are in jail every day," Queensland farmer Ashley Gamble told the Nine Network. "You turn up here because you've got to turn up. It's just depressing." Stock agent Simon Bourke told the ABC: "We're selling livestock we don't want to sell… down the track there's really not going to be too many cattle or sheep left." Image copyright Reuters Image caption A farmer stands in the middle of a dried-up dam near the town of Gunnedah in New South Wales Cattle farmer David Graham said he was resigned to waiting for rain, telling the BBC: "In our community you just support each other through the tough times." Suicide rates in rural regions are on average about 40% higher than in urban areas, mental health group Sane Australia has said. Southern Australia has just experienced its second-driest autumn on record, according to the Bureau of Meteorology, with rainfall 57mm (2.24in) below average. Less than 10mm of rain was then recorded in parts of NSW in July, and drier than normal conditions are forecast in coming months. On Wednesday, officials said 23% of NSW was classified as being in "intense drought", with the remainder in drought or drought-affected. 

Farming impact of Australia's worst drought in living memory -- The worst drought in living memory is sweeping parts of eastern Australia, leaving farmers struggling to cope and asking questions about their future. Record-low rainfall in some regions and successive seasons of above-average temperatures have blighted vast tracts of Australia's grazing and crop land. While the weather has improved in parts of Western Australia, winter rain has gone missing across much of the country’s east, leaving farmers praying for rain after planting seed in dry soil or culling cattle and sheep they can no longer afford to feed. New South Wales, which just recorded its fifth-driest July on record, has been hardest hit. About 99 percent of the state – which accounts for a quarter of Australia’s agricultural output by value – is now officially in drought. With grazing pastures turned to dust and feed costly and scarce, the drought is having a major impact on livestock. Farmers have been shipping in hay from growers in the country’s west or the far north to feed their livestock. Even those sources are now being depleted, however, and as grain silos in the south are emptied, desperate owners are being forced to slaughter animals, even if it means it will take years for herds to recover. The cull will ultimately leave the size of Australia’s national herd at a record low, ushering in a prolonged period of livestock rebuilding and higher prices for the industry. . The drought has devastated large swathes of eastern Australia's crop land, which supplies about a third of the nation's wheat. Australia’s last winter was the warmest since records began more than a century ago and one of the 10 driest, sapping moisture from the earth. Dry conditions since have only made things worse, leaving farmers to plant dry and hope for rain to salvage their crops. Last year, drought cut Australia’s output to the lowest level in a decade. This season has got off to an even worse start, with farmers planting in some of the driest soil in years. The ground in drought-hit regions has dried out to such a depth that it is even killing large trees. Scientists have reported more swathes of forest are dying off, while farmers point to trees that have survived 100 years on their properties but which are now dying before their eyes.  

Scorching Summer in Europe Signals Long-Term Climate Changes -- In Northern Europe, this summer feels like a modern-day version of the biblical plagues. Cows are dying of thirst in Switzerland, fires are gobbling up timber in Sweden, the majestic Dachstein glacier is melting in Austria.In London, stores are running out of fans and air-conditioners. In Greenland, an iceberg may break off a piece so large that it could trigger a tsunami that destroys settlements on shore. Last week, Sweden’s highest peak, Kebnekaise mountain, no longer was in first place after its glacier tip melted.Southern Europe is even hotter. Temperatures in Spain and Portugal are expected to reach 105-110 degrees Fahrenheit this weekend. On Saturday, several places in Portugal experienced record highs, and over the past week, two people have died in Spain from the high temperatures, and a third in Portugal. But in the northernmost latitudes, where the climate is warming faster than the global average, temperatures have been the most extreme, according to a study by researchers at Oxford University and the World Weather Attribution network.  “In the past, we had this kind of heat wave once every 10 years, and now we have them every two years or something like that,” said François-Marie Bréon, a climatologist and deputy director of the Laboratory of Climate and Environmental Science, a research institute affiliated with France’s National Center for Scientific Research. “That’s really the sign of climate change: We have heat waves that aren’t necessarily more intense but that are more and more frequent.”

Europe heatwave: Spain and Portugal struggle in 40C+ temperatures - More than 700 firefighters are battling a major wildfire in southern Portugal's Algarve region, as parts of Europe continue to swelter. Temperatures reached 46C (115F) in places, close to Portugal's national record of 47.4C (117.3F). Soaring temperatures continued in Spain, where three deaths by heatstroke were reported. A continent-wide heatwave in recent weeks has seen drought and wildfires from Greece to Sweden. Portugal's Civil Protection Agency has been sending mobile text alerts warning of extreme fire risk in some areas, as they seek to avert casualties. Dozens of people were killed in two major forest fires last year. Friday saw local all-time record temperatures at almost half the country's weather stations. A major fire broke out on Friday in Monchique, in Algarve, consuming more than 1,000 hectares of forest and forcing evacuations from one village. On Saturday the fire was boosted by 46C temperatures with "a real feel of 50C", rescue operations head Victor Vaz Pinto told local media. The fire has been spreading through eucalyptus forest and dense undergrowth, the Civil Protection Agency says. Meanwhile in Spain, media reports said two people died of heatstroke in the southeastern Murcia region, while a third - believed to be homeless - died in Barcelona. Elsewhere in Europe:

  • Four nuclear reactors in France were forced to close because of the heat
  • Some sections of road closed in the Netherlands after asphalt melted in the heat
  • Temperatures remain in the high 20s in southern England
  • But in Sweden temperatures have dropped and some areas see rain showers after the country's hottest July for 250 years, which saw dozens of wildfires.

Europe sizzles as heatwave continues - Europe continues to swelter after a weekend that saw near-record high temperatures of 46C in Portugal, not far off the three-decade European record of 48C held by Athens.Temperatures have been on a par with the hottest location on Earth - Death Valley in California, driven higher by a hot air mass moving north from Africa. And as well as sometimes fatal discomfort for people the heat is causing some practical problems for industry. France was forced to close four nuclear reactors to keep the rivers Rhone and Rhine cool. Overheated water can result in the death of fish on a mass scale, as has happened in Hamburg's Alster river. Steam from evaporating water also caused problems for road workers in Germany - tarring the already baking asphalt. As temperatures soared to near record highs in southern Portugal, around 800 firefighters battled a forest fire in the Algarve. The hilly Monchique area was evacuated as flames consumed more than 1,000 hectares. Wildfires are also a threat in neighbouring Spain. On Sunday, firefighters eventually brought a blaze in San Vicente de Alcantara under control. The authorities have issued a warning covering the entire southern region of Extremadura. So far the stifling heat has played a part in the deaths of two men.

 Hot weather exposes World War II munitions in German waters -- World War II munitions have been found in numerous places in the Elbe River in the eastern German states of Saxony-Anhalt and Saxony, according to police. So far 22 grenades, mines or other explosives have been found in the Elbe this year, Saxony-Anhalt police spokeswoman Grit Merker told DW. "We ascribe that to the low water level. That's pretty clear," she said July was the hottest month in Germany since temperatures have been recorded, while July 31 was the hottest day, with temperatures reaching 39.5 degrees Celsius (103.1 degrees Fahrenheit) in Bernburg, Saxony-Anhalt. Earlier this week the water level was down to 51 centimeters (20 inches) in Magdeburg, the capital of Saxony-Anhalt. The historical low point was 48 centimeters in 1934.In most cases, people contact the police after happening upon the bombs, which mainly stem from World War II, Merker said. Weapons disposal experts are then sent in to examine the discovery, which sometimes turns out to be an old gas container or fire extinguisher. If the explosives can't be transported, they are detonated on site, which is less often the case, Merker said. Experts detonated two anti-tank mines found in the Elbe in Saxony last Saturday.

Deaths rose 650 above average during UK heatwave – with older people most at risk - Nearly 700 more deaths than average were recorded during the 15-day peak of the heatwave in June and July in England and Wales, according to official statistics.Experts said that an increase in deaths is fully expected during heatwaves, but they cautioned that the provisional data requires further analysis to determine if the higher mortality is statistically significant for the summer months.“The heatwave will have been associated with a number of excess deaths,” said Dr Adrian Boyle of the Royal College of Emergency Medicine. “The people most at risk in a heatwave are the frail elderly with heart or kidney problems.”The UK is “woefully unprepared” for deadly heatwaves, a cross-party committee of MPs concluded in a report published on 27 July. The MPs said the government had ignored warnings from its official climate change adviser, and that without action heat-related deaths will triple to 7,000 a year by the 2040s.The height of the heatwave was from 25 June to 9 July, according to the Met Office, a run of 15 consecutive days with temperatures above 28C. The deaths registered during the weeks covering this period were 663 higher than the average for the same weeks over the previous five years, a Guardian analysis of data from the Office of National Statistics shows.  ONS analysis for previous years indicate hundreds of additional deaths were associated with brief periods of heatwave conditions in July 2016 and June 2017. The full toll of the 2018 heatwave could reach 1,000, according to one prediction.

The influence of temperature on UK death rates -- Between 2006 and 2017 over 600,000 UK residents died in January but only 460,000 in July. This is commonly interpreted to mean that cold kills more people in the UK than heat. The results presented here confirm this, but they also indicate that the excess winter deaths are related to low indoor temperatures in inadequately-heated residences that increase the risk of respiratory and other diseases rather than to outdoor temperatures. Complicating and poorly-understood factors, such as why influenza epidemics occur dominantly in winter, nevertheless make it difficult to estimate exactly how many deaths are caused by cold per se. If “global warming” continues, however, the overall impact will be to lower the UK’s climate-related death toll.     I began by downloading monthly death data for England and Wales between January 2006 and June 2018 from the UK Office of National Statistics and monthly Central England Temperature (CET) over the same period from the Met Office Hadley Centre. Figure 2 compares the two data sets. There is a clear negative correlation between deaths and temperature:   There are, however, a number of cases where temperature does not match deaths, such as the large spikes in 2009, 2015, 2017 and 2018 and the lack of a major increase in deaths in December 2010, a record cold month. An XY plot of the Figure 2 data also exhibits a large amount of scatter and a relatively weak correlation between deaths and temperature (R squared = 0.46).   So how well does influenza match temperature? Figure 5 compares the number of weekly deaths with influenza incidence rates between 1999 and 2017 (data again from the UK Office of National Statistics) with CET temperatures superimposed as accurately as I can on the irregular X scale. Influenza rates show the same inverse seasonal correlation with temperature as do death rates, but only December 2010 shows an influenza “spike” correlating with low winter temperatures, and this did not cause a corresponding spike in deaths. The influenza spike in July 2009, which occurred in midsummer and had no visible impact on deaths either, is an added complication:

More Than 70,000 People Hospitalized Amid Record-Breaking Heat in Japan - An ongoing heatwave has sent a record 71,266 people to hospitals across Japan between April 30 and Aug. 5 with 138 people dying from heat-related illnesses, The Japan Times reported, citing the nation's Fire and Disaster Management Agency.The busy capital of Tokyo saw the highest number of people taken to hospitals, at 5,994. Osaka followed with 5,272. About 40 percent of the total tally consists of elderly people.The number of people hospitalized in just the past three months far exceeds the previous record of 58,729 recorded from June 1 to Sept. 30 in 2013.Last month, the city of Kumagaya in the Saitama prefecture reached 41.1 degrees Celsius (106 degrees Fahrenheit), an all-time high for the country, prompting the national meteorological agency to declare the extreme heat a "natural disaster."What's more, the heat is expected to continue. The Disaster Management Agency has urged the public to take caution and to drink enough water and use air conditioners. Meanwhile, the scorching conditions has government officials considering whether to introduce daylight saving time for the Olympic Games in 2020, which will be hosted in Tokyo. The plan being considered would move clocks two hours forward. For instance, marathon runners would set off at 5 a.m. instead of 7 a.m. to avoid sweltering conditions during their races.

North Korea declares heatwave 'unprecedented natural disaster' as South resorts to 'ice vests' - The Korean Peninsula is suffering alongside Europe in soaring temperatures, with Seoul residents resorting to ‘ice vests’ to cool down, and the North declaring an “unprecedented natural disaster.”Dozens of people, and millions of farm animals – including more than 2m chickens - have died in South Korea during weeks of scorching weather that have seen thermometer readings rise above 40C. Authorities in the eastern port city of Gangneung have been placing ice blocks at public places including bus stops and train stations, while in the capital, Seoul, residents have flocked to air-conditioned shopping malls to escape the city’s hottest ever temperatures, which hit 39C last week.    The city’s fountains are pumping out cooling water, and handheld electric fans and ice vests – which are padded with ice cubes or a cooling gel – have become ‘must-have’ items. Many have resorted to jumping into over-crowded swimming pools to beat the heat. The baking conditions have been attributed to a wall of high atmospheric pressure in the Northern Pacific and the heatwave is expected to last throughout August.  Citizens in the North, where temperatures are also in the high 30s, have fewer options to cool down given the power shortages that make air conditioning a rare luxury.

Heatwave eases in Europe's hotspot Portugal, wildfire rages  (Reuters) - Temperatures in Portugal, at the crest of a European heatwave, began to ease from near record levels on Sunday, but a forest fire raged for a third day in the south, battled by 800 firefighters and 12 aircraft.  The heatwave has brought drought and wildfires to Europe from Greece, where 91 people died in a fire in July, to Sweden. In parts of Portugal temperatures climbed to nearly 47 degrees Celsius on Thursday and Saturday, just off the country’s record of 47.3C and Europe’s high of 48C set in Athens in 1977.  Flames have consumed more than 1,000 hectares of forest, an area the size of over 1,200 soccer fields, in the hilly Monchique area in the southern Algarve region popular with tourists. Authorities deployed 130 soldiers to help with the efforts. “It’s a terrible setting and considering the weather conditions it will not get better today,” said civil protection commander Col. Manuel Cordeiro. Wildfires last year killed 114 people in Portugal’s worst such tragedy on record and authorities were this time quick to evacuate more than 100 people from several villages around Monchique. TV footage showed burned out cars and charred buildings the villagers had left behind.  Six people were hurt while trying to escape another blaze in Estremoz near the Spanish border on Saturday, authorities said. That blaze has since been put out. Firefighters from Portugal and Spain were battling a fire which had engulfed dry trees and shrubs near Badajoz in southwestern Spain and Spanish authorities issued a warning that the entire southern region of Extremadura is at an extreme risk of wildfires.  In Lisbon, the temperature hit a record 44C on Saturday, almost emptying the city streets normally teeming with tourists. The weather service IPMA predicted 42C in the capital on Sunday and a maximum of 44C in the central-east interior. Most regions remain on red alert for fires and heat stroke until Monday. By Tuesday, the temperature is expected to drop below 40C.

On fire: July was California’s hottest month ever recorded    - The devastating wildfires that erupted in California in July, some of which are still raging, were stoked by the state’s hottest weather in recorded history.  The National Oceanic and Atmospheric Administration announced Wednesday that July was California’s hottest month ever observed. The state’s average temperature of 79.7 degrees edged past the previous record of 79.5 degrees in July 1931 and was five degrees warmer than normal.  “This is not some fluke. This is part of a sustained trend,” Daniel Swain, a climate scientist at the University of California at Los Angeles, told the Los Angeles Times.  Temperatures in California have risen steadily over the past century. Eight of the 10 hottest Julys on record have occurred since 1996, and four of the top 10 since 2013.  The hot, dry and sometimes windy conditions “created ideal wildfire conditions,” NOAA’s report on July’s weather said. The destructive Carr, Ferguson and Mendocino Complex fires were among the many set off in July. Those three fires alone have burned over a half-million acres. The Mendocino Complex Fire set the record for the state’s biggest,  surpassing the Thomas Fire in late 2017.  [Apocalyptic webcam image offers snapshot of California’s nightmare fire season] “The nighttime warmth has been especially extraordinary so far this summer in California,” Twain tweeted. “Preliminary data suggest that overnight temperatures this July were warmest on record across most of state, including areas near ongoing major fires and in Los Angeles County.”  California’s scorching July was headlined by a historic heat wave in Southern California on July 6. Most records for the date were obliterated, and quite of few of the highest temperatures were the highest for the month of July or any month of the year, known as “all-time” records.

California's Huge Wildfires Will Likely Have “Serious Health Effects” All Over the West -- Huge wildfires in California have killed at least six people and razed hundreds of homes. A pall of smoke has shrouded much of California and has wafted eastwards, with NASA satellites showing fingers of smoke billowing as far as Salt Lake City, Utah.Much of the smoke from the two fires—near the city of Redding and another close to Yosemite national park—has remained close to ground level, prompting air quality warnings.“A big wildfire event not only impacts local communities but also people hundreds of miles away,” said Richard Peltier, assistant professor of environmental health sciences at the University of Massachusetts. “Even if your home isn’t being destroyed and you think ‘this isn’t my problem’ you could suffer serious health effects.”  Once a forest turns into a roaring fire, plumes of sooty smoke containing gases and microscopic particles are released. This can cause a range of symptoms such as coughing, burning eyes and shortness of breath.  More seriously, the smoke can trigger asthma attacks or, more chronically, lead to heart problems and has even been linked to the development of cancer. As summers become longer, warmer and drier in the US west, forests are being transformed into perfect staging grounds for repeated wildfires of increasing ferocity.

143-mph 'fire tornado' that cut a path of destruction is an ominous sign of the future - As authorities sifted the rubble from the fire that burned more than 1,000 residences in Shasta County, they were startled by what they encountered. A soaring transmission tower was tipped over. Tiles were torn off the roofs of homes. Massive trees were uprooted. Vehicles were moved. In one spot, a fence post was bent around a tree, with the bark on one side sheared off. This was not typical wildfire damage. Rather, it was strong evidence of a giant, powerful spinning vortex that accompanied the Carr fire on July 26. The tornado-like condition, lasting an hour and a half and fueled by extreme heat and intensely dry brush as California heats up to record levels, was captured in dramatic videos that have come to symbolize the destructive power of what is now California’s sixth-most destructive fire.  It may take years before scientists come to a consensus on what to exactly call this vortex — a fire whirl, as named by the National Weather Service, or a fire tornado. Whatever it’s called, it’s exceptionally rare to see a well-documented fire-fueled vortex leap out of a wildfire and enter a populated area with such size, power and duration.  It’s believed to have lasted from 7 p.m. to 8:30 p.m. on July 26 and struck some of the hardest-hit neighborhoods in Redding.  This kind of fire twister has been documented before, but only a handful “at this sort of scale,” said Neil Lareau, assistant professor of atmospheric sciences at the University of Nevada, Reno, who was among those comfortable calling it a fire tornado. “You’re starting with a rare event to begin with, and for it to actually impact a populated area makes it even rarer.” The National Weather Service on Thursday said a preliminary estimate of maximum wind speeds in the vortex were in excess of 143 mph. That would make it equivalent to a twister with a rating of EF-3 out of a maximum of 5 on the Enhanced Fujita scale.  “Depending on the final number, this might actually be the strongest ‘tornado’ in California history, even if it wasn’t formally a tornado,” UCLA climate scientist Daniel Swain said by email. There have been a couple of marginal EF-3 twisters in California’s past, “but this fire whirl was almost certainly longer-lived, larger in spatial scope and perhaps even stronger from a wind speed perspective.” Radar analyzed by Lareau clearly shows a spinning vortex in northwest Redding as the Carr fire rapidly expanded in the evening of July 26.

Yosemite National Park closed by 'hazardous' air from explosive Ferguson fire in California - Parts of Yosemite National Park will be closed "indefinitely" due to ongoing wildfires in and around the scenic valley, the National Park Service said Sunday. The closures include Yosemite Valley, El Portal Road, Wawona Road, Big Oak Flat Road, Glacier Point, the Mariposa Grove of Giant Sequoias, the Merced Grove of Giant Sequoias, Wawona Campground, Crane Flat Campground and Tamarack Campground. As of Sunday, the Ferguson fire had burned 89,633 acres and was 38 percent contained. It is one of 18 major fires burning throughout the Golden State and its smoke has filled the Yosemite Valley, blocking views of El Capitan and Half Dome in addition to Yosemite Falls.“In talking to people, no one has ever seen the smoke this heavy,” park spokesman Scott Gediman told the Los Angeles Times.On Friday, evacuations were ordered due to "multiple hazards" along several roads in addition to power outages in Yosemite Valley. Two firefighters have died so far battling the blaze. Ferguson Fire officials told FOX26 that all the power in Yosemite Valley was out, and there was no way for park employees to keep food or filter air due to the outages.

Trump Says California Lawmakers to Blame for Wildfires - President Donald Trump tweeted for the first time about the deadly wildfires ravaging California that have killed nine people, destroyed hundreds of buildings and charred hundreds of thousands of acres. Trump did not offer condolences. Rather, the president tweeted Sunday that the wildfires are "being magnified & made so much worse by the bad environmental laws which aren't allowing massive amount of readily available water to be properly utilized." He added that the water is being diverted into the Pacific Ocean. Congressman Ted Lieu (D-Calif.) slammed Trump's remarks."There is more than enough readily available water in CA to fight the fires," he tweeted. "The truth is that wildfires across the United States started increasing in the 1980s. Some of this increase is attributable toclimate change."Also, firefighters have not complained about lacking water to fight the 17 major wildfires across the state.When asked if there's a water shortage at the Carr and Mendocino Complex fires—the most serious of the many infernos—California Department of Forestry and Fire Protection spokeswoman Lynette Round told theSan Francisco Chronicle, "Not that I'm aware of ... but that doesn't mean it's not happening."Rather, firefighters told Buzzfeed that the severity of the fires can be attributed to the region's extreme weather conditions and gale-force winds that have whipped the flames.

White House approves Carr Fire disaster declaration, California governor says --The White House has approved a disaster declaration for Shasta County, California, where officials say the massive Carr Fire has killed seven people and is continuing to burn through homes and property.The death toll in the Carr Fire reached seven Saturday when a Pacific Gas & Electric worker was killed while working with a crew to restore power in western Shasta County, utility spokesman J.D. Guidi said. An eighth fire-related death occurred in the Ferguson Fire, east of San Jose, when Capt. Brian Hughes of the Arrowhead Interagency Hotshot Crew was killed.   In a statement announcing the White House's approval Saturday, Gov. Jerry Brown said California had submitted the request for a Presidential Major Disaster Declaration earlier that day to help with the impact of fires across the state. More than 14,000 firefighters are currently battling 17 major fires burning across California. In addition to the Shasta declaration, Brown's office said FEMA was considering requests for disaster declarations for Lake, Mendocino and Napa counties "on an expedited basis." “The Mendocino Complex fire remains a dynamic and rapidly changing challenge for firefighters, with additional evacuation orders issued on Saturday and thousands of structures remaining threatened by the massive wildfire." Brown's office said.

Mendocino Complex Fire explodes to 2nd largest blaze in California history - The Mendocino Complex Fire has charred more than 273,000 acres, making it the second largest blaze in California's history. Firefighters will continue to face local gusty winds and building heat this week.To put this in perspective, the massive blaze is burning an area larger than New York City. As AccuWeather predicted, hot and dry weather allowed the Mendocino Complex Fire to spread rapidly this past weekend, which resulted in mandatory evacuations for portions of Colusa County, California, on Saturday evening. Over 20,000 people have now been evacuated from Colusa, Lake and Mendocino counties. The Mendocino Complex fire is comprised of the Ranch and River fires. Together, these comprise the second largest California wildfire on record in terms of acreage burned. A total of 9,200 structures are being threatened, while 130 have been destroyed.  Heat and poor relatively humidity will continue to plague firefighters battling this complex fire each afternoon and evening into early this week.  Farther south in California, stronger Sundowner winds are also anticipated to develop and significantly increase the fire danger around Santa Barbara. These winds are anticipated Monday night when there can be gusts to 45 mph.  The neighboring valleys can anticipate triple-digit heat, while the deserts from Palm Springs, California, to Phoenix, Arizona, will endure highs in the 110s. Temperatures in a few locations along the Colorado River can approach or crack the 120-degree mark.

California's Carr Fire Was Bad. The Mendocino Complex Fire Is Worse -  Another major wildfire is tearing through California and it’s growing at a phenomenal pace. The Mendocino Complex Fire jumped creeks, firelines and roads this weekend, and is already the second-largest wildfire in the state’s history, as judged by acres burned.   As of Monday morning, the blaze has consumed 273,664 acres and destroyed 75 homes, as well as 68 other structures, according to Cal Fire, the California agency responsible for fire protection. It has not resulted in any fatalities to date.It’s a virtual certainty the fire will become the state’s largest wildfire in history in the coming days, as last December’s Thomas fire, claimed 281,893 acres.The Northern California fire is located near Clear Lake, just south of the Mendocino national forest. Officials say the flames threaten more than 9,000 structures. And parts of Colusa, Lake, and Mendocino counties have been evacuated. Cal Fire says the total blaze is currently 30% contained.The fire comes as California firefighters continue to struggle to contain the deadly Carr Fire to the north of the Mendocino Fires. That fire, which is currently 43% contained, has destroyed more than 1,000 homes and burned over 160,000 acres. Seven people, including two firefighters, have died so far in relation to that fire. The Mendocino Complex is technically two separate fires. The Ranch Fire is the larger of the two fires, having consumed more than 225,000 acres so far. It’s just 21% contained and is growing fast, jumping at least four creeks, a major road and a fire line in a six-mile stretch this weekend. This smaller blaze has consumed 48,663 acres and is considered to be 58% contained. That should allow Cal Fire to shift some resources from it to the Ranch fire soon. Both fires began on July 27. Officials are investigating the cause of both.

 Mendocino fire has become California's largest ever - Two blazes that began burning through Northern California late last month have grown at breathtaking speed to form a massive inferno that has now set a new mark for destruction.The twin wildfires, collectively known as the Mendocino Complex Fire, have together more than doubled in size in the past four days and burned through 290,692 acres, or 454 square miles, of parched land — an area almost the size of Los Angeles. By Monday night, the Mendocino Complex Fire had earned an infamous distinction, becoming the largest wildfire ever recorded in the state, according to the California Department of Forestry and Fire Protection, or Cal Fire. It has now surpassed the Thomas Fire that burned nearly 282,000 acres of land in Ventura and Santa Barbara counties late last year and the Cedar Fire that killed 15 people in San Diego County 15 years ago.“We broke the record,” Cal Fire spokesman Scott McLean said, according to the Los Angeles Times. “That’s one of those records you don’t want to see.”   The Mendocino Complex Fire showed little sign of slowing Tuesday. Fueled by low humidity, triple-digit temperatures and winds blowing across wide swaths of tinder-dry vegetation, the conflagration has expanded to three counties northwest of Sacramento, surrounded a river and parts of neighboring reservoirs, and destroyed and damaged dozens of homes and other structures.“There’s some challenges that firefighters are facing near the fire and in the area of the fire. We have strong, erratic winds, and what that’s doing is blowing embers, and it’s spreading the fire,” Capt. Thanh Nguyen, a spokesman for the Mendocino Complex Fire, said Monday. “You got steep terrain that makes it difficult for firefighters.” Typically, temperatures dip and humidity rises overnight, giving crews a window to slow the fires’ spread. But Nguyen said these have not happened in the affected areas. Firefighters are unlikely to see much respite. Temperatures will dip slightly to the low 90s and high 80s this week, but no rain is in the forecast. “We’re experiencing the same thing every day, which is our afternoon winds and high winds in the area,”

President Obsesses Over How Rivers Work as Wildfires Rage --The Mendocino Complex Fire burning in Northern California officially became the largest fire in the state's history after doubling in size over the past four days, state fire officials said yesterday. As firefighters work to contain the blazes and the seventeen other fires throughout the state, President Trump doubled down with a second incomprehensible tweet claiming that too much water from California is flowing into the Pacific Ocean to properly combat the fires. "We have plenty of water to fight these wildfires, but let’s be clear: It’s our changing climate that is leading to more severe and destructive fires," Daniel Berlant of Cal Fire told the New York Times. Puzzled experts guessed that the president is mixing two unrelated issues in his tweets, referencing a separate conflict between environmentalists who want to preserve the state's rivers and farming interests that want more irrigation.

10 Haunting Photos As California's Largest Wildfire Ever Spirals Out Of Control - On Monday, the twin fires being treated as one incident north of San Francisco became the largest wildfire in state history, destroying 443 square miles (1,148 square kilometers), nearly the size of the city of Los Angeles and 45% greater than New York City.  The Mendocino Complex grew to span 283,000 acres (114,526 hectares) on Monday when two wildfires merged at the southern tip of the Mendocino National Forest, the California Department of Forestry and Fire Protection said. The size of the fire has surpassed the previous record set by the Thomas Fire which burned 281,893 acres in Santa Barbara and Ventura counties when it destroyed more than 1,000 structures. It is now the largest of eight major fires burning out of control across California, prompting U.S. President Donald Trump to declare a “major disaster” in the state. The wildfire about 225 miles (360 kilometers) north of San Francisco started more than two weeks ago by sparks from the steel wheel of a towed-trailer's flat tire. It killed two firefighters and four residents and displaced more than 38,000 people. The Mendocino Complex, which is 30% contained, has been less destructive to property than some of the other wildfires in the state - it has so far burned down 75 homes - because it is mostly raging in remote areas. But as AP notes, officials say it threatens 11,300 buildings and some new evacuations were ordered over the weekend as the flames spread. More than 14,000 firefighters are battling more than a dozen major blazes throughout California, state Department of Forestry and Fire Protection spokesman Scott McLean told AP. The 3,900 crews battling the Mendocino Complex on Monday were focusing on keeping flames from breaking through fire lines on a ridge above the foothill communities of Nice, Lucerne, Glen Haven, and Clearlake Oaks, said Tricia Austin, a spokeswoman for Cal Fire. Elsewhere, the Carr Fire - which has torched 164,413 acres in the scenic Shasta-Trinity region north of Sacramento since breaking out on July 23 - was 47% contained according to Reuters. The Carr Fire has been blamed for seven deaths, including a 21-year-old Pacific Gas and Electric Company lineman Jay Ayeta, whom the company said on Sunday was killed in a vehicle crash as he worked with crews in dangerous terrain. The Northern California fires have created such a haze of smoke in the Central Valley that Sacramento County health officials advised residents to avoid outdoor activities for the entire week. Below we shows 10 haunting photos from the wildfire, courtesy of Bloomberg:

16 major fires burning in hot, dry, windy California; firefighters battle largest blaze in state’s history — Catastrophic wildfires continue to ravage California, as one blaze nearly doubled in size over the last three days, making it the largest in the state’s history. No one has been injured in the Mendocino Complex Fire, which consists of two fires — the Ranch Fire and the River Fire — burning around Clear Lake, in several counties in Northern California.Combined, they form the biggest blaze that California firefighters are currently battling. Altogether, the Mendocino Complex Fire has burned 283,800 acres — growing about 80% since Friday night. As of Monday evening, it was 30% contained and had destroyed 75 residences.The Mendocino Complex Fire has now surpassed last year’s Thomas Fire, which burned 281,893 acres in Ventura and Santa Barbara counties, as the largest fire in Cal Fire history. Exhausted firefighters across the state are trying to contain 16 major fires that are burning in hot, dry and windy conditions. On Monday, another fast-moving fire ignited in the state — this time in Orange County, where firefighters battled the Holy Fire that expanded to more than 1,200 acres. That fire started in the Cleveland National Forest and evacuations in the nearby areas have been ordered, according to the Orange County Fire Authority.In Northern California’s Shasta County, the devastating Carr Fire claimed its seventh victim Saturday when a Pacific Gas & Electric worker died while working with a crew to restore power, utility spokesman J.D. Guidi said.Over the weekend, the White House approved a disaster declaration for Shasta County, allowing affected residents from the Carr Fire to apply for federal disaster assistance such as temporary housing, home repairs and other programs. At the same time, President Donald Trump blamed the state’s environmental laws for the wildfires. “California wildfires are being magnified & made so much worse by the bad environmental laws which aren’t allowing massive amount of readily available water to be properly utilized,” he tweeted Sunday.  It wasn’t immediately clear what California laws President Trump was referring to. Henri Grissino-Mayer, a geography professor at the University of Tennessee, said he had “no clue” what President Trump was referring to in his tweet.

Norovirus breaks out at California fire shelter  - Northern California officials are contending with a norovirus outbreak at a wildfire evacuation shelter.Lake County Public Health Director Denise Pomeroy said Wednesday that 20 to 30 people had shown symptoms of the virus in the last 48 hours. The airborne bug causes diarrhea, vomiting, nausea and stomach cramps.Officials are taking steps to separate those who have shown symptoms from others at the shelter and hired a company to clean and disinfect inside. Additional handwashing stations also were set up.Pomeroy says about 150 to 175 people were at the shelter in Lower Lake High School on Tuesday night. Many were leaving Wednesday as officials lifted more evacuations.About 1,500 people remain under evacuation orders as firefighters battle the largest wildfire recorded in California history, called the Mendocino Complex.  Commerce Secretary Wilbur Ross has directed the National Marine Fisheries Service to prioritize water use in California for fire-fighting, potentially overriding its use to protect endangered species.“The protection of life and property takes precedence over any current agreements regarding the use of water in the areas of California affected by wildfires,” Ross said in a statement. “Going forward, the Department ... (is) committed to finding new solutions to address threatened and endangered species in the context of the challenging water management situation in California.”The directive follows a tweet by President Trump on Sunday that blamed the severity of California’s wildfires partly on its water management policies.  State experts disputed the charge. The fires are in hills far from the Pacific Ocean and from the man-made storage and distribution system that transports water from the wetter, northern part of the state to the southern part.

Dramatic scenes from California's wildfires -For the past few weeks, California has been under siege by several wildfires as firefighters work to regain control. For a state that is still struggling from the destructive and costly effects of the 2017 wildfire season, this summer is not looking any better. Firefighters across the state continue to battle 17 wildfires, with the largest located in Mendocino County. This week, the Mendocino Complex Fire in Southern California became the largest wildfire in California's recorded history, consuming over 300,000 acres and surpassing last year's Thomas Fire, which burned just over 280,000 acres. The Carr Fire, near Redding, also continues to burn. It has already claimed the lives of 8 people, destroyed hundreds of homes and displaced thousands of residents. Following are some of the dramatic and catastrophic scenes firefighters and residents are facing.

California wildfire: Should inmates be fighting the state’s worst ever blaze? - With the largest wildfire in the state of California’s history razing homes and businesses, the paid, professional firefighters who have been deployed by the thousands there to save lives are getting help from what may seem like an unexpected place: the state’s prisons, and thousands of felons who have signed up to risk their lives for just dollars a day.More than 2,000 inmates have volunteered to join an army of 14,000 firefighters fighting at least three massive fires in the state, including 58 youth offenders, in a role that often results in 24-hour shifts where workers face potentially fast-changing conditions that could put firefighter lives in danger within moments.  While the inclusion of inmate firefighters has provided a helpful boost to the response – and saved the state government as much as $100m – their employment has raised questions about whether the conditions of their work are exploitative – and whether it makes sense to pay people dramatically differently when they’re facing down the same potentially deadly threats.  “Absolutely – this is very inhumane,” Clarise McCants, the campaign director for the group Colour of Change, said, citing a vast pay inequity between incarcerated firefighters and those who did not come from state prisons to work.  “And, there needs to be a really big change so that people are actually treated fairly, so they have increased pathways to get out of prison early, so there’s fairness in that, and that they’re actually able to make a living once they get out,” Ms McCants continued.  Emergency firefighters in California make at least $11 per hour (£8.50), according to the California Department of Forestry and Fire Protection (Cal Fire), which oversees emergency fire responses in the state. That pay – which jumps to at least $16.50 an hour for overtime – dwarfs that of the inmates who make $2 a day, plus another $1 for each hour they spend fighting an active fire during that time.

Wildfire smoke is wreaking havoc on air quality in the Western U.S. - The destructive wildfires that continue to burn thousands of acres across California have created an air pollution nightmare for millions of residents on the West Coast. Smoke pouring from 20 active wildfires has prompted officials to issue air-quality alerts in several states.As news broke Monday night that the Mendocino Complex fire has officially become the largest wildfire in California  history, residents in nearby Sacramento County were warned to stay indoors if possible through Friday. The wildfires are emitting vast amounts of smoke full of a toxic mixture of gases and fine particles that come from burning wood and plant material. When inhaled, the microscopic particles can quickly move to the lungs and bloodstream, increasing the risk of developing asthma and other respiratory problems. In addition to the dangerous particulate matter, the toxic combination of gases in smoke clouds provide a perfect breeding ground for the formation of surface-based ozone, which can result in negative health effects in its own right. Weeks of wildfires combined with record-breaking heat have created a rather stagnant air mass, incapable of “mixing out” the clouds of smoke, allowing the amount of smoke to continue to increase across much of the Western United States, resulting in some historically high bad air quality. In many areas Tuesday, the air quality reached Code Orange levels, translating to unhealthy conditions for sensitive groups such as young children, older adults and those with respiratory problems. But there were also sizable pockets of Code Red and even Code Purple conditions, meaning unhealthy to very unhealthy air for all populations.

California battles its biggest ever wildfire, Trump vows support (Reuters) - U.S. President Donald Trump struck a more conciliatory tone over California’s raging wildfires on Tuesday, saying he was in constant contact with officials there, a day after blaming the state’s environmental policies for exacerbating the fires. One of the 17 major fires in California, dubbed the Mendocino Complex, became the biggest in state history on Tuesday, eclipsing a previous record set only eight months ago, as hot, windy conditions fanned the blazes in what Governor Jerry Brown has called a “new normal.” The Mendocino Complex, made up of two fires, grew to nearly 300,000 acres (117,700 hectares) - almost the size of Los Angeles - and was expected to burn for the rest of the month, the California Department of Forestry and Fire Protection (Cal Fire) said. The blaze has surpassed the Thomas Fire, which burned 281,893 acres (114,078 hectares) in Santa Barbara and Ventura counties in southern California last December, destroying over 1,000 structures.  In the last two days, Trump has said California was letting water run into the ocean instead of using it to fight blazes and blamed California’s environmental policies for worsening the fires. The comments baffled California firefighters, who said they had more than enough water to douse the flames. “We’re going to have to have some meetings about it because there are ... things you can do to mitigate what’s happening,” Trump said at a dinner in New Jersey.  The fires have killed seven people, destroyed over 1,500 structures and displaced tens of thousands of people over the past month.

Biggest blaze in California history challenges firefighters: Firefighters struggled against rugged terrain, high winds and an August heat wave Tuesday to slow the spread of the biggest wildfire ever recorded in California, an inferno that exploded to be nearly the size of Los Angeles in just 11 days. The 450-square-mile blaze, centered near the community of Upper Lake, about 100 miles north of San Francisco, spread fast because of what officials said was a perfect combination of weather, topography and abundant vegetation turned into highly flammable fuel by years of drought.Firefighting efforts were also initially hampered by stretched resources, said the Department of Forestry and Fire Protection, also known as Cal Fire. When the fire started July 27, thousands of firefighters were hundreds of miles north battling a massive blaze that spread into the city of Redding, destroying more than 1,000 homes, in addition to a dozen other major blazes. A few days after the Upper Lake fire started, Cal Fire Battalion Chief John Messina told a community meeting that with so many fires already raging in California, "resources are already committed" so officials were forced to prioritize public safety and private property. After those two things are addressed then we'll go after the pieces of fire that are in remote areas," Messina said. "Typically, we'd go at all at once. There is just not the resources for that." The flames were raging in mostly remote areas, and no deaths or serious injuries were reported. But at least 75 homes have been lost, and thousands of people have been forced to flee. The blaze, dubbed the Mendocino Complex, was reported 20 percent contained on Tuesday. Its rapid growth at the same time firefighters were battling more than a dozen other major blazes around the state fanned fears that 2018 could become the worst wildfire season in California history. "For whatever reason, fires are burning much more intensely, much more quickly than they were before," said Mark A. Hartwig, president of the California Fire Chiefs Association. 

Holy fire threatens Lake Elsinore, bringing evacuations; new fire near Ramona: The Holy fire in the Cleveland National Forest marched toward Lake Elsinore on Thursday afternoon, forcing a new round of evacuations. Residents living in homes on the mountainside of Lake Street and in the southeast region from Grand Avenue to Ortega Highway were told by the U.S. Forest Service to leave their homes immediately as the fire moved their way. AdvertisementThe Holy fire began Monday in Orange County and burned more than 9,600 acres through Cleveland National Forest and into Riverside County. Earlier evacuation orders covered McVicker Canyon, Rice Canyon, Horsethief Canyon, El Cariso, Rancho Capistrano, Indian Canyon, Glen Eden, Sycamore Creek and Mayhew Canyon, according to the U.S. Forest Service, as well as sections of Ortega Highway in the forest. To the south, a new brush fire broke out west of Ramona and quickly charred between 100 and 150 acres while threatening structures along a rural road. Dubbed the Rangeland fire, it was first reported as 15 acres a little before 1:30 p.m. on Rangeland Road near Highway 78, according to Cal Fire San Diego. “There is an immediate structure threat to the area of Rangeland Road,” California Department of Forestry and Fire Protection officials tweeted at 1:45 p.m. Firefighters estimated that the blaze had grown to between 100 and 150 acres before 2 p.m. Authorities say the Holy fire was intentionally set. Forrest Gordon Clark, 51, was arrested on suspicion of two counts of felony arson, one count of felony threat to terrorize and one count of misdemeanor resisting arrest in connection with the ignition of the blaze. It was not immediately clear how the fire was set. Clark was booked Wednesday and was being held on $1-million bond. 

Aggressive wildfire threatens thousands of homes in southern California city (Reuters) - Hundreds of firefighters were building barriers and constructing containment lines early on Friday to slow an approaching wildfire threatening to torch thousands of homes in a lakeside community southeast of Los Angeles. More than 21,000 people have been evacuated in and around Lake Elsinore where furious flames and billowing smoke rose into the sky at the edge of the city of 60,000 as the blaze, dubbed the Holy Fire, burned nearby in the Santa Ana Mountains. “It feels like a war zone,” Ana Tran told the Los Angeles Times as ash and flame retardant fell on her neighborhood. The fire, which was five percent contained, was being fueled by dry brush covering steep terrain and stoked by erratic wind gusts during the night, said Thanh Nguyen, a spokesman for the incident said. “Strong down drafts is making the fire move aggressively downhill,” said Nguyen, noting that firefighters were working to build barriers and containment lines to protect more than 2,000 homes at risk from the fire. Three firefighters suffered minor injuries battling the relatively small blaze that consumed more than 10,200 acres (4,128 hectares) since it began on Tuesday, fire officials said. Governor Jerry Brown declared a state of emergency for the area on Thursday, freeing up additional resources to battle the blaze. Forrest Clark, 51, was charged with setting the fire, the Orange County District Attorney Office said. The Holy Fire was one of several fires burning in California that have displaced tens of thousands of people. Wildfires across the state and region could be further stoked by strong gusts, low humidity and hot weather on Friday and Saturday, forecasters warned. 

"This Thing's Massive" - 14,000 Fight Devastating California Fires, 2 Arsonists Charged As Death Toll Rises -   "Everything is on a 100 times scale," exclaimed Craig Cottrill, chief of the Wellington Fire Department in New Zealand, who along with 52 other firefighters from down under, are battling the biggest wildfires California has ever seen. "This thing's massive."  In fact there are now over 14,000 on the frontline with crews, including almost 2,000 inmates, 200 soldiers, and dozens of firefighters from overseas.They are deployed statewide and led by Cal Fire. The state's firefighting agency employs 5,300 full-time firefighters and hires an additional 1,700 each fire season. Trained prisoners and firefighters from 17 states and around the world fill out the ranks.Those on the ground get help from more than 1,000 fire engines, 59 bulldozers, 22 air tankers, 17 airplanes, 12 helicopters and 11 mobile kitchens. They are battling blazes on the Nevada border and along the coast.  Status:  [table of data for several fires as of Aug 9 PM]  Sadly, the death toll in what was already the most lethal year for firefighters in California since 2008 increased to five on Thursday, when Andrew Brake, 40, of Chico - a heavy equipment mechanic - was killed after falling asleep at the wheel on his way to the fire lines near Redding, a family member told The Chronicle. A man has been arrested in connection with the Holy Fire burning in the Cleveland National Forest southwest of Corona, according to CBSLA. The Cleveland National Forest Twitter account posted about the arrest late Wednesday morning. The suspect, 51-year-old Forrest Gordon Clark, was booked into Orange County Jail on suspicion of two counts of felony arson, one count of felony threat to terrorize, and one count of misdemeanor resisting arrest. A 32-year-old man from Temecula was arrested on suspicion of arson Wednesday night after he was accused of setting multiple fires, one of which burned thousands of acres in the San Bernardino National Forest, destroyed homes and forced thousands to flee.

Wildfire Smoke Spreads Across Majority of U.S. States - The destructive wildfires currently raging in the American West have produced so much smoke that it can be observed in the majority of U.S. states, the Weather Channel reported.Varying concentrations of smoke have spread as far east as Lake Superior and Hudson Bay, and as far south as Baja, California, the National Oceanic and Atmospheric Administration (NOAA) said Monday.Aerosol index simulations from NASA's Goddard Space Flight Center from last Friday through Monday even showed smoke particles along the Southeastern coast and parts of upstate New York and northern New England, the Weather Channel noted.The thickest smoke can be observed across much of California, Oregon, eastern Washington, northern Nevada, northern Utah, southern Wyoming, northern Colorado and southwestern Nebraska, according to NOAA.There are 18 active fires in California alone, including the Mendocino Complex Fire, which was recently declared the largest in state history, and eclipsed last year's Thomas fire which burned 283,800 acres in Ventura and Santa Barbara.   Officials have issued air quality advisories to dozens of communities surrounding the wildfires. The National Weather Service warns that exposure to particle pollution can cause serious health problems, aggravate lung disease, cause asthma attacks and acute bronchitis and increase risk of respiratory infections.

 Smoke from the California wildfires is spreading 3000 miles to New York City -- Take a look at this forecast model from the National Weather Service. It shows how the smoke from the wildfires scorching California is traveling thousands of miles. In this case, all the way to New York City -- about 3,000 miles away.The weather service uses an experimental model that forecasts the spread of smoke from wildfires across the country. It says winds lift the smoke up and carry it across the US. And it doesn't stop there -- some of the particles move even beyond the East Coast. Right now, firefighters are battling more than a dozen blazes in California, including the largest in the state's history -- the Mendocino Complex fire. But this isn't the first time smoke from the western wildfires is spreading all the way to the East Coast. Last September, smoke stretched across the entire country. The smoke in the east is more than a mile above the surface. When it's that high and stays there, the health risks are minimal, according to the weather service. But if it's pulled down by the jet stream, it can cause unhealthy air quality. A satellite image taken Thursday shows that the western wildfire smoke spreading toward the East Coast of the US in the upper atmosphere as the forecast model predicted. In some cases, exposure to wildfire smoke can cause respiratory issues and symptoms similar to a sinus infection. Wildfires can also have effects on pollution. And some of these effects, scientists say, have been underestimated. A Georgia Tech study published last year found that wildfires can be a big source of pollution through the spreading of particles in the air. The smoke from the summer wildfires on the West Coast, researchers found, brought several toxic chemicals into the atmosphere. In the western states especially, the study said, this can mean air quality problems in nearby areas.

Smoke, heat plague Oregon (AP) — A layer of smoke blanketed much of Oregon as a heat wave sent temperatures soaring to dangerous levels. Temperatures were reaching 105 degrees Fahrenheit (40.56 Celsius) on Thursday, according to the National weather Service. In the Central Oregon town of Bend, temperatures were 20 degrees above average for this time of year. Gov. Kate Brown said 11 large fires are burning in Oregon. The smoke smudged the skies in the Willamette Valley and made the snowcapped peaks of the Cascade Range barely visible. Fire season starts earlier every year, and Brown blamed that and the heat wave on climate change. She vowed to do everything she can to reduce use of fossil fuels, which contributes to global warming. Brown said that like many Oregonians, she has been feeling the heat, with no air conditioning in her private home and only one room in the governor's mansion having AC.

US wildfires: smoke billows and we're stuck indoors – this is how we live now -- Klamath Falls kids have been spending a lot of time inside this summer – days and days indoors, sweating and playing with Lego and watching TV. The outdoor pool has been closed. Our baseball team, the Klamath Falls Gems, cancelled the rest of the season.  This year’s fire season in the west started out early and is on pace to be one of the worst ever. For those in the path of the flames, it is a major emergency, a life-altering, even life-threatening disaster. For a much larger group of westerners, these fires inflict a lesser but chronic cost. We are smoked in. This isn’t a one-time occurrence. We had a “smoke wave” like this last summer too. There have been so many wildfires in our area in recent years that smoke is officially becoming the season after summer and before what-happened-to-fall.There are dozens of major fires currently burning across the west, including the Carr fire in and near Redding, California, which is over 150,000 acres. On Sunday this and other blazes in the state prompted Donald Trump to declare a disaster. Eight major fires are also burning in southern Oregon, and the governor declared a statewide emergency in mid-July. The Environmental Protection Agency has a color-coded system to communicate how bad the smoke is. It ranges from green, for clear, to red, which is unhealthy for everyone, and purple, meaning “very unhealthy”. There’s even a worse category called “hazardous,” which is a kind of a muddy crimson I’ve come to associate with the apocalypse. In Klamath Falls, we’ve hit “red” for at least part of every day for the last 16 days, and “purple” for 12 of those days. Friday was hazardous.

Air Pollution Denial Could Become EPA Policy - For the last year and a half, fringe theories once promoted only by tobacco lobbyists and the very far-right have seeped into the offices of the Environmental Protection Agency. Now, those theories could soon be reflected in official EPA regulations intended to protect the public’s health.A story published Monday in environmental policy outlet E&E News details the evidence. “After decades of increasingly strong assertions that there is no known safe level of fine particle exposure for the American public, [the] EPA under the Trump administration is now considering taking a new position,” reporter Niina Heikkinen wrote. “The agency is floating the idea of changing its rulemaking process and setting a threshold level of fine particles that it would consider safe.” (She’s referring to particulate matter that is 2.5 micrometers or less in diameter, small enough to penetrate deep into the circulatory system and potentially infiltrate the central nervous system. PM2.5 is the main component of soot.) Under these changes, which are being considered by EPA acting administrator Andrew Wheeler, PM 2.5 would no longer be considered a “non-threshold pollutant”—one that causes harm at any level of exposure. Instead, it would become a“threshold pollutant,” or one that causes harm only above a certain exposure level.Wheeler is considering this change most likely because it would help him to legally justify repealing the Clean Power Plan, a set of Obama-era climate regulations to reduce greenhouse gas emissions from coal plants.  Obama’s EPA had argued that the Clean Power Plan would reduce PM2.5 pollution, thus creating from $13 billion to $30.3 billion in public health benefits. This figure made up about half of the Clean Power Plan’s stated benefits. If Wheeler changes the official designation of PM2.5, the EPA’s position would be that breathing in small amounts of soot has the same impact as breathing in none. Thus, many of Obama’s predicted benefits would be erased.

Trump team blames wildfires on environmentalists, sparking a backlash - Scientists say California’s record wildfires have been fed by an abnormally hot and dry fire season, but the Trump administration continues to insist that there’s a culprit to blame other than climate change: environmentalists and their policies. “Radical environmentalists” should shoulder some of the blame for pushing back against “active forest management,” policies that include mechanical thinning and timber harvest to reduce the risks of wildfires, Interior Secretary Ryan Zinke wrote in an op-ed in USA Today Wednesday. Zinke is the latest administration official to echo President Donald Trump, who tweeted Monday that the fires that have killed at least seven people and consumed more than 500,000 acres of land, should be blamed on “bad environmental laws.” It’s an assertion that environmentalists and scientists reject — especially as his administration works to dismantle international efforts to combat climate change. “Zinke, like Trump, continues to deny the obvious. It is climate change that is exacerbating wildfire season in the West,” said Kirin Kennedy, associate director for lands and water legislative policy at Sierra Club. “The long-term safety of homes, businesses and families in the path of these fires relies on cutting climate pollution — something wholly at odds with Secretary Zinke’s push to drill, mine and frack every possible acre of our parks and public lands.” Trump started blaming environmentalists earlier this week. “Must also tree clear to stop fire spreading!” Trump tweeted, apparently referring to an unrelated agricultural dispute involving the amount of water from snowmelt in the Sierras being allowed to flow into the Pacific Ocean to sustain fish populations in rivers rather than being used to irrigate farmland. Commerce Secretary Wilbur Ross picked up on that theme Wednesday, saying he’s directed the National Marine Fisheries Service to “facilitate access to the water needed to fight the ongoing wildfires affecting the state of California.” But California’s fire service says there’s no shortage of water. “We have plenty of water to fight these fires,” California Department of Forestry and Fire Protection said Monday in a statement tweeted by ABC7 news. It said that two of the biggest fires are near lakes that are being used to obtain water.

Trump administration overrides endangered species protections to access water - The Trump administration says that water in California should be prioritized for wildfire response instead of endangered species protections, even though state officials say they have enough water to fight the fires.    The Department of Commerce announced a directive on Wednesday that says the National Oceanic and Atmospheric Administration is taking over management of water in California in areas affected by the ongoing fires.  The change announced Wednesday would allow federal agencies to expedite decisions about water under an emergency provision of the Endangered Species Act.  The directive specifically says that the National Oceanic and Atmospheric Administration, which includes the National Marine Fisheries Service, will take over management of water during the wildfire emergency in California. Commerce Secretary Wilbur Ross directed the Service to tell other federal agencies "the protection of life and property takes precedence over any current agreements regarding the use of water in the areas of California affected by wildfires."   But there is concern that the Trump administration is actually wading into a political conflict about water in California between the salmon fishing industry and farmers. The two groups have been going back and forth for years on whether water use should be limited to protect salmon populations crucial to fisheries or should be diverted for agricultural use.  "Secretary Ross’s directive is nothing more than a smokescreen designed to weaken these protections that NMFS’s scientists determined are necessary to keep these native fish from going extinct. It’s almost like the extinction of these creatures is their real goal, so that they no longer have to leave any water in rivers, but can divert it all to corporate agribusiness. The people of California won’t stand for Trump destroying our precious resources to line the pockets of his corporate buddies,” senior director of the water division for the Natural Resources Defense Council Kate Poole said in a statement.

California wildfires set off political fight over who should pay for damage-   As 17 fires burn across the state, California's legislature is grappling with what it should do to help residents cope with blazes. The most controversial question facing the state is a decision over who should pay when power lines touch off destructive blazes.That has set off a huge political fight in the state capitol. On Thursday lawmakers heard hours of testimony on a proposal by Gov. Jerry Brown to tweak state liability laws.Currently, utilities can be on the hook financially for fires even if they are not negligent in maintenance. Brown isn't proposing a complete repeal of the liability laws, but he wants to throw the question to the courts. Brown's proposal would allow judges the discretion to assign responsibility for the fire, weighing whether the utility company followed all safety regulations, how much the property was harmed and whether safer electrical systems were available but not used.Huge liability costs for utilities are a very real scenario. State fire investigators have found Pacific Gas & Electric, the state's largest utility, responsible for 16 of last year's devastating Northern California wildfires. Those fires killed dozens of people and destroyed thousands of homes and PG&E is currently facing estimated liability costs of at least $2.5 billion.On Thursday, a representative of the governor told lawmakers that the change would bring the electric industry in California more in line with flood control districts, which aren't forced to pay for property damage if they followed state safety laws and regulations.

California wildfire will burn for the rest of August, say officials --  The Mendocino Complex Fire has already engulfed 290,692 acres (117,639 hectares) - almost the size of Los Angeles.  Barely a third of it is under control, according to the California Department of Forestry and Fire Protection. Firefighters are tackling 18 major blazes across the state amid strong winds and low humidity.The fire - which comprises two blazes in the state's north - was declared the biggest in California's history yesterday. Officials had set a target to extinguish the fire by mid-August, but they now say they will need until early September.The fire has burned 75 buildings and led to thousands of evacuations. A separate blaze - the Carr fire, further north - has killed at least seven people and destroyed more that 1500 structures. Burning through almost 160,000 acres, it was 47 percent contained by yesterday.  Meanwhile, more fires have been breaking out, adding to the mammoth workload of fire crews. The so-called Holy Fire, in southern California, grew dramatically and rapidly on Monday, with two hikers needing to be airlifted to safety.  At least 14,000 firefighters are struggling to contain the multiple outbreaks.The crews have been boosted by US army personnel and more than 1000 prisoners. The inmates - who are considered low-risk offenders - work on a volunteer basis but they also receive $2 (£1.50) a day, plus $1 an hour. Fire crews from Australia and more than 30 New Zealanders have also flown over to share their expertise in battling bush fires.  The New Zealand team, including people from defence and Department of Conservation personnel and contractors, will have to work 12 to 14 hour-long days in extreme conditions. Firefighters told the LA Times about their gruelling schedule. One said his crew had slept - sitting up - in the seats of their fire engine on some nights. "It's been pretty crazy - they're calling this the new norm,"  "In years past, there were one or two big fires a year. Now they're doing three to four huge fires in a week."

The era of megafires: the crisis facing California and what will happen next - California is no stranger to fire. But even for a region accustomed to fire, the continuing wildfire siege has proven unprecedented. Although it is only early August, numerous very large, fast-moving, and exceptionally intense fires have already burned vast swaths of land throughout the state – consuming hundreds of thousands of acres and thousands of homes and claiming at least nine lives, including four firefighters. State and national firefighting resources are stretched to their limits; California’s governor, Jerry Brown, has characterized these devastating wildfires as California’s “new normal”.  But it would be a mistake to assume that the region has reached any semblance of a stable plateau. Instead, the likelihood of large, fast-moving, and dangerous wildfires will continue to increase in the coming decades – and it will combine with other demographic and ecological shifts to produce a large increase in the risk of megafires that threaten both human lives and the ecosystems we depend upon.  The causes are complex, and people are part of the problem. In 1980, 24 million people lived in California; today there are nearly 40 million. Much of this population growth has occurred outside of the dense urban core of cities, resulting in rapid expansion of housing in suburban and semi-rural areas adjacent to wildlands. Of the tens of thousands of homes burned by wildfires in California in recent decades, nearly all were located in this suburban-rural borderland. With housing shortages and high prices plaguing cities throughout the state, it is unsurprising that residents build on the fringes, places often replete with natural beauty. Yet residents are often unaware of the risks inherent in living there, and the need to mitigate those risks accordingly – their lives may depend upon it. Another exacerbating problem: the way we historically managed our forests. Demand for timber in the early 20th century ushered in a new era of federally mandated fire suppression. This national policy has been highly successful at achieving its intended goal: historically, 98% of new fires are extinguished before reaching the relatively modest size of 300 acres. But while this well-intentioned policy of “total suppression” certainly reduced the amount of land burned in wildfires, it also had an unintended side effect: a deficit of low-intensity and forest-regenerating natural fires. This deficit has allowed for an accumulation of wildfire “fuel” in the form of more densely spaced trees and thicker undergrowth in areas that had previously experienced frequent fire. Forests and wildlands are increasingly “primed to burn” under hot and dry conditions. 

At least 91 dead, hundreds injured by earthquake on Indonesian island popular with tourists -- &At least 91 people are dead and hundreds more injured as a magnitude 7.0 earthquake rocked Indonesia's popular island of Lombok on Sunday, according to Indonesian authorities and the U.S. Geological Survey. The island is popular with tourists and now about 1,000 foreign visitors have been evacuated to nearby islands. The powerful quake struck at a relatively shallow depth of 10.5 kilometers off the north coast of Lombok, a little over a mile from Loloan village, on Sunday night local time, the USGS said. It was the second deadly quake to hit the island in a week. The country's National Board for Disaster Management said Monday that 91 people died and 209 people were injured in the quake. Thousands more people were displaced as thousands of buildings were destroyed. The agency warned all of the numbers were likely to increase as search operations continued Monday. Houses damaged by an earthquake are seen in North Lombok, Indonesia, Monday, Aug. 6, 2018. The powerful earthquake struck the Indonesian tourist island of Lombok, killing a number of people and shaking neighboring Bali, as authorities on Monday said.  As of Sunday evening local time, there were 47 aftershocks with smaller earthquake intensity, according to the National Board of Disaster Management. Despite its popularity with tourists, officials said everyone who died was an Indonesian citizen. They said most of those who died were struck by falling debris from collapsed buildings.

Aftershock brings fresh trauma to Indonesia’s quake-hit Lombok (Reuters) - A magnitude 6.2 aftershock rocked Indonesia’s Lombok on Thursday, sparking fresh panic on the tropical tourist island as the official death toll from a powerful earthquake four days earlier almost doubled to 259. Reuters witnesses reporting on the aftermath of Sunday’s quake in the north of the island said buildings and walls that had already been weakened collapsed, and people ran out onto roads even as rocks tumbled down from hillsides. “Evacuees and people ran out of houses when they felt the strong shake of the 6.2 magnitude quake,” Sutopo Purwo Nugroho, a spokesman for Indonesia’s disaster mitigation agency (BNPB), said on Twitter. “People are still traumatized. Some buildings were damaged further because of this.” Officials said the epicenter of the aftershock was on land and so there was no risk of a tsunami. The United States Geological Survey recorded the latest quake at 5.9, at a depth of 10 km (six miles). BNPB’s toll of verified deaths from Sunday’s 6.9 magnitude quake was raised on Thursday to 259 from 131. “This number will continue increasing as rescue teams continue to find victims under collapsed buildings,” the agency said in a statement. A humanitarian crisis is also looming in Lombok, where thousands have been left homeless and in desperate need of clean water, food, medicine and shelter. Authorities made announcements over loudspeakers at evacuation sites, urging people to remain calm and stay inside tents or find open space if they were inside or near buildings. “Please stay calm, this is just an aftershock and it will be over soon, there’s no need to be scared,” one official announced. Officials said about three-quarters of Lombok’s rural north had been without electricity since Sunday, although power had since been restored in most areas before the aftershock. Aid workers have found some villages hard to reach because bridges and roads were destroyed. 

Atmospheric carbon last year reached levels not seen in 800,000 years - The concentration of carbon dioxide (CO2) in Earth’s atmosphere reached 405 parts per million (ppm) last year, a level not seen in 800,000 years, according to a new report. It was also the hottest year on record that did not feature the global weather pattern known as El Niño, which is driven by warmer than usual ocean waters in the Pacific Ocean, concludes the State of the Climate in 2017, the 28th edition of an annual compilation published by the National Oceanic and Atmospheric Administration (NOAA). Overall, 2017 ranked as the second or third warmest year, depending on which measure is used, since researchers began keeping robust records in the mid-1800s.Even if humanity “stopped the greenhouse gasses at their current concentrations today, the atmosphere would still continue to warm for next couple decades to maybe a century,” said Greg Johnson, an oceanographer at NOAA’s Pacific Marine Environmental Laboratory in Seattle, Washington, during a press call yesterday about the report. The hefty document includes data compiled by 524 scientists working in 65 countries. A few highlights:

  • Atmospheric concentrations of CO2—the primary planetary warming gas—last year rose by 2.2 ppm over 2016. Similar levels were last reached at least 800,000 years ago, according to data obtained from air bubbles trapped in ancient ice cores.
  • Atmospheric concentrations of methane and nitrous oxide—both potent warming gases—were the highest on record. Levels of methane increased in 2017 by 6.9 parts per billion (ppb), to 1849.7 ppb, compared with 2016. Nitrous oxide levels increased by 0.9 ppb, to 329.8 ppb.
  • Last year also marked the end of a world-wide coral bleaching event that lasted 3 years. Coral bleaching occurs when seawater warms, causing corals to release algae living within their tissues, turning the coral white and sometimes resulting in the death of the coral. It was the longest documented bleaching event.
  • Global precipitation in 2017 was above the long-term average. Russia had its second wettest year since 1900. Parts of Venezuela, Nigeria, and India also experienced heavier than usual rainfall and flooding.
  • Warmer temperatures contributed to wildfire outbreaks around the world. The United States suffered an extreme wildfire season that burned 4 million hectares and caused more than $18 billion in damages. The Amazon region experienced some 272,000 wildfires.
  • In Alaska, record high permafrost temperatures were reported at five of six permafrost observatories. When thawed, permafrost releases CO2 and methane into the atmosphere and can contribute to global warming.
  • Arctic sea ice took a hit. The extent of sea ice hit a 38-year low, and was 8% below the mean extent reported for 1981 to 2010. Spring snow cover in the Arctic, however, was greater than the 1981 to 2010 average, and the Greenland Ice Sheet recovered from a record low mass reported in 2016. 2017 was also the second warmest year on record for the Arctic.
  • Many countries reported setting high-temperature records, including Argentina, Uruguay, Spain, Bulgaria, and Mexico.

Risk of ‘Hothouse Earth’ despite CO2 cuts -  It may sound like the title of a low budget sci-fi movie, but for planetary scientists, "Hothouse Earth" is a deadly serious concept.  Researchers believe we could soon cross a threshold leading to boiling hot temperatures and towering seas in the centuries to come.Even if countries succeed in meeting their CO2 targets, we could still lurch on to this "irreversible pathway". Their study shows it could happen if global temperatures rise by 2C. An international team of climate researchers, writing in the journal, Proceedings of the National Academy of Sciences, says the warming expected in the next few decades could turn some of the Earth's natural forces - that currently protect us - into our enemies.  Each year the Earth's forests, oceans and land soak up about 4.5 billion tonnes of carbon that would otherwise end up in our atmosphere adding to temperatures. But as the world experiences warming, these carbon sinks could become sources of carbon and make the problems of climate change significantly worse.  So whether it is the permafrost in northern latitudes that now holds millions of tonnes of warming gases, or the Amazon rainforest, the fear is that the closer we get to 2 degrees of warming above pre-industrial levels, the greater the chances that these natural allies will spew out more carbon than they currently now take in.  According to the authors, the current plans to cut carbon may not be enough if their analysis is correct. "What we are saying is that when we reach 2 degrees of warming, we may be at a point where we hand over the control mechanism to Planet Earth herself," co-author Prof Johan Rockström, from the Stockholm Resilience Centre, told BBC News.  "We are the ones in control right now, but once we go past 2 degrees, we see that the Earth system tips over from being a friend to a foe. We totally hand over our fate to an Earth system that starts rolling out of equilibrium."

Pollution is slowing the melting of Arctic sea ice, for now --The Arctic is one of the “canaries in the coal mine” for climate change. Long ago, scientists predicted it would warm quicker than other parts of the planet, and they were right. Currently, the Arctic is among the fastest-warming places on the planet. Part of the reason is that as the Arctic warms, ice melts and ocean water is uncovered. The ocean is darker than ice so it in turn absorbs more sunlight and increases its warming. This is a feedback loop.Another reason is that the Arctic doesn’t get that much sunlight so increased energy from the atmosphere has a bigger influence there than it would have elsewhere.Scientists have looked to the Arctic for clues and hints of human climate change over the past decades. The fact that the Arctic is warming has led to a 70% reduction in the volume of summer sea ice – an enormous loss of ice.  A recent paper just published in the Journal of Climate by the American Meteorological Society takes an in-depth look at how fast the Arctic ice is melting and why. According to the paper, the authors completed a detection and attribution study of Arctic sea ice decline from 1953 to 2012. That is 60 years of data that tell the picture of climate change. The “detection” part of this study was about detecting what long-term trends are apparent over these six decades. The “attribution” part of the study is figuring out what is the cause of the trends..The authors concluded that the combined cooling effect from human aerosols was detected in all three datasets of ice. That means, it didn’t matter whose measurements you used – the effect of aerosol cooling was present.  So how much of an effect do aerosols have? It turns out 23% of the warming caused by greenhouse gases was offset by the cooling from aerosols. Unfortunately, this isn’t good news. It means that if/when humans reduce our aerosol pollution, the warming in the Arctic and the ice loss there will be worse.

Greenhouse gases are warming the world—but chilling Antarctica. Here’s why -  The greenhouse gases that are warming the globe actually cool Antarctica much of the year, a new study confirms. The odd trend doesn’t break the laws of physics, but it does highlight what a strange place Earth’s southernmost continent truly is. Antarctica is home to many extremes. It’s the world’s highest continent, with an average elevation just a shade under 2300 meters. And despite its ice, it’s technically a desert thanks to a paucity of precipitation. This lack of moisture is one of the key factors behind the region’s “negative greenhouse effect,”  Cool greenhouse gases high in Earth’s atmosphere typically trap heat by absorbing infrared radiation emitted by our planet’s warm surface before it reaches space. Thanks to its release by many human activities, carbon dioxide (CO2) is one of the most notorious of these planet-warming gases, but water vapor is a strong greenhouse gas, too. It is abundant in the atmosphere, giving it a much stronger overall warming effect. And when water vapor is scarce, as it is above central Antarctica, the continent’s greenhouse effect goes topsy-turvy, Sejas says. Add to it another weather phenomenon called a temperature inversion, where the atmosphere warms as altitude increases, rather than growing colder, and things truly start to go awry.    “Antarctica is the only place in the world where the surface is colder than the stratosphere,”   The continent’s surface temperatures are typically 20°C colder than the temperature a few hundred meters up in the atmosphere, he explains. The persistent temperature inversion causes high-altitude greenhouse gases to actually emit more heat to space than they trap, Sejas says. Recent studies identified this negative greenhouse gas effect over Antarctica, but those analyses typically looked at the effect only in terms of CO2, Sejas notes. So he and his colleagues analyzed how water vapor might contribute to the cooling effect. Although there’s very little water vapor over Antarctica at low altitude, there’s even less in the overlying stratosphere, Sejas says. Any heat radiated toward space by low-altitude water vapor keeps on going, as if the continent’s heat-trapping comforter had been ripped away in the middle of the night. This negative greenhouse effect is in effect about 9 months out of the year, the team reports.

Reflecting sun's rays would cause crops to fail, scientists warn - Proposals to combat climate change by reflecting the sun’s rays back into space would cause widespread crop failure, cancelling out any benefits to farming from the reduction in warming, according to new research.  By examining the effects of volcanic eruptions on agriculture – which has a similar effect to proposed artificial methods of scattering solar radiation through aerosols – scientists have concluded that such methods could have unintended consequences. “[The research was to] find a way to examine the side effects of geoengineering without experimenting on the climate,” said Jonathan Proctor of University of California, Berkeley, lead author of the paper published in the peer review journal Nature. “[We found] potential adverse effect on agricultural production.”But he said there could be other positive effects that were less easy to capture.The findings deal another blow to proposals to use geoengineering to reduce or delay global warming, which some scientists think may be necessary to stave off the worst effects of rising greenhouse gas emissions. Spraying or injecting tiny airborne particles into the stratosphere has been regarded as one of the prime possibilities for geoengineering, by reflecting some of the sun’s rays back into space before they can warm the Earth.

This climate-change hack would reflect more sunlight. Not such a bright idea, study says. Scientists are pondering what might be called the volcanic solution to global warming. It would be the ultimate desperate measure, a climatological Hail Mary and, possibly, a very bad idea. The only reason it's an actual subject of research is that human civilization has failed to take steps to stave off dangerous levels of climate change.  In 1991, Mount Pinatubo erupted in spectacular fashion.  Molten-hot ash and gas shot into the upper atmosphere, spread out across the globe, reflected sunlight and naturally cooled the planet for more than a year. Researchers say nature may be offering an example of a possible technique for limiting global warming. People can't command volcanoes to erupt, but they can more or less mimic the effects of a volcano through technology. The basic idea is to use aircraft, or some other means, to spew sunlight-reflecting aerosols into the stratosphere and change the albedo — the reflectivity — of the planet. It goes by many names: solar geoengineering, solar radiation management, albedo management, albedo hacking.One hypothesized reason for doing something so audacious is that it might benefit agriculture by preventing heat stress on food crops. But a paper published Wednesday in the journal Nature came to a different and surprising conclusion. Using historical data from two volcanic eruptions, the researchers concluded that tampering with the atmosphere would have no net effect on crop yields.The food crops wouldn't suffer as much heat stress as they would without the intervention in the atmosphere, but they also wouldn't receive as much photosynthesis-powering sunlight. The pluses would be offset by the minuses.“If we think of geoengineering as experimental surgery, our findings suggest that the side effects of treatment are as bad as the original disease,” said Jonathan Proctor, an agricultural economist at the University of California at Berkeley and the lead author of the paper.

Capitalism Killed Our Climate Momentum, Not “Human Nature” - Naomi Klein - This Sunday, the entire New York Times Magazine will be composed of just one article on a single subject: the failure to confront the global climate crisis in the 1980s, a time when the science was settled and the politics seemed to align. Written by Nathaniel Rich, this work of history is filled with insider revelations about roads not taken that, on several occasions, made me swear out loud. And lest there be any doubt that the implications of these decisions will be etched in geologic time, Rich’s words are punctuated with full-page aerial photographs by George Steinmetz that wrenchingly document the rapid unraveling of planetary systems, from the rushing water where Greenland ice used to be to massive algae blooms in China’s third largest lake.  The novella-length piece represents the kind of media commitment that the climate crisis has long deserved but almost never received. We have all heard the various excuses for why the small matter of despoiling our only home just doesn’t cut it as an urgent news story: “Climate change is too far off in the future”; “It’s inappropriate to talk about politics when people are losing their lives to hurricanes and fires”; “Journalists follow the news, they don’t make it — and politicians aren’t talking about climate change”; and of course: “Every time we try, it’s a ratings killer.” None of the excuses can mask the dereliction of duty. It has always been possible for major media outlets to decide, all on their own, that planetary destabilization is a huge news story, very likely the most consequential of our time. They always had the capacity to harness the skills of their reporters and photographers to connect abstract science to lived extreme weather events. And if they did so consistently, it would lessen the need for journalists to get ahead of politics because the more informed the public is about both the threat and the tangible solutions, the more they push their elected representatives to take bold action.  That’s also why it is so enraging that the piece is spectacularly wrong in its central thesis. According to Rich, between the years of 1979 and 1989, the basic science of climate change was understood and accepted, the partisan divide over the issue had yet to cleave, . Writing of the key period at the end of the 1980s, Rich says, “The conditions for success could not have been more favorable.” And yet we blew it — “we” being humans, who apparently are just too shortsighted to safeguard our future.  Yep, you and me. Not, according to Rich, the fossil fuel companies who sat in on every major policy meeting described in the piece. 

America’s contaminated recycling  -- In recent years, the model for U.S. recycling has been to send it overseas to China. China gets a raw material worth money; the U.S. gets rid of its rubbish. But since the start of this year, China has been refusing to take contaminated recycling, forcing communities across the U.S., like Lynn, Massachusetts, to quickly take action.China's new anti-pollution campaign — dubbed the National Sword — refuses some items outright and demands extremely clean recyclables for the rest (0.5 percent contamination). That's why Julia Greene, recycling coordinator for the city of Lynn, is spending her summer looking through recycling bins. She rifles through Lynn resident Diane Thomas' bin. It's filled with plastic bottles — a good thing, except for one problem: The bottles are filled with liquid. Greene explains why that's an issue. The liquid can leak onto perfectly fine recyclables and ruin them. The bin also has used paper towels — which, although they're paper, aren't recyclable. They're covered with food that can further contaminate other products in the bin.  Greene says most residents, like Thomas, have good intentions but they simply don't know some of the rules to recycling. Later, Greene broadens her explanation about the problem with liquid-filled bottles. "When you put those into those bales and then they sit there for weeks and months, as they go to be made into other materials then you've got all kinds of problems with mold, etc. That's why we want to clean it up as best as possible."

Career EPA Staff Objected to Trump Administration's Asbestos Plan -- Attorneys and scientists with the U.S. Environmental Protection Agency (EPA) objected to the Trump administration's proposal of a "significant new use rule" (SNUR) for asbestos, according to internal agency emails obtained by the The New York Times.Trump's former EPA boss Scott Pruitt quietly announced the proposal in June, framing the plan as an "important, unprecedented action on asbestos," a toxic construction material and known carcinogen that killsalmost 15,000 U.S. citizens annually.  Asbestos is not banned in the U.S. but there are strict regulations on its use. But as Fast Company noted, the way the proposed rule is written could allow manufacturers to create new products containing asbestos on a case-by-case basis.In one of the emails obtained by the Times, veteran EPA attorney Mark Seltzer raised red flags about the Trump administration's proposal."This new approach allows asbestos-containing products that are not currently used to be used in the future," Seltzer wrote in the May 2 email."Many manufacturers have stopped using asbestos in their products but would be allowed to through this SNUR if it is not one of the approximately 15 types that the SNUR requires a [notification] for," he said. In another email from Sharon Cooperstein of the EPA's policy office, she "echoed" her colleagues' objections, adding that "the new approach raises significant concerns about the potential public health impacts of the SNUR."

Arkema chemical company indicted for plant fire after Hurricane Harvey -The owners of the Houston-area chemical plant that suffered explosions and fires due to Hurricane Harvey, releasing potentially noxious fumes into the air, was indicted by a grand jury on Friday.  Arkema North America CEO Richard Rowe and plant manager Leslie Comardelle are named in the indictment, which says the company was not prepared for the flooding which caused the fire at the plant in August 2017.  "Companies don’t make decisions, people do," Harris County District Attorney Kim Ogg said in a statement. "Responsibility for pursuing profit over the health of innocent people rests with the leadership of Arkema.  "Indictments against corporations are rare," she added. "Those who poison our environment will be prosecuted when the evidence justifies it."  The Crosby, Texas, plant was flooded during Harvey, which made landfall in southern Texas on Aug. 25, 2017 and slowly moved northeast.  The flood sparked multiple fires and explosions, and caused authorities to evacuate about 200 people in the area. Twenty-one people, including rescue personnel, were treated for injuries.  The charges brought in Friday's indictment carry a penalty of up to five years in prison for each person and up to a $1 million fine for Arkema, according to the district attorney.  Arkema called the charges "astonishing" based on the conclusions from a report by the U.S. Chemical Safety and Hazard Investigation Board in late May.  "These criminal charges are astonishing, especially since the U.S. Chemical Safety Board concluded that Arkema behaved responsibly," Arkema spokesperson Janet Smith said in a statement to Houston ABC station KTRK. "At the end of its eight-month investigation, the Chemical Safety Board noted that Hurricane Harvey was the most significant rainfall event in U.S. history, an Act of God that never before has been seen in this country."

Edward Burtynsky: The Anthropocene Project (photos) - “Most people would walk by a dump pile and assume that there’s no picture there,” says global industrial landscape photographer Edward Burtynsky. “But there’s always a picture, you just have to go in there and find it.” Born in Canada in 1955, Burtynsky has been investigating human-altered landscapes in his artistic practice for over 35 years, capturing the sweeping views of nature altered by industry; from stone, to minerals, oil, transportation, and silicon. “Of course, it’s important to me to make sure that my pictures are attractive to the eye,” he says. “But beneath the surface there’s always a bigger, deeper environmental issue.”His latest exhibition, The Anthropocene Project, is directly influenced by the proposed new geologic era ‘Anthropocene’ – introduced in 2000 by chemist and Nobel Prize winner Paul Jozef Crutzen, to represent a formal recognition and acknowledgement of the “human signature” on the planet. Experts argue that the end of the current epoch has been marked by striking acceleration since the mid-20th century of carbon dioxide emissions and rising sea levels, the mass extinction of global species, and the transformation of land by deforestation and development. Burtynsky hopes to demonstrate this. “Scientists do a pretty terrible job of telling stories, whereas artists have the ability to take the world and make it accessible for everyone,” says the 63-year-old. “We are having a greater impact on the planet than all the natural systems combined. I’m trying to let people know that.” The Anthropocene Project includes photographs of the biggest terrestrial machines ever built in Germany, concrete seawalls in China that now cover 60 per cent of the mainland coast, and psychedelic potash mines in Russia’s Ural Mountains. Burtynsky says that in order to make an impact it was important to capture the largest examples of extractions of the planet, which explains why he visited a mighty 20 countries over a period of five years.

 The great German sand shortage  --On the beloved German holiday island of Sylt, you can swim, surf, rub shoulders with some of the country’s wealthiest folks and sunbathe naked. But there is one thing that you cannot do — build a sandcastle. In fact, if you construct a sand home, you may well be fined €1,000 by the local authorities.  Officials justify the draconian edict in multiple ways.   But also: Sand that has been dug up and turned into a castle is more easily blown away. And this is a problem because there is a sand shortage brewing in Germany.Sand is an vital resource worldwide, used for everything from ingredients for toothpaste and for silicon in electrical appliances to cement on the streets and construction materials in every building. Sand is the most used resource on the planet, with 40 billion tons used in construction over the past year, as part of a $70 billion industry. Germany uses about 4.6 tons per citizen every year. But there’s a growing shortage worldwide. Experts talk about “peak sand” today the way they used to talk about “peak oil.” And it is increasingly rare for Germany to open up new opportunities for sand extraction, despite the country’s ever-growing need for the material. “There are no conflict-free extraction sites anymore,” says sand lobbyist Thomas Beisswenger, head of industry association ISTE, making it harder to get as much sand as is required. He has only seen a handful of extraction sites open up in the past decade, as he’s seen about 50 close. Around three-quarters of those closures were spurred by citizen initiatives. “Not in my backyard” is a big motivation, Mr. Beisswenger says.

Average U.S. construction costs for solar and wind continued to fall in 2016 – EIA - Based on 2016 EIA data for newly constructed utility-scale electric generators (those with a capacity greater than one megawatt) in the United States, annual capacity-weighted average construction costs for solar photovoltaic systems and onshore wind turbines declined, while construction costs for natural gas generators increased slightly. These three technologies accounted for about 93% of total electric generating capacity added in 2016. Across the United States, investment in electric generating capacity in 2016 increased more than 50% from 2015.  The cost of construction for solar photovoltaic (PV) projects has steadily decreased since EIA began collecting data in 2013. Average construction costs reached $2,436 per kilowatt (kW) in 2016, down from $3,705/kW in 2013. Nearly 500 PV generating units totaling 8 gigawatts (GW) were added to the electric grid in 2016, making it the second-most common technology installed in 2016, after wind turbines. Solar PV systems vary by the type of panel used and whether the system uses tracking technology. In 2016, crystalline silicon solar PV systems with tracking were the most-added solar technology and the least expensive, at $2,243/kW. The effect of U.S. tariffs, approved in early 2018, on imported silicon solar cells and modules on future solar photovoltaic costs is unknown. Utilities added 84 wind turbine projects, totaling 8.8 GW, to the electric grid in 2016. The construction costs for onshore wind generators in 2016 reached $1,630/kW, a slight decrease from 2015.  Capacity-weighted costs tend to be lower for larger wind plants. In the past three years, most new wind capacity has been larger plants—89% of 2016 wind turbine additions were to sites with more than 100 megawatts. As the capacity added at a site increases, the capacity-weighted construction cost decreases because the siting and infrastructure costs are shared by more turbines and capacity.

Environmental Groups Ask Supreme Court to Revisit Clean Power Plan Stay -- Environmentalists want the Supreme Court to reconsider its unprecedented decision 2 ½ years ago to stay the Clean Power Plan.Attorneys for a coalition of green groups Friday asked Chief Justice John Roberts to force opponents of the plan to explain why the stay should continue. The Supreme Court halted implementation of the rule in February 2016 on a 5-4 vote; it was the late Justice Antonin Scalia’s last action on the court.In their letter, the environmentalist groups cited the frustration expressed by some judges on the U.S. Court of Appeals for the District of Columbia Circuit that the stay, combined with litigation delays in the lower court, has allowed EPA to circumvent its duties to regulate greenhouse gases.A full panel of D.C. Circuit judges heard oral arguments over the rule in September 2016 but never issued any decision on its legality. The D.C. Circuit agreed to halt litigation in April 2017 and has since issued orders extending the hold.“The litigation has come to a protracted standstill with the support of the parties that sought a stay in this Court,” the environmentalists wrote to Roberts. “In light of these changed circumstances, the Court may wish to require the parties to explain why the stay should continue in effect.”The coalition includes the Environmental Defense Fund, Natural Resources Defense Council, Sierra Club and Center for Biological Diversity.The letter comes as the Trump administration last week informed the court that it will not complete a replacement for the 2015 Obama rule until at least early next year. EPA has asked the D.C. Circuit to keep the case in abeyance as it completes work on the proposal (Climatewire, July 27). Some judges are getting impatient with the administration’s timeline for revising the rule, as the environmentalists noted in their letter.

Power restored to nearly all of Puerto Rico | TheHill: The Puerto Rico Electric Power Authority (PREPA) on Monday announced that power has been restored to most of the island's residents, eleven months after Hurricane Maria devastated the power grid. The restoration process faced a disturbance hours into the final restoration push when a power line went down on Monday afternoon, affecting customers in San Juan and other municipalities.BREAKING: Another large power outage in Puerto Rico; there’s been a failure of the 50200 line running from Costa Sur to Manatí; customers in parts of Bayamón, San Juan & some municipalities in the central part of the island are affected.  Helicopters being used to find the problem — David Begnaud (@DavidBegnaud) August 7, 2018   Earlier in the day, PREPA had announced only .002 percent of its customers, or 25 people, remained without power. It is unclear how many customers lost power during the most recent outage.

 U.S. Officials Push New Penalties for Hackers of Electrical Grid  --Top administration officials are devising new penalties to hit back more forcefully at state-sponsored hackers of critical infrastructure to deter attacks such as the successful penetration of U.S. utilities by Russian agents last year. The push for explicit action is coming from top federal agencies to fight worsening threats to the country’s electricity system and other critical industries, particularly menacing actions from Russia, China, Iran and North Korea. Hackers working for the Russian government claimed “hundreds of victims” last year in a campaign against the energy sector that ultimately put them inside the control rooms of U.S. electric utilities where they could have caused blackouts, officials with the Department of Homeland Security said in briefing last month. The events have forced “an evolution in the U.S. government’s thinking about how to deter malicious cyberactors,” said Robert L. Strayer, the State Department’s deputy assistant secretary in charge of cybersecurity matters, in an interview. Spearheading the effort are the departments of State, Treasury and Defense, among other major agencies, according to government officials. The threat to the U.S. electric grids is so serious that in June a group of presidential advisers said the country needs to prepare for a “catastrophic power outage” possibly caused by a cyberattack. The National Infrastructure Advisory Council, mostly current or former chief executives of companies engaged in critical industries, said resources need to be stockpiled in community enclaves to prevent mass migrations of desperate people. Privately owned utility companies acknowledge they need more help from the federal government, including the military. The utilities say they don’t have the resources on their own to protect the country’s three big electric grids—one in the east, one in the west and one in Texas—against foreign governments. “There must be accountability for bad actors,” said Tom Fanning, chief executive of Atlanta-based Southern Co., one the nation’s biggest utility companies. “I can’t hit back. I can’t fight back. I want to know the Department of Defense is going to be there and hold people accountable.” 

Group says US energy panel stacked with industry supporters — Conservationists claimed in a lawsuit filed Tuesday that a Trump administration committee reviewing royalties paid by companies on fossil fuels extracted from public lands is stacked with industry supporters who conduct some meetings in secret. The Western Organization of Resource Councils asked a federal judge in Montana to disband the U.S. Interior Department’s Royalty Policy Committee and strike down its recommendations. The 20-person panel — comprised of representatives from industry, state government, tribes and academia — was established last year by U.S. Interior Secretary Ryan Zinke. It’s supposed to find ways to remove barriers to drilling and mining, while making sure taxpayers aren’t shortchanged by energy companies. Critics allege the panel has made one-sided recommendations that favor industry and weaken environmental protections. Those include calls to speed up oil and gas lease sales in the Arctic, hasten approvals for new drilling and allow coal companies to largely self-determine the value of fuel they sell on the export market. “It’s basically the fox guarding the hen house,” said Steve Charter, a rancher from Roundup, Montana and board member of the Western Organization of Resource Councils. “That committee is supposed to be representing all interests, but it’s been pretty much totally stacked with industry and some Western states with a real strong development bias,” he added. 

California vows to fight Trump EPA's move to freeze fuel economy rules - Vowing to defend California's authority to set its own greenhouse gas emissions rules, Gov. Jerry Brown said the state would fight the new EPA plan “in every conceivable way possible.” )The Trump administration Thursday pushed ahead with plans to unravel the federal government’s most effective action to fight climate change — aggressive fuel economy standards aimed at getting the nation’s cars and trucks to average more than 50 miles per gallon by 2025.After months of discussion and drafts, the Environmental Protection Agency and the National Highway Traffic Safety Administration formally unveiled their plan to rewrite those rules and replace them with ones so lax that even automakers are wary.The administration’s plan would freeze mileage targets in 2020 for six years. It would also move to end California’s power to set its own, tougher greenhouse gas emissions standards and nullify the state mandate that automakers sell a specified number of electric vehicles. EPA officials sought to portray the proposal as the administration’s opening bid in a negotiation with California. State officials, however, loudly denounced the plan as too extreme and threatened to fight it in court. California and the 13 other states that follow its more stringent rules argue the Clean Air Act empowers them to keep the Obama-era standards in place in their markets.

  California tees up effort to counter Trump’s car emissions rollback | TheHill: California officials are preparing a regulatory counterpunch against the Trump administration’s proposal to roll back auto emissions and fuel efficiency standards. The California Air Resources Board (CARB) on Tuesday outlined its argument that a federal proposal to revoke the state's authority to set its own emissions rules is illegal. “This is contrary to the facts and the law,” CARB declared in a 54-page report. “It frustrates Congressional intent, upheld by the Supreme Court and lower federal courts, in the Clean Air Act and the Energy Policy and Conservation Act to conserve energy and protect the environment by setting maximum feasible standards, and to preserve California’s authority to take the measures it deems necessary to set its own motor vehicle emission standards.” The proposal from the Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration (NHTSA) would also cancel out heightened emissions standards set to take effect for vehicles built between 2021 and 2026, freezing the standards at their planned 2020 level. With Tuesday’s report, CARB is officially proposing its first step against the Trump administration's rollback. Since recent federal car standards have aligned with California’s, regulators have deemed automakers to be in compliance with the state rules if they follow the federal ones. Now, CARB wants to amend its regulations so that the assumption of compliance would only apply if the Trump administration doesn’t ease the standards. “The proposed amendments will ensure that appropriate and necessary greenhouse gas emission reductions and public health protections are achieved by California’s standards,” the agency wrote Tuesday. “They are also important for maintaining the pace of greenhouse gas emission reductions that are necessary to achieve our statutory targets.”

 U.S. ethanol exports on pace to shatter record -- In Washington, D.C., government data released on Friday shows that U.S. ethanol exports through June stood at 927.7 million gallons (mg), up 33 percent from the first half of 2017 and on pace to shatter last year’s record of 1.38 billion gallons (bg). According to the Renewable Fuels Association, robust export markets are more important now than ever before, as actions by the Environmental Protection Agency are undermining domestic ethanol demand. At the halfway point for 2018, Brazil had been the leading market for U.S. ethanol exports, receiving 345.9 mg—or about 37 percent of total shipments. Exports to Brazil in the first half of 2018 were up 28 percent over the same period in 2017. Canada has been the second-leading export market, with 159.5 mg of U.S. ethanol flowing north of the border in the first six months of the year. That’s up 8 percent from the same period a year ago.

China is building coal plants again - Satellite imagery reveals that many coal-fired power projects that were halted by the Chinese government have quietly restarted. Analysis by CoalSwarm estimates that 46.7 gigawatts of new and restarted coal-fired power construction is visible based on satellite imagery supplied by Planet Labs. The coal-fired power plants are either generating power or will soon be operational. The arrival of summer has led to temporary electricity shortages in many regions, with reports of power demand outstripping supply in Shandong, Henan, Hunan, Hubei and Zhejiang provinces. This has resulted in a loosening of policy-level restrictions on the coal power sector. In May 2018 the National Energy Administration permitted Shaanxi, Hubei, Jiangxi and Anhui to restart construction of coal-fired power stations. Restrictions were also relaxed to some degree in four other provinces.

Munich Re to back away from coal-related business: CEO (Reuters) - Munich Re, the world’s biggest reinsurer, will stop investing in bonds and shares of companies that generate more than 30 percent of their sales with coal-related business, its chief executive said, caving to pressure from investors. “In the individual risk business, where we can see the risks exactly, we will in future in principle no longer insure new coal-fired power plants or mines in industrial countries,” Joachim Wenning added in a commentary to be published in German daily Frankfurter Allgemeine Zeitung on Monday. Policymakers are pushing companies to do more to help meet a target, agreed in Paris in 2015, to limit global warming to below 2 degrees Celsius. Investors are increasingly using their financial muscle to reward those at the forefront of that transition. Swiss Re, world number two by share value, said in July it would not reinsure any company for which thermal coal represents more than 30 percent of its business, following French peer Scor. Despite being a vocal supporter of the Paris deal, Munich Re had said as recently as last month that it did not plan to copy Swiss Re in limiting its underwriting of coal companies. 

Progressives 'Furious' After Report of DNC Proposal to Reverse Ban on Fossil Fuel Donations -- After winning applause from environmentalists in June for unanimously voting to ban donations from fossil fuel companies, the Democratic National Committee (DNC) has reportedly proposed reversing the ban and is planning to vote on a resolution on Friday that would once more allow oil companies to pour money into DNC coffers. "Couched in language of embracing the contributions of fossil fuel workers, the proposal, introduced by DNC Chair Tom Perez, states that the party will accept donations from 'employers' political action committees,'" reports the Huffington Post, which obtained a copy of the new proposal (pdf).The DNC's reversal immediately sparked anger among progressives and activists who have been pushing the party to end its reliance on Big Oil money and begin confronting the climate crisis with the urgency and boldness it requires.  Honestly, these people are bound and determined to deflate and demobilize their base - and then blame the Russians when they lose. https://t.co/CgyeT2Vrqw— Naomi Klein (@NaomiAKlein) August 10, 2018   "I am furious that the DNC would effectively undo a resolution passed just two months ago just as the movement to ban fossil fuel corporate PAC money is growing (and Democrats are winning)," Democratic Party activist R.L. Miller, a co-sponsor of the original resolution that banned fossil fuel PAC money, told the Huffington Post. "There's no reason the DNC should go back on their promises and accept corporate PAC money," tweeted the advocacy group People for Bernie. "The rule being proposed by Tom Perez may allow the Koch Brothers to donate to the party. They could create an 'employer pac' at Georgia Pacific, have a union member donate, then fill it with their own cash."

DNC reverses ban on fossil fuel donations | TheHill: The Democratic National Committee (DNC) overwhelmingly passed a resolution on Friday evening saying it welcomes donations from fossil fuel industry workers and “employers’ political action committees.” Critics of the newly passed resolution are calling it a reversal of the DNC’s recently adopted ban on accepting donations from fossil fuel companies’ political organizations. DNC Chairman Tom Perez sponsored Friday’s resolution that allows the committee to accept contributions from “workers, including those in energy and related industries, who organize and donate to Democratic candidates individually or through their unions’ or employers’ political action committees.” Perez, who served as Labor Secretary in the Obama administration, said the new measure was a commitment to organized labor. The resolution also says that the party wants “to support fossil fuel workers in an evolving energy economy.”On a conference call Friday, Perez said that after the June resolution passed, members of the labor community voiced concerns about the ban, calling "an attack on the working people in these industries." But he stressed that the DNC will still work to combat climate change. 

Big coal joins fight against Lake Erie green energy wind turbines  - Cleveland Plain-Dealer- Boaters and birders have been upfront about their opposition to the six-turbine Icebreaker Wind project planned for Lake Erie, but a new, powerful voice of resistance has recently emerged: Big Coal.In documents and sworn statements filed with the Ohio Power Siting Board on Thursday, the wind farm developers presented evidence that Murray Energy Corp. has been bankrolling anti-Icebreaker consultants, as well as lawyers representing two Bratenahl residents who have testified against the project.Cody E. Nett, a spokesman for Murray Energy, confirmed the company's involvement by e-mail and said, "Murray Energy is pleased that its outside counsel... can assist the Bratenahl residents to prevent Icebreaker from steam-rolling this project through the Ohio Power Siting Board certification process without the public scrutiny and opposition that it deserves." Robert Murray, who has homes in Moreland Hills and Belmont County, is the founder and CEO of the nation's largest privately-owned coal company, with 16 active mines in five states and Colombia, South America. As coal sales plunge and hundreds of coal-fired power plants are shut down across the country, green energy facilities such as Icebreaker pose a formidable new source of competition for Murray's coal companies. Even if Murray had wanted to intervene in the state certification process for Icebreaker, he likely would have been denied, said David Karpinski, vice president of operations for the Lake Erie Energy Development Corporation. Interveners must first file a request to participate in the decision-making process with the siting board, which is responsible for reviewing applications for the construction of major utility facilities such as power plants and wind farms.

Eight Permits Awarded in Ohio's Utica Shale – Eight new permits were issued last week for horizontal wells across the Utica shale, according to the latest update from the Ohio Department of Natural Resources. Oklahoma City-based Ascent Resources received five permits to drill in the Utica. Two permits are for wells in Jefferson County, two others are targeted for Guernsey County and a single permit was issued for a well in Belmont County, according to ODNR. The agency issued two permits to XTO Energy for wells in Belmont County, while Eclipse Resources LP secured a single permit for a well in Monroe Township. According to ODNR, there were 18 rigs operating across the Utica during the week ended Aug. 4. No new permits issued in the northern tier of the Utica, which includes Mahoning, Trumbull and Columbiana counties. No new Utica well permits were issued to energy companies in neighboring Lawrence or Mercer counties in western Pennsylvania, according to the Pennsylvania Department of Environmental protection.

Cabot Oil & Gas opens Jeromesville office - - With exploratory drilling of fracking wells underway in Ashland County, Cabot Oil & Gas has set up a local office in Jeromesville. The Houston-based company marked the move with a ribbon cutting Monday at the newly leased office at 31 W. Main Street.   "We were looking for a central location where we could be able to interact with the community, and this was the perfect spot... A lot of people have questions, and we want to provide answers," said George Stark, director of external affairs for Cabot's north region. The questions surround Cabot's current activities and future plans in Ashland and surrounding counties.   The company is looking for fossil fuels-- either oil or natural gas-- below the Utica Shale formation. Cabot plans to drill at least five exploratory wells by the end of the year.   After drilling about a mile below the ground vertically and then about two miles horizontally, Cabot uses a process called hydraulic fracturing to extract the fuels.  Cabot has already drilled its first well in Green Township and plans to begin hydraulic fracturing there by the end of the month. Drilling will begin soon on a second well in Mohican Township, and a pad for a third well is being constructed in Vermillion Township.   Stark indicated his company should know around the end of the year whether it intends to keep drilling in the area.   "Right now we're still in the exploratory phase."

Pilot Flying J seeks drivers for Carroll County terminal - Crude oil production in the Utica Shale is driving a need for Pilot Flying J Crude Division to hire more truck drivers.. The prominent truck stop and retail plaza, also known as Pilot Flying J, in the 2300 block of Faircrest Street SW represents the retail end, the final product of the petroleum industry. Demand for Pilot Flying J Crude Division's transport services is to the point where the corporation needs more drivers to haul crude oil from well sites to the refineries. "Right now we have 24 drivers here in the Carrollton yard," said Christian Whitlock of Pilot Flying J. "We are looking to hire 10 more. They can't get enough drivers. It is a drivers' market right now. We have 14 trucks. There is plenty of it (petroleum) out there. We expect it to be here for a long time." Whitlock oversees the Pilot Flying J truck terminal in the 4100 block of Canton Road NW (state Route 43) in Carroll County's Harrison Township.A spokesman for the Ohio Department of Natural Resources' Division of Oil and Gas agrees with Whitlock's assessment."There is quite a lot of natural gas production as well as some oil production," said Steve Irwin, public information officer for the Ohio Department of Natural Resources. "Crude (oil) is fairly steady." Pilot Flying J tanker trucks haul crude oil for Shell Oil Co. and Chesapeake Energy to various regional refineries. The crude oil and natural gas being extracted out of the ground are products of the Utica Shale formation.

Encino Acquisition Partners agrees to acquire all of Chesapeake's Ohio Utica Shale oil and gas assets - EAP is acquiring 933,000 net acres of leasehold spanning the condensate, liquids-rich and dry gas windows of the Utica play in Ohio. On that property are 920 wells producing and non-producing wells, and EAP plans to operate multiple drilling rigs on the properties to increase production and cash flow. Chesapeake was the largest leaseholder in Columbiana County and at the forefront of the leasing boom in the Utica shale that began in 2010. Canada Pension Plan Investment Board and Encino Energy formed EAP in 2017 to acquire large, high-margin oil and gas production and development assets in the U.S. lower 48 states. In support of this acquisition, CPPIB will invest approximately $1 billion in EAP and will own approximately 98 percent of the partnership. Houston-based Encino will invest in EAP alongside CPPIB and will operate the acquired assets on behalf of EAP.  Together, EAP’s owners plan to build a large, well-capitalized independent E&P company. “At EAP, Encino and CPPIB are building a company focused on shareholder returns with top-notch people, carefully managed risk and sustainable, safe operations,” said Hardy Murchison, Encino’s chief executive officer. “With a multi-decade inventory of development projects held by 920 producing wells, the Utica acquisition provides an excellent start for EAP. We are excited to work with Chesapeake’s employees in the Utica and all other stakeholders in the state of Ohio. With a strong balance sheet and a partner of CPPIB’s stature, EAP is well positioned for continued growth through drilling and acquisitions.”

Chesapeake leaving, but not done drilling yet –Chesapeake Energy may be selling its Utica Shale oil and gas assets in Ohio but the company is continuing to drill new wells in Columbiana County. Chesapeake’s subsidiary, Chesapeake Exploration, has applied to the Ohio Department of Natural Resources seeking permits to drill two new horizontal wells at an existing drill site in Washington Township. The site is the Sevek farm off Clarks Mill Road. The news comes 10 days after Houston-based Encino Acquisition Partners announced it had reached an agreement with Chesapeake to acquire all 933,000 net acres of leasehold spanning the condensate, liquids-rich and dry gas windows of the Utica play in Ohio. The deal is worth $2 billion and expected to be concluded sometime in the fourth quarter. Chesapeake has 920 producing and non-producing wells in Ohio, of which more than 50 are in Columbiana County. Chesapeake is the largest leaseholder in the county. 

CNX Spending Increases on Well Issues, Water Costs -- CNX Resources Corp. on Thursday said it would spend more this year, primarily to cover higher-than-expected water costs and take care of problems at some of its well sites in Appalachia.The company is now guiding for capital expenditures (capex) to come in at $900-950 million instead of its previous forecast of $790-915 million. More than half of the increase is due to well remediations and the higher cost of getting water trucked to its completion operations.  “We had four separate pads impacted in the first half of the year. That includes extended fishing operations on two pads where we had issues retrieving downhole equipment and two southwest Pennsylvania Marcellus pads where some abnormal conditions created issues with production casing cement that required repairs,” and slowed cycle times, COO Tim Dugan said during a call Thursday to discuss second quarter results. The issues have since been resolved or accounted for in the company’s revised spending plans, he said.The remainder of the capex increase was due to inflation, steel tariffs and a prepayment related to a three-year agreement for an electric fracturing fleet.CNX produced 122.6 Bcfe during the second quarter, up from 92.2 Bcfe in the year-ago period. Second quarter volumes declined from 1Q2018, when they came in at 129.5 Bcfe. The decrease was expected, however, after the company bought online just three wells during the second quarter, which was also its first without shallow oil and gas assets it sold at the beginning of the year. The Marcellus Shale continued to anchor sales volume. CNX produced 64.7 Bcfe from the formation in the second quarter, up 14% from the year-ago period. Utica Shale volumes also continued to soar, driven mainly by the company’s assets in Monroe County, OH. Utica production was 42.6 Bcfe, or 209% higher than it was in 2Q2017.

Breaking: Retired teacher sentenced to 2 - 6 months in case brought by Energy Transfer Partners - The retired special education teacher who has been in a years-long battle to protect her property and the environment from Energy Transfer Partners’ Mariner East 2 pipeline was sentenced to 2 — 6 months by Pennsylvania Court of Common Pleas Judge George Zanic. Ellen Gerhart was arrested last Friday for indirect criminal contempt after Energy Transfer Partners filed a motion that made charges including that she’d baited bears and mountain lions to the pipeline easement. (See www.dailykos.com/...) Few details are known about the sentencing. Indirect criminal contempt usually has a maximum sentence of 15 days, so it is unclear how the judge justified a sentence of 2 - 6 months. This post will be updated as we learn more.The case raises many important legal questions about what landowners can and cannot do on their own property after a portion of it has been taken by eminent domain, as was the case here. Sharon Kelly of DeSmog Blog wrote an excellent piece that looks at those issues.  Here is the release issued by the Gerhart family and their attorneys.. On Friday, August 3, Huntingdon County Judge George Zanic sentenced 63-year-old grandmother, retired teacher, and landowner Ellen Sue Gerhart to two to six months in jail and a $2,000 fine for indirect criminal contempt of court. Judge Zanic’s decision was based on accusations from lawyers for Texas-based oil and gas giant Energy Transfer Partners (ETP), the developer of the pipeline project through Gerhart’s land. The company alleged that Gerhart had baited a bear onto the pipeline easement on her wooded 27-acre property. Elise Gerhart, daughter of Ellen, said, “If you build a pipeline through the woods, you should expect to see bears and other wildlife. Judge Zanic gave this $50 billion company the power of eminent domain over my family’s property and our governor gave them the permits. My mom’s protest on her own property is not the injustice here.” In an interview prior to her arrest, Ellen Gerhart said, “We’ve had no choice but to take a stand and defend what our government officials are unwilling to protect. Our right to peacefully object to an unjust and dangerous pipeline should be protected over the profit margin of these foreign corporations.”

Mariner East 2 pipeline nears completion -- Construction of Sunoco Pipeline LP's controversial Mariner East 2 pipeline is nearing completion, but natural gas isn't expected to flow through it for at least a couple more months.  Sunoco spokeswoman Lisa Dillinger said this week that 99 percent of mainline construction - which includes areas in Berks County - is complete. However, an important part of construction is the additional safety testing once the pipeline is installed, she said.  "These tests include hydrotesting - testing with water at higher-than-normal operating pressures - and inline inspection using a caliper pig," Dillinger said in an email. "Caliper pigs are a supplemental testing tool that continuously measure the inside diameter of the pipeline through an array of spring-loaded sensing fingers."  These safety tests on the pipeline and related facilities are 79 percent complete, and Dillinger said she expects all construction and safety testing to be completed in the third quarter of this year.The $2.5 billion Mariner East 2 project traverses 17 counties in southern Pennsylvania. Work started in Berks in April 2017. Plans call for two new 20-inch pipelines that will run through Brecknock, Caernarvon, Cumru, Robeson, South Heidelberg and Spring townships, and New Morgan.  The pipelines, known as Mariner East 2 and Mariner East 2X, will carry natural gas liquids east from the Marcellus and Utica shale areas in western Pennsylvania, West Virginia and eastern Ohio to the Marcus Hook Industrial Complex on the Delaware River in Delaware County. From Marcus Hook, most of those liquids - propane, ethane and butane - are shipped overseas for use in plastics manufacturing. The project has been plagued by leaks and construction setbacks, and in January the DEP halted all work on the pipeline, citing egregious and willful violations, including several in Berks County. After levying a $12.6 million civil penalty, DEP allowed work to resume in February.

DEP fines Sunoco $148000 for pipeline trouble -The state Department of Environmental Protection has fined Sunoco Pipeline LP $148,000 for violations of the Clean Streams Law and Dam Safety and Encroachment Act that occurred during the construction of the Mariner East 2 pipeline in Berks, Chester and Lebanon counties.In all three counties, Sunoco impacted the private water supplies of several residents by causing cloudy, turbid, discolored and/or lost water in their wells, in addition to causing pollution and potential pollution to waters of the commonwealth, according to a DEP news release.In Chester County, Sunoco also failed to immediately notify the DEP of the adverse impacts on private water supplies, the release said.“Sunoco's actions violated the law and will not be tolerated,” DEP Secretary Patrick McDonnell said in the release. “Sunoco cannot impact water supplies. If it does, Sunoco must address those impacts to the satisfaction of the water supply's owner, including replacement or restoration of the impacted water supply.”The collected penalty will be divided and deposited into the Clean Water Fund and the Dams and Encroachments Fund.  “No company is above the law,” McDonnell added. “Sunoco must comply with all conditions in its permits. DEP will continue to monitor Sunoco's compliance with those conditions and take all steps necessary to ensure Sunoco complies with its permits and the law.”

Negotiations continue to move PennEast pipeline in Bethlehem Township –   Negotiations are continuing over moving a section of the PennEast pipeline slated to run about 200 feet from a Bethlehem Township housing complex. Residents of the Hope Ridge development off Hope Road have deep concerns because of the pipeline’s proximity to dozens of the neighborhood’s 84 homes. PennEast has received approval from the Federal Energy Regulatory Commission to build a 120-mile pipe that will run from Luzerne County to Mercer County, N.J. In Bethlehem Township, a portion of the pipeline would run on the east side of Route 33, go across Easton Avenue, pass through township-owned property and behind a cell tower then take a series of 90-degree bends on a track that follows Hope Road. If the 36-inch natural gas pipeline were to rupture, Hope Ridge is within the 900-foot blast zone. About 30 residents on Monday implored Bethlehem Township commissioners to reject any effort by PennEast Pipeline to obtain easements to build a natural gas pipeline that would pass within 200 feet of their homes on Hope Road. “It is up to you gentlemen to protect us,” resident Phyllis Wertman said. . Kelly said the group discussed whether the pipeline could be moved onto land on Hope Road that is owned and used by PennDOT as a maintenance yard. “It would go through their [PennDOT] property. And PennDOT has been amenable to what makes sense,’’ Kelly said. 

Too big to fail: How one gas company can leave a mark on Pennsylvania -- Diversified Gas & Oil PLC may be the largest operator of old oil and gas wells in the country.  Another way of saying that is the Alabama-based company might have the most responsibility for plugging wells across Appalachia.  That’s not lost on Pennsylvania regulators. On July 25, the state Department of Environmental Protection announced that it had ordered three companies — Alliance Petroleum Corp., XTO Energy Inc. and CNX Gas Co. — to plug 1,058 abandoned wells statewide after production records showed the wells had not produced any oil or gas for a year.The agency didn’t spell out a key detail: Nearly all of those unproductive wells are now owned by Diversified, which has grown at a breakneck pace over the past year — swallowing up smaller companies and picking up shallow gas assets that the company has referred to as “unloved” and “forgotten” by big shale drillers. Diversified is following a strategy of keeping the conventional wells active as long as possible without drilling new ones — counting on its volume and efficiency to allow it to profit on the fuel production that others have abandoned. And Pennsylvania is increasingly alarmed that, once the wells have been wrung dry, the cost of plugging all of them might overwhelm the company and land in the state’s lap. The state has never before faced such a concentration of liabilities in one company.  While the companies that sold to Diversified hailed their release from long-term liabilities, those same liabilities didn’t seem to weigh down Diversified’s balance sheet. When EQT Corp. announced the sale of many of its conventional wells to Diversified in June, the Pittsburgh-based firm boasted that it had shed nearly $200 million in plugging and well abandonment liabilities. But what showed up on Diversified’s books was $70 million.CNX Resources was glad to get rid of $197 million in plugging costs for its shallow wells, which Diversified recorded as a $22 million liability.

Pittsburgh train derailment points to failing infrastructure --A freight train derailed Sunday afternoon in downtown Pittsburgh with massive fright cars and debris landing less than 100 feet from a light-rail and bus station where passengers were waiting for their bus or train.  Several cars landed on the track used by the light-rail train. A light-rail train had passed through the area just a few minutes before the accident. A fast thinking Port Authority employee who was working the ticket booth at the time quickly directed passengers from both platforms and away from the accident.  Public safety officials said that no one was hurt and none of the cars were carrying hazardous or flammable chemicals. The route is often used by trains pulling oil tankers, natural gas and chemicals used in the fracking of natural gas.The freight train was traveling west along the Norfolk and Southern Railway line near Station Square when the cars fell off the track around 1 p.m. A spokesperson for the railway said that crews that specialize in removing and cleaning up from train derailments were on route for Pittsburgh. A special crane capable of lifting the loaded cars off the hill would have to be brought in as well.  On Monday morning, crews could be seen working to stabilize the fallen cars and beginning the removal process. Several cars could be seen dangling and a large crane was being used as a brace to keep the cars from rolling further down the hill. Over 26,000 people use the light-rail service each day to get into and out of the city for work.

API Strikes Back At Cuomo For "Extreme Energy Policies"  - The American Petroleum Institute has attacked New York Governor Andrew Cuomo for his energy agenda, which, API New York executive director Karen Moreau said in a statement, is hurting the most vulnerable members of society. The statement comes in response to Governor Cuomo’s refusal to renew the air quality permit of the gas-fired Competitive Power Ventures Power Plant in the state. “Governor Cuomo has sided with environmental extremists over New York’s most vulnerable: low-income families and seniors,” Moreau said. “Gov. Cuomo’s actions to close Indian Point coupled with efforts to stifle new clean natural gas power generation are creating a manufactured, needless energy crisis throughout New York and the northeast that will harm residents in the region – disproportionately hurting low-income and elderly residents who rely upon affordable electricity to heat, cool, and power their homes.” The New York Governor is on a quest to put an end to fossil fuel and nuclear power use in the state, and this quest has already cost New Yorkers substantial increases in their utility bills. A May report from the Consumer Energy Alliance found that New Yorkers pay some 44 percent more for electricity than their neighbors in Pennsylvania, which has abundant gas reserves and the pipelines to send this gas to New York. In January 2018, the Alliance said, “spot market prices in the New York City region jumped to a record high of $140.25 for natural gas, as compared to the average natural gas spot market price for New York in 2017 was $3.08. New Yorkers were subjected to prices that were $137 higher due to self-inflicted capacity constraints created by their own elected officials.” Also in May, Governor Cuomo said all natural gas plants operating in New York will be eventually closed and that he will not approve any new gas-fired plant projects.

FERC overturns N.Y. denial of Northern Access -- The Federal Energy Regulatory Commission yesterday overruled New York's decision on an embattled natural gas pipeline, marking at least the second major FERC action against New York's pipeline blockade.It's not yet clear whether that gives the 99-mile Northern Access 2016 pipeline the necessary clearances to begin construction. National Fuel Gas Co., its developer, said yesterday it's still digesting the FERC action. And New York says it will object."If FERC fails to reverse its misguided decision, DEC will appeal to the 2nd Circuit and seek a stay of any construction and continue to vigorously use every legal avenue to protect our state's resources," the New York State Department of Environmental Conservation said in a statement today.Nevertheless, the action is a significant marker in the ongoing battle to define federal and state powers over gas pipelines. Under the Clean Water Act, states have a well-established legal authority to review, and deny, pipelines over their water impacts. But after New York denied several projects in recent years, the gas pipeline industry and congressional Republicans accused the state of abusing its power. The issues — what the law really says and how FERC ought to interpret it — are now getting worked out in various courts and before FERC. New York cases have played a front-and-center role. In one case involving Constitution Pipeline Co., FERC backed New York's decision to block the project (Energywire, Jan. 12). In another case regarding the Valley Lateral pipeline, a federal appeals court sided with the developer — and FERC — and said it could build (Energywire, March 13). In each of these cases, "waiver" is a key concept. Under Section 401 of the Clean Water Act, after states receive an application for a water permit, they have a year to conduct the review. If they exceed that year, FERC can determine the state's taken too long — "waived" its authority — and advance the project anyway.

The Latest Pipeline Battle Is Ramping Up in New York - It’s understandable that New Yorkers are not looking kindly upon a new fracked-gas pipeline that’s proposed to snake its way mere miles from the same areas hardest hit by Hurricane Sandy. Banding together in a coalition of environmental groups and local communities, they are now organizing to prevent the construction of the Northeast Supply Enhancement pipeline.  Developed by Williams, a publicly traded, Fortune 500 company, the NESE is proposed to span Lower New York Bay, from Sayreville, New Jersey, to the Rockaways in Queens. The project would be an extension of the existing Transco pipeline, which stretches from Texas to New York. There is already one segment of the Transco that crosses Lower New York Bay, just south of where the NESE is slated.  “Unfortunately, due to the growing popularity of gas, the existing pipeline operates at maximum capacity,” says Chris Stockton, a Williams spokesperson.  Williams contends that the NESE is necessary to feed New York’s growing energy needs, particularly in light of the city’s oil-to-gas boiler conversion program. Under a 2011 law, buildings in the five boroughs must switch their heating fuel from soot-producing oils to relatively cleaner alternatives, such as gas, by 2030. This environmental initiative, Williams insists, has created demand that surpasses the capacity of the existing Transco pipeline; thus, the NESE is necessary to increase supply to providers like National Grid, which fills residential, commercial, and industrial gas needs in Staten Island, Queens, and Brooklyn, as well as Long Island.  “Williams claims that the pipeline would bring gas supply that New Yorkers desperately need,” says Kim Fraczek, director of the Sane Energy Project, a sustainable-energy-advocacy group. “However, New York City’s boiler conversions would require only a max 6 percent increase in National Grid supply, which will be more than accounted for in building-efficiency improvements and the transition to renewables.”  To corroborate that 6 percent figure, Fraczek points to an assessment commissioned by the city itself. Similarly, in comments to the Federal Energy Regulatory Commission, National Grid states that it needs only a 10 percent increase in gas supply to cover both New York City and Long Island. The NESE, on the other hand, would increase capacity by more than 64 percent.

WVU Shale Lab Digs Into Marcellus-Utica Permeability Testing —West Virginia University (WVU) is one of many universities that are digging into shale research labs as part of their course curriculum within their petroleum and natural gas engineering programs.  Because of special funding and support from the energy industry and government agencies, these future engineers are able to actively receive a head start on their site work.During a recent tour of WVU’s petroleum and natural gas engineering department, Professor Kashy Aminian of the Benjamin M. Statler College of Engineering and Mineral Resources, shared several working labs where energy companies and alumni have provided financial support and equipment to simulate various operations of the natural gas industry.   In 2017, Dominion Energy donated more than $150,000 in meters and regulators to WVU. The engineering department conducted a special ceremony naming the state-of-the- art lab as the “Dominion Energy Natural Gas Measurement Laboratory.”     One of the most interesting shale technology labs that Aminian highlighted during the tour was a shale lab called the Precision Petrophysical Analysis Laboratory (PPAL). He demonstrated that the lab has measurable capabilities of determining; permeability (nano-darcy range), pore volume (0.1% accuracy), absolute permeability (gas pressure correction), impact of stress (reservoir conditions), impact of adsorption and pore structure characterization.  Aminian is also a specialized consultant in the oil and gas industry who consults energy companies on how to “predict production” so they may increase on their return on investments. With a research grant from the U.S. Department of Energy National Energy Technology Laboratory (NETL), the PPAL will be advantageous for natural gas companies at their E&P divisions.

Documenting Fracking Impacts: A Yearlong Tour from a Bird's-Eye-View - I always tell people that you can’t really understand or appreciate the enormity, heterogeneity, and complexity of the unconventional oil and gas industry’s impact unless you look at the landscape from the cockpit of a Cessna 172. This bird’s-eye-view allows you to see the grandeur and nuance of all things beautiful and humbling. Conversely, and unfortunately more to the point of what I’ve seen in the last year, a Cessna allows one to really absorb the extent, degree, and intensity of all things destructive. I’ve had the opportunity to hop on board the planes of some amazing pilots like Dave Warner, a forester formerly of Shanks, West Virginia, Tim Jacobson Esq. out of La Crosse, Wisconsin, northern Illinois retired commodity and tree farmer Doug Harford, and Target corporate jet pilot Fred Muskol out of the Twin Cities area of Minnesota. Since joining FracTracker I’ve been fortunate to have completed nearly a dozen of these “morning flights” as I like to call them, and five of those have taken place since August 2017. I’m going to take the next few paragraphs to share what I’ve found in my own words and by way of some of the photos I think really capture how hydraulic fracturing, and all of its tentacles, has impacted the landscape. The following is by no means an empirical illustration. I’m increasingly aware, however, that often times tables, charts, and graphs fail to capture much of the scale and scope of fossil fuel’s impact. Photos, if properly georeferenced and curated, are as robust a source of data as a spreadsheet or shapefile, both of which are the traditional coins of the realm here at FracTracker.

Mountaineer Gas pipeline to change path - As the first segment of Mountaineer’s pipeline — a 22.5 mile line of pipe to run from Berkeley Springs to Martinsburg — inches toward completion, the company is altering the route of its second segment originally slated to run from Martinsburg through Kearneysville to Charles Town.Instead, according to Mountaineer Gas’ July 31 application to the West Virginia Public Service Commission, that pipeline will instead run to Ranson, with the goal to hook up with the $150 million Rockwool manufacturing plant being built there. The company’s filing papers outline it plans to build an extension down from Martinsburg to the Rockwool plant located at the former Jefferson Orchards Farm and pick up any other new customers that appear. The company’s Ranson extension line must be approved by the PSC.“We plan on building a pipeline out to the Rockwool area,” said Moses Skaff, senior vice president and chief administrative officer of Mountaineer Gas. “Our overall intentions have not changed.“Our strategy is still to go where existing opportunities require us,” Skaff said. “When we get big business developments we are going to continue to go in that direction. We are going to go where businesses want us to be. We still plan on going in that direction, it just may be a little more strategic.”Mountaineer eventually plans to build pipeline extensions into other parts of Jefferson County, Skaff said. “We are continuing to move in that direction, but because of new business development, the actual direction — or how we get there — may change a little bit,” Skaff said. “As we are building that, we’ll pick up customers along the way.”Mountaineer in its PSC filing last year said it planned to spend $15 million to build line extensions to Charles Town and Shepherdstown that were listed as segments 2 and 3.  Skaff said Mountaineer had never actually filed papers with the PSC for what the company had originally envisioned as extensions 2 and 3.

US halts construction on EQT West Virginia to Virginia Mountain Valley gas pipeline (Reuters) - U.S. energy regulators have told EQT Corp and other companies building the $3.5-$3.7 billion Mountain Valley natural gas pipeline from West Virginia to Virginia to stop all construction. The action by the U.S. Federal Energy Regulatory Commission (FERC), in a filing on Friday, followed a July 27 order from the U.S. Court of Appeals for the Fourth Circuit that vacated decisions by the Department of the Interior’s Bureau of Land Management (BLM) and the Department of Agriculture’s Forest Service authorizing construction of Mountain Valley across federal lands. That court decision was the most recent appeals court victory by the Sierra Club and other opponents of the pipeline. Mountain Valley is one of several pipelines under construction to connect growing output in the Marcellus and Utica shale basins in Pennsylvania, West Virginia and Ohio with customers in other parts of the United States and Canada. FERC said in its decision Friday that it cannot predict when the BLM or Forest Service may act or whether the agencies will ultimately approve the same route for Mountain Valley. “Should the agencies authorize alternative routes, (Mountain Valley) may need to revise substantial portions of the project route across non-federal lands, possibly requiring further authorizations and environmental review,” FERC said in its filing. In response to the FERC order, EQT spokeswoman Natalie Cox said in an email on Saturday the company “respectfully disagrees with the breadth of the August 3 stop work order.” “We will continue to work closely with all agencies to resolve these issues and look forward to continuing the safe construction of this important infrastructure project,” Cox said. Before the FERC decision, EQT delayed its target date to finish the pipeline to the first quarter of 2019 from late 2018. Analysts at Height Capital Markets in Washington, however, projected the project may not enter service until the fourth quarter of 2019.

US FERC halts work on full route of Mountain Valley natural gas pipeline after court ruling — The US Federal Energy Regulatory Commission late Friday halted work on the full route of the 301-mile, 2 Bcf/d Mountain Valley Pipeline, in light of an appeals court ruling that struck the federal permits allowing the natural gas project to run through national forest land.The decision marks another hurdle for a project that would move West Virginia production to downstream markets in Transcontinental Pipe Line's Zone 5 near the Virginia-North Carolina border.In a letter order Friday, Terry Turpin, director of FERC's Office of Energy Projects, said: "Allowing continued construction poses the risk of expending substantial resources and substantially disturbing the environment by constructing facilities that ultimately might have to be relocated or abandoned," should federal resource agencies need to authorize alternative routes.The order responded to a July 27 decision by the 4th US Circuit Court of Appeals vacating US Bureau of Land Management and US Forest Service rights-of-way and temporary use permits that allowed the project to traverse about 3.6 miles of the Jefferson National Forest.  There is no reason to assume the federal agencies would not be able to comply with the court's remand instructions and reissue the rights-of-way, Turpin said. "However, commission staff cannot predict when these agencies may act or whether these agencies will ultimately approve the same route," he added.  Among several problems, the court found BLM ran afoul of the Mineral Leasing Act requirement that it favor routes using existing rights-of-way unless those alternatives were impractical. The court also found the USFS failed to explain why it adopted findings in FERC's environmental impact statement even though USFS had previously disputed the percent efficacy of erosion barriers included in the document. Further, it found fault with changes to the forest management plan made to accommodate the right-of-way. Mountain Valley is one of numerous pipeline projects targeting deliveries to Transco's mainline, including Atlantic Sunrise, WB XPress, and Atlantic Coast Pipeline. Natalie Cox, a spokeswoman for EQT, said the sponsor agreed with FERC that the BLM and USFS will be able to satisfy the court's requirements, and suggested the agencies will be able to work quickly to supplement their initial findings. In addition, she said EQT believed BLM was correct about the impracticality of route alternatives. Given that Mountain Valley has halted work in the national forest, she said "we respectfully disagree with the breadth" of FERC's order temporarily halting work on the pipeline.

An order stops work on the Mountain Valley Pipeline, but for how long? - As construction of a mammoth natural gas pipeline grinds to a halt, there’s already talk of when it might restart. In a statement from Mountain Valley Pipeline late Friday night, several hours after the company was ordered to stop all construction for a review of environmental concerns, a spokeswoman expressed hopes for a quick turn-around. “We will continue to work closely with all agencies to resolve these issues and look forward to continuing the safe construction of this important infrastructure project,” Natalie Cox wrote in an email. Opponents of a 303-mile buried pipeline that is cutting a path through Southwest Virginia were both surprised and elated Friday when the Federal Energy Regulatory Commission directed that all construction must “cease immediately.” FERC, the lead agency overseeing the project, cited a July 27 ruling by a federal appeals court that reversed two approvals — one by the U.S. Forest Service and another by the Bureau of Land Management — allowing the pipeline to pass through the Jefferson National Forest. Although the forest accounts for just 1 percent of the pipeline’s total length, its protected ridgelines have become a formidable obstacle that Mountain Valley must now clear. That’s because the stop-work order covers the project’s entire route, for as long as it takes the Forest Service and the bureau to reconsider Mountain Valley’s plans to control construction-related erosion and sediment in the public woodlands. “ Tammy Belinsky, a Floyd County attorney who joined lawyers with the Sierra Club in successfully challenging the Forest Service approval, said parts of the review process ordered by the 4th U.S. Circuit Court of Appeals could take six months to complete. Cox declined to speculate on the timing. But in earlier court filings involving a different phase of construction, Mountain Valley warned that an eight-month delay would cost the company more than $600 million. In a written declaration dated June 1, project manager Robert Cooper said that if the 4th Circuit stayed a permit allowing the company to cross streams and wetlands in West Virginia, it would cause “irreparable harm” to the $3.7 billion project. A few weeks later, the appeals court granted the stay sought by the Sierra Club and other conservation groups, preventing Mountain Valley from starting work on more than 500 water body crossings.

Mountain Valley Pipeline Snitches Now Have Nothing to Do - Our lead story today is that the Federal Energy Regulatory Commission has temporarily shut down all work on the Mountain Valley Pipeline, in both Virginia and West Virginia.  A shame. We spotted another story about a group of landowners and outside radical anti-fossil fuelers who call themselves Mountain Valley Watch. The group, adamantly opposed to MVP, flies drones over work areas to see if they can spot the least little “violation” by workers (Look! That guy just dropped a Snickers bar wrapper on the ground!). The members and fawning media try to label them as “citizen-scientists,” which is laughable. They’re snitches. They run around spying on their neighbors (i.e. workers) hoping to catch them in violation of some obscure code–all in the name of “being an extra set of eyes.” That’s why there’s environmental agencies with trained regulators and inspectors–to do that kind of work. But it’s just so much fun flying drones around, being a virtual peeping Tom. Trouble is, now that MVP construction is stopped, what will the pipeline snitches do with their time? Their neighbors might want to keep an eye out for drones buzzing overhead… The following article was run by the Associated Press in dozens of publications, spoon-fed to it from a non-profit called the Energy News Network, a partisan, anti-drilling outfit funded by the Rockefellers and Park Foundation (among other Big Green funders). It’s a totally biased article, but useful to make our point that these people are snitches, plain and simple: Citizen group provides extra eyes on the ground for pipeline regulators

4th Circuit Court Suspends Atlantic Coast Pipeline at Blue Ridge Parkway - A federal appeals court on Monday threw out construction certificates for the Atlantic Coast Pipeline, likely halting work on the $6 billion project planned by major Southeastern utilities. Monday’s court ruling is a significant setback for developers of the 600-mile Atlantic Coast Pipeline, planned by Dominion Energy, Duke Energy and Southern Co. Environmental advocates and local landowners argued that the NPS permit to build the pipeline ignored how tree clearing would impact the scenic and conservation goals of the Parkway, a nearly 500-mile road that runs through Virginia and North Carolina. The court sided with complaints, ruling that NPS decision on Blue Ridge “is not accompanied by any explanation, let alone a satisfactory one.” The ruling means there is “a hole in the 600-mile pipeline now that it has no right to cross,” said DJ Gerkin, attorney at the Southern Environmental Law Center, which argued the case. The project is planned to run from West Virginia to deliver gas to customers in Virginia and North Carolina.In the same decision, the court also detailed its justification for a May ruling that invalidated permits issued by the Fish and Wildlife Service (FWS) for Atlantic Coast because they did not properly assess the impact of the project on five animal species covered by the Endangered Species Act. Because FERC was not a party to the case, which pitted environmentalists versus NPS and FWS, the court could not order FERC directly to issue a stop-work order for Atlantic Coast (ACP). It did, however, issue a stern warning to the pipeline developers that they should stop building.“FERC’s authorization for ACP to begin construction is conditioned on the existence of valid authorizations from both FWS and NPS,” Chief Judge Roger Gregory wrote for the three-judge panel that decided the case. “Absent such authorizations, ACP, should it continue to proceed with construction, would violate FERC’s certificate of public convenience and necessity.”With the certificate vacated, “the pipeline cannot exist in its proposed form with its current authorizations,” and instead “would have to be re-authorized with a new permit or possibly a new route to proceed,” Gregory added in a footnote.

 US appeals court vacates permit for Atlantic Coast natural gas pipeline to cross Blue Ridge Parkway — Presenting a further legal hurdle to the Atlantic Coast Pipeline natural gas project, the US 4th Circuit Court of Appeals on Monday vacated a permit the National Park Service issued that allowed the pipeline to cross under the scenic Blue Ridge Parkway.  The court also fleshed out reasoning for its May order vacating a Fish and Wildlife Service permit that authorized harm to threatened or endangered species from the construction.  The 600-mile, 1.5 Bcf/d pipeline project, stretching from Harrison County, West Virginia, to Virginia and North Carolina, is part of a batch of projects totaling 6.5 Bcf/d in capacity that would take Appalachian supply to downstream markets in the Mid-Atlantic region. Like the neighboring Mountain Valley Pipeline, its permits to cross forested, mountainous areas have been the target of legal challenges from environmentalists. Considering the National Park Service right-of-way that allowed for the pipeline to pass under the Blue Ridge Parkway, the court found NPS invoked inapplicable laws to back its decisions. Moreover, it found NPS failed to assure the action was consistent with purposes of the scenic parkway and conservation goals of the national park system. It pointed to NPS' own studies about visual impacts on views from the parkway, and called the agency's lack of explanation on consistency issues "particularly troubling." Turning to the incidental take permit for species, the court found FWS failed to comply with requirements for when habitat can be used as a surrogate for setting a numeric limit on "take" of species.  It dismissed as "circular and unavailing" claims that some numeric limits were not possible because FWS lacked survey data or Atlantic Coast had not completed the surveys. "FWS cannot escape its statutory and regulatory obligations by not obtaining accurate scientific information," it said. While the agency said it lacked time, the court found FWS "incorrectly characterizes" the law in arguing it needed to complete its consultation within 90 days. The decision came one business day after the US Federal Energy Regulatory Commission halted work on the Mountain Valley Pipeline following a 4th Circuit ruling striking permits for national forest crossings for that project. Given that action, "FERC should immediately halt all construction on the Atlantic Coast Pipeline," said SELC Senior Attorney Greg Buppert."This is an example of what happens when dangerous projects are pushed through based on politics rather than science," added Southern Environmental Law Center attorney DJ Gerken.

Second Controversial Fracked Gas Pipeline Runs Into Legal Trouble -  Three days after the U.S. Federal Energy Regulatory Commission (FERC) ordered work to pause on the Mountain Valley Pipeline, its sister pipeline also ran into legal trouble.A federal appeals court on Monday vacated two permits required by the Atlantic Coast Pipeline to complete its 600 mile project beginning in West Virginia and traveling through Virginia to North Carolina, The Associated Press reported."There is no right way to build these dirty, dangerous fossil fuel projects, and people in Virginia and across the country will continue to come together to fight them until they are permanently halted," Sierra Club Executive Director Michael Brune told The Associated Press.  The Sierra Club was one of the groups, along with Defenders of Wildlife and the Virginia Wilderness Committee, that brought the case that led to the ruling by the 4th U.S. Circuit Court of Appeals. The case was argued by the Southern Environmental Law Center.The court ruled that the a National Park Service (NPS) permit allowing the pipeline to pass under the Blue Ridge Parkway was invalid because it did not explain how the pipeline's construction would not contradict the scenic purpose of the parkway, which connects Virginia's Shenandoah National Park to North Carolina's Great Smoky Mountains National Park.Construction would require cutting enough trees that a gap in the forest would be visible from at least one parkway observation point.Chief Judge Roger Gregory called the permit "arbitrary and capricious" in his ruling. "Arbitrary and capricious" were also the words used by the court to justify vacating a second permit granted by the U.S. Fish and Wildlife Service because it didn't specify any limits to the pipeline's impact on five threatened or endangered species.The revoking of the second permit built on a ruling in May, in which the court initially found that the "incidental take statement," which is the statement that sets limits on the impact of projects on vulnerable species, was not sufficiently clear. Following that initial ruling, the pipeline's builders said they would suspend construction along 21 miles in West Virginia and 79 miles in Virginia until a new "incidental take statement" was completed.

More federal pipeline permits scrapped by appeals court - The Atlantic Coast pipeline suffered a major setback this week as an appeals court scrapped another federal approval for the natural gas project.The 4th U.S. Circuit Court of Appeals yesterday issued an opinion vacating a National Park Service right of way allowing the pipeline to cross the iconic Blue Ridge Parkway in central Virginia.The opinion also elaborates on the court's May 15 decision to scrap an endangered species assessment prepared by the U.S. Fish and Wildlife Service. The appeals court found both decisions arbitrary and capricious."We're grateful that the 4th Circuit recognized what a treasure the Blue Ridge Parkway is," Southern Environmental Law Center attorney D.J. Gerken, who argued the 4th Circuit case, told E&E News.SELC is now calling on the Federal Energy Regulatory Commission to block construction on the 600-mile Atlantic Coast pipeline, which stretches from West Virginia to North Carolina. If the scenario sounds familiar, that's because a similar one just played out for the Mountain Valley pipeline, another Appalachia natural gas project. The 4th Circuit vacated Forest Service and Bureau of Land Management approvals for that pipeline last month.On Friday, FERC halted construction on Mountain Valley while the agencies address the deficiencies with their approvals (Energywire, Aug. 6).Atlantic Coast opponents say the same standard should apply in their case. SELC attorney Greg Buppert and Appalachian Mountain Advocates attorney Ben Luckett sent a letter to FERC last night urging it to issue another stop work order.The 4th Circuit did not address the issue directly yesterday but in a footnote seemed to agree. "As noted previously, FERC's authorization for ACP to begin construction is conditioned on the existence of valid authorizations from both FWS and NPS," the court wrote. "Absent such authorizations, ACP, should it continue to proceed with construction, would violate FERC's certificate of public convenience and necessity."

Latest action from federal judges puts further pressure on Virginia’s gas pipelines -  Two massive natural gas pipelines that have stirred fierce environmental opposition in Virginia are facing new hurdles after key permits were rejected by federal judges. On Monday, a three-judge panel of the U.S. Court of Appeals for the Fourth Circuit threw out a pair of permits for the Atlantic Coast Pipeline. One permit addressed protections for endangered species; the other allowed the project to tunnel under the federally owned Blue Ridge Parkway. Late last month, the same court revoked a different permit for the separate Mountain Valley Pipeline, one that would have allowed that project to cross a 3.5-mile stretch of the Jefferson National Forest. On Friday, the Federal Energy Regulatory Commission called a halt to all work on the full, 300-mile length of the Mountain Valley Pipeline until the national forest permit issue is resolved. Though the hitches for both projects could prove temporary, environmental groups that brought the cases said the mounting legal troubles show the pipelines were approved in a hasty manner.  “This is an example of what happens when dangerous projects are pushed through based on politics rather than science,” lawyer D.J. Gerken, who argued the Atlantic Coast Pipeline case for the Southern Environmental Law Center, said via email. The companies behind both projects said the issues raised by the court cases are not major threats and defended the pipelines as having been exhaustively reviewed by government agencies. The Atlantic Coast project is the bigger of the two, and is being built by a consortium of companies led by Dominion Energy. It would carry natural gas 600 miles from West Virginia through central Virginia and down into North Carolina. Tree-felling for the project stopped in Virginia in March, and the state has not yet given final approval to erosion and sediment control plans, so work on that pipeline in the state was on hold even before the federal permit revocations. The route for the Atlantic Coast Pipeline is slated to pass under the Blue Ridge Parkway near the Wintergreen ski resort in Nelson County near Charlottesville. The parkway is controlled by the National Park Service, which had approved the plan. But the judges, in a 62-page opinion written by Fourth Circuit Chief Judge Roger Gregory and joined by judges James A. Wynn Jr. and Stephanie D. Thacker, said the Park Service “acted arbitrarily and capriciously by failing to explain why ACP’s pipeline is not inconsistent with parkway purposes.”

Another federal permit struck down? No big deal, Dominion says - Dominion Energy, the lead partner in the 600-mile Atlantic Coast Pipeline, says Monday’s decision by a federal appeals court stripping its authority to drill under the Blue Ridge Parkway isn’t that big a deal. The company expects that the National Park Service “will promptly re-issue the permit.”  “Ample evidence to support the requisite finding that the permit is consistent with applicable statutory purposes has previously been provided to the NPS,” Dominion wrote Tuesday in a letter to the Federal Energy Regulatory Commission. “Atlantic is confident that the NPS will quickly issue a new permit resolving the court’s concerns. Furthermore, there is no reason to believe that the NPS will consider any change in the location of ACP’s crossing under the Blue Ridge Parkway.”However, opponents of the deeply controversial natural gas pipeline have called on FERC to order a halt to all construction, as it did last week with Mountain Valley Pipeline, a separate project that lost its authority to cross U.S. Forest Service lands, likewise at the hands of the U.S. Court of Appeals for the 4th Circuit. The same court also revoked a key approval issued by the U.S. Fish and Wildlife Service that was intended to gauge the harm the Atlantic Coast Pipeline posed to threatened and endangered species. The court found it too vague to be enforceable and sent the agency back to the drawing board. Dominion is still proceeding with construction along parts of the route in West Virginia and North Carolina, though it still lacks approvals to begin work in Virginia. “Should the commission allow Atlantic to proceed with construction, it would risk foreclosing new alternatives required as a result of the additional review by the National Park Service and the Fish and Wildlife Service,” the Southern Environmental Law Center wrote in a letter to FERC Monday. “As the commission observed in its letter to MVP, ‘allowing continued construction poses the risk of expending substantial resources and substantially disturbing the environment by constructing facilities that ultimately might have to be relocated or abandoned.'”

First Evergas very large ethane carrier takes to the water --The first of a pair of very large ethane carriers (VLECs) under construction at the Dalian Shipbuilding Industry Co (DSIC) shipyard for Evergas has been floated out from its building dock. The occasion was accompanied by cutting first steel for the second of the pair.The two 85,000 m3 ethane carriers will be chartered to INEOS Trading & Shipping to carry ethane from the US Gulf to China. SP Chemicals has contracted to buy the cargoes that the first of the two VLECs will transport, for use as feedstock in a new 650,000 tonnes per annum ethylene cracker it is building at Taixing in China’s Jiangsu province.The two newbuildings represent an extension of the ethane delivery capabilities of the shipping and trading arm of the giant INEOS petrochemical group. INEOS Trading & Shipping already charters eight 27,500 m3 Evergas-operated, Dragon-class ethane carriers for the transatlantic delivery of competitively priced US ethane to group ethylene crackers at Grangemouth in Scotland and Rafnes in Norway.The first of the DSIC newbuildings is due for completion in Q1 2019. The pair, like the Dragon-class ethane carriers, are being built to the semi-pressurised/fully refrigerated (semi-ref) gas carrier design.The vessels represent the first application of the semi-ref design to very large gas carriers and will be fitted with the largest IMO Type C pressure vessel cargo tanks ever constructed. IMO Type C gas tank containment systems do not require a secondary barrier.Three of the four cargo tanks on each VLEC are being built to the Star Tri-lobe configuration to help optimise the cargo-carrying space available when the Type C containment system is chosen. The largest of the tri-lobe units, which consist of three cylinders combined into one, on the DSIC VLECs has a capacity of 23,000 m3 and weighs 1,800 tonnes.  For a given hull envelope, the tri-lobe solution offers a 20% increase in cargo space compared to using bi-lobe tanks.

Haynesville Natural Gas Production Reaches Five-year High --The U.S. Energy Information Administration (EIA) reports that in June, natural gas production in the Haynesville shale formation in northeastern Texas and Louisiana averaged 6.35 Bcf/d, accounting for 8.5% of the total U.S. dry natural gas production, Haynesville’s highest production level since November 2012.  The Haynesville formation lies deep underground between 10 500 and 13 500 ft. In comparison, the depth of the Marcellus shale ranges between 4000 and 8500 ft. This depth makes drilling costs in the Haynesville shale generally higher than other shale plays. However, breakeven costs have decreased in recent years, making Haynesville natural gas economic at its current prices, according to the EIA.

China Threatens 25% Import Tariff On U.S. LNG --In the latest trade war tit-for-tat, China has included for the first time liquefied natural gas (LNG) in its list of goods up for a potential 25-percent import tariff, should the United States impose additional tariffs on Chinese imports.As the U.S.-China trade spat turns into a full-blown war with tariffs and retaliatory tariffs and threats of further tariffs, U.S. energy exports to China may suffer if Beijing follows through with its threat to slap tariffs on U.S. oil and oil product imports.Up until Friday, China had excluded LNG from the goods that it would hit with an import tariff in retaliation for a possible new U.S. round of tariffs on Chinese goods.The Friday statement from the Chinese commerce ministry has already had Chinese LNG end-users and suppliers saying that they would likely deter spot procurement of U.S. LNG cargoes in the near term if the tariff comes into effect.“[A] 25% [tariff] is not something we can absorb even if domestic demand is strong,” a source at a state-owned Chinese company told Platts on Monday. “So while this uncertainty persists, I doubt buyers will be buying a lot of spot US LNG.”

China adds US LNG to list of products for potential 25% import tariff — China has added US LNG to its list of products liable to a potential 25% import duty if the US follows through on threats to expand its existing round of tariffs on Chinese exports, according to an announcement Friday by the Customs Tariff Commission of the State Council. The move by Beijing comes in response to US President Donald Trump's decision earlier this week to explore the possibility of 25% tariff on $200 billion worth of Chinese products as the trade war between China and the US continues to escalate.US LNG imports into China do not attract any duty currently.The trade war between the US and China escalated in June when China announced an additional 25% tariff on $50 billion worth of US goods, including energy and agricultural products. But LNG, demand for which is rising in China, was not on the list.China is on track to become the largest buyer of US LNG this year. It has imported more than 1.25 million mt to date this year, compared with 1.61 million mt in the whole of 2017, behind Mexico and South Korea, according to data from S&P Global Platts Analytics. China became the largest contributor to global LNG consumption growth in 2017. It surpassed South Korea as the world's second-largest LNG importer and its share of global LNG demand is expected to rise to the same level as Japan's by 2030.

Exxon Seeks Long-Term Deals for U.S. Oil Exports -- Exxon Mobil Corp. is courting refiners with rare long-term U.S. crude export deals, according to people familiar with the matter, as the company expands its trading scope.The oil giant has approached several refiners to discuss contracts for exports of light, sweet crude from the prolific Permian Basin starting as early as this year, said the people, who asked not to be identified because the discussions are private. The talks are in early stages, with volumes, timing and price still to be determined.Long-term contracts -- which involve the sale of cargoes of a certain quality, volume and price over a set period from as little as 6 months to multiple years -- for U.S. oil are uncommon, with the sector still in its early innings after a decades-long export ban was lifted in late 2015. Rather, most deals are done on a spot basis, depending on the relative cost of American supplies versus cargoes from the Middle East and Asia. The move is a next step for the Irving, Texas-based oil major as it seeks to capitalize on its extensive global network of oil production and refineries. In recent months, the firm has hired senior traders and analysts to expand its operations beyond just selling its own crude and refined products and into proprietary trading, seeking to boost performance that has lagged its competitors. Exxon’s move to secure potential customers comes at a time when Chinese buyers such as Sinopec have delayed purchases of U.S. oil due to the escalating tariff conflict. The company first focused on waterborne cargoes, according to people familiar with the matter, to take advantage of its strong position in the Permian and access to pipelines and storage. Exxon said earlier this year it wanted to triple production by 2025. The company has also been exporting at least double the amount of crude it moved last year, people familiar with the matter said in June.

Race is on to build Texas' first offshore oil export terminal -- HoustonChronicle --The race is on to build Texas’ first offshore oil-exporting terminal that could accommodate the world’s largest crude-carrying vessels. The global commodities trading firm Trafigura Group will announce Monday that it plans to build the Texas Gulf Terminals Project in the Gulf of Mexico, off the coast from Corpus Christi. An offshore terminal would avoid port traffic and float in waters deep enough to handle the largest ships. Trafigura is unveiling the project almost three weeks after the Houston energy company Enterprise Products Partners said it plans to build an even larger offshore oil exporting terminal south of Galveston. Corpus Christi and the Houston Ship Channel have led the nation in oil exports ever since Congress lifted the nation’s decades-old crude export ban at the end of 2015. The timing coincided with a boom in U.S. oil production, especially in West Texas’ Permian Basin, pushing crude volumes to record highs this summer. More of that oil is exported because domestic consumption remains relatively flat. Just as there’s a rush to build pipelines hundreds of miles from the Permian to port and refining hubs near Houston and Corpus Christi, there’s also competition to construct oil exporting terminals to ship out the crude. The Port of Corpus Christi is expanding to handle the flood of oil, and several companies along the Houston Ship Channel are expanding terminals. But the ports still aren’t able to handle the largest oil tankers, known as very large crude carriers, or VLCCs. Despite ongoing dredging efforts, the channels at Texas ports aren’t deep enough for the giant ships to leave the ports filled to capacity. Very large crude carriers can only fill up partially at Texas ports, and then receive the remaining oil volumes from another ship in deeper waters. It’s a more time-consuming and expensive process.

Higher Oil Prices Turn Texas Main Road Into The ‘Death Highway’ -  Rising oil prices have led to an increase in trucking of frac sand, water, oilfield equipment, pipes, and fuel in West Texas. Together with the higher truck traffic on a main road in Texas, fatalities involving truckers have surged since oil prices resumed their upward trend last year, according to data by the Texas Department of Transportation compiled by Bloomberg. Long shifts behind the wheel, inexperienced truck drivers, and speeding on one of the main roads in Texas used for trucking sand, water, and equipment have earned Route 285 the name of the “Death Highway” among locals. According to the Texas Department of Transportation, 93 people died in fatal accidents involving trucks in 2017 just on the Permian section of the “Death Highway”, a highway that runs for 845 miles through the states of Texas, New Mexico, and Colorado. That’s 43 percent higher than the number of fatalities back in 2012. According to locals, there is a correlation between the price of oil and the number of fatal accidents along the highway in Texas. The number of deaths dropped in 2015, when oil prices crashed, but they started to rise again with the rally in the price of oil. Route 285 may very well be “the deadliest highway in the United States,” While truckers are currently in high demand in Texas where the Permian oil production is booming, some new hires and inexperienced truck drivers are just trying to make as much money as they can, and they sometimes sit behind the wheel tired and don’t stop for rests. “When you’ve been in the oilfield for ten to 11 days, working 14 hours a day, you just become so tired that you’re not thinking straight,”

Sixty-three-year-old pipeline worker killed in blast in Texas -- A pipeline worker was killed in Midland County, Texas, while responding to a leak in the El Paso Natural Gas Pipeline last Wednesday. The worker has been identified as 63-year-old Bud Taylor of San Angelo, Texas, a 30-year veteran of the energy industry and operations manager at Navitas Midstream Partners. The explosion that killed Taylor occurred around 11:30 a.m. and was followed by two others. Four other pipeline workers and two firefighters who have yet to be identified were also injured in the blasts.The five workers were airlifted Wednesday to University Medical Center in Lubbock, Texas, where Taylor died from his injuries on Friday. According to a hospital spokesman, one worker remained in critical condition and two in serious condition. A fifth worker was released earlier in the week after being treated. Two other workers with less-severe injuries were treated at Midland Hospital. Taylor attended Crane High School in Crane, Texas, and leaves behind his wife, Rita Seymour Taylor. A former coworker described Taylor on his LinkedIn profile as “a strong leader and very detail oriented…good to work for and will listen to the opinions of others.”Midland is home to the Permian Basin oilfield, the largest oilfield in the United States, and is crisscrossed by both oil and natural gas pipelines. The causes of the leak, which led to the explosion and the fires that followed, are unknown, according to press reports, but are currently under investigation by pipeline operator KinderMorgan. KinderMorgan had isolated a part of the El Paso Natural Gas Pipeline as a precaution after it was alerted to the fire drawing near to its line. One of the workers airlifted last Wednesday was a KinderMorgan employee.

Welcome to the 'Man Camps' of West Texas –  There’s not much to look at except dirt, mesquite, and sagebrush around the 10 acres of flat, almost treeless land near Goldsmith, Texas, where Aries Residence Suites runs a housing complex used by itinerant oil workers. Three years ago, all 188 rooms were as empty as the landscape—a testament to crude’s tumble from more than $100 a barrel to $30. Today, prices are up around $70 and almost every Aries bed is occupied, just as at many other “man camps” throughout West Texas. The Permian Basin, a more than 75,000-square-mile expanse of sedimentary rock that’s one of the world’s biggest oil plays, is drawing billions of dollars in new investment. Companies are scrambling to find people to do everything from operating drilling rigs to driving trucks. Wages have reached such lofty levels that even unskilled laborers can earn $100,000 a year. Many of the jobs are in remote areas with no houses, schools, or supermarkets, so free room and board are essential perks for workers, most of whom elect to leave their families at home.  Thousands of workers now reside in dormitory-like compounds in West Texas and eastern New Mexico, and more are on the way. Aries, which has 11 locations spread out over North Dakota, Oklahoma, and Texas, is expanding Goldsmith, which is near capacity, to 400 beds and will soon break ground on a 500-bed facility in Orla, Texas, a town with new oilfield activity but a population of less than 300. Permian Lodging, which operates one of the biggest man camps in the basin, says all 1,200 units at a 90-acre lot outside Midland, Texas, are occupied, and it recently built a slightly smaller facility roughly 100 miles southwest, near Pecos. The company is also readying two other camps in Texas and one in New Mexico, for a total of almost 1,300 beds. “It’s crazy,” says Dennis Noland, founder of Alpha Resources, a human resources consultant that does work with companies in the Permian. “It is the best example of a boomtown, Wild West area that I’ve ever seen.”

EOG sees Permian hydraulic fracturing work slowing in 2nd half (Reuters) - Independent oil and gas producer EOG Resources on Friday said Delaware Basin completions will make up a smaller percentage of its overall hydraulic fracturing work in late 2018, a signal that pipeline constraints may continue to choke growth in the largest U.S. shale play. Activity in the Permian Basin, which includes the Delaware, has outpaced pipeline takeaway capacity in recent months as U.S. oil production has hit record highs. The pipeline constraints have pushed down the price of local oil and prompted some companies to reallocate resources to other basins. EOG said Delaware completions made up about 40 percent of its total hydraulic fracturing work during the first half of the year, but expected that to decline to 30 percent in the second half of 2018. Conversely, the company expects completions in Wyoming’s Powder River Basin, North Dakota’s Bakken, and Colorado’s DJ basin to climb from 10 percent to 20 percent of its total hydraulic fracturing work in the second half. Noble Energy on Friday said it would slow Permian hydraulic fracturing completions during the second half of the year, shifting more resources to the DJ basin. EOG this week said it was expanding its presence in Wyoming’s Powder River Basin, tapping into the Mowry and Niobrara resource plays, in addition to the Turner formation. That basin is now the company’s third largest asset. The company said it is designing a gas gathering and compression system to facilitate takeaway away from the Powder River Basin. EOG is also evaluating opportunities to move crude from the Powder River Basin to the U.S. Gulf Coast, executives told analysts during the company’s quarterly earnings call. Anadarko Petroleum Corp this week also said it was growing its footprint in the Powder River Basin. 

Locked Into Hedges, Shale Misses Out On Oil Price Rally  - The shale industry is set to enjoy its best year, arguably in its history, but some drillers are not benefitting as much as expected because they locked themselves into hedges at lower prices.Shale drilling has historically been a loss-making proposition. The precipitous decline in output from shale wells meant that companies had to use the revenue from one well to drill the next well. Cash was continuously recycled back into new wells, and shareholders rarely saw any profits flow back to them.That is set to change this year. “Higher prices and operational improvements are putting the US shale sector on track to achieve positive free cash flow in 2018 for the first time ever,” the International Energy Agency (IEA) wrote in a recent report on energy investment.But not everyone is raking in as much money as they might have wanted. A handful of shale companies posted lower-than-expected profits in recent days, owing to the fact that they secured hedges for their second quarter production at prices that were lower than the prevailing market price. Among the companies that undershot expectations were Devon Energy, Anadarko Petroleum and Chesapeake Energy. As Reuters notes, many shale companies hedged at around $55 per barrel in the second quarter while WTI was much higher. Those hedges were likely secured last year, when oil traded at lower levels. The shale companies locked in those positions as a risk management strategy, guarding against the possibility of a meltdown in prices. If the economy had crashed or OPEC decided to flood the market once again for some reason, and oil prices fell back below $50 per barrel this year, those companies would have been protected.As it happened, however, prices surged in the first half of this year. WTI surpassed $70 per barrel in the second quarter, rising to its highest point in more than three years. Some shale drillers were stuck selling their oil for prices in the mid-$50s. Anadarko said that it missed out on nearly $300 million in pre-tax revenue because it was locked into hedges. Devon Energy also missed expectations for its quarterly earnings, noting that it earned 20 percent less in oil sales than would have been the case absent the hedges. When asked if the company would revise its hedging plans, Devon’s CEO David Hager said it would stick with the strategy. “We think it's important to underpin the cash flows of the company to make sure that we have a certain level of consistency in cash flows to be able to fund the capital program,” Hager said on an earnings call. “And so we are doing this through a systematic program largely, where we're reaching out 18 months and hedging production at any given time.”

Plains to Bring Permian Projects Online Early Amid Pipeline Bottlenecks (Reuters) - Plains All American Pipeline LP said two West Texas crude pipeline projects would begin partial operations slightly ahead of their original schedules as bottlenecks in the region depress prices to the weakest level in four years. One of the two, the Sunrise expansion project, is expected to go into partial service in the fourth quarter this year while the Cactus II line will begin partial service in the third quarter of 2019, the company said on a conference call late on Tuesday. The Sunrise extension will add about 500,000 bpd of capacity from Midland to Colorado City and Wichita Falls, Texas, and provide connections to the oil-storage hub of Cushing, Oklahoma. Full service on the 670,000 barrels per day (bpd) Cactus II line from the Permian basin to Corpus Christi is targeted for April 2020. By late this year, a portion of the line, from Wink, to McCamey, Texas, will begin partial service, the company said. "We expect continued growth across our gathering and intrabasin pipeline systems (in the Permian) and to operate at or near capacity on our takeaway pipelines throughout the second half of the year," said Greg Armstrong, Plains chief executive. The company also is developing projects in Canada that would increase oil gathering for existing systems and boost utilization on its Rainbow pipeline system that serves western Canada. It also is considering a project that could add volumes to its Wascana system. These projects are in the early phases of development and would likely take 12 to 24 months to bring into service, Plains said. The Permian basin in West Texas and western Canada has been grappling with takeaway constraints as oil production in the region has outpaced pipeline capacity. Prices in Midland, Texas, sank to a $17 discount to benchmark futures last week while Western Canada Select oil last week traded at $34.15 per barrel lower than West Texas Intermediate light oil, the biggest differential since November 2013.

Tanker carrying fracking water crashes, spills near Poudre River -- A tanker truck containing fracking water crashed and spilled its fluid on Poudre Canyon Road on Thursday night, according to the Colorado State Patrol. The driver, Oswaldo Valenzuela-Inzunza, was uninjured, CSP Trooper Gary Cutler said Friday afternoon. Cutler said citations, if any, have not yet been made regarding the crash. Valenzuela-Inzunza has a Mexico driver's license, Cutler said CSP troopers responded at 11:05 p.m. to the crash site at 9552 Colo. 14, which follows the Poudre River. Despite the road's close proximity to the water, Cutler said CSP has not notified the federal government of any water contamination, meaning the spill did not reach the Poudre River. Cutler said CSP requested an independent contractor to help clean up the spill, though the amount of spilled liquid remained unknown as of Friday afternoon. He added that both lanes of traffic were closed almost immediately after the spill Thursday night, and heavy equipment crews continued to clean up the wreck until 6:24 a.m. Friday, when the roadway reopened. 

Bella Romero Fracking Draws Ire of Community, Activist and Initiative 97 Decides Future of Fracking - Cullen Lobe’s environmental consciousness was awakened during the Dakota Access Pipeline standoff in 2016 between the Standing Rock Sioux Tribe and companies planning to run a gas pipeline underneath the Missouri River, the tribe’s only source of fresh water.  After returning to Colorado, Lobe soon encountered what he calls the local version of the DAPL fight at Bella Romero Academy, a predominantly low-income, minority, fourth-through-eighth-grade school in Greeley whose ballfields could soon be less than 1,000 feet from 24 fracking wells.   Earlier this year, a handful of local activists including Lobe entered Extraction’s fracking site to stage a protest that included Lobe locking himself to one of the company’s bulldozers. The protest was streamed to Facebook, putting a national spotlight on local concerns about the risks and potential health impacts of a fracking site so close to a school. But what activists believed to be a simple act of civil disobedience has landed them in court, with Lobe, who’s studying journalism and environmental studies at Colorado State University, facing up to a year in jail. Lobe sees communities across Colorado fighting fracking developments that are increasingly encroaching on neighborhoods and schools.  Activists like Lobe, environmental groups and even cities are fighting back, hoping that state regulators and companies will hear their pleas. Voters may even get to decide in November how close fracking wells can be to the public. The controversy over the Bella Romero project dates back to 2013, when a company called Mineral Resources was granted a permit for a fracking operation near a south Greeley charter school called Frontier Academy. Mineral Resources was acquired by Extraction Oil and Gas in 2014, which abandoned its plans near Frontier Academy after significant pushback from parents. An alternative to the Frontier Academy site was found, about ten minutes to the east. The new site was right behind Bella Romero Academy, where more than 90 percent of students qualify for free and reduced lunch. Extraction didn’t return requests for comment for this story, but it recently told the New York Times that the Bella Romero location offered an opportunity to pipe out oil and gas, which would reduce truck traffic at the site, and to employ sound-minimizing rigs thanks to the availability of electric utilities on the site.

Boulder eyes pollution tax on drillers as Longmont preps for fracking 'deep underneath' a reservoir “Boulder’s City Council wasted little time Tuesday night in advancing two measures aimed at potential oil and gas drilling, including a pollution tax on any future extraction and a statement condemning an industry-backed ballot initiative,” reports The Boulder Daily Camera. “Both items, on the consent agenda, were discussed only briefly. The pollution tax would be levied against drillers: up to $6.90 per barrel of oil and 88 cents per thousand cubic feet of natural gas. The tax would apply only to resources extracted within city limits; there is currently no expressed interest or plans for such projects, and Boulder has a timeout on applications in place through June 2020. Councilwoman Cindy Carlisle was the only council member to speak about the tax, calling out statements made by industry group Colorado Oil and Gas Association in opposition. In remarks to the Camera, the group’s head Dan Haley called the measure a tax increase; Carlisle clarified that it was not a tax on citizens, but on drillers.” “Longmont City Council was assured by the city staff Tuesday night that future fracking to free up oil and gas deposits deep underneath Union Reservoir — and the subsequent drilling and extraction of those minerals — pose minimal risks to the quality of the water it stores,” reports The Longmont Times-Call. “During a study-session review of the staff’s research, however, several council members indicated they wish they had more of a guarantee that oil and gas companies drilling from surface sites far away from the reservoir and its shorelines could be held financially responsible for rapid and complete response to spills, leaks or other problems. Before the staff presented its report, however, a handful of residents stated their opposition to allowing hydraulic fracturing and horizontal drilling under the reservoir east of Longmont, even though the city is currently in a binding agreement the council approved last spring to keep wells and related equipment off the actual surface of city-owned lands near the reservoir.”

Dakota Access developer amends $1B racketeering lawsuit (AP) — The developer of the Dakota Access oil pipeline on Monday amended a $1 billion racketeering lawsuit it filed last August against three environmental entities after a federal judge criticized the original filing as vague and threatened to throw it out of court.The latest blow to the lawsuit came Friday, when U.S. District Judge Billy Roy Wilson said Texas-based Energy Transfer Partners hadn't proven its case against the Earth First environmental movement, though he said it could sue individual members if it had enough evidence.ETP on Monday added five individual defendants: a man allegedly affiliated with Greenpeace, two Iowa women who have publicly claimed to have vandalized the pipeline, and two people associated with the Red Warrior Camp, a protest group alleged to have advocated aggressive tactics such as arson. The company also amended its accusations, limiting defamation and business interference claims to Greenpeace and adding a criminal trespass count against all defendants."We are confident this move to include even more bogus claims in an already broad and baseless case will be the final nail in the coffin of a sham legal tactic," said Greenpeace attorney Deepa Padmanabha. ETP initially sued Greenpeace, BankTrack and Earth First, alleging the "rogue eco-terrorist groups" worked to undermine the $3.8 billion pipeline that's now moving oil from North Dakota to Illinois. The groups said the lawsuit was an attack on free speech, and Earth First also maintained it's an unstructured social movement similar to Black Lives Matter and can't be sued. Wilson on July 24 dismissed BankTrack for lack of evidence, a day after he had ordered ETP to show why Earth First shouldn't be tossed. Company attorneys countered that Earth First should be held accountable for "eco-terrorist activities" and argued that ETP at the very least should be given permission to add the Florida-based Earth First Journal to the lawsuit. The company had tried earlier to serve the lawsuit on the Journal, but the publication effectively argued it was not the same as the movement.

 Oil pipeline inspection industry ‘going wrong’ as surveys fail to prevent spills -- In September 2015, Shell’s San Pablo Bay oil pipeline burst near the Californian town of Tracy, contaminating the surrounding soil with 900 barrels of crude.Two months later, in November, Shell was conducting tests to fix the problem when the pipeline spilled again.Pipelines fail: it’s a widely understood risk when liquids are pumped at pressure across land and sea. Since 1986 there have been nearly 8,000 oil and gas pipeline incidents in the US, spilling 76,000 barrels per year, resulting in more than 500 deaths, 2,300 injuries and nearly $7 billion in damage, according to the Center for Biological Diversity.Tiny cracks, often invisible to the eye, appear as infrastructure ages. Detecting them before they cause spills is a multi-billion dollar global business.But according to industry insiders and a prominent accident investigator, oil pipeline inspection companies may be overstating their ability to find these defects. A California state fire marshal report, accessed through a records request by Climate Home News, said three separate inspection companies assessed the San Pablo Bay pipeline during a series of accidents between September 2015 and May 2016. All of them failed to detect anomalies in the areas that burst.After the two 2015 spills, Shell hired Rosen Group, an international inspection company, headquartered in Switzerland, to replace T.D. Williamson, another global company.The state fire marshal reported that Rosen tested the pipeline in December 2015. The company found more than 20 abnormalities, which were repaired. Later, more abnormalities were identified, of which some were also repaired. After that round of maintenance Rosen told Shell there were no “actionable defects” on the line, the fire marshal said. After receiving the Rosen analysis, Shell increased the pressure in the pipeline on 17 May, 2016. Three days later, it ruptured again, and 500 barrels spilled.

BLM seeks public opinion about fracking on California public lands– More than a million acres of public land in California may soon be opened for fracking and oil drilling. The Bureau of Land Management is seeking comments on the potential harm created if 400,000 acres of public land and an additional 1.2 million acres of federal mineral estates in the Bakersfield Field Office Planning area, which includes Kern, Fresno, Kings, Madera, San Luis Obispo, Santa Barbara, Tulare and Ventura counties, are approved for fracking and oil drilling. Fracking is an oil-extraction process that inject fluids into shale beds to access oil or natural gas. The BLM intends to prepare a supplemental Environmental Impact Statement (EIS) and a potential Resource Management Plan. To comment on the issue, email blm_ca_bkfo_oil_gas_update@blm.gov or mail letters to Bakersfield Field Office, Bureau of Land Management, Attn: Bakersfield RMP Hydraulic Fracturing Analysis, 3801 Pegasus Drive, Bakersfield, CA 93308. The Center for Biological Diversity and Los Padres ForestWatch successfully sued BLM for approving a resource management plan allowing oil and grass drilling and fracking on stretches of public lands in California without adequately analyzing and disclosing the impacts of fracking on air quality, water and wildlife, according to Center for Biological Diversity. “This step toward opening our beautiful public lands to fracking and drilling is part of the Trump administration’s war on California,” Clare Lakewood, a senior attorney at the Center for Biological Diversity, said in a news release from her agency. “We desperately need to keep these dirty fossil fuels in the ground. But Trump is hell-bent on sacrificing our health, wildlife and climate to profit big polluters.” As a result of the lawsuit, BLM agreed to complete a new analysis of the pollution risks before deciding to allow drilling and fracking on public lands in California. The BLM’s 30-day comment period for the proposal begins Wednesday.

Trump Moves to Open 1.6 Million Acres of California Public Lands to Fracking - The Trump administration took the first steps on Wednesday towards opening up 1.6 million acres of public land in California to fracking and oil drilling, The Sacramento Bee reported.In a notice of intent published on the Federal Register Wednesday, the Bureau of Land Management (BLM) said it would prepare an environmental impact statement on the use of fracking on 400,000 acres of public land and 1.2 million acres of mineral estate overseen by BLM in California counties including Fresno, San Luis Obispo and Santa Barbara, The Hill reported.Concerned citizens have 30 days from Wednesday to comment on the proposal.The move would lift a five-year moratorium on leasing federal land in California to oil companies, The Center for Biological Diversity (CBD) said in a statement.It also comes less than a week after the Trump administration proposed revoking California's waiver to set its own vehicle emissions standards under the Clean Air Act and just days after Trump blamed the state's environmental policies for the record-breaking wildfires it is currently battling."It's a coordinated attack on California by the Trump administration," CBD senior attorney Clare Lakewood told The Hill.No federal lands in the state have been leased to oil companies since 2013, when a federal judge found that the BLM had leased land in Monterey County without fully considering the environmental impact of fracking.Environmentalists are concerned that fracking can increase the risk of earthquakes and contaminate groundwater, The Sacramento Bee reported. The later risk is increased in California, a 2015 report from the California Council on Science and Technology found, because fracking in the state happens in areas with shallow depths close to groundwater and uses an especially high amount of toxic chemicals, The CBD reported.

Fracking Fracas: BLM to Open California Public Lands - Jerri-lynn Scofield - The US Bureau of Land Management (BLM) took initial steps yesterday to open 1.6 million acres of California public lands to fracking and conventional oil drilling, ending a five-year moratorium on such practices in the state. In its Notice of Intent, the BLM announced it will analyze the impact of fracking thought the state and will prepare a Supplemental Environmental Impact Statement and a potential Resource Management Plan. The BLM has  solicited public comments according to a tight schedule; the comment period closes on September 7, 2018. The Center for Biological Diversity (CBD) noted in a press release, Trump Administration Moves to Reopen California Public Lands to Oil Leasing that the notice covers 400,000 acres of public land and an additional 1.2 million acres of federal mineral estate, located in Fresno, Kern, Kings, Madera, San Luis Obispo, Santa Barbara, Tulare, and Ventura counties. It also provided background on the current moratorium: In 2015 the Center for Biological Diversity and Los Padres ForestWatch, represented by Earthjustice, successfully sued the BLM for approving a resource management plan allowing oil and gas drilling and fracking on vast stretches of California’s public lands without adequately analyzing and disclosing the impacts of fracking on air quality, water and wildlife. As a result of the groups’ legal victory, the BLM agreed to complete a new analysis of the pollution risks of fracking before deciding whether to allow drilling and fracking on public land across California’s Central Valley, the southern Sierra Nevada and in Santa Barbara, San Luis Obispo and Ventura counties. In BLM kicks off review of Calif. fracking impacts, Energy Wire discussed what followed from the US district court for the central district of California’s 2016 ruling in this action and its wider significance:  The Sacramento Bee reported in Trump administration moves to open 1.6 million acres to fracking, drilling in California that county supervisors in San Luis Obispo have placed a measure on the November ballot that would ban new oil exploration and new fracking operations in unincorporated regions of the county:  The CBD further emphasized: A 2015 report from the California Council on Science and Technology concluded that fracking in California happens at unusually shallow depths, dangerously close to underground drinking water supplies, with unusually high concentrations of chemicals, including substances dangerous to human health and the environment.

Regulatory ‘Burden’? A Mere $2,000 Would Have Saved This Man’s Neighborhood -- The exasperation was apparent in Jesse Marquez's voice recently as he testified at a public hearing in Washington DC, about a U.S. Environmental Protection Agency proposal to roll back a safety rule that would make the chemical industry more accountable for public health.Marquez was 17 years old when he and his family witnessed a massive explosion right in front of their house in the LA community of Wilmington. The explosion occurred at the Fletcher Oil and Refining Co., located across the street in the city of Carson, California, where Marquez and his family were living at the time. Four oil tanks exploded, and one tank roof top flew 700 feet into the air, landing in the middle of the street intersection. All seven members of his family suffered from burns ranging from 1st degree to 3rd degree.  Déjà vu gripped Marquez in the spring of 2015, when he heard about an explosion at ExxonMobil's oil refinery in neighboring Torrance. The explosion occurred just a few m iles down the road from the explosion he had lived through 46 years earlier. The blast narrowly missed a tank of highly toxic hydrofluoric acid, which if released, would have lethally gassed thousands of people.  Shaken by news of this new explosion and many others over the years, Marquez began researching steps the oil refinery could have taken to avert it. His research disclosed that if the refinery had spent just $2,000 on a gas leak detector, ExxonMobil could have found the gas leak that triggered its explosion and the explosion at the Fletcher Oil refinery in Carson could have also been prevented. Recently, after the Trump EPA postponed a new final rule that would require ExxonMobil and other companies to take basic steps to prevent future chemical releases, Marquez and other members of communities affected by chemical disasters traveled to Washington to testify before EPA. There have been at least 48 disasters, and counting, since the original effective date of the amendments.

Southern California Gas Agrees to Settlement for 2015 Methane Leak - A California utility has agreed to a $120 million civil settlement for a massive gas leak that drove thousands of families from their Los Angeles homes. Southern California Gas Co. will pay civil penalties and for programs to mitigate methane emissions for the October 2015 leak at the Aliso Canyon natural-gas storage field northwest of Los Angeles. The company has already pleaded no contest to criminal charges for the leak, which released 109,000 metric tons of methane near the community of Porter Ranch, according to state air officials. The new settlement requires the company to mitigate the effects of that methane, authorities and the company announced Wednesday. “There is no excuse for what happened,” California Attorney General Xavier Becerra said in a statement. “This leak undermined our crucial work to reduce greenhouse gas emissions and protect our people and the environment.” The company said its mitigation programs would capture methane from dairy farms and waste for use in transportation. The settlement money will also pay for a long-term health study on the effects of the leak, and the settlement requires the company to take several other steps to improve safety and publicly monitor methane levels around the facility. The Aliso Canyon underground site is the fifth-largest such gas-storage facility in the U.S. and is essential to the region’s power industry. It gushed methane—one of the most potent heat-trapping gases responsible for climate change—for 15 weeks, leading California to declare a state of emergency while locals reported headaches, nosebleeds, rashes and other woes. It eventually led to a federal review that called for a sweeping safety overhaul of more than 400 underground natural-gas storage fields. The settlement, if approved by the Los Angeles Superior Court, would resolve all the claims in several government lawsuits against the company, Mr. Becerra’s statement said. Along with the state attorney general, the California Air Resources Board, Los Angeles City Attorney Mike Feuer and the County of Los Angeles are part of the settlement.

Court Rules that Portland Oil Terminal Ban Does not Violate the Commerce Clause -- In a big win for the City of Portland, Oregon, the Oregon Court of Appeals issued a ruling that the city had not violated the U.S. Constitution’s Commerce Clause by voting to ban any new fossil fuel terminals within its borders. “This is a major victory for the climate and our communities,” said Maura Fahey, staff attorney at Crag Law Center, which represented environmental groups intervening in the case, in a statement. “Industry couldn’t even get its foot in the door of the courtroom to try to overturn the City’s landmark law. This sends a powerful message to local communities that now is the time to take action to protect our future.”  This ruling could have important implications for other communities fighting fossil fuel projects because the court ruled that the city’s ban did not violate the Commerce Clause, which is the main argument the oil industry has used against bans like the ones in Portland, Oregon and other cities.The Commerce Clause gives Congress the sole power to regulate interstate and foreign trade, and oil companies have argued that bans like the one in Portland are impacting interstate trade. With this ruling, the Oregon Court of Appeals has dealt a significant blow to that legal argument.  This new ruling in Oregon appears to be a path for other port cities to issue a blanket ban on new oil infrastructure projects instead of having to fight them on a project-by-project basis. And cities have been doing just that.

Fracking scheduled for British Columbia -(UPI) -- A review of operational plans for shale exploitation in British Columbia confirms the prospects for a pioneering fracking campaign, Calima Energy stated. The company announced Friday that a study commissioned from Canadian Discovery Ltd., a consultant firm, of more than 500 drilling sites near Calima's acreage revealed promise for a hydraulic fracturing campaign in the Montney shale basin in British Columbia. "The extensive review conducted by Canadian Discovery gives us confidence that our drilling plans are aligned with the best practice of other successful operators in northern British Columbia," Calima Managing Director Alan Stein said in a statement emailed to UPI. Calima said it now plans to drill three wells in the Montney formation. The program will have a core well with two horizontal extensions. Oil and gas exploration since the 1950s has utilized conventional operations to tap into a basin that straddles the borders of Alberta and British Columbia. Advances in horizontal drilling and hydraulic fracturing, or fracking, have uncorked new opportunities and Calima said federal data point to as much as 449 trillion cubic feet of marketable natural gas and 1.1 billion barrels of marketable oil in the Montney formation. Drilling is scheduled for December, with production testing schedule for four to six weeks. The Australian energy company operates more than 70,000 acres in the Montney shale. It received authorization from the provincial oil and gas commission to build, maintain and operate a road into its holdings early this year.

Trans Mountain Expansion Could Cost More Than Expected - The Trans Mountain pipeline expansion project could end up costing more than initially estimated, documents filed with U.S. regulators by Kinder Morgan suggest, according to a Reuters report.The document Reuters cites is a report Kinder Morgan filed with U.S. regulatory authorities following its deal with the Canadian federal government to sell it the controversial project. In it, Kinder Morgan’s financial adviser TD Securities notes that the project could incur additional costs of between US$770 million to US$1.46 billion (C$1-1.9 billion) and face a delay of up to 12 months, to December 2021.The initial estimated capital cost of the project was US$5.67 billion (C$7.4 billion), with the estimate provided by TD Securities. Earlier this year Ottawa agreed to buy the project for US$3.45 billion (C$4.5 billion) to save it, although now it needs to find investors to sell it on to. Meanwhile, it will provide the funding necessary for restarting work on the project until the deal closes.The Trans Mountain expansion has become one of the most controversial pipeline projects in North America as it pitted two provinces against each other, sparking both protests and support rallies. Alberta heavy oil producers need more pipeline capacity as their production grows but pipeline capacity stays the same. British Columbia’s new NDP government, which came into office last year, however, is against any new oil pipelines, although it doesn’t mind getting the crude it gets currently through the existing pipeline. The government has repeatedly cited higher risks of spills not just along the pipeline but at the port of Vancouver from where the crude sent via Trans Mountain should be loaded and sent to international markets.

Canada's Biggest Producer Cuts Drilling As Heavy Oil Price Tumbles -- Canada Natural Resources, the largest producer, is allocating capital to lighter oil drilling and is curtailing heavy oil production as the price of Canadian heavy oil tumbled to a nearly five-year-low relative to the U.S. benchmark price.Due to the transportation bottlenecks, the discount at which Western Canadian Select (WCS)—the benchmark price of oil from Canada’s oil sands delivered at Hardisty, Alberta—trades relative to WTI has been more than US$20 this year.On Thursday, that discount blew out to US$30.80 a barrel—the largest WCS-WTI differential since December 2013, according to data compiled by Bloomberg.Canada Natural Resources said on Thursday in its Q2 results release that its North America crude oil and natural gas liquids (NGLs) production in the second quarter dropped by 3 percent from the first quarter of 2018, primarily as a result of production curtailments and shut-in volumes of around 10,350 bpd as well as reduced drilling activity and delayed completion and ramp up of certain primary heavy crude oil wells drilled in Q1 and Q2.“Due to current market conditions the Company has exercised its capital flexibility by shifting capital from primary heavy crude oil to light crude oil in 2018, resulting in an additional 7 net light crude oil wells targeted to be drilled in the second half of the year. Primary heavy crude oil drilling was reduced by 24 net primary heavy crude oil wells in Q2/18, with an additional 35 primary heavy crude oil well reduction targeted for the second half of the year,” Canada Natural Resources said yesterday. Canada is producing record amounts of heavy oil from the oil sands and its economic recovery is driven by the oil industry, but drillers are finding it increasingly difficult to get this oil to market because pipelines are running at capacity and new ones are finding opposition from various groups.

Canadian Oil Crisis Continues As Prices Plunge   Canadian oil producers are once again suffering from a steep discount for their oil, causing the largest spread between Canadian oil and WTI in years.Western Canada Select (WCS) recently fell below $40 per barrel, dropping to as low as $38 per barrel on Tuesday. That put it roughly $31 per barrel below WTI, the largest discount since 2013.The sharp decline in WCS prices is a reflection of a shortage of pipeline capacity. Much of the talk about pipeline bottlenecks these days focuses on the Permian basin, and the unfolding slowdown in shale drilling, which could curtail U.S. oil production growth. But Canada’s oil industry was contending with an inability to build new pipeline infrastructure long before Texas shale drillers.However, the problem has grown more acute over the last 12 months. Even as pipeline takeaway capacity hasn’t budged, Canadian oil production continues to rise. Output could jump by around 230,000 barrels per day (bpd) in 2018, followed by another 265,000-bpd increase in 2019, according to the International Energy Agency. As more supply comes online, the pipelines are filling up, and there is little relief in sight. Until Enbridge’s Line 3 replacement is completed – targeted for late 2019 – midstream capacity won’t expand. Enbridge recently received a crucial permit from the state of Minnesota, through which the pipeline will traverse, even though state regulators questioned the need for the pipeline. Environmental groups and Native American tribes affected by the pipeline have vowed to mount a resistance to the replacement and construction of the Line 3, echoing the protests of the Dakota Access Pipeline from two years ago. “They're bringing highly toxic, highly poisonous tar sands oil directly through major watersheds and the last standing reserve of wild rice that the Ojibwe have to harvest,” Bill Paulson, a member of the Ojibwe tribe, told CNN last month. “Our culture is the wild rice and gathering and being out in the woods. If there's a threat to that, then there's a direct threat to the people.”

Natural Gas Crawled Higher And Makes It To The Midpoint - In mid-February, the price of September NYMEX natural gas futures hit a low at $2.674 per MMBtu.As the daily chart highlights, over the next four months, the price action in the September futures contract trended higher hitting a peak of $3.018 on June 18. The $3 per MMBtu level proved too high to handle for the energy commodity, and the price corrected over the next month. Natural gas fell to a low of $2.671, just 0.3 cents below its mid-February bottom on July 19. While price momentum has risen into overbought territory, open interest has moved higher with the price in a sign that more speculators on the long and short side have come to the market over recent sessions. At 1.576 million contracts on August 2, is at a record high, and at its highest level since June 19 when natural gas hit its peak price at over the $3 per MMBtu level. Natural gas was trading at around the $2.86 level on Friday, August 3. Despite record production and massive reserves of natural gas in the United States, the energy commodity has been trickling, rather than flowing, into storage.  As the chart shows, on Thursday, August 2, the Energy Information Administration reported another small injection of natural gas into storage of 35 billion cubic feet. Total stocks stood at 2.308 trillion cubic feet for the week ending on July 27 which was 23% below last year's level and 19.7% below the five-year average for this time of the year. While production continues at a record level in the U.S., demand is apparently just as strong as the amount flowing into storage for the coming winter season has been low. The latest price appreciation from $2.671 per MMBtu on July 19 has been, at least partially, the result of the low level of inventories. As the daily chart shows, the midpoint of the price range stands at $2.8445 per MMBtu, and last week the price made it up to the $2.86 level on Friday. The midpoint is the 50% retracement level of the move from the June high to the July low and stood as technical resistance for the futures contract.

The U.S. Remains The Natural Gas King - Data from the 2018 BP Statistical Review of World Energy show that last year the U.S. maintained a healthy lead as the global natural gas powerhouse.In 2017, the U.S. produced an average of 71.1 billion cubic feet per day (Bcf/d) of natural gas. That’s a 1.0 percent increase from 2016 production, but not quite good enough to beat the 2015 record of 71.6 Bcf/d.That was still good enough for a 20.0 percent share of the world’s total natural gas production.  To put the U.S. production numbers in perspective, natural gas production for the entire Middle East was 63.8 Bcf/d. Russia, in second place among countries, saw its natural gas production surge by 8.2 percent, but at 61.5 Bcf/d that was still well behind the U.S. The U.S. had dominated global natural gas production until the 1980s, at which time it ceded the lead to Russia. The Middle East has grown its natural gas production at a much faster rate over the past 50 years, though, and is on pace to take the lead during the next decade. U.S. natural gas production had been in decline until the fracking boom that began in the middle of the previous decade. Production grew in the U.S. by an astounding 51 percent from 2005 to 2015, which pushed the U.S. back into the global lead.U.S. consumption has also grown rapidly as power plants have turned increasingly to natural gas as both a replacement for coal-fired power, and a backup for new renewable capacity. Another important outlet for U.S. natural gas production has been exports, both via pipeline and as liquefied natural gas (LNG).  Last week RBN Energy reported that in early July, pipeline exports to Mexico breached 5.0 Bcf/d for the first time ever.  The U.S. may continue to lead the world in natural gas production for a few more years, but the level of proved natural gas reserves implies that our lead could be short-lived.The Middle East’s proved natural gas reserves at the end of 2017 were 2.8 quadrillion cubic feet, nearly ten times U.S. proved reserves of 309 trillion cubic feet. For perspective, U.S. proved reserves are only 4.5 percent of the global total.Russia has more proved natural gas reserves than any other country with 1.23 quadrillion cubic feet, followed by Iran with 1.17 quadrillion cubic feet. Total proved natural gas reserves at the end of 2017 were enough to satisfy 2017 global production rates for 52.6 years.

NYMEX September gas rises as warmer weather intensifies supply concerns — The NYMEX September natural gas futures contract increased Tuesday 3.7 cents to settle at $2.897/MMBtu as the market picks up strength amid expected warm weather and supply concerns. The front-month contract traded Tuesday between $2.857/MMBtu and $2.900/MMBtu. Even though power burn and production backed off from recent levels, the market picked up strength as supply concerns and warmer weather expected in mid-August added to bullish sentiment.US dry gas production fell 1.4 Bcf/d day on day to 79.8 Bcf/d Tuesday, as production dipped in the Rockies and fell 700 MMcf/d, according to S&P Global Platts Analytics data. This marks the lowest level dry gas production has seen since June 26, but dry production has averaged 80.56 Bcf/d since that time. The strong production seen in the summer months has not made the storage deficit smaller as power burn records were set during the warmer-than-average summer. Looking ahead, the most recent six- to 10-day temperature forecast from the National Weather Service calls for higher-than-average temperatures for most of the Upper Midwest and Northeast, which is expected to add to the strength the market has experienced lately. Traders, analysts and other market sources have been debating about the market's position in terms of supply, and about whether current production is strong enough to make up for deficit. Bullish fundamentals of the storage deficit are currently being counteracted by the bearish strong production the market has seen,  Looking ahead to the NYMEX winter strip, the December, January and February futures contracts were all trading above $3/MMBtu for the second consecutive day Tuesday. The front-month and winter strip have both gained some momentum as supply concerns intensify.

Just How Imbalanced Is Natural Gas Supply And Demand, And What Does it Mean for Prices? . Since the beginning of 2018, the natural gas storage deficit versus the 5-year average has ballooned from -362 BCF to -557 BCF, a 4-year high. During this same period, however, prices have tumbled from a peak of $3.63/MMBTU on January 29 to just $2.85/MMBTU on August 2, a correction of 22%. And despite storage levels being down a massive 688 BCF year over year, natural gas prices are actually down around 1% year over year. So, what explains this disconnect between price and storage level? As most natural gas investors are aware, the primary driving force maintaining and growing the storage deficit has been the goodwill of Mother Nature. A brutally cold start to 2018 driving the first -300 BCF weekly withdrawal on record, a late end to the season with weekly draws persisting into the second half of April, and a series of heatwaves this summer have all served to boost first residential/commercial heating demand and then powerburn cooling demand. Without the favorable influence of 2018 weather, goes the conventional wisdom, the bearish influences of record production and plateauing LNG and Mexican exports would have quickly erased this deficit. And based on the laws of averages, eventually, temperatures will normalize, and natural gas storage injections will turn dramatically bearish, thereby justifying the seeming disconnect between observed inventories and prices. However, the assumption that natural gas supply and demand is "dangerously imbalanced" seems to be frequently thrown around with little justification beyond record domestic production which, while admittedly is up an alarming 8 BCF/day year over year, ignores gains in gas demand. While a portion of demand gains have been driven by favorable winter and then summer temperatures - and this contribution will indeed fade once temperatures do normalize - there has also been a significant increase in natural gas infrastructure over the past year driving new temperature-independent gas demand. This article examines natural gas supply/demand balance under a microscope and calculates the true temperature-adjusted supply/demand imbalance and uses this calculation to project natural gas inventories through the end of the year and estimates the impact on natural gas price.

 US natural gas storage volume rises 46 BCf to 2.354 TCf: EIA — The amount of natural gas in US storage facilities increased 46 Bcf to 2.354 Tcf in the week that ended August 3, the US Energy Information Administration reported Thursday. The build was slightly larger than an S&P Global Platts' survey of analysts expected. The analysts' consensus call was for a 45 Bcf injection. The injection was larger than the 29 Bcf build reported in the corresponding week in 2017, but again lower than the five-year average addition of 53 Bcf, according to EIA data. As a result, stocks were 671 Bcf, or 22%, below the year-ago level of 3.025 Tcf and 572 Bcf, or 20%, under the five-year average of 2.926 Tcf. The injection was larger than the 35 Bcf build reported a week earlier as cooler weather dampened gas-fired power generation in multiple regions and production ticked up in the Northeast and Gulf of Mexico, according to data from S&P Global Platts Analytics. The NYMEX September gas futures contract slipped 1 cent to $2.94/MMBtu following the 10:30 am EDT storage announcement. The EIA reported a 23 Bcf injection in the East to raise stocks to 575 Bcf, compared with 670 Bcf a year ago; a 27 Bcf build in the Midwest to lift inventories to 579 Bcf, compared with 769 Bcf a year ago; a 2 Bcf addition in the Mountain region to nudge stocks up to 148 Bcf, compared with 202 Bcf a year ago; a 5 Bcf withdrawal in the Pacific to drop inventories to 245 Bcf, compared with 290 Bcf a year ago; and a 1 Bcf pull in the South Central region to drop stocks to 807 Bcf, compared with 1.095 Tcf a year ago. Total inventories are now 97 Bcf below the five-year average of 672 Bcf in the East, 153 Bcf less than the five-year average of 732 Bcf in the Midwest, 32 Bcf under the five-year average of 180 Bcf in the Mountain region, 71 Bcf below the five-year average of 316 Bcf in the Pacific, and 219 Bcf beneath the five-year average of 1.026 Tcf in the South Central region. There are 12 to 14 more weeks of injections likely before the flip to withdrawal season based on EIA's historical data. Over the past five years, stocks have increased by 903 Bcf between now and early November. If storage increased in line with the average, the heating season would begin with 3.25 Tcf in storage. However, due to elevated production, Platts Analytics is estimating the season will start at 3.37 Tcf at a roughly 500 Bcf deficit to normal.

Analysis: US LNG export demand faces steep ramp up  — Natural gas demand from US LNG export terminals is set to double over the next year as a spate of new liquefaction projects now nearing completion enters service. By September 2019, the startup of Elba Island Trains 1-10, Sabine Pass Train 5, Corpus Christi Trains 1-2, Cameron Train 1 and Freeport Train 1 will add a combined 3.7 Bcf/d in new liquefaction capacity, according to a forecast published by S&P Global Platts Analytics. As early as next month, initial feedgas demand from Elba Island Trains 1-6 could come online, eventually ramping up to approximately 210 MMcf/d. The company's full 10-Train Moveable Modular Liquefaction System or MMLS would consume just 350 MMcf/d upon completion, making it the smallest of the first-wave US LNG liquefaction projects. Following an early July order from the US Federal Energy Regulatory Commission authorizing the introduction of fuel gas at Cheniere Energy's Corpus Christi Train 1, Texas' first LNG liquefaction facility could be the next in line to begin exporting, with commissioning cargoes expected by first-quarter 2019. Based on Cheniere's previous timeline from fuel-gas authorization to initial feedgas deliveries, which averaged roughly 120 days at Sabine Pass, it is possible that the Corpus Christi terminal could see a first export cargo as early as February. According to Cheniere CEO Jack Fusco, exports from Sabine Pass Train 5 won't be far behind.  . During the second half of 2019, Platts Analytics is forecasting an even steeper ramp up in LNG demand with the startup of Elba Island's remaining Trains, 7-10 in July, followed by Cameron LNG Train 1, Freeport Train 1 and Corpus Christi Train 2 by next September. Combined, the seven liquefaction trains would add another 2 Bcf/d in US liquefaction demand. Looking further ahead, while Cameron, Freeport and Corpus Christi's remaining trains, currently under construction, seem certain to enter service over the next two to three years, LNG export projects still in search of buyers seem less certain now, thanks to an increasingly bitter trade war between Washington and Beijing. While the two sides' tit-for-tat tariffs have yet to engulf the LNG industry, some industry analysts and market participants worry that the Chinese market, now the third largest for US LNG exports, could soon impose a crippling 25% tariff on US liquefied gas. 

New wave of mega LNG projects is approaching (Reuters) - A new race to build multi-billion dollar liquefied natural gas (LNG) plants is gaining momentum after a long hiatus in investments as energy giants sense a widening supply gap within five years. Spending on new, complex facilities that super-chill gas into liquid in order to allow its transportation dried up following the collapse in energy prices in 2014. Appetite was further dampened by fears that a plethora of LNG plants built since the late 2000s would lead to a large supply glut until early in the next decade. But sentiment has radically changed over the past year. Buoyed by rising oil prices and exceptionally strong demand from rapidly growing economies such as China and India, executives are increasingly confident conditions are once again ripe for new projects. Qatar, the world’s largest LNG producer, is preparing to expand its facilities by around one third to produce 100-108 million tonnes per year (mtpa) by 2023-2024. The state-owned company expects long-standing partners Exxon Mobil, Royal Dutch Shell, Total and ConocoPhillips to help build and fund the new expansion phases as well as possibly new entrants, he said. A major change in the outlook happened after China strongly boosted imports of LNG in recent years to reduce coal burn in its fight against pollution. “The supply-demand balance definitely looks more favorable towards producers these days,” “China will continue to make the real difference in demand. I don’t see them slowing down. They are shifting attention to building more and more infrastructure,” The LNG market will require over 200 million tonnes per year of new supply through to 2030, or roughly 25-30 mtpa per year in new capacity additions to 2025, The main source of growth is expected to come from the United States, where supplies rose sharply and prices plummeted with the expansion of shale drilling. 

Europe wants U.S. LNG if the price is right - Europe relies heavily on Norway and Russia for oil and natural gas. Natural gas, from Russia in particular, is a source of tension given anti-trust concerns about Russian energy company Gazprom and the tendency of the Kremlin to use energy as a tool for political influence.Announcing the implementation of the July agreement, Juncker said Thursday that Europe was ready to move on U.S. LNG.  "The growing exports of U.S. liquefied natural gas, if priced competitively, could play an increasing and strategic role in EU gas supply," he said in a statement. "But the U.S. needs to play its role in doing away with red tape restrictions on liquefied natural gas exports."The U.S. Energy Information Administration reported total LNG exports quadrupled in 2017 from the previous year. All of the LNG shipped from the United States came from the Sabine Pass terminal in Louisiana, reaching more than two dozen countries. Four more terminals are expected online within the next two years, boosting export capacity from 1.94 billion cubic feet per day last year to 9.6 billion cubic feet per day.  The U.S. National Defense Authorization Act, meanwhile, states that U.S. efforts should promote energy security in Europe, noting Russia uses energy "as a weapon to coerce, intimidate and influence" countries in the region.

Europe Getting Serious About Buying U.S. LNG -- European nations are far behind Mexico and China when it comes to receiving liquefied natural gas from the U.S., but the region is making its biggest effort to date to change that. European Commission trade officials will travel to Washington on Aug. 20 to follow up on an energy agreement last month between the Commission’s President Jean-Claude Juncker and U.S. President Donald Trump. Europe pledged to import more LNG in a bid to diversify imports, while America is seeking new markets for its expanding production of the fuel. Russia is currently Europe’s biggest supplier. “The European Union is ready to facilitate more imports of liquefied natural gas from the U.S. and this is already the case as we speak,” Juncker said in a statement on Thursday. “The growing exports of U.S. liquefied natural gas, if priced competitively, could play an increasing and strategic role in EU gas supply.” Europe received about 10 percent of total U.S. exports last year, up from 5 percent in 2016 after the American shale gas revolution went global with the opening of the Sabine Pass export facility on the country’s Gulf of Mexico coast. Since then, Europe has imported more than 40 LNG cargoes from the U.S., or 2.8 billion cubic meters, the Commission said. Still, that’s just a fraction of Europe’s demand of almost 550 billion cubic meters last year. Most gas arrives by pipelines from Russia and Norway, as well as in LNG tankers from Qatar, the biggest producer of the super-chilled fuel. As the region’s own fields deplete and nuclear and coal plants are decommissioned, demand for the fuel is rising. European buyers are taking a closer look at U.S. gas after Brent oil futures, a key pricing component for much of the LNG sold across the globe, soared to a 3 1/2-year high earlier this year, Greg Vesey, chief executive officer of Liquefied Natural Gas Ltd., said Wednesday in an interview in New York. Russian gas supplies to Europe are also linked to crude, and moves in the commodity affect gas prices at the region’s hubs. U.S. supplies, in contrast, are tied to low-cost shale gas at the benchmark Henry Hub in Louisiana. The discount for Henry Hub versus futures at the U.K’s National Balancing Point has widened to about $5 per million British thermal units, the most for this time of the year since 2013. “Now the prices actually make sense with where crude is going, the spreads are there and it’s worthwhile to talk about U.S. gas,” said Vesey, whose company is developing an export terminal in Louisiana. 

US-German tensions rise as construction starts on Nord Stream 2 gas pipeline  -- Work has finally begun laying pipes for the $11.5 billion Nord Stream 2 gas pipeline that is at the centre of a bitter dispute between Washington and Berlin. Pipe installation commenced at the end of July near Greifswald, on Germany’s Baltic coast. Completion of the 1,200-kilometre line is anticipated by the end of 2019, with the new pipe carrying Russian gas starting in 2020. The route largely follows that of the Nord Stream 1 line, which has been operating since 2011. The new line will double the capacity for the transport of natural gas from Russia under the Baltic Sea to Germany, where it is further distributed across Europe in two overland pipelines.  The construction of the Nord Stream 2 line has been the subject of fierce disagreement ever since it was originally proposed in 2012. The German government, whose former Social Democratic chancellor Gerhard Schröder is chairman of the Nord Stream AG operating company, regards the expansion as vital to ensure Germany benefits as a central hub for the distribution of gas throughout much of Europe—as well as shoring up its own energy supplies. Opposition to the construction of Nord Stream 2 has formed a part of an increasingly bellicose US foreign policy and military encirclement of Russia, first under Barack Obama and now Donald Trump. It is also bound up with Trump’s targeting Germany to divide and weaken the European Union (EU), which he regards unambiguously as a competitor rather than an ally.

Scientists Want Oil Drilling Ban In British County After Series of Earthquakes - Four senior geologists are calling for a moratorium on oil and gas drilling in Surrey in the UK, southeast of London, after 12 earthquakes were registered in the area over the past four months.Between April 1 and July 18, a total of twelve seismic events were detected in the Newdigate, Surrey area, the British Geological Survey (BGS) says. “We are aware there is public concern over human activities, a number of which are capable of producing earthquakes. We are not able to say if there is a connection between oil and gas activities, or any other man-made activities, and the events,” BGS said. Companies exploring for oil and gas in the area are using only conventional processes since fracking is not authorized in Surrey. Now four geologists are calling for a moratorium on drilling in the area in a letter to The Times on Monday, in which they say: “We believe that public health and the environment are not being adequately protected given the unstable geology, which had not been identified before permits were issued for the currently active drill sites.” “There are two oil sites in the immediate area: Horse Hill and Brockham. A causal link with either well site cannot be ruled out, so we need the full picture for the risk assessment,” say Stuart Gilfillan FGS, senior lecturer in geochemistry at School of GeoSciences, University of Edinburgh; Stuart Haszeldine FRSE, professor of geology, University of Edinburgh; Bill McGuire, emeritus professor in geophysical and climate hazards, UCL; Richard Selley, emeritus professor of petroleum geology, Imperial College London. Brockham site operator Angus Energy, for its part, claims that regional geology means that it is physically impossible for its drilling to have caused the earthquakes.

Petrobras’ Net Profit Rises Thirty-Fold On Higher Oil Prices -- Brazil’s state-run oil firm Petrobras benefited from the rising oil prices and booked a thirty-fold yearly jump in its second-quarter net income, which also beat analyst expectations.Petrobras said on Friday that its Q2 net income surged to US$2.68 billion (10.072 billion Brazilian reais) from US$84 million (316 million reais) in the second quarter of 2017, helped by rising Brent prices, which resulted in higher margins in oil exports and oil product sales in Brazil. Other factors that contributed to the thirty-fold profit increase included the depreciation of the Brazilian currency, lower interest expenses due to debt reduction, and lower general and administrative expenses and equipment idleness.The profit jump was also well ahead of analyst estimates for US$1.505 billion in Q2.For Q1 2018, Petrobras had posted what was then its highest quarterly profit since the beginning of 2013 on the back of higher oil prices and proceeds from asset sales.For the first half of 2018, Petrobras also saw soaring profits, at US$4.54 billion (17.033 billion reais), the net income was 257 percent higher compared to the first half of 2017, and the best first-half performance since 2011.  The heavily indebted company also cut more of its debt in the first half of 2018. Petrobras’s net debt stood at US$73.662 billion at end-June, down by 13 percent compared to the end of December last year.

Venezuela's oil major PDVSA cut debt to Russia's Rosneft $400 mil in Q2 — Venezuela's state oil and gas company PDVSA cut its debt to Russia's top crude producer Rosneft by $400 million in the second quarter to $3.6 billion as of the end of June, Rosneft's second-quarter results presentation showed Tuesday. Rosneft agreed prepayment deals for crude and products deliveries with Venezuela between 2014 and 2016, the last of which is due to expire at the end of 2020. The company gave Venezuela a total of $6.5 billion in pre-payments, a Rosneft official said earlier this year.Venezuela's debt to the Russian major thus shrank by $1 billion in the six months since the end-2017 figure, according to the presentation.Rosneft reported in May that Venezuela had paid off $600 million of debt in the first quarter. The Russian company also said it reduced crude purchases from the Latin American country in the first three months of the year.With the Venezuelan economy moving downhill and its oil industry crumbling in recent years, PDVSA told customers earlier this year it was not able to fully meet its supply requirements. Due to provide Rosneft with 222,000 b/d of diluted crude oil, or DCO, PDVSA only had 116,000 b/d available in June, a PDVSA source said earlier.In the face of crushing debt, crumbling infrastructure, worker unrest, hyperinflation and US sanctions, Venezuelan oil output dropped by 670,000 b/d in a year to 1.24 million b/d in July, according to S&P Global Platts OPEC survey. This is the lowest level in the 30-year history of the Platts OPEC survey, except a debilitating worker strike in late 2002 and early 2003. With economic hardship, Russia and Rosneft have provided extensive economic support to Venezuela and PDVSA in recent years. Late last year, Russia's finance ministry agreed to refinance Venezuela's $3.15 billion loan, extending the payment period to 2026 and introducing more favorable conditions on servicing the loan.Rosneft also has stakes in upstream projects in Venezuela, including five oil projects: Petromonagas, Petrovictoria, Petroperija, Boqueron and Petromiranda, which together account for around 4% of Venezuela's overall production, according to the Russian company.

State refiners drive India's July Iran oil imports to a record: trade sources (Reuters) - India’s monthly oil imports from Iran surged by about 30 percent to a record 768,000 barrels per day (bpd) in July, as state refiners’ intake surged ahead of U.S. sanctions in November, preliminary tanker arrival data obtained by Reuters showed. The shipments also include some parcels that were loaded in June and arrived in India last month, the data obtained from trade sources showed. July volumes were about 85 percent higher than year ago shipments of about 415,000 bpd, the data showed. State refiners that had cut imports from Iran in 2017/18 due to a dispute over development rights of a giant gas field, have tied up significantly higher volumes for this fiscal year that began in April, drawn to the discounts offered by Iran. Tehran had offered almost free shipping and an extended credit period for oil sales to India, its top oil client after China. Iran was hoping to sell more than 500,000 bpd of oil to India in 2018/19, its oil minister Bijan Zanganeh said in February. State refiners accounted for about four-fifth of Iranian oil imports in July with Indian Oil Corp along with its unit Chennai Petroleum Corp getting about 300,000 bpd oil from Tehran, the preliminary data showed. In April-July, the first four months of this fiscal year, India’s oil imports from Iran has risen by an annual 40 percent to about 677,500 bpd, the data showed. Purchases from Iran could slow from August as imports from Tehran are getting tougher after the United States in May pulled out of a 2015 nuclear deal and announced the renewal of sanctions against Tehran. Some sanctions will take effect from August 6 while others, notably on the petroleum sector, will take effect on Nov 4.

India’s Top Refiner Buys U.S. Oil To Partially Replace Iranian Crude - Indian Oil Corp, the biggest refiner in India, has purchased a total of 6 million barrels of U.S. crude oil for delivery between November and January, as it has started to look for a replacement of Iranian oil cargoes ahead of the U.S. sanctions on Iran’s oil exports returning in early November.  The 6-million-barrel purchase was the first time that Indian Oil Corp (IOC)—which was the first Indian refiner to buy U.S. oil last summer—has bought U.S. crude oil through a mini-term tender, the Indian company’s Director of Finance A.K. Sharma told Reuters on Wednesday.IOC is buying 2 million barrels of U.S. Mars for November delivery, one million barrels of Mars and Eagle Ford each in a combination cargo for December delivery, and 2 million barrels of Louisiana Light Sweet (LLS) to be delivered in January next year, Sharma said.Ahead of the return of the U.S. sanctions on Iran, India’s state refiners boosted their Iranian oil purchases, pushing up Indian oil imports from Iran by 30 percent from June, to a record 768,000 bpd in July, according to preliminary tanker arrival data that Reuters has obtained from trade sources.Iran is said to have started to offer India cargo insurance and tankers operated by Iranian companies as some Indian insurers have refused to cover oil cargoes from Iran in the face of the returning U.S. sanctions on Tehran. Hindustan Petroleum was said to have cancelled a crude oil shipment from Iran after its insurer refused to provide coverage for the cargo on concern about U.S. sanctions.India’s imports from Iran could start to slow from August as some big Indian refiners worry that their access to the U.S. financial system could be cut off if they continue to import Iranian oil, prompting them to reduce oil purchases from Tehran.

U.S. crude exports to India surge as China intake fades: Russell (Reuters) - U.S. crude oil producers appear to have found an alternative buyer for cargoes no longer heading to China, with India on track to import record volumes in August. India has booked a total of 9.94 million barrels of crude, about 319,000 barrels per day (bpd), to arrive from the United States this month, according to vessel-tracking and port data compiled by Thomson Reuters Oil Research and Forecasts. This would be almost triple the 119,000 bpd India imported from the United States in July, and well above the 190,000 bpd for November last year, the previous record for a month. The August total is also likely to be just above the 9.65 million barrels imported over the first seven months, showing the scale of acceleration in India’s imports of U.S. crude. Indian refiners’ interest in U.S. crude will be welcome news to shale producers looking for buyers outside of China, which is likely to scale back imports as the trade dispute between the administration of President Donald Trump and Beijing escalates. Although not imposed as yet, China has proposed import taxes of up to 25 percent on U.S. crude, as well as on liquefied natural gas and coal. While U.S. crude exports to China appear to have held up in August, with about 342,000 bpd expected to arrive, they seem set for a slump in September. So far, about 203,000 bpd of U.S. crude have been booked for arrival in China next month, according to vessel-tracking data, and the window for more cargoes to be added is closing, given it takes at least three weeks for a tanker to make the journey from the Gulf of Mexico to China’s east coast. For U.S. crude exporters, India is a market ripe for expansion, given the voyage from the Gulf of Mexico to India’s west coast takes about three weeks, much the same as it does to China’s east coast. This means shipping costs are more or less in line with sending cargoes to China. 

Indian Oil Corp signs first US term crude deal, buys 6 million barrels for Nov-Jan delivery — State-run Indian Oil Corp has signed its first US term crude oil deal, buying 6 million barrels, as the Asian buyer steps up efforts to devise an alternative buying strategy amid uncertainty about purchases from Iran because of US sanctions. IOC's director of finance A.K. Sharma told S&P Global Platts that the volumes would be shipped in in three VLCCs -- one each for delivery in November, December and January. "Yes, we have signed the deals," Sharma said, but did not provide price details. The deal is believed to be the first term deal by an Indian refiner. Until now, Indian refiners have been buying mainly spot cargoes from the United States. A question mark on India's future strategy in buying crude oil from Iran as well as Beijing's trade war with Washington have opened a window of opportunity for Indian refiners to dramatically step up purchases from the US, a trend that could continue in the coming months, analysts told Platts earlier this week. According to the latest US census export data, from an average of 29,000 b/d of crude flow from the US to India in the January-April period, the volume jumped sharply to 152,000 b/d in May, and 261,000 b/d in June, a new monthly record. Private refinery sources in India added that an improvement in shipping logistics in the US had boosted the appetite of many Indian refiners for American crude on a regular basis, and some were also considering term purchases. Sharma did not identify the exact crude grades that the state-run refiner bought on the latest US crude term deal, but some Asian trade sources based in Singapore said the Indian end-user could have bought a combination of light sweet grades and medium sour Mars Blend crude.

At Iran's Risk, Trump Is Winning Over Fastest Growing Oil Market -- One of Iran’s biggest oil customers is buying more U.S. crude as President Donald Trump sticks to his pledge to squeeze the Persian Gulf nation’s energy trade.State-run refiner Indian Oil Corp., which had been buying U.S. crude in the spot market, signed a term tender to purchase American oil for delivery every month between November and January, according to Finance Director Arun Kumar Sharma. That will help more than double the company’s shipments from the U.S. so far this year compared to last fiscal year.“This tender is the first step toward future imports of U.S. crude oil through term contracts,” Sharma said in a phone interview on August 8.A greater commitment to U.S. crude may help shield India from supply disruptions when sanctions on oil aimed at curbing the Islamic republic’s nuclear program begin in early November. It also gives American producers greater inroads to the fastest-growing oil consumer, a market that’s currently dominated by Middle-Eastern suppliers.American oil giant Exxon Mobil Corp. is said to be courting Asian refiners with rare long-term U.S. crude export deals in a bid to expand its trading scope. Long-term contracts -- which involve the sale of cargoes of a certain quality, volume and price over a set period from as little as 6 months to multiple years -- for American oil are uncommon and most deals are done on a spot basis after a decades-long export ban was lifted in late 2015.“Long-term contracts will be central to the U.S. strategy,” said Abhishek Kumar, a senior energy analyst at Interfax Energy in London. “That ensures the U.S. will have customers for its hydrocarbons in the medium-to-long term.”Indian Oil agreed to buy 6 million barrels of U.S. crude through the term-tender, taking its American crude purchases to 16 million barrels in total since April. That compares to its previous year’s spot purchases of 6.6 million barrels from the shale producer. The nation’s biggest refiner said in May that it plans to nearly double its oil imports from Iran to 7 million tons during the financial year that began in April. But Trump’s push to isolate the Islamic Republic is forcing it to prepare alternative plans. Indian Oil is still awaiting direction from its government on Iranian crude imports, Sharma said.

Analysis: India's love affair with US crude intensifies amid Iran puzzle — A question mark on India's future strategy in buying crude oil from Iran as well as Beijing's trade war with Washington have opened a window of opportunity for Indian refiners to dramatically step up purchases from the US, a trend that could continue in the coming months. As plentiful volumes of US crude might be looking for new homes when China imposes a 25% import tariff on American crude, a large number of the displaced barrels could make its way to India, analysts said.According to the latest US census exports data, from an average of 29,000 b/d of crude flow from the US to India in the January-April period, the volume jumped sharply to 152,000 b/d in May and 261,000 b/d in June, a new monthly record."We believe that any cutback in China's crude oil imports from the US due to US-China trade tensions will see more US crude cargoes heading towards Europe, India and Southeast Asia," Lim Jit Yang, director for Asia at S&P Global Platts Analytics, said.China received 14.65 million barrels of US crude in June, a historical high, but volumes have more than halved to just 6.9 million barrels in July, according to Platts' vessel tracker cFlow. Arrivals in August are expected to shrink even more to around 6 million barrels. Oil tankers laden with US crude that were initially headed to China appear to be getting diverted to other buyers."We are seeing that Indian refiners are now more open to consider mini term deals for US supplies -- for example one US cargo per month. This will help them import US crude on a regular basis," Senthil Kumaran, senior oil analyst at Facts Global Energy, said.  Private refinery sources in India added that an improvement in shipping logistics in the US had whetted the appetite of many Indian refiners to buy American crude on a regular basis."We will definitely see more US crude coming to India in H2. Shipping is now much more smoother and whenever economics works, we will see more volumes of US crude coming to India," a source at a private refiner said.FGE added, however, that US would be only filling a part of the void created by a fall in imports from Iran.

Indonesia bets big on biodiesel to limit costs of oil imports (Reuters) - Indonesia plans to require all diesel fuel used in the country contain biodiesel starting next month to boost palm oil consumption, slash fuel imports, and narrow a yawning current account gap. While the proposal has been welcomed by the palm oil industry and government, it has raised concerns among the automobile industry the fuel could impact engine performance. Environmentalists fear the boost to local palm oil consumption will hasten Indonesia’s already fast spreading deforestation. Indonesia currently imports around 400,000 barrels per day of crude oil and a roughly similar amount of refined products, which makes Southeast Asia’s largest economy vulnerable to the sort of increases in global crude prices seen over the past year. With the current account deficit estimated to grow by $8 billion in 2018, the plan is to cut diesel imports by mandating that all diesel consumers, including power plants and railways, use biodiesel that contains 20 percent bio-content (B20), typically palm oil. Officials estimate this will save Indonesia around $6 billion per year. The program will increase domestic consumption of palm oil in the world’s largest producer of the edible oil, providing a market for output that has climbed by 35 percent over the past five years. In Indonesia, the bio component in biodiesel consists of fatty acid methyl esters (FAME) made from palm oil. Indonesia has 26 FAME producers, including units of palm oil giants like Sinar Mas Group, Wilmar (WLIL.SI), and Musim Mas, according to the Indonesian Biofuels Producers Association (APROBI). FAME is supplied to fuel distributors including Pertamina, blended with petroleum-based diesel and sold to end-users. For a graphic on Indonesia's energy sector, click reut.rs/2Mc915Y Currently only around one-quarter of Indonesia’s FAME production capacity is utilized, and the new program could raise this to up to 50 percent, said Togar Sitanggang, a senior official at the Indonesia Palm Oil Association (GAPKI). The government has said it will provide incentives to biodiesel producers, but has not provided details. 

The Trump-Putin friendship could be all about oil and China - Trump’s revealed preferences and prejudices, along with the beliefs that he would like others to hold, can serve as useful guides as to what could explain the Trump-Putin relationship, and what they discussed in Helsinki.The president has made it clear that he has a preference for white people, Christians and the rich and powerful. He perceives the economy, trade and money as zero-sum games. His world is full of competitors but no partners, deal-makers and deal-breakers. His end game with Russia could be to drive a wedge between the Russians and the Chinese, and another between the Russians, Iran and Syria.  After all, Russia is white, Christian and not a real economic competitor. The Chinese are non-white, non-Christian and a growing formidable economic power that is contesting American dominance in almost all economic domains. Iran and Syria are primarily Muslim countries and enemies of Israel, and belong to a group of nations for whom Trump has shown nothing but disdain and contempt.But why would Trump attack traditional partners (the European Union, Great Britain, Canada and other NATO countries) when presumably he could have courted the Russians without having to insult his old partners? Well, it could be that Trump is demonstrating and setting an example for Putin to follow.

PRC Tells Yanquis to Shove It On Iran Oil Imports -  Truly *independent* countries--from American influence, at least--are free to buy Iranian oil.It's odd that Trump campaigned on American isolationism--withdrawing from misadventures in Afghanistan, Iraq, Syria, et cetera--and then to see his actions on Iran. Being the archetypal Stuck in the 80s sort of guy, Trump seems to have an odd fixation on bashing Iran. Famously leaving the agreement struck on Iranian compliance on limiting enriched nuclear materials in exchange for lifting sanctions, the United States wants to get its way when none of the other signatories to the JCPOA agreement have left it.The oddity here is that the United States wants everyone else to follow through with re-implementing sanctions on Iran. If this isn't a prime example of playing "globocop" and busybodying in world politics, then I don't know what is. Given the commercial ties of countries like Western European ones with the United States, it's certainly difficult for them to ignore American pressure to stop buying Iranian fuel. For instance, the Germans may chafe at the neophyte US ambassador telling them to stop buying Iranian fuel, but they ultimately will have to comply lest they face American economic sanctions.  Thankfully, though, there is someone bucking the trend. What's more, it's a JCPOA signatory, a permanent member of the UN Security Council, and now the largest buyer of Iranian oil. Yes, I am talking about ChinaThe U.S. has been unable to persuade China to cut Iranian oil imports, according to two officials familiar with the negotiations, dealing a blow to President Donald Trump’s efforts to isolate the Islamic Republic after his withdrawal from the 2015 nuclear accord... Teams of U.S. officials have been visiting capitals around the world to try to choke off sales of Iranian oil by early November, when U.S. sanctions are due to snap back into effect.  Francis Fannon, the assistant secretary of state for the Bureau of Energy Resources, was recently in China to discuss sanctions, according to a State Department spokesperson. Unfazed, the administration has warned that even allies would face sanctions if they didn’t show “significant” progress in reducing Iranian oil purchases by Nov. 4, ruling out broad exemptions or waivers. Instead of putting the brakes on its Iranian oil purchases, China has hit the gas instead.

Chinese State Oil Major Suspends U.S. Oil Imports Amid Trade War --Due to the rising trade tension between China and the United States, the trading arm of Chinese state oil major Sinopec has suspended imports of crude oil from the United States, Reuters reported on Friday, citing sources familiar with the plans.Sinopec’s trading unit, Unipec, has not booked new purchases of U.S. crude oil at least until October, one of Reuters’ sources said. Yet it was not immediately clear how long the suspension of U.S. oil imports would last.Earlier this year, Unipec had planned to trade up to 300,000 bpd of U.S. crude oil by the end of 2018, which would have been triple the volume of U.S. crude oil that it traded last year.Amid the ongoing trade war between the United States and China, however, Chinese buyers have scaled down purchases of American oil after China threatened to impose a 25-percent import tax on U.S. energy imports if the United States imposed additional tariffs on more Chinese products. U.S. energy exports to China may suffer if Beijing follows through with its threat to slap tariffs on U.S. oil and oil product imports.  China is America’s second-largest crude oil customer after Canada.

Despite Weak Teapot Demand, China’s Oil Imports Recover In July - China’s crude oil imports in July rose for the first time in three months, but were still at their third lowest monthly level so far this year, as independent refiners continue to suffer from the new tax regime eroding their refining margins.According to data by China’s General Administration of Customs compiled by Reuters, Chinese crude oil imports increased to 8.48 million bpd in July from 8.36 million bpd in June and from 8.18 million bpd in July last year.In June, China’s crude oil imports had dropped for a second consecutive month and hit their lowest level since December 2017 on the back of trimmed purchases by the independent refiners—the so-called ‘teapots’. Chinese imports stood at 8.36 million bpd in June, down by 9 percent from May’s imports of 9.2 million bpd, and down compared to the 8.8 million bpd imports in June 2017. In July, Chinese imports recovered somewhat as some of teapots returned from maintenance and as refining margins for the state-held majors improved amid higher fuel prices and waning competition from the independents.   Under the stricter tax regulations and reporting mechanisms effective March 1, the teapots now can’t avoid paying consumption tax on refined oil product sales—as they did in the past three years—and their profit bonanza is coming to an end

The Unforeseen Consequences Of China’s Insatiable Oil Demand - While it’s true that China’s crude oil imports recovered slightly in July, it was still among the lowest so far this year due to a decline in demand from smaller so-called independent “teapot” refineries.However, for the first seven months of the year, China imported some 8.98 million barrels per day (bpd) of crude oil, up 5.6 percent from a year earlier. Total natural gas imports, including both pipeline gas and liquefied natural gas (LNG), rose to 7.38 million tonnes during the same period, up 28.3 percent from a year ago, according to customs data. Moreover, amid both economic growth as well as Beijing’s mandate that gas make up at least 10 percent of the country’s energy mix by 2020 to offset the effects of rampant air pollution from dirtier thermal coal power production, the long term trajectory for both China’s natural gas consumption, as well as oil usage, will continue to increase, posing both a geopolitical and financial dilemma for the country that the U.S. and many western powers grappled with for decades. Going forward, China’s gas demand is projected by the IEA to rise by 60 percent between 2017 and 2023 to 376 billion cubic meters (bcm), including a spike in its LNG imports to 93 bcm by 2023 from 51 bcm last year. The IEA has also projected that China will become the world’s top natural gas importer (both pipeline and LNG) by next year. This marked increase in Chinese LNG procurement has changed the global LNG market from one that was projected to remain in a supply overhang scenario until around 2022 or even later to one that is now projected to have possible shortfalls of the super-cooled fuel around the same time frame. It has also ushered in new confidence for global LNG producers and talk of pushing ahead more greenfield LNG projects to meet this demand, a possibility unheard of just a year ago.  This increase in gas usage will also mean that China’s domestic gas output, though it will be the world’s fourth largest gas producer by 2023, will be unable to keep up, with China increasingly becoming more reliant on gas imports from both established LNG producers like Australia, the U.S. (current trade tensions notwithstanding) and Russia, but also more geopolitically volatile producers such as Qatar, still the world’s top LNG producer, Yemen, Oman, Papua New Guinea, in time Mozambique, and others.

China Just Laid Down The Gauntlet, Proposes Tariffs On US Natural Gas  -- President Donald Trump’s trade war with China could reach a whole new level if Chinese officials follow through on a threat to impose tariffs on U.S. natural gas. Trump’s trade war is escalating rapidly. The back-and-forth began when the White House in July slapped a 25-percent tariff on a litany of Chinese goods worth around $34 billion, a move intended to punish them for intellectual property theft and unfair trade practices. Chinese leaders immediately retaliated with similarly sized tariffs on vehicles, soybeans, pork and other U.S. commodities. Now — in response to the Trump administration threatening to raise the tariff rate on other Chinese goods — its government is teasing a 25-percent tariff on imports of U.S. natural gas. If enacted, the tariff would be a major blow to the American natural gas industry, which, thanks to the development of hydraulic fracturing, has been experiencing unprecedented growth in recent years. Cheaper and less polluting than other fossil fuels, the production and consumption of liquified natural gas (LNG) has grown rapidly. The trade of LNG has also jumped. U.S. natural gas exports quadrupled in 2017, according to the Energy Information Administration. Over half of those exports went to Mexico, South Korea and China. If President Xi Jinping decides to follow through on a 25-percent tariff, the result would have major ramifications for American shale producers. Cheniere, America’s biggest exporter of natural gas, saw its shares drop nearly 8 percent upon the report. “At least in the short term any Chinese buyer looking for long-term supply would have to drag their feet on signing a U.S. contract,”  Notably, China’s threats follow a July meeting between Trump and European Commission President Jean-Claude Juncker, where the EU leader promised to purchase more U.S. natural gas.

China removes US crude oil from latest round of import tariffs - — China announced Wednesday retaliatory tariffs on an additional $16 billion worth of US imports, including oil products, LPG and coal in a new list of affected goods but leaving off widely-expected import duties on US crude. The Chinese Ministry of Commerce's latest list imposes 25% tariffs on a swathe of energy commodities from August 23 including "asphalt shale, oil shale and tar sand."But the ministry said the latest tariffs remove a previous reference to US crude in earlier proposals announced on June 16. Naphtha, propane and butane all remain on the new list which also covers waste metals, petrochemical products and cars.The latest tit-for-tat escalation in the trade war between the two countries comes after the US earlier Wednesday said it would implement a 25% tariff on an additional $16 billion worth of Chinese imports from August 23.Removing crude from the list may reflect China's inherent energy security concerns, ClearView Energy Partners said in a note Wednesday."Simply put, crude may have been a bluff -- and LNG could be too -- and energy scarcity may have led China to retreat from its threat posture," managing director Kevin Book said in the note.  Another explanation could be that China is rationalizing its crude import policies to defend its plan to continue importing Iranian crude after US sanctions snap back November 4.  US tariffs implemented on July 6 saw China retaliate by imposing a 25% tariff on $34 billion worth of US imports of food products, agricultural commodities such as soybean, and motor cars. China's Ministry of Commerce said then that it has been "forced to fight back." China has already shortlisted US LNG imports for 25% tariffs in a previous round of retaliatory duties announced on August 3, but this has yet to be implemented. In addition to energy commodities including road fuels, naphtha and coal, the latest list covers waste metals and cars under the $16 billion worth of US products that China will target from August 23.

China State Firms to Expand Domestic Oil, Gas Exploration After Xi's Call (Reuters) - China's state energy giants pledged this week to expand domestic oil and gas exploration and production and increase in particular natural gas supplies following an instruction from President Xi Jinping to boost national energy security. China National Offshore Oil Company, China's offshore oil and gas specialist, said on Wednesday it aims to boost domestic oil and gas proven reserves including a 10-year plan to stabilise annual output at its top fields at Baohai Bay at 30 million tonnes, a statement on the company's website said. On Tuesday top energy group CNPC said one of its key tasks in response to Xi's call to ensure energy security was to fast-track investments in natural gas production and infrastructure including underground storage. China suffered a severe natural gas crunch last winter as demand spurred by Beijing's massive gasification push expanded much faster than domestic fields could supply and a lack of pipelines and storage hindered gas deliveries. Li Jiewen, spokeswoman for CNOOC Ltd, said the fact that companies issued statements around the same time was because it was when mid-term management meetings were held and companies normally issue strategic remarks after those meetings. "(In implementing top-level instructions) Companies will follow their own development characteristics and proceed with plans accordingly," said Li. China, the world's top energy user and also largest crude oil importer, is facing declining reserves and soaring development costs at mature oilfields. Rapid growth in natural gas demand has led to surges in imports which made up some 45 percent of total consumptions last year and the country is set to overtake Japan as the world's top gas buyer next year, as estimated by the International Energy Agency. The state oil firms' remarks came as China is entangled in a tit-for-tat trade war with the United States. Beijing has added both U.S. crude oil and liquefied natural gas on its proposed retaliatory tariff list. 

Iran’s Oil Exports Drop For Third Consecutive Month --Iran’s oil exports dropped by 7 percent to 2.32 million bpd in July—their lowest level in four months—as South Korea and Europe are slashing imports ahead of the return of the U.S. sanctions on Tehran, data from S&P Global Platts showed on Tuesday.However, Iranian oil exports to its top two customers—China and India—continued to stay high last month. Exports to China rose to 799,452 bpd in July from 722,100 bpd in June, while Iranian oil sales to India increased by more than 40,000 bpd from June to 706,452 bpd in July, S&P Global Platts data shows.Europe—which as a whole has been Iran’s third-biggest single customer—saw imports drop to 465,450 bpd last month from 485,768 bpd in June, with demand from France, Spain, and Turkey down and purchases from Italy and Greece steadily up. In Europe, spot demand for Iranian crude is sharply down, but refiners with term contracts are still honoring them, according to sources who spoke to Platts.Analysts expect Iran’s oil exports to drop more noticeably beginning in September, and the rate of decline to accelerate as the United States looks to have Iran’s current customers reduce Iranian oil imports to ‘zero’. In June, although China and India held their Iranian oil purchases high, the top Asian oil importers and Iranian oil customers—China, India, Japan, and South Korea—bought in June their lowest combined volume of Iranian oil in seven months, as South Korea slashed Iranian purchases. Starting in July, South Korea is halting Iranian oil imports for the first time since 2012 amid pressure from the United States to discontinue purchases from Iran.  Analysts expect the U.S. sanctions to take between 500,000 bpd and 1 million bpd of Iranian crude oil off the market when full sanctions return in early November, and some experts think that the figure will be closer to 1 million bpd.

U.S. Grants Iran Sanctions Waiver To Southern Gas Corridor --The U.S. is granting an Iran sanctions waiver to the Southern Gas Corridor natural gas pipeline projects designed to carry Azeri gas from the Caspian Sea to Turkey and onto Europe by-passing Russia.Iran’s NICO holds a 10-percent stake in the Shah Deniz consortium that is developing the Shah Deniz 2 gas deposit in Azerbaijan, which will be the starting point for the Southern Gas Corridor.The executive order signed by U.S. President Donald Trump on Monday contains a “Natural Gas Project Exception” which describes the Southern Gas Corridor without naming it.The natural gas project exemption is referencing the Iran Threat Reduction and Syria Human Rights Act of 2012, which stipulates that the act has exceptions for certain natural gas projects “for the development of natural gas and the construction and operation of a pipeline to transport natural gas from Azerbaijan to Turkey and Europe”, and “that provides to Turkey and countries in Europe energy security and energy independence from the Government of the Russian Federation.”Last month, BP and its partners started up the US$28-billion Shah Deniz 2 gas development in Azerbaijan—the starting point of the Southern Gas Corridor for gas supplies into Europe expected to reduce European dependence on Russian gas. The Southern Gas Corridor consists of several separate energy projects with a total investment of around US$40 billion. Apart from the Shah Deniz 2 development, the Corridor will include three pipelines—the South Caucasus Pipeline (SCPX) to Azerbaijan and Georgia; the Trans Anatolian Pipeline (TANAP) to Turkey; and the Trans Adriatic Pipeline (TAP) planned to cross Greece, Albania, and end up in Italy.

Japan Negotiating with U.S. For Iranian Oil Import Exemption - Japan will continue to negotiate with the United States to seek exemption from the U.S. sanctions on Iran’s oil, as Tokyo wants to avoid negative impacts on its energy supply and business activity, Japan’s public broadcaster HNK quoted Trade Minister Hiroshige Seko as saying on Tuesday.  Japan and the United States held talks earlier this month on Iran’s sanctions, Seko told reporters today, adding that he conveyed Japan’s position that the sanctions shouldn’t disrupt the Japanese corporate activity.“The Japanese side insisted on the basic principle that [the US sanctions] should not affect energy supply or have a negative impact on Japanese corporate activities,” Platts quoted Seko as saying at a news conference. According to data by the Japanese Ministry of Economy, Trade and Industry (METI), Japan’s oil imports from Iran stood at 162,222 bpd on average between January and June 2018, down by 2.7 percent year on year. The imports from Iran accounted for 5.3 percent of Japan’s total crude oil imports in the first half this year.   As early as in May, when U.S. President Donald Trump announced that sanctions on Iran would return, Japan signaled that it would seek some kind of exemption from Iran’s oil sanctions. Talks have been held throughout the summer, and reports have had it that the U.S. had asked Japan to completely stop importing Iranian crude oil. In the middle of July, the head of the Japanese oil refiners’ association said that Japan was likely to stop purchasing Iranian crude oil, with last loadings expected by the middle of September and arriving in Japan by mid-October. On Monday, when asked about the talks with Japan over a U.S. waiver, a senior U.S. Administration official told reporters via teleconference that “We don’t disclose private deliberations with other governments over these things. As we’ve said, we – our goal is to get the import of Iranian oil to zero. We are not looking to grant exemptions or waivers, but we do and are glad to discuss requests and look at requests on a case-by-case basis. But beyond that, we don’t comment on it.”

Egypt To Start Importing Israeli Gas For Re-export In Early 2019 - An Egyptian company is set to begin importing gas from Israeli offshore fields in the first quarter of 2019 and to re-export it as part of its plan to become a regional gas hub, sources in Egypt’s energy industry tell Reuters.In February this year, Israel’s Delek Group and Houston-based Noble Energy—the main partners in two large gas fields offshore Israel—signed agreements to sell significant quantities of natural gas from the Leviathan and Tamar fields to Dolphinus Holdings to supply gas in Egypt.These agreements, one for natural gas from Leviathan and one for Tamar, each provide for total contract quantities of 1.15 trillion cubic feet of natural gas. The natural gas sales, both under 10-year contracts, are expected to supply industrial and petrochemical customers as well as future power generation in Egypt, Noble Energy said back in February.The price of the gas to be supplied under both export deals will be set by a price formula linked to Brent Crude prices. Delek has estimated that the total revenues from the Tamar and the Leviathan gas sale deals to Egypt may reach US$15 billion.Egypt has received the backing of the World Bank in its efforts to be a regional oil and gas trading hub, as several new gas projects started up recently in the Mediterranean country.  Following the start-up of the giant gas field Zohr, Egypt has become an important player in the Mediterranean. Zohr, discovered by Eni in 2015, plays a key role in helping Egypt to avoid the need to import liquefied natural gas (LNG), according to the Italian oil and gas major. In June, Egypt issued what is likely to be its last LNG import tender, and could begin exports early in 2019, Egypt’s Petroleum Minister Tarek El-Molla told Bloomberg at the time. The June tender was for Egypt’s third-quarter gas needs, and it might not need to import LNG for the fourth quarter and onwards, the minister said.

Saudi Arabia resumes oil exports through Red Sea lane (Reuters) - Top oil exporter Saudi Arabia said on Saturday it has resumed all oil shipments through the strategic Red Sea shipping lane of Bab al-Mandeb. Saudi Arabia halted temporarily oil shipments through the lane on July 25 after attacks on two oil tankers by Yemen’s Iran-aligned Houthi movement. A statement by the Energy Ministry said shipments had resumed on Saturday. “The decision to resume oil shipment through the strait of Bab al-Mandeb was made after the leadership of the coalition has taken necessary measures to protect the coalition states’ ships,” Energy Minister Khalid al-Falih said in the ministry statement. Saudi Aramco confirmed that shipping had resumed effective immediately. “The company is careful to continue monitoring and evaluating the current situation in coordination with the relevant bodies and take all necessary procedures to ensure safety,” Aramco said in a statement. Yemen, where a Saudi-led coalition has been battling the Houthis in a three-year war, lies along the southern end of the Red Sea, one of the most important trade routes in the world for oil tankers. The tankers pass near Yemen’s shores while heading from the Middle East through the Suez Canal to Europe. The Bab al-Mandeb strait, where the Red Sea meets the Gulf of Aden in the Arabian Sea, is only 20 km (12 miles) wide, making hundreds of ships potentially easy targets. After Saudi’s decision to halt shipments, Yemen’s Houthi group said on July 31 it would halt attacks in the Red Sea for two weeks to support peace efforts. The Saudi coalition intervened in Yemen’s civil war in 2015 to restore the internationally recognized government of exiled president Abd-Rabbu Mansour Hadi. 

OPEC Oil Output Climbs as Saudi Arabia Pumps Near Record -- OPEC’s crude output increased last month as Saudi Arabia pumped near-record volumes to make good on a pledge to consumers that demand would be met. The kingdom’s oil production grew by 230,000 barrels a day in July, to 10.65 million barrels per day. This is just shy of an all-time peak reached in 2016, according to a Bloomberg survey of analysts, oil companies and ship-tracking data. Higher crude output from the Saudis, along with Nigeria and Iraq, pushed up total production from the Organization of Petroleum Exporting Countries by 300,000 barrels a day, offsetting losses from a spiraling economic collapse in Venezuela, political clashes in Libya and the onset of U.S. sanctions against Iran. The group’s 15 members, which now include Congo, collectively produced 32.6 million barrels per day. Saudi Arabia’s production increase shows it’s delivering on promises to prevent prices from damaging the global economy after Brent crude reached a three-year high above $80 a barrel earlier this summer. The kingdom has been under acute pressure from President Donald Trump to open the taps as he chokes off exports from Saudi’s political rival, Iran. When OPEC met in June, the organization agreed it had been cutting supplies excessively and should restore output to 100 percent of a target set in late 2016. With the production increases made since then, they’ve succeeded: compliance was at 104 percent in July. However, the organization is bitterly divided on the interpretation of the June agreement. While the Saudis and their Gulf allies said they would increase production to make up for countries unable to, Iran argues that they’re violating individual country targets and ultimately betraying the organization. Although the sanctions don’t officially take effect until November, Iran is already seeing customers flee as the U.S. imposes penalties on buyers after Trump quit a nuclear accord with the country. 

Iran accuses OPEC/non-OPEC committee of trying to redistribute crude oil output quotas - Iran accuses OPEC/non-OPEC committee of trying to redistribute crude oil output quotas — The six-country OPEC/non-OPEC committee overseeing the agreement improperly attempted to redistribute crude oil production quotas at its July 18 meeting in Vienna, Iranian oil minister Bijan Zanganeh wrote to UAE energy minister and OPEC President Suhail al-Mazrouei on Wednesday. Should the committee persist in its efforts, Zanganeh said he would request an extraordinary OPEC meeting to resolve the conflict. The committee, called the Joint Ministerial Monitoring Committee, and its subsidiary Joint Technical Committee are only charged with assessing member compliance with the agreement, Zanganeh wrote in a letter posted online by Iran's oil ministry news service Shana. Iran, which has steadfastly maintained that the deal does not allow members to produce above their individual quotas, attended the committee meeting as a non-voting observer. "To our dismay we witnessed that some members attempted to redistribute over-conformity in production adjustment level among themselves, and attempts to hand over OPEC countries' over-conformity to non-OPEC countries," Zanganeh wrote. "This very procedure is totally in contradiction with the monitoring task of both JMMC and JTC, and indicates misinterpretation by the JMMC over its mandate, as well as disregard for the decision of the 174th Meeting of the OPEC Conference." Mazrouei had no immediate comment on the letter, UAE officials said. OPEC and 10 non-OPEC allies led by Russia agreed on June 23 to raise production by about 1 million b/d by reducing overcompliance with production cuts that had been in force since January 2017. But the coalition has left unsettled how those barrels will be divvied up. Several members are unable to raise production; Venezuela is in the throes of an economic crisis, while Iran faces the snap back of US sanctions in November. That leaves primarily Saudi Arabia and its Gulf allies, along with Russia, to account for the bulk of the increase by tapping into their spare capacity. Iran has said that the deal still maintains individual quotas, while Saudi Arabia and Russia have said the deal has morphed into a collective supply ceiling.

Saudi Arabia pumped less crude oil in July: OPEC sources (Reuters) - Top oil exporter Saudi Arabia pumped around 10.290 million barrels per day of crude in July, two OPEC sources said on Friday, down about 200,000 bpd from a month earlier. The amount of oil supplied to the market in July was slightly higher at 10.380 million bpd, the sources said. Supply to the market - domestically and for export - may differ from production depending on the movement of barrels in and out of storage. Saudi Arabia told the Organization of the Petroleum Exporting Countries that the kingdom pumped 10.488 million bpd of crude oil in June, an increase of 458,000 bpd from the production figure it submitted for May. However, crude supply to the market in June was higher than wellhead production at 10.579 million bpd, a figure that includes domestic consumption and all exports, including from storage tanks. OPEC agreed with Russia and other oil-producing allies in June to raise output from July, with Saudi Arabia pledging a “measurable” supply boost. OPEC and the non-OPEC producers said they would raise supply by returning to 100 percent compliance with previously agreed output cuts, after months of underproduction. That would mean a roughly 1 million bpd increase in output. 

OPEC Sources: Saudis Cut July Production  | Rigzone -- Saudi Arabia, which recently pledged oil-supply increases to tame rallying crude prices, cut production last month, according to OPEC delegates familiar with the matter. The biggest member of the Organization of Petroleum Exporting Countries pumped 10.3 million barrels a day in July, according to the delegates, who asked not to be identified because the data is private. The kingdom told the cartel it produced 10.489 million in June. The cutback comes despite promises from Saudi Energy Minister Khalid al-Falih that key OPEC members and their allies would add about 1 million barrels of supply, doing "whatever is necessary to keep the market in balance." Under pressure from U.S. President Donald Trump to reassure markets, the kingdom was said to have been preparing to pump 10.8 million or 11 million barrels a day. The lower number follows signs that the Saudis couldn't ultimately find buyers to justify pumping at record output levels. U.S. crude futures lost more than 7 percent in July, their steepest drop in two years, amid signs that a surplus is re-emerging in some parts of the world market. There are growing fears that the trade war between the U.S. and China could impair demand. 

 Analysis: Saudi crude oil production data catches market by surprise, but not all are convinced — The unexpected news last week that Saudi Arabia cut crude oil production by 200,000 b/d last month has the market scratching its head. The kingdom, which had signaled after the June 23 OPEC meeting that it could pump as high as 11 million b/d, instead produced a much more modest 10.29 million b/d in July, Saudi sources told S&P Global Platts on Friday, down from 10.49 million b/d in June. Crude supplied to market was 10.38 million b/d, the sources added, indicating that Saudi Arabia pulled barrels out of storage. The figures are at odds with several independent assessments of Saudi production, including Platts' OPEC survey released earlier Friday, which pegged the kingdom's July output at 10.63 million b/d. "We haven't seen any destocking that could justify why the supply to market was higher than production at 10.38 million b/d," said one Platts survey participant, adding that he would not be revising down his production estimate. Others, however, were more willing to take at face value the Saudi source numbers, which were reported by several news agencies. One participant cited lower export figures in the month and indications that Saudi Arabia was having trouble placing its barrels into the market. Platts tanker tracking software cFlow shows Saudi crude exports dropped 461,000 b/d from June to 7.140 million b/d, despite the country's OPEC Governor Adeeb al-Aama saying July 19 that exports would be flat month-on-month. The Platts OPEC figures are compiled by surveying OPEC and oil industry officials, traders and analysts, all of whom remain confidential, as well as reviewing proprietary shipping data. Saudi officials did not elaborate on why production fell in July.  But in a sign that expected robust demand is not materializing for Saudi crude as hoped, Aramco last week slashed its official selling prices for crude to Asia and Europe loading in September. In his July 19 statement, Aama said that Saudi Arabia "does not try to push oil into the market beyond its customers' needs."

Why Saudi Oil Production Suddenly Dropped - As if oil market participants haven’t had enough conflicting market forces to digest over the past week, reports that Saudi Arabia’s crude oil production surprisingly dropped in July by around 200,000 bpd from June further confounded the market and sent oil prices rising on Monday.Last week, several surveys of OPEC’s crude oil production in July showed that the cartel is pumping at high rates, and Saudi Arabia is nearing its production record. But on Friday, Saudi sources and OPEC sources told news agencies that the Saudi oil production was not even close to record figures—and it actually dropped last month compared to June.  The Saudis pumped 10.29 million bpd in July, Saudi sources told S&P Global Platts on Friday. On the same day, two OPEC sources told Reuters that Saudi Arabia’s crude oil production in July was 10.29 million bpd.  According to OPEC’s secondary sources, the ones the cartel uses to calculate quotas and compliance, Saudi Arabia’s oil production had jumped in June by 405,400 bpd compared to May, to reach 10.420 million bpd.According to a Reuters survey from last week, Saudi Arabia’s production in July was 10.65 million bpd, but exports were close to June’s levels because the Saudis increased domestic use at power plants and refineries. OPEC’s crude oil production jumped by 340,000 bpd in July from June, as Saudi Arabia pumped near-record volumes, the S&P Global Platts survey showed on Friday.The numbers leaked by Saudi and OPEC sources on Friday are in stark contrast with many of the surveys. Some of the Platts survey participants think that Saudi Arabia may have trouble placing its barrels on the market, and demand for Saudi crude may not have been as robust as the Kingdom had expected. “I think what they’re trying to do is, there’s a story in the market that the Saudis and the UAE and Kuwaitis and Russians were all vastly increasing production well ahead of any cutbacks from Iran, and I think they are trying to change the narrative,” a Platts survey participant said.

Discrepancy Over Saudi Oil Data Could Rattle Markets -Saudi Arabia has pressed independent energy analysts to alter their estimates of its oil production, people familiar with the matter said, a move that could put it in conflict with other members of the fractious Organization of Petroleum Exporting Countries. The world’s largest oil exporter has told OPEC it cut output in July, according to delegates, but estimates from the U.S. government and independent agencies say it boosted production—amounting to a huge difference of as much as half a million barrels a day. The data showing differing trends between official and independent estimates of Saudi output is set to be published Monday in the cartel’s monthly report, potentially causing confusion in trading markets about how much oil is reaching consumers. “The Saudis have been giving the impression they know what they are doing...They could lose credibility,” said John Hall, chairman of U.K. consultancy Alfa Energy.  “It could increase volatility” in prices. The kingdom has called some agencies over the last week, asking that analysts change their estimates, according to people familiar with the discussions. Some agencies rebuffed the request but others bowed to the pressure, they said. There is no specific requirement that Saudi Arabia accurately report its production but the discrepancy is highly unusual and adds to tensions within OPEC over whether to boost output. Saudi officials told OPEC delegates last weekend that the kingdom’s production had fallen by 200,000 barrels to 10.29 million barrels a day in July, according to energy ministry officials. Oil prices rose 1.6% in New York Monday.But according to New York-based S&P Global Platts, a provider of energy information, Saudi production increased to about 10.6 million barrels a day last month. The Energy Information Administration, a branch of the U.S. Department of Energy, arrived at the same estimate.

Oil market enters post-OPEC era: Kemp (Reuters) - Saudi Arabia and Russia started to raise their oil production several weeks before the formal decision to increase output was taken by OPEC and its allies towards the end of June. Saudi Arabia increased its production to 10.49 million barrels per day (bpd) in June from 10.03 million in May and 9.87 million bpd in April, according to government data submitted to OPEC (tmsnrt.rs/2M7dhH5). Russia’s Rosneft also started to raise output from late May, anticipating a relaxation of the supply curbs, according to an investor presentation released with the company’s second-quarter results on Tuesday. The two largest suppliers within OPEC+ adjusted production first and then invited other members to ratify the decision that had already been taken when OPEC and non-OPEC producers met in Vienna on June 22 and 23. The sequence of events confirms the locus of decision-making and power has shifted decisively away from OPEC and OPEC+ to Saudi Arabia and Russia. OPEC has been marginalised as a decision-making group; the oil market has moved into a post-OPEC era where management is undertaken by Riyadh and Moscow with some political input from Washington. The implication that the decision to increase production was taken and started to be implemented well before the OPEC+ meeting is consistent with movements in hedge fund positioning, spot prices and spreads. The fact that the decision to raise output, and probably by how much, had already been taken helps explain much of what transpired in Vienna. Iran’s oil minister, who initially appeared to oppose any rise in output, eventually consented to a statement that signalled an increase but without numbers or country allocations. Because the output increase had already been agreed between Saudi Arabia and Russia, and was in fact underway, Iran had little choice. The same is true for a number of other OPEC members that opposed an output increase. The Iranian minister could have refused to agree to the statement, in which the output increase would have continued anyway, or agreed to a consensus statement that omitted contentious allocations. Unsurprisingly, the minister opted for the latter, since it provided a modicum of face-saving, but it shows the extent to which other members of OPEC now have minimal bargaining power.

Fund managers turn bullish on gasoline: Kemp (Reuters) - Fund managers are rebuilding a big bullish position in U.S. gasoline futures and options - even as they remain on the sidelines across other petroleum contracts.Hedge funds and other money managers raised their combined net long position in the six most important futures and options contracts linked to petroleum prices by 22 million barrels in the week to July 31 (https://tmsnrt.rs/2LZzVkT).Net position changes were small in Brent (+5 million barrels), NYMEX and ICE WTI (-5 million barrels), U.S. heating oil (+3 million barrels) and European gasoil (+5 million barrels).But portfolio managers raised their net long position in U.S. gasoline by 15 million barrels, after increasing it by 11 million barrels the week before.Funds' long positions in gasoline outnumber shorts by 105 million barrels, up from a recent low of 78 million at the end of June.Positioning has become exceptionally stretched, with bullish long positions outnumbering bearish short ones by more than 25:1.In other contracts, however, hedge fund activity has remained subdued over the last two weeks, after heavy liquidation in the middle of July.Long positions remain very high (1.16 billion barrels), but well below the record set at the start of the year (1.63 billion).Short positions continue to trend downward and now amount to only 110 million barrels in total across all six contracts, just 1 million barrels above multi-year lows.With the exception of gasoline, fund managers may have become less convinced prices will rise further - but few are willing to bet that they will pull back significantly.

Oil prices edge up after Saudi output dips; US drilling stalls - Oil prices edged up on Monday as Saudi crude production took a surprising dip in July and American shale drilling seemed to plateau. Markets also anticipated an announcement from Washington due later on Monday detailing renewed US sanctions against major oil exporter Iran. Spot Brent crude oil futures were trading at $73.26 per barrel at 0101 GMT on Monday, up 5 cents from their last close. US West Texas Intermediate (WTI) crude futures were up 12 cents, or 0.2 per cent, at $68.61 barrel. US energy companies last week cut oil rigs for a second time in the past three weeks as the rate of growth has slowed over the past couple of months. Drillers cut two oil rigs in the week to August 3, bringing the total count down to 859, Baker Hughes energy services firm said on Friday. Many US shale oil drillers posted disappointing quarterly results in recent weeks, hit by rising operating costs, hedging losses and a fall in crude prices away from 2018 highs reached between May and July. Outside the United States, top crude exporter Saudi Arabia pumped around 10.29 million barrels per day (bpd) of crude in July, two OPEC sources said on Friday, down about 200,000 bpd from a month earlier. That drop came despite a pledge by the Organization of the Petroleum Exporting Countries (OPEC), of which Saudi Arabia is the de-facto leader, in June to raise output from July, with Saudi Arabia pledging a "measurable" supply boost. Still, with Russia, the United States and Saudi Arabia now all producing 10 million to 11 million bpd of crude, just three countries now meet around a third of global oil demand.

The Oil Bulls Are Back --Oil prices edged up at the start of the week on the implementation of the first round of sanctions on Iran. The Trump administration is talking tough about trying to get Iran’s oil exports to zero. That remains to be seen, but the market took on a bullish tinge at the start of the week, expecting losses from Iran to begin to pile up (more below).  The Trump administration moved to implement sanctions on Iran this week, a decision announced months ago. The first round of sanctions applies to the sale of U.S. dollars to Iran, the purchasing of Iranian sovereign debt, Iran’s automotive industry and the trade in precious metals. The oil-related sanctions will take effect in November, and analysts expect countries to begin cutting their imports from Iran with that deadline now only three months away. Estimates on outages vary, but many analysts expect the losses to top 1 mb/d. Amrita Sen of Energy Aspects said oil could hit $90 by the end of the year. Related: Pakistan: Exxon Is Close To Making A Mega Oil Discovery In a surprise move, Saudi Arabia cut its oil production in July to 10.29 mb/d, down 200,000 bpd from a month earlier. The unexpected reduction came after Saudi Arabia reportedly could not find buyers for the price that it demanded, opting to cut output rather than offer discounts. The move indicates a desire by Riyadh to keep prices from falling from current levels.. Saudi Arabia resumed oil shipments through the Strait of Bab el-Mandeb after a two-week hiatus due to security concerns.  Reuters argues that oil policy is now being driven by Saudi Arabia and Russia, and OPEC, as we have known, is obsolete. “OPEC is no longer the primary decision-making forum for producing countries trying to coordinate policy on output and prices. Real decision-making power has passed from OPEC and its group of allies into the hands of Saudi Arabia and Russia,” Reuters wrote.

Oil markets tread water ahead of renewed U.S. sanctions against Iran (Reuters) Oil markets started cautiously on Tuesday, as many traders in Asia were reluctant to take on new positions ahead of the introduction of U.S. sanctions against major crude exporter Iran. Spot Brent crude oil futures were at $73.74 per barrel at 0100 GMT on Tuesday, down 1 cent from their last close. U.S. West Texas Intermediate (WTI) crude futures were down 8 cents at $68.93 barrel. U.S. sanctions against major oil exporter Iran are set to kick in at 12:01 a.m. U.S. Eastcoast time (0401 GMT) on Tuesday. Traders in Asia said they were holding back on making bets on oil ahead of European and U.S. trading hours, which tend to see much higher liquidity and stronger price movements. “The U.S. seems hell-bent on regime change in Iran and is reimposing sanctions at midnight Washington time as the 6th becomes the 7th of August,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader. Many other countries, including U.S. allies in Europe and also China and India oppose the introduction of new sanctions, but the U.S. government said it wants as many countries as possible to stop buying Iranian oil. “It is our policy to get as many countries to zero as quickly as possible. We are going to work with individual countries on a case by case basis, but our goal is to reduce the amount of revenue and hard currency going into Iran,” said a senior U.S. administration official on Monday. ANZ bank said a 24-hour strike at three North Sea oil and gas platforms operated by Total, which started at 0500 GMT on Monday, was also supporting prices.  

Oil Trades Flat After API Reports Major Crude Draw - The American Petroleum Institute (API) reported a crude oil inventory draw of 6 million barrels of United States crude oil inventories for the week ending Aug 4, compared to analyst expectations that this week would see a draw in crude oil inventories of 3.33 million barrels.  Last week, the American Petroleum Institute (API) reported a build of 5.59 million barrels of crude oil.The API reported a build in gasoline inventories for week ending Aug 4 in the amount of 3.1 million barrels. Analysts predicted a draw of 1.7 million barrels.Oil prices were trading up modestly on Tuesday prior to the release of the API data on inventories, and failed to move much after data release, with WTI trading up 0.12% (+$0.08) at $69.09 per barrel, with Brent crude trading up 1.02% (+$0.75) at $74.50 per barrel as continued trade tensions with China persist and as the United States levied the first round of sanctions on Iran, with the promise of more to come in November. Muddying the waters is the mystery surrounding Saudi Arabia oil production figures which some say was up in July and others say was downUS crude oil production as estimated by the Energy Information Administration came off last week's new high of 11 million bpd, settling back down to 10. 9 million bpd this week, based on weekly estimates provided by the EIA.Distillate inventories were up this week—by 1.8 million barrels, compared to an expected build of 220,000 barrels. Inventories at t he Cushing, Oklahoma site decreased this week by 576,000 barrels.

WTI Dips As Big Product Build Offsets Crude Inventory Draw - WTI gave back overnight (Iran sanctions) gains coming in to the API print unchanged, then whipsawed up and down after a bigger than expected crude draw was offset by big builds on the product side.  API

  • Crude -6mm (-3mm exp)
  • Cushing -576k (-1mm exp)
  • Gasoline +3.1mm
  • Distillates+1.8mm

After another surprise crude build last week, API was expected to be a decent draw and did but the big builds on the product side offset the gains. Additionally today, Energy Information Administration forecasts domestic oil output to average 11.7 million barrels a day next year, down from a previous estimate of 11.8 million a day. The agency also lowered its outlook for output this year. Last month, the agency said the U.S. is set to become the world’s top oil producer in 2019. The EIA still sees production reaching 12 million barrels a day by the end of next year.

Oil rises as U.S. sanctions on Iran stir supply worries (Reuters) - Oil prices rose on Tuesday after U.S. sanctions on Iranian goods went into effect, intensifying concerns that sanctions on Iranian oil, expected in November, could cause supply shortages. Renewed U.S. sanctions against OPEC member Iran officially went into effect at 12:01 a.m. EDT. The sanctions did not include Iran’s oil exports. The country exported almost 3 million barrels per day (bpd) of crude in July. The sanctions target Iran’s U.S. dollar purchases, metals trading, coal, industrial software and its auto sector. U.S. sanctions on Iran’s energy sector are set to be re-imposed after a 180-day “wind-down period” ending on Nov. 4. “It certainly is a reminder to everyone that the U.S. is serious about sanctions, and it’s doubtful they will grant waivers,” said John Kilduff, partner at Again Capital Management in New York. Brent futures LCOc1 rose 90 cents, or 1.2 percent, to settle at $74.65 a barrel, after hitting a session high of $74.90. U.S. West Texas Intermediate (WTI) crude futures CLc1 settled 16 cents, or 0.2 percent, higher at $69.17 a barrel, down from an earlier high of $69.83. Along with geopolitical tensions that could impact Iran’s crude output, traders are also keeping a close eye on U.S. inventories, which are expected to fall 3.3 million barrels in the week ended August 3, according to analysts polled on Tuesday. [EIA/S] Crude futures briefly rose in post settlement trade, with WTI at $69.07 a barrel, on data from the American Petroleum Institute that showed U.S. crude inventories fell 6 million barrels last week. Oil prices rose earlier in the trading session after the U.S. sanctions on Iran went into effect, but gains were limited as market participants lacked clear signs on just how much the proposed oil sanctions would affect Iranian crude output, Kilduff said.

$90 Oil Is A Very Real Possibility | OilPrice.com - U.S. sanctions on Iran could push oil prices up to $90 per barrel later this year. The first round of U.S. sanctions on Iran just took effect, a slew of measures targeting Iran’s currency and its financial sector. The U.S. sanctioned the trading of bank notes issued by the Iranian government, the trade of gold and precious metals, any transactions involving the Iranian rial, Iran’s sovereign debt and its automotive sector. The sanctions will tighten the screws on the Iranian economy, and the measures have already sent the currency tumbling. However, the more important sanctions – targeting Iran’s oil exports – take effect in November. There is still a wide range of possibilities for what is set to occur over the next three months in regards to the impact on production and exports. Originally, the Trump administration stated its desire to push Iran’s exports to “zero.” The subsequent spike in oil prices forced them to backtrack quite a bit. But, the Trump administration has made it clear that it wants to cut off as much Iranian supply as the market can bear without sending prices up too much. Those are, in many ways, conflicting goals, but it likely means that a significant chunk of Iranian production will be disrupted. “I don’t think the market has fully baked in losses over a few hundred thousand barrels [per day]. That’s where the price impact potentially would come in,” Richard Nephew, a senior research scholar at the Center on Global Energy Policy at Columbia University, told S&P Global Platts Capitol Crude on Monday. “I think Iran will lose between 600,000 and 1 million barrels per day in exports, and that’s up from what I would have thought back in February,” he added, citing the Trump administration’s determination to push exports as close to zero as possible and the willingness from countries around the world to comply with American sanctions. 

WTI Drops Back Below $68 After Big Gasoline Build, Small Crude Draw - WTI has tumbled this morning (back below $68) as Bloomberg Intelligence Senior Energy Analyst Vince Piazzanotes that optimism for crude oil has softened from previous highs this summer. Elevated U.S. production, concerns about tariffs slowing global economic growth and rising world oil output have weakened sentiment. Renewed U.S. sanctions on Iran partially offset the bearishness.  DOE:

  • Crude -1.35mm (-3mm exp)
  • Cushing (-1mm exp)
  • Gasoline +2.9mm (-1.9mm exp) (first build since June)
  • Distillates

After last week's surprise 3.8mm crude build, DOE reported a considerable smaller than expected (and API-reported) draw but a big build in gasoline and distillates is putting pressure on WTI prices...Cushing stocks have now fallen for 12 straight weeks to the lowest since 2014. Production fell for the 2nd week in a row (remember the EIA rule changes mean we are now only getting incremental 100k shifts rounded up or down)...

Oil Prices Slide As China Imposes 25% Tariff On U.S. Oil - Amid a steep correction in crude prices, China said on Wednesday that it would impose a 25-percent tariff on U.S. imports worth US$16 billion, including crude oil, diesel, cars, coal, and steel products, in retaliation to the U.S. list of US$16 billion worth of Chinese imports that will be taxed by U.S. authorities from August 23.On Wednesday, the Office of the United States Trade Representative (USTR) released a list of around US$16 billion worth of imports from China that will be subject to a 25-percent additional tariff as part of the United States’ response to China’s unfair trade practices related to the forced transfer of American technology and intellectual property, the office said.“This second tranche of additional tariffs under Section 301 follows the first tranche of tariffs on approximately $34 billion of imports from China, which went into effect on July 6,” it added.China didn’t waste time in retaliating, and said today that its tariffs on 333 U.S. products, including crude oil, would also take effect on August 23.  As the U.S.-China trade spat turns into a full-blown war with tariffs and retaliatory tariffs and threats of further tariffs, U.S. energy exports to China may suffer with Beijing now following through with its threat to slap tariffs on U.S. oil and oil product imports.  China has, in recent years, become a key export market for growing U.S. energy exports. In fact, China is America’s second-largest crude oil customer after Canada. Chinese imports of U.S. crude oil in May, for example, averaged 427,000 bpd, more than any other destination and surpassing Canada’s 289,000 bpd imports, EIA data shows.

 Crude Tumbles to Lowest Point in Nearly Seven Weeks-- Crude tumbled to a nearly seven-week low as the escalating trade dispute between the world's biggest economies overshadowed a decline in U.S. crude stockpiles. Futures declined 3.2 percent on Wednesday in New York, the biggest drop in more than two weeks. China will levy 25 percent tariffs on billions of dollars in U.S. gasoline, diesel and other goods in a matter of weeks. Meanwhile, American crude inventories fell by just a fraction of what was forecast, while the gasoline surplus expanded for the first time since June, the Energy Information Administration reported. Investors are focused on "the geopolitical issues that the market is facing right now, especially the Chinese tariffs on gasoline and refined products in general, which can certainly impact near-term pricing," said Adam Wise, who oversees an $8 billion energy portfolio at John Hancock Financial Services Inc. in Boston. "The key to future global demand growth, and therefore, the underlying commodity price, is China and so to the extent that you're seeing noise around that, you're going to get softness in the crude market." The U.S. benchmark crude has traded below $70 a barrel this month as the U.S.-China dispute percolated. As American sanctions isolate Iran, exports by OPEC's No. 3 producer have fallen and the Islamic Republic is relying more on its own tanker fleet to deliver oil to customers, according to ship-tracking data compiled by Bloomberg. West Texas Intermediate crude for September delivery dipped $2.23 to settle at $66.94 a barrel on the New York Mercantile Exchange. Brent for October settlement slid $2.37 to end the session at $72.28 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a $6.03 premium to WTI for the same month.

Oil prices plunge to nearly 7-week low amid US-China trade tension - Oil prices fell sharply on Wednesday, hammered by an escalating trade dispute between the United States and China, weak Chinese import data and a smaller-than-anticipated drop in American crude stockpiles. U.S. West Texas Intermediate (WTI) crude futures ended Wednesday's session at a seven-week low, dropping $2.23, or 3.2 percent, to $66.94. Front-month Brent crude oil futures fell $2.40, or 3.2 percent, to $72.25 a barrel by 2:20 p.m. ET, after hitting a three-week low at the bottom of the session. WTI has now failed to break through $70 a barrel several times this week, and fell through a recent low near $67 on Wednesday, said John Kilduff, founding partner at energy hedge fund Again Capital. "If we get below $66 here, you're arguably violating the long-term uptrend channel," he said, referring to technical levels that bracket U.S. crude's upward trajectory this year. China on Wednesday threatened to slap a 25 percent tariff on $16 billion of U.S. goods. The move came in response to the Trump administration's plan to slap the same tariff on an equal amount of Chinese imports in the coming weeks. The mounting trade tension has raised concerns that global economic growth will slow, lowering demand for crude oil in the process. The list of U.S. goods released by China on Wednesday includes diesel, fuel oils and other petroleum products. China announced plans on Friday to place tariffs on U.S. liquefied natural gas. "It's certainly going to impact on movement between the U.S. and China, making it less efficient, meaning pressure on prices here," said Andrew Lipow, president of Lipow Oil Associates. Earlier on Wednesday, government data showed China's imports of crude oil in July rose slightly after falling in the previous two months. However, July imports still ranked as the third lowest monthly level this year, Reuters reported.

After Wednesday's Wild Ride, Crude Oil Stabilizes - A day after hitting a nearly seven-week nadir, crude oil futures regained traction on Thursday but still ended the day lower. “After falling to fresh lows Wednesday, oil prices stabilized on Thursday – trading in a tight range of less than a dollar per barrel for both the September WTI contract and the October Brent contract,” said Delia Morris, Houston-based commodity pricing analyst. “Yesterday’s developments around an escalating trade dispute between the U.S. and China continued to weigh on prices.” The WTI traded from $66.49 to $67.41 before settling at $66.81 a barrel – a 13-cent decline for the day. Meanwhile, the Brent lost 21 cents to end Thursday’s session at $72.07 a barrel. “The downside risk of China imposing tariffs on U.S. exports of gasoline and diesel, and also potentially crude oil, is driving price movements more than any future price benefits, such as the reinstatement of Iranian sanctions, which could remove substantial supply from global markets,” said Morris. September gasoline futures also declined Thursday, losing two cents to end the day just under $2.00 a gallon. Henry Hub natural gas futures bucked the overall trend for the day, edging upward less than a penny to settle at $2.955 per million British thermal units.

 Crude Oil Prices Settle Lower on Concerns Trade War May Hurt Demand - - WTI crude oil prices settled lower Thursday on worries the escalating U.S.-China trade war may hurt global crude demand. On the New York Mercantile Exchange crude futures for September delivery fell 13 cents to settle at $66.81 a barrel, while on London's Intercontinental Exchange, Brent fell 0.19% to trade at $72.16 barrel. In what was a rocky session for oil prices, investors continued to fret about the impact of a trade war between the U.S. and China ahead of Chinese tariffs on U.S. goods, which come into effect Aug. 23, and threaten demand for oil-derived fuels. The Chinese Ministry of Commerce slapped a 25% tariff on an additional $16 billion worth of U.S. products on Wednesday. In a surprise move, however, the ministry removed U.S. crude from the list of goods subject to the levy, but included oil products. "Some traders swooped in and picked up oil as it is relatively cheap today, but there is still a lot of uncertainty surrounding its prospects," said David Madden at CMC Markets. "The Energy Information Administration report yesterday, pointed to a fall in U.S. demand," Madden said. ."Traders are also concerned about China's demand, given the country is locked in a trade spat with the U.S." Oil prices are on track to post a loss for the week after suffering their biggest one-day drop in more than three weeks Wednesday on the back of data showing a smaller-than-expected draw in U.S. crude supplies and rising product inventories. Inventories of U.S. crude fell by 1.351 million barrels for the week ended Aug. 3, missing expectations for a draw of 2.800 million barrels, according to data from the Energy Information Administration (EIA) on Wednesday. The smaller-than-expected draw in crude supplies came as imports rose by about 2.64 million barrels a day (bpd) and exports rose by 5.40 million bpd, data from EIA showed. Oil-market observers will likely turn to the Baker Hughes rig count data Friday for signs that U.S. output continues to tighten after data on Wednesday, showed U.S. oil output fell to 10.8 million barrels a day last week.

Slowing global economic momentum holds oil prices in check (Reuters) - Oil prices have stalled over the last two months as the prospect of tough sanctions on Iran’s exports from November is offset by concerns about a slowdown in global economic growth later in 2018 and 2019.Brent futures prices for crude delivered in 2019 have been flat since late May, after rising strongly since February, with the calendar strip steadying around $71-73 per barrel. The U.S. government estimates Iran’s oil exports will be cut by between 0.7 and 1.0 million barrels per day from November as a result of sanctions (“U.S. forecasts 50 percent cut in Iran oil sales”, Bloomberg, Aug. 10).But the prospective loss of crude has failed to lift prices as traders focus on compensating increases in production from Saudi Arabia and Russia, as well as slower growth in consumption.Brent’s six-month calendar spread has slumped from a steep backwardation in April and May into a contango structure as traders anticipate more oil availability (https://tmsnrt.rs/2MAQVuG).Some of the shift stems from the big increase in production by Saudi Arabia and Russia that started in late May and June, which should help build up stocks ahead of the reimposition of sanctions in November.But it also coincides with a weakening of the global economic outlook that suggests slower growth in consumption of diesel and other refined products later this year and into 2019.The Organization for Economic Cooperation and Development’s composite leading indicator has slipped since the start of the year and “is pointing tentatively to easing growth momentum in the OECD area as a whole”.Growth is easing in Canada, Germany, France and Britain though it remains stable in the United States and Japan (“Composite Leading Indicators,” OECD, Aug. 8).The World Trade Organization’s trade outlook indicator also points to a slowdown in the momentum of global trade growth in the months ahead (“World Trade Outlook Indicator”, WTO, Aug. 9).Export orders have declined steadily since the start of the year, while air freight volumes and container port throughput are growing above trend but appear past their peak, according to the WTO. The WTO notes air freight has proven to be a timely indicator of overall world trade and an early signal of turning points in economic activity.

 IEA raises 2019 oil demand growth estimate to 1.5 million b/d from 1.4 million b/d — The International Energy Agency on Friday raised its estimate of world oil demand growth next year to 1.5 million b/d from 1.4 million b/d, anticipating the impact of price rises will peter out, and highlighted robust non-OPEC oil output growth. In its monthly oil market report the IEA also raised its estimates of the "call" on OPEC, or the need for OPEC crude, by 300,000 b/d in 2018 to 32.3 million b/d, and by 500,000 b/d in 2019 to 31.9 million b/d. However, following a strong first quarter this year it said world oil demand had grown by a mere 750,000 b/d on the year in the second quarter, constrained by sharp price rises and currency depreciations, and highlighted "risks to the forecast from escalating trade disputes and rising prices if supply is constrained." European oil demand fell 120,000 b/d on the year in the second quarter as the stimulus from low prices ended, it said. By contrast, China and India remain "on course to grow solidly this year," the IEA said. "Oil demand growth is expected to remain relatively subdued in Q3 2018 before rebounding in Q4 2018," it added. On the supply side, the IEA raised its estimate for growth in non-OPEC oil output next year to 1.9 million b/d, from 1.8 million b/d in its previous report. Growth will be led by the US, with a 1.25 million b/d increase, Brazil with an extra 350,000 b/d, and Canada and Russia each increasing output by 210,000 b/d.  OPEC held its production steady in July at 32.18 million b/d, with Saudi Arabia producing 10.35 million b/d, the IEA said. Russia, OPEC's partner in production cuts, increased its crude and condensate output by 150,000 b/d in July to 11.21 million b/d, the IEA added.. Iran's output was the lowest since April last year at 3.75 million b/d as Europe reduced its Iranian crude imports and South Korea completely stopped its Iranian imports. But Iranian shipments to Asia overall crept up to 1.65 million b/d, and shipments to India reached a record 770,000 b/d, the IEA said. It said second-largest producer Iraq had raised its production by 200,000 b/d in July to 4.56 million b/d, with exports from the south of the country at a record high as Basra Light exports hit 3.54 million b/d, offset by subdued volumes through the Kurdistan pipeline to Turkey of 330,000 b/d. The IEA also said oil stocks in the OECD countries had reduced to 32 million barrels below the five-year average in June, falling seasonally by 7.2 million barrels on the month to 2.82 billion barrels. 

Oil Prices Take A Breather As Supply Jumps - Oil markets took a breather at the end of the week as new supply from Russia and Saudi Arabia calmed fears of a tightening market, but there are plenty of bullish catalysts on the horizon. The IEA said in a new report that more supply from Saudi Arabia and Russia has eased supply concerns, but that the current lull in the oil market might only be temporary with sanctions on Iran looming. . The International Energy Agency said that higher output from Saudi Arabia and Russia have tamped down concerns about supply. The partial recovery in Libya has also dialed down the danger to the oil market. The IEA slightly revised up its forecast for demand growth in 2019 to 1.5 million barrels per day (mb/d), up 0.1 mb/d from last month. For this year, however, demand growth slowed in the second and third quarter, after a blistering first quarter. This “cooling down” of the oil market – both in terms of fewer disruptions and slower demand – has caused prices to fall back from a few weeks ago. But it could be temporary. With Iran sanctions set to take effect in November, it could be “very challenging” to ensure adequate global supply, the IEA said.  . Despite having proposed to include American crude oil under its list of tariff targets, China left oil off of its list this week when it imposed $16 billion worth of tariffs on U.S. products. The decision, analysts say, is a reflection of China’s import needs, particularly with supplies from Venezuela in decline and supplies from Iran potentially disrupted. Still, Chinese refiners have begun ratcheting down purchases of American oil and LNG anyway, in anticipation of potential tariffs. The trade fight helped push down oil prices this week, even though crude oil was not caught up in the new tariffs, as the oil market grew concerned about the impact on the global economy.

US Oil Rig Count Grows By 10 -  U.S. energy companies this week added the most oil rigs since May as drillers follow through on plans to spend more on exploration and production in anticipation of higher crude prices in 2018 than recent years.Drillers added 10 oil rigs in the week to Aug. 10, bringing the total count to 869, the highest level since March 2015, Baker Hughes said in its weekly report. That rig count increase occurred despite U.S. crude prices being on track to fall for a sixth week in a row for the first time since August 2015 on worries trade tensions between the United States and China could hurt oil demand.The U.S. rig count, an early indicator of future output, is higher than a year ago when 768 rigs were active as energy companies have been ramping up production in anticipation of higher prices in 2018 than previous years.So far this year, U.S. oil futures have averaged $66.28 per barrel. That compares with averages of $50.85 in 2017 and $43.47 in 2016.Looking ahead, crude futures were trading near $67 for the balance of 2018 and over $64 for calendar 2019. In anticipation of higher prices in 2018 than 2017, U.S. financial services firm Cowen & Co. this week said the E&P companies it tracks, including Anadarko Petroleum Corp., Apache Corp. and Cabot Oil and Gas Corp., have provided guidance indicating an 18% increase this year in planned capital spending.

Baker Hughes: US Drillers Add Most Oil Rigs Since May (Reuters) - U.S. energy companies this week added the most oil rigs since May as drillers follow through on plans to spend more on exploration and production in anticipation of higher crude prices in 2018 than recent years. Drillers added 10 oil rigs in the week to Aug. 10, bringing the total count to 869, the highest level since March 2015, General Electric Co's Baker Hughes energy services firm said in its closely followed report on Friday. That rig count increase occurred desite U.S. crude prices being on track to fall for a sixth week in a row for the first time since August 2015 on worries trade tensions between the United States and China could hurt oil demand. More than half the total oil rigs are in the Permian basin in west Texas and eastern New Mexico, the nation's biggest shale oil field. Active units there increased by six to 485, the most since January 2015. The U.S. rig count, an early indicator of future output, is higher than a year ago when 768 rigs were active as energy companies have been ramping up production in anticipation of higher prices in 2018 than previous years. So far this year, U.S. oil futures have averaged $66.28 per barrel. That compares with averages of $50.85 in 2017 and $43.47 in 2016. Looking ahead, crude futures were trading near $67 for the balance of 2018 and over $64 for calendar 2019 . In anticipation of higher prices in 2018 than 2017, U.S. financial services firm Cowen & Co this week said the exploration and production (E&P) companies it tracks, including Anadarko Petroleum Corp, Apache Corp and Cabot Oil and Gas Corp, have provided guidance indicating an 18 percent increase this year in planned capital spending. In recent weeks, Anadarko, Apache, Cabot and other energy firms have boosted the amount of capital they plan to spend on drilling and completions in 2018. Cowen said the E&Ps it tracks now expect to spend a total of $85.2 billion in 2018, up from an estimate of $83.6 billion last week. That compares with projected spending of $72.2 billion in 2017. 

US Oil & Gas Rigs Jump By 13; Analysts Bullish on International Growth - Oil and natural gas supply and price signals are still telling exploration and production (E&P) companies to drill, according to the latest U.S. rig count from Baker Hughes, a GE company (BHGE).For the week ending Aug. 10, BHGE found that the number of active oil rigs increased by 10 to 869, while the number of rigs drilling for natural gas increased by three to 186. Respectively, these figures represent 13% and 3% premiums to last year’s rig count for the week.The rig report came during a week where both natural gas and crude prices enjoyed gains. With help from some late-session buying, September natural gas rallied for a sixth straight day on Thursday to close at $2.955. Meanwhile, September crude futures are still comfortably above the $60/bbl mark. The contract opened Friday morning approximately 41 cents higher than Thursday’s close at $67.22/bbl.Taking a closer look at the BHGE report for the week, the most action -- unsurprisingly -- took place in the Permian Basin. According to the data, the basin added five rigs for the week to finish at 485, with five rigs added to Delaware sub-basin, one added to the Midland sub-basin and one rig being laid down in the “other Permian” classification.Around the rest of the country, gains and losses were minimal. The Utica Shale added one rig to 24, while the Marcellus Shale dropped one to 52. The SCOOP (South Central Oklahoma Oil Province), Barnett and Eagle Ford plays all lost one apiece to 29, two and 79 rigs, respectively, while the Granite Wash and Haynesville each added one rig to total 17 and 49 rigs respectively.On the international drilling scene, a team from Evercore ISI said “global oil markets have tightened,” which will keep the commodity’s price elevated for the next few years leading to a “strong and long” global upcycle. “Global E&P spending must accelerate significantly, particularly internationally, as it becomes increasingly clear that the current state of projects will inadequately produce the supply to meet demand over the next few years,”

Oil set for sixth weekly loss as trade war stokes demand fears --Oil was poised for a sixth weekly loss in New York, the longest run of declines in three years, as a trade war between the world's two biggest economies stokes fears of weaker growth in energy demand. Futures rose 0.7 percent, but were still headed for a 1.8 percent loss this week. The U.S. and China are threatening to slap additional tariffs on imports from each other in a matter of weeks, with the tit-for-tat protectionist measures set to expand. At the same time, fears about global oil supplies have receded after producers pumped more, according to the International Energy Agency.  Oil is trading near a seven-week low on fears the intensifying trade tension will crimp global economic growth and increase financial vulnerability. Supply fears could still return to the fore later this year due to U.S. sanctions on Iran, the IEA said, with some crude buyers already looking elsewhere for supplies before the restrictions take effect in November. West Texas Intermediate crude for September delivery traded at $67.27 a barrel on the New York Mercantile Exchange, up 46 cents, at 8:31 a.m. in New York. The contract slipped 13 cents to $66.81 on Thursday. Prices are headed for the longest run of weekly declines since August 2015. Total volume traded was about 15 percent below the 100-day average.Brent for October settlement rose 51 cents to $72.58 on the London-based ICE Futures Europe exchange. Prices dropped 21 cents to $72.07 on Thursday, and are headed for a 0.8 percent drop this week. The global benchmark crude traded at a $6 premium to WTI for the same month.

Oil prices end up for the day on forecast for rising demand, but lower for the week -- Oil prices settled higher Friday as a forecast for rising global crude demand, and supply boosts from Russia, offset lingering concerns about trade tensions cutting global consumption of energy products.The International Energy Agency raised its forecast for global oil demand growthby 110,000 barrels a day to 1.5 million barrels for 2019. Its monthly report also said global supply had risen by 300,000 barrels a day last month, mainly because of higher output from Russia and higher output from the Organization of the Petroleum Exporting Countries.  Global markets were also watching developments in Turkey, where a currency crisis bubbles, and in Russia, for any potential implications for global economic growth. West Texas Intermediate futures for September delivery on the New York Mercantile Exchange rose 82 cents, or 1.2%, to $67.63 a barrel. The gain halted a two session skid for the contract.   Brent crude for October 74 cents, or 1%, to $72.81 a barrel.  Both contracts booked weekly declines, with WTI posting a fall over the 5-session stretch of 1.3%, and Brent posting a drop over the same period of 0.6%. Investors have also been monitoring the back-and-forth tariffs introduced by the U.S. and China, fearing that the trade spat could eventually impact global growth. So far, U.S. crude has been excluded from China’s list. Baker Hughes on Friday reported that the number of active U.S. rigs drilling for oil increased by 10 to 869 for the week, coming after the report showed a decline of 2 in the earlier period. The total active U.S. rig count, which includes oil and natural-gas rigs, increased by 13 to 1,057 from 1,044, according to Baker Hughes. September natural gas lost 1.1 cent, or 0.4%, to settle at $2.944 per million British thermal units, snapping what had been a sixth straight advance for the contract, its longest stretch of gains since Nov. 10, 2017. For the week, the natural-gas contract climbed by 3.2%.

America's About To Unleash Its NOPEC 'Superweapon' Against The Russians & Saudis - The US Congress has revived the so-called “NOPEC” bill for countering OPEC and OPEC+.   Officially called the “No Oil Producing and Exporting Cartels Act”, NOPEC is the definition of so-called “lawfare” because it enables the US to extra-territorially impose its domestic legislation on others by giving the government the right to sue OPEC and OPEC+ countries like Russia because of their coordinated efforts to control oil prices.Lawsuits, however, are unenforceable, which is why the targeted states’ refusal to abide by the US courts’ likely predetermined judgement against them will probably be used to trigger sanctions under the worst-case scenario, with this chain of events being catalyzed in order to achieve several strategic objectives. The first is that the US wants to break up the Russian-Saudi axis that forms the core of OPEC+, which leads to the second goal of then unravelling the entire OPEC structure and heralding in the free market liberalization of the global energy industry. This is decisively to the US’ advantage as it seeks to become an energy-exporting superpower, but it must neutralize its competition as much as possible before this happens, ergo the declaration of economic-hybrid war through NOPEC. How it would work in practice is that the US could threaten primary sanctions against the state companies involved in implementing OPEC and OPEC+ agreements, after which these could then be selectively expanded to secondary sanctions against other parties who continue to do business with them.The purpose behind this approach is to intimidate the US’ European vassals into complying with its demands so as to make as much of the continent as possible a captive market of America’s energy exporters, which explains why Trump also wants to scrap LNG export licenses to the EU.

Iranian Navy Holds Drills In Persian Gulf After Threats To Block Strait Of Hormuz Iran's Revolutionary Guard on Sunday confirmed rumors that they moved up the timing of a large naval drill in the Persian Gulf several days ahead of the Islamic Republic's planned annual exercises, according to Reuters. State news agency IRNA said the war games were aimed at "confronting possible threats" from enemies.  “This exercise was conducted with the aim of controlling and safeguarding the safety of the international waterway and within the framework of the program of the Guards’ annual military exercises,” Guards spokesman Ramezan Sharif said, according to IRNA.  The U.S. military’s Central Command on Wednesday confirmed it has seen increased Iranian naval activity. The activity extended to the Strait of Hormuz, a strategic waterway for oil shipments the Revolutionary Guards have threatened to block.Reuters  While Iran didn't comment on the size of the drill, Haaretz reported on Friday that "more than 100 vessels" would participate, citing a U.S. official.  The U.S. military’s Central Command on Wednesday confirmed it has seen an increase in Iranian naval activity, including in the Strait of Hormuz, a strategic waterway for oil shipments that Iran’s Revolutionary Guards have threatened to block. “We are monitoring it closely, and will continue to work with our partners to ensure freedom of navigation and free flow of commerce in international waterways,” said Navy Captain Bill Urban, the chief spokesman at Central Command, which oversees U.S. forces in the Middle East. A third official said the Iranian naval operations did not appear to be affecting commercial maritime activity. -Haaretz

Iran arrests central bank's top foreign exchange official - The Iranian central bank's top foreign exchange official has been arrested, according to a judiciary spokesperson, as tensions rise in advance of the imminent return of sanctions by the United States.Ahmad Araghchi, who was a vice-governor at the bank in charge of forex, was arrested along with several other unnamed individuals, including a government clerk and four currency brokers, state broadcaster IRIB cited spokesperson Gholam-Hossein Mohseni Ejeie as saying on Sunday.The arrests come as Iranians brace for the reimposition of US sanctions on Tuesday, following Washington's withdrawal from a multinational nuclear deal with Iran. Meanwhile, news of protests continues to filter in from around the country, driven by concerns over water shortages, the economy and wider anger at the political system.The government of President Hassan Rouhani has also faced heavy criticism from conservative opponents, who have demanded action on corruption and renewed efforts to rescue the economy.On Sunday, his cabinet announced it was easing foreign exchange rules, undoing a disastrous attempt to fix the value of the rial in April. The April decision - combined with fears over US sanctions - fuelled a run on the currency that saw it lose more than half its value.

Iran says delivery of ATR planes "positive" gesture of Europe -  (Xinhua) -- Delivery of five ATR 72-600 passenger aircraft to Iran is a positive step by the European Union to fulfil its obligations subject to the bilateral deals signed in the aftermath of the 2015 international nuclear accord, an Iranian minister said on Sunday. The French-Italian aircraft manufacturer ATR delivered five more turboprops to Iran on Sunday, official IRNA news agency reported. The ATR 72-600 passenger planes landed at Tehran's international Mehrabad airport on Sunday morning, a day before the United States reimposed the first round of sanctions on Iran. Abbas Akhoundi, Iranian minister of road and urban development, expressed hope that Iran's cooperation with European countries, as well as with China, Russia, India, Turkey and neighboring states, will help Iran tackle the existing difficult situation due to the U.S. sanction threats. The world is facing challenges that U.S. President Donald Trump has brought about, but it is important to know how to act under such conditions to remain unaffected, said Akhoundi at the receiving ceremony of the ATR planes. Besides, Farzaneh Sharafbafi, head of Iran Air airline, said the procedure is underway to receive remaining ATR planes. Despite the U.S. deadline for European and its own companies to cut their relations with Iran, "we managed to secure the delivery of (part of) the remaining ATRs through negotiations with French and Italian officials," Sharafbafi said. 

Russia Slams Leak Of Secret Memo On US-Moscow Cooperation in Syria -- There's been a number of hugely significant developments in Syria at the end of this week all of which point to the war's end, with President Bashar al-Assad and the Syrian Army ultimately emerging firmly victorious. Even Israel seems to have changed its tune, with Defense Minister Avigdor Lieberman telling reporters on Thursday, "From our perspective, the situation is returning to how it was before the civil war, meaning there is a real address, someone responsible, and central rule."But now there's a diplomatic scramble underway and exchange of accusations related to potential Russia-United States cooperation on rebuilding Syria, repatriating refugees, and rooting out the remaining jihadist pockets. On Friday Reuters published a bombshell report based on a leaked US government memo revealing a secret deal possibly in the works between top Russian and American generals initiated by the Russian side last month during the very week that President Donald Trump met with Russian President Vladimir Putin in Helsinki .Russia has since slammed the leak, but has confirmed it confidentially extended the hand of cooperation on Syria. According to the Reuters report, Russia has used a closely guarded communications channel with America’s top general "to propose the two former Cold War foes cooperate to rebuild Syria and repatriate refugees to the war-torn country, according to a U.S. government memo."

US Coalition Cooperates With Al-Qaeda In Yemen, Associated Press Confirms -- A new Associated Press report confirms what was long ago detailed by a number of independent investigative journalists, and even in some instances buried deep within sporadic mainstream reports of past years: the US-coalition in Yemen is actually cooperating with al-Qaeda terrorists in the campaign to dislodge Shia Houthi militants.The AP report begins dramatically as follows:Again and again over the past two years, a military coalition led by Saudi Arabia and backed by the United States has claimed it won decisive victories that drove al-Qaida militants from their strongholds across Yemen and shattered their ability to attack the West.Here’s what the victors did not disclose: many of their conquests came without firing a shot.That’s because the coalition cut secret deals with al-Qaida fighters, paying some to leave key cities and towns and letting others retreat with weapons, equipment and wads of looted cash, an investigation by The Associated Press has found. Hundreds more were recruited to join the coalition itself. And contrary to the normative response of US officials to such allegations, which as in the case of US support to jihadists in Syria typically runs something like "we didn't know" while hiding behind a system of 'plausible deniability' in the case of Yemen officials involved have now admitted to the AP that coalition allies knowingly allowed al-Qaeda in the Arabian Peninsula (AQAP) to survive and flourish.

Pro-ISIS Media Outlet Signals Imminent Biological Attack On The West -- Over the past week, a pro-Islamic State (ISIS) media group has published a series of posters encouraging biological attacks on Western targets.   Excerpt from the transcript (MEMRI):“While the world is watching silently! The European governments are developing satanic chemical attack systems to be brutally tested on the cities and peoples, which refused humiliation and humiliation so the Muslim countries in Africa and Khorsan turned into testing fields of phosphorus bombs and toxic gas. The crusader alliance continues bombing Mosul, Raqqa, Al-Anbar and others… with various types of chemical bombs and incendiary gases. And similar to the enemies of God! We invite you, oh Muwahid [monotheist] who lives between the Mushrikeen [idolaters] that you clean the dust of humiliation and to renew the fatal nightmare in the land of the devil worshipers with a silent destructive weapon. It can not be detected or tracked it can not be escaped or avoided with simple equipment, extract the most harmful viruses and infection bacteria then release them safely by following these simple steps: First, try to find the most severe epidemics to treat.” “Hantavirus, derived from the feces and droppings of rats that carry the plague of the most serious plague at the moment. The Cholera virus is extracted from the patient’s waste. Typhoid bacteria, found in human and animal wastes in general and frequent in the dirty areas.”: “Second, spread the bacteria extracted by type as follows.”: “Sprinkle the liquid substances or the basics of bacteria with drinking water to take effect automatically. Sprinkle the crushed material on exposed fruit and public foods or scatter them in the air in crowded places – with caution.”

Saudi Arabia to freeze new trade with Canada, recalls ambassador -- Saudi Arabia said on Sunday that it is ordering Canada's ambassador to leave the country and freezing all new trade and investment transactions with Canada in a spat over human rights."We consider the Canadian ambassador to the Kingdom of Saudi Arabia persona non grata and order him to leave within the next 24 hours," Saudi Arabia's Foreign Ministry said on Twitter. The ministry added that Saudi Arabia is recalling its ambassador to Canada. Both the Saudi and Canadian ambassadors were away on leave at the time of the announcement.The dispute appears to be over a tweet on Friday from Global Affairs Canada."Canada is gravely concerned about additional arrests of civil society and women's rights activists in Saudi Arabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful human rights activists," the tweet said. The Saudi Foreign Ministry called the use of "immediately release" in Canada's tweet "unfortunate, reprehensible, and unacceptable in relations between states."It dismissed Canada's characterization of the activists as "an incorrect claim" and said Canada's attitude was "surprising." "Any other attempt to interfere with our internal affairs from Canada, means that we are allowed to interfere in Canada's internal affairs," it said.Saudi state television later reported that the Education Ministry was coming up with an "urgent plan" to move thousands of Saudi scholarship students out of Canadian schools to take classes in other countries. The sudden and unexpected dispute bore the hallmarks of Crown Prince Mohammed bin Salman, Saudi Arabia's 32-year-old future leader, whose recent foreign policy exploits include the war in Yemen, the boycott of Qatar and Lebanese Prime Minister Saad Hariri's surprise resignation broadcast during a visit to the kingdom. Hariri later rescinded the resignation, widely believed to be orchestrated by Riyadh, and returned to Beirut.

Saudi Arabia’s Spat With Canada Risks Backlash From Investors -  Saudi Arabia’s diplomatic rupture with Canada risks complicating the kingdom’s efforts to woo foreign investors as it seeks to overhaul its economy.  Saudi Arabia on Monday declared Canada’s ambassador persona non grata, and gave him 24 hours to leave the country. The decision to expel the Canadian ambassador, Dennis Horak, came after Canada’s Foreign Ministry criticized Saudi Arabia for arresting human-rights activists.   In pushing back against what it described as an unacceptable attempt by Canada to interfere in its domestic affairs, the Saudi Foreign Ministry announced it “will put on hold all new business and investment transactions with Canada.” The diplomatic spat with Canada will also affect 7,000 Saudi students who are currently in Canada on government-sponsored scholarships. The spokesman for Saudi Arabia’s Ministry of Education, Mubarak al-Osaimi, on Monday said that the kingdom would stop funding scholarships and training programs in Canada, and that it would help transfer Saudis affected by the decision to other countries. Separately, Saudia airlines, the national carrier, announced it would suspend flights to Canada from Aug. 13.  Canada’s Foreign Minister Chrystia Freeland said Monday the government was “deeply concerned” by Saudi Arabia’s move to expel Canada’s ambassador on the basis of statements “in defence of human-rights activists detained in the kingdom.” At a press conference in Vancouver, she said officials were waiting to hear from Saudi Arabia about how the relationship between Canada and the kingdom unfolds given this diplomatic row. “We stand by what we have said,” she said. “We will always speak up for human rights and women’s rights.” Saudi Arabia’s Crown Prince Mohammed bin Salman has launched a grand reform plan, called Vision 2030, that aims to transform the kingdom from a staunchly conservative petrostate to a more socially liberal country less dependent on oil. But Prince Mohammed has also made it clear he won’t brook outside criticism of key decisions—a stance that analysts say could threaten capital flows that Saudi Arabia needs for its overhaul. “Branding Saudi Arabia as an attractive destination for investment and trade is one of the underlying assumptions of Saudi Vision 2030,” said Thomas Juneau, an assistant professor and Middle East expert at the University of Ottawa. “Impulsive foreign-policy decisions like this have the exact opposite effect.”

Saudi Arabian agency stops buying Canadian wheat, barley (Reuters) - Saudi Arabia’s main state wheat buying agency has told grains exporters it will no longer buy Canadian wheat and barley in its international tenders, European traders said on Tuesday, as a diplomatic dispute between the two countries escalates. Traders said they had received an official notice from the Saudi Grains Organization (SAGO) about its decision. Canada on Monday refused to back down in its defense of human rights after Saudi Arabia froze new trade and investment and expelled the Canadian ambassador in retaliation for Ottawa’s call to free arrested Saudi civil society activists. “As of Tuesday August 7, 2018, Saudi Grains Organization (SAGO) can no longer accept milling wheat or feed barley cargoes of Canadian origin to be supplied,” a copy of the notice seen by Reuters said. One European trader said it was not clear if the decision involved only new purchases or delivery of previously agreed contracts. “But I would not deliver Canadian grains to Saudi Arabia now, even on previous contracts,” the trader added. Another trader said: “This is to me clearly part of the diplomatic dispute between Saudi Arabia and Canada, there is no other reason.” Winnipeg-based grain trader G3 said it was continuing with business as normal. G3 is a partnership of Saudi Arabian agriculture company SALIC and U.S. grain handler Bunge Ltd (BG.N). The SAGO agency generally specifies that wheat purchased at international tenders must be sourced from the European Union, North America, South America or Australia. In SAGO’s last purchase of 625,000 tonnes of wheat in an international tender on July 16, Canada was seen as a possible supplier. Analysts said the Middle East had been importing less wheat from Canada and the United States in recent years due to higher shipping costs, while China has become a bigger barley buyer. “There will be plenty of opportunities for Canada to sell barley and wheat elsewhere,”

Saudi Arabia suspends Toronto flights in row with Canada –-- Saudi Arabia's state airline has suspended its direct flights to Toronto after Canada called for the release of detained activists for civil society and women's rights.The Middle Eastern country has also frozen all trade and expelled Canada's ambassador over the "interference".Canada has responded by saying it "will continue to advocate for human rights".Those held include the Saudi-American human rights campaigner Samar Badawi, sister of jailed blogger Raif Badawi.Canada's Foreign Affairs Minister Chrystia Freeland said she was "deeply concerned" by the diplomat's expulsion, but added: "Canada will always stand up for the protection of human rights, including women's rights and freedom of expression around the world. "We will never hesitate to promote these values and we believe that this dialogue is critical to international diplomacy." Her Saudi counterpart, Adel al-Jubeir, had earlier tweeted that Canada's position was based on "misleading information", adding that anyone arrested was "subject to Saudi laws that guarantee their rights". The leading Saudi women's rights campaigner Manal al-Sharif thanked Canada for "speaking up" and asked when other Western powers would do the same. In what appeared to be a further sign of deteriorating relations between the two countries, a verified Twitter account, which is reportedly linked to Saudi authorities, shared an image of a plane flying towards Toronto's famed CN Tower. The image was overlaid with text, including a quote which read "he who with what doesn't concern him finds what doesn't please him".

Saudi Arabia to Continue Selling Oil to Canada Despite Diplomatic Tensions - Saudi Arabia’s oil shipments to Canada will remain steady despite growing tensions between the two countries, the Saudi energy minister has promised. “The current diplomatic crisis between Saudi Arabia and Canada will not, in any way, impact Saudi Aramco’s relations with its customers in Canada,” he promised. The clash between the two countries arose following Saudi Arabia’s move to detain activist Samar Badawi. Canadian Minister of Foreign Affairs Chrystia Freeland criticized the action and voiced her country’s concerns, demanding all detained activists be released. Responding to Canada’s comments, Riyadh has frozen all new trade and investment in Canada, canceled flights via its national carrier to Toronto and ordered thousands of Saudi students studying through official scholarships in Canada to leave and find new academic programs in other countries. The kingdom further forbid Saudis from seeking medical treatment in the North American country, saying it would move patients already in Canada to hospitals elsewhere.

 Saudi Arabia Crucifies Man In Mecca While Decrying Canada's Human Rights - Saudi Arabia has executed a man by crucifixion inside Mecca, considered Islam's holiest city, Bloomberg reports. It was carried out Wednesday, during the same week a Saudi spat with Canada over human rights criticisms has dramatically escalated into a full-blown diplomatic and economic war.  Ironically the crucifixion was carried out a day after Saudi-owned media began calling out Canada's human rights record through a series of bizarre videos aired on state channels, in response to Canada's own initial criticism of the kingdom's detention of activists. The crucifixion sentence, considered the kingdom's most brutal method of capital punishment, is typically reserved for the most egregious of crimes in this case a Myanmar man was convicted of breaking into a woman's home, threatening her with a gun, and subsequently murdering her by repeated stabbing. Other charges the immigrant faced ranged from theft of weapons to separate instances of attempted rape and murder, including in a separate home invasion charge. The accused criminal, Elias Abulkalaam Jamaleddeen, was executed after the crucifixion penalty was upheld by the country's supreme court and given final approval by the king. Like with the more common and "routine" Saudi capital punishment method of public beheading, crucifixions are intended to send a severe deterrent message to the broader Saudi populace. Amnesty International provides the following description of the gruesome practice:Crucifixions take place after the beheading. The body, with the separated head sewn back on, is hung from or against a pole in public to act as a deterrent. The pole is sometimes shaped in the form of a cross, hence the use of the term “crucifixion”. Saudi Arabia is among the world's top executioners, and beheaded over 48 people within only the first four months of 2018, according to Human Rights Watch.

Did Saudis Just Threaten Canada With 9/11-Style Attack for Crime of Criticizing Their Atrocious Human Rights Record? -- As tensions between Saudi Arabia and Canada continue to soar after the Canadian Foreign Ministry dared to condemn the kingdom's imprisonment of dissidents and human rights activists, a verified Twitter account connected to the Saudi government tweeted a graphic on Monday that appeared to threaten Toronto with a 9/11-style attack. The image—which was deleted after it sparked widespread outrage—showed an Air Canada jet flying in the direction of the 1800-foot CN Tower, invoking memories of the September 11, 2001 attack on the World Trade Center that killed thousands, including 26 Canadians. Overlaying the image was the quote, "He who interferes with what doesn't concern him finds what doesn't please him." After deleting the initial tweet and replacing it with a graphic without the Canadian jet, the Saudi account apologized for posting the "inappropriate" image and implausibly claimed that the message behind the graphic—which was clear as day to most observers—was misinterpreted.  The Saudi account insisted that the Canadian jet flying toward CN Tower was supposed to represent Riyadh's expulsion of the Canadian ambassador, who was kicked out following Canada's criticism of Saudi Arabia's notoriously appalling human rights record. Saudi Arabia's Media Ministry later shut down the infographic account and said it is investigating the matter. Journalists and other commentators from Canada and around the world were wholly unimpressed by Saudi Arabia's explanation and apology. Highlighting the well-known fact that 15 of the 19 September 11th hijackers were Saudi citizens, German political scientist Marcel Dirsus offered the Saudi government some free PR advice: "If you represent a kingdom which brought forth the majority of 9/11 attackers, don't use a plane flying into a tower in North America when you have a disagreement with Canada. It doesn't help."

Canada to Ask Allies to Help Cool Saudi Dispute; US Offers No Aid -- Canada plans to seek help from the UAE and Britain to defuse an escalating dispute with Saudi Arabia, sources said on Tuesday, but close ally US made clear it would not get involved. The Saudi government on Sunday recalled its ambassador to Ottawa, barred Canada‘s envoy from returning and placed a ban on new trade, denouncing Canada for urging the release of jailed rights activists. Riyadh accused Ottawa on Tuesday of interfering in its internal affairs. One well-placed source said the Liberal government of Prime Minister Justin Trudeau – which stresses the importance of human rights – planned to reach out to the UAE. “The key is to work with allies and friends in the region to cool things down, which can happen quickly,” said the source, who declined to be identified because of the sensitivity of the situation. Another source said Canada would also seek help from Britain. The British government on Tuesday urged the two nations to show restraint. The US, traditionally one of Canada‘s most important friends, stayed on the sidelines. US President Donald Trump – who criticised Trudeau after a Group of Seven summit in June – has forged tighter ties with Riyadh. “Both sides need to diplomatically resolve this together. We can’t do it for them; they need to resolve it together,” US State Department spokeswoman Heather Nauert told a briefing. 

Saudi claims ‘badge of pride’ in break with Canada | Asia Times: Saudi Arabia on Wednesday pulled the plug on medical care for its citizens in Canada, the latest move in a crisis analysts say has less to do with Ottawa and more to do with Riyadh’s desire to project power. The sudden deterioration in ties started with a Tweet.Canada’s foreign ministry raised alarm over the arrest of a number of Saudi activists, including Samar Badawi, the sister of the jailed blogger Raif Badawi. Raif’s wife and children reside in Canada. Most irksome to the Saudi authorities, Canada labeled those arrested as “peaceful human rights activists” and called for their “immediate release.” The Saudi foreign ministry snapped back with a barrage of Tweets, calling the Canadian appeal an attack on its sovereignty, announcing a freeze on new trade deals, and declaring the Canadian ambassador a “persona non grata.” Riyadh quickly cancelled all academic scholarships for its students in Canada, who number in the thousands. A $15 billion sale of Canadian combat vehicles, inked under the previous administration, hangs in the balance. It was a shock response, but one that analysts say was calibrated to send a big message with minimal cost. Canada, with which Saudi Arabia has relatively insignificant trade ties – around $3 billion per year (compared to over $45 billion with the US) – presented an opportune foil. “Criticism like this is always taking place. Just look at the number of people from the US who’ve criticized Saudi Arabia in one way or another over the years,” said analyst Kamran Bokhari of the Center for Global Policy in Washington, DC. For Saudi Arabia, the Canadian criticism offered a “relatively low-cost opportunity” to fire back. “This is a way to showcase that Saudi Arabia is willing to confront even Western allies,” Bokhari told the Asia Times. 

The Blowup With Canada Is the Latest Saudi Overreach. Will They Ever Pay a Price? --Have the Saudis gone stark-raving bonkers?  First, they pick a fight with Canada — yeah, that Canada! Maple syrup-loving, hockey-playing, poutine-eating, liberal, multicultural Canada; the land with free health care and a prime minister who wears “Eid Mubarak” socks.  On Sunday, Saudi Arabia (over)reacted to a single tweet from the Canadian foreign ministry. The tweet called on the Saudis to “immediately release” imprisoned activist Samar Badawi, sister of Raif, as well as “all other peaceful #humanrights activists.” The Saudi foreign ministry lambasted the Canadians for an “unfortunate, reprehensible, and unacceptable” statement, announced the “freezing of all new trade and investment transactions” with Canada, demanding the Canadian ambassador leave the country “within the next 24 hours.” At the same time, Saudi trolls took to Twitter to declare their loud support for … Quebec’s independence. Who knew that an absolute Persian Gulf monarchy was so passionate about a French-speaking secessionist movement 6,000 miles away? (Hey, Canadian trolls — if you even exist — my advice would be to retaliate by offering Ottawa’s backing for independence in the restless, Shia-dominated Eastern Province of Saudi Arabia. It’ll drive them totally nuts.)   Saudi Arabia was just getting started. And Saudi Arabia was just getting started. On Monday, the kingdom escalated the row by suspending scholarships “for about 16,000 Saudi students” studying in Canada, the Toronto Star reported, “and ordered them to attend schools elsewhere.” (Can you think of a better example of biting your bigoted nose to spite your intolerant face?)    Then — and this is my favorite part of this whole bizarre episode — a Saudi group put out an image on Twitter of a Canadian airliner flying directly toward Toronto’s tallest building over a warning against interfering in others’ affairs. (The Saudi group later deleted it and apologized)   Are. You. Kidding. Me?

Canada Frees Itself From Saudi Oil Imports -- The ongoing political row between Canada and Saudi Arabia over Ottawa’s demand that the kingdom release detained women’s rights activists in the country is picking up momentum. Earlier this week, Saudi Arabia ordered the Canadian ambassador to leave Saudi Arabia “within 24 hours” after his country criticized the recent arrest of Saudi women’s rights activists. However, Saudi Arabia, showing heightened sensitivity into what it perceives as foreign intrusion into its own affairs, upped the ante even more, by saying it would freeze "all new business" between the kingdom and Canada and also in an admittedly knee-jerk response, recalled thousands of Saudi students attending Canadian universities, a move to hurt Canada financially.Omar Allam, a former Canadian diplomat and head of Allam Advisory Group, said the recall of 12,000 to 15,000 Saudi students from Canada, and accompanying relatives, is going to remove as much as CAD$2 billion in annual investment in the Canadian economy.   Judith Dwarkin, chief economist with RS Energy Group in Calgary, said Wednesday that Canada could easily replace the oil it imports from Saudi Arabia should relations with the kingdom deteriorate to the point that trade in crude is halted. She said that eastern Canadian refineries import about 75,000 to 80,000 barrels per day (bpd) of Saudi crude, adding that since its only 10 percent of total Canadian oil imports, it represents a “drop in the bucket” compared to that of the U.S. which covers two-thirds of Canadian oil imports and could increase that level if needed.  "The Saudis, if they choose to supply less to Canada, will divert those barrels, possibly to China, and U.S. barrels that would have gone to China, but are uncompetitive under Chinese tariffs, come to Canada," Dwarkin said. "Basically, the cupboard gets rearranged."

Yemen war: Saudi-led air strike on bus kills 29 children --At least 29 children have been killed and 30 wounded in a Saudi-led coalition air strike in Yemen, the International Committee of the Red Cross says. The children were travelling on a bus that was hit at a market in Dahyan, in the northern province of Saada. The health ministry run by the rebel Houthi movement put the death toll at 43, and said 61 people were wounded. The coalition, which is backing Yemen's government in a war with the Houthis, said its actions were "legitimate".It insists it never deliberately targets civilians, but human rights groups have accused it of bombing markets, schools, hospitals and residential areas.Meanwhile the new UN special envoy to Yemen, former British diplomat Martin Griffiths, is planning to invite the warring parties to Geneva in September to discuss a framework for negotiations.  UN envoy Martin Griffiths says that if peace efforts in Yemen fail, the world could be looking at “Syria-plus".He told the BBC's Lyse Doucet that if the conflict is left unresolved, Yemen could collapse and the international community could be looking at "Syria-plus" in the years to come. "The war in Yemen will get more complicated the longer it goes on. There will be more international interest and polarisation in terms of the parties, it will fragment further, it will be more difficult to resolve - even more than it is now."

US complicit in air strike that murdered dozens of children in Yemen -- Countless atrocities have been carried out by Washington and its local proxies over the 17 years since the launching of the “global war on terror,” a pretext invoked to justify wars of aggression aimed at solidifying the control of US imperialism over the oil-rich and strategically vital Middle East. Entire countries, including Iraq, Libya and Syria, have been decimated, and entire cities, including Mosul and Raqqa, have been reduced to smoking rubble. The victims, the dead and maimed, number in the millions, while those driven from their homes include many tens of millions. Still, there are specific acts of sheer brutality and contempt for human life that stand out and sum up the criminality of this entire enterprise. Such was the bombing carried out Thursday in Yemen by a Saudi warplane, a jet supplied by the US, which dropped American-made bombs and missiles and was guided to its target with the aid of US intelligence officers, and refueled in midair by American tanker aircraft.  The target selected was a crowded marketplace area in the center of the city of Dahyan in Yemen’s northern province of Saada. Witnesses reported that the warplanes had been hovering over the town for over an hour, so those ordering the strike had to have a clear idea of what they would be hitting. Residents said they didn’t believe a crowded market would be targeted so they went about their business. The Saudi warplane scored a direct hit on a bus loaded with school children traveling through the market from their summer camp to a mosque for an annual celebration marking the end of summer vacation.The International Committee of the Red Cross (ICRC) reported that its hospital had received the lifeless bodies of 29 children pulled from the smoldering wreckage of the bus. Most of these children were under the age of 10, some of them as young as eight. According to Saada’s medical office, the air strikes killed 47 people, including people in the streets near the bus. At least 77 more were wounded, some of them grievously, with the death toll likely to rise.

Watch Reporters Slam US For Refusing To Condemn Saudi-US Airstrike On Yemen School Bus In Live Briefing -- Just as expected, State Department spokesperson Heather Nauert refused to condemn Thursday's coalition airstrike on a school bus in Yemen, which left as many as 50 people dead and 63 injured — the vast majority of which were children. As we reported previously, Saudi-US/UK coalition jets scored a direct hit on the school bus packed with children as it drove through a crowded market place in Dahyan, in the rebel-held north of Yemen.During the State Department's daily press briefing, Nauert was asked point blank by journalists, starting with the AP's Matt Lee, whether the US condemns the attack.The whole testy exchange on Yemen is worth watching, especially as Matt Lee lays out the case for direct US complicity in the attack on the bus packed with children from the start of his question: "The Saudis obviously are the ones who conducted this, but they do that with weapons supplied by the U.S., with training supplied by the U.S., and with targeting information, targeting data, supplied by the U.S. How can something like this happen?" he said. Watch the State Department's response here:

Russia to Deploy Military Police to Golan Heights -- (Reuters) - Russia will deploy its military police on the Golan Heights frontier between Syria and Israel, its defense ministry said on Thursday, after weeks of mounting volatility in the area. Syrian President Bashar al-Assad’s sweeping away of rebels in southwestern Syria has worried Israel, which believes it could allow his Iranian backers to entrench their troops close to the frontier. Underlining the tensions, Israel killed seven militants in an overnight air strike on the Syrian-held part of the Golan Heights, Israeli radio said on Thursday. Sergei Rudskoi, a senior Russian defense ministry official, said that Russian military police had on Thursday begun patrolling in the Golan Heights and planned to set up eight observation posts in the area. He said the Russian presence there was in support of United Nations peacekeepers on the Golan Heights who, he said, had suspended their activities in the area in 2012 because their safety was endangered. “Today, UN peacekeepers accompanied by Russian military police conducted their first patrols in six years in the separation zone,” Rudskoi told a briefing for journalists in Moscow. “With the aim of preventing possible provocations against UN posts along the ‘Bravo’ line, the deployment is planned of eight observation posts of Russia’s armed forces’ military police,” Rudskoi said. He said the Russian presence there was temporary, and that the observation posts would be handed over to Syrian government forces once the situation stabilized.

Mass protest led by Druze against Israel’s Nation State law -- Tens of thousands of Israelis, waving Druze and Israeli flags and calling for equality, gathered in Rabin Square in downtown Tel Aviv Saturday to demonstrate against the Nation State Law that enshrines Jewish supremacy. The Druze are angered by being rendered second-class citizens. The demonstration was reported to be around 150,000 strong, making it the largest-ever Druze rally. Dozens of protesters also demonstrated outside Finance Minister Moshe Kahlon’s house in the northern city of Haifa. The Druze are a minority Muslim sect, numbering around 120,000 in Israel, less than 2 percent of its population, but with larger Druze communities in neighbouring Lebanon and Syria. Unlike other Palestinian Israelis, who along with the Circassian community and the Bedouin form 21 percent of Israel’s nine million population and are exempt from military service, the Druze serve in the Israel Defense Forces, Border Police and the Civil Administration and are active participants in the government and media, with some rising to high positions. The Nation State law enshrines Israel as “the national home of the Jewish people,” declaring that “the right to exercise national self-determination in the State of Israel is unique to the Jewish people.” It includes Jews not just in Israel but throughout the diaspora who have automatic right to immigration and citizenship, and proclaims Jerusalem “complete and united” as Israel’s capital. It sanctions the apartheid-style exclusion of Arabs from exclusively Jewish communities, declaring, “The state views the development of Jewish settlement as a national value and will act to encourage and promote its establishment and consolidation.” It demotes Arabic from its position as an official state language and gives official and exclusive standing to Jewish symbols, including declaring “Hatikva” the national anthem. It prevents Palestinians from getting Israeli citizenship by marrying Israelis and future asylum seekers from entering Israel. The law makes no mention of Israel’s non-Jewish citizens, democracy or equality and has sparked widespread criticism from Israel’s Palestinian citizens, opposition parties and Jewish groups abroad. Criticism from the Druze—despite their small numbers—is significant because of their previous stalwart support for the Israeli state.

Swedish-flagged Flotilla Vessel Intercepted by Israel– The Israeli army Saturday morning said that it had taken over a European ship, the Swedish-flagged “Freedom,” captained by John Turnbull of Vancouver, that was aimed at breaking the naval blockade imposed on the Gaza Strip by the occupation forces 12 years ago. After the brutal violence and theft that the Norwegian-flagged Al Awda was subjected to, just days before, Captain Turnbull had stated that the participants and crew of the Freedom will not resist if boarded. On its website, Ship To Gaza – Sweden, published the following statement; “We now have confirmed information that S/Y Freedom to Gaza have been boarded on international waters, by Israeli navy. Latest reported position was about 40 nautical miles of the coast of Gaza at 8.06 pm. Onboard Freedom for Gaza was a crew of twelve persons from five different countries. They are now captured and taken to Israel against their will (For full list follow this link). The boat also carries a cargo of medical supplies. In this situation, the demands of Ship to Gaza are that the ship with its crew and cargo will be returned to the site of the boarding, and that they will be allowed to go in peace through international and Palestinian waters in accordance to international law. In effect, this is a demand that the eleven years-long illegal and destructive blockade on Gaza will be lifted at last. The government of Sweden have repeatedly stood behind demands on a lifting of the blockade. We now expect that the same government, in the capacity of flag nation of the attacked vessel, will also support our specific demands regarding the ship, crew and cargo.”

PayPal closes pro-Palestinian group’s account in collusion with Israeli government -- PayPal has closed the account of the French web site Agence Media Palestine in response to a global campaign by Israel to organise a crackdown on Palestinian supporters and critics of Israel, using fabricated claims of anti-Semitism.The closure of the account by the American payment-processing corporation poses difficulties for Palestinians and Palestinian journalists, as there are few other international payment mechanisms. It marks a dangerous new stage in the ongoing campaign to isolate the Palestinians, criminalise political expression and censor freedom of speech on the Internet.Agence Media Palestine, a Palestine solidarity organisation, publishes articles on Palestine in French, translating many from sources published elsewhere. It lists as its supporters prominent figures in France, such as the late author and concentration camp survivor Stéphane Hessel, Israeli filmmaker Eyal Sivan and human rights activist Mireille Fanon-Mendès France. Within hours of Agence Media Palestine receiving notification from PayPal that it had closed its account, without citing any reason or violations of the terms of agreement, the web site received an email from Benjamin Weinthal, saying, “Your organisation lists PayPal as a donation method, but the payment is blocked.”

Turkey to Freeze Assets of 2 U.S. Officials As Retaliation for Sanctions — Turkey’s president said Saturday the country will freeze the assets of two United States officials in retaliation for sanctions against Turkey’s justice and interior ministers over the detention of an American pastor, while attempting a conciliatory tone.Speaking in Ankara, President Recep Tayyip Erdogan said Turkey had been “patient” since the U.S. Treasury sanctions imposed Wednesday, but ordered authorities to “freeze the assets of America’s justice and interior ministers in Turkey, if there are any.” It is unclear who that would affect, due to differing Cabinet roles in the United States than in Turkey, or if the intended officials even have any holdings in Turkey.Turkey’s Interior Minister Suleyman Soylu and Justice Minister Abdulhamit Gul mocked the sanctions this week, saying they have no assets in the U.S, but the sign of deteriorating Turkish-American relations sent Turkey’s national currency — the lira— tumbling.Erdogan called the sanctions a “serious disrespect towards Turkey” and accused the U.S. of hypocrisy for demanding the release of evangelical pastor Andrew Craig Brunson while ally Turkey tries him over alleged links to terror groups. Brunson, jailed in December 2016, is now under home detention. He is facing a 35-year sentence if convicted of the charges of “committing crimes on behalf of terror groups without being a member” and espionage. Top U.S. officials, including President Donald Trump and Vice President Mike Pence, have said there is no evidence against Brunson and demanded his release.

Turkish Lawyers Want To Raid Incirlik Air Base, Arrest US Troops For Terrorist Ties - A group of lawyers aligned to Turkish President Recep Tayyip Erdogan has filed formal charges against a number of US Air Force officers who are stationed at Turkey’s Incirlik Air Base. The complaint accuses them of having ties to terrorist groups, and of being in league with the banned Gulenist organization. Since the failed 2016 military coup, Erdogan has blamed cleric Fethullah Gulen for plots against him, and has been targeting any and all perceived enemies, accusing them of being in league with Gulen. This is the first time US troops, let alone US troops inside Turkey, have faced such charges. Analysts say they believe the charges are a direct response to last week’s imposition of sanctions against two Turkish cabinet members by the US. The sanctions were imposed in protest of Turkey’s detention of American pastor Andrew Brunson, who has been held since 2016 on accusations of Gulenist ties. The criminal complaint names Cols. John C. Walker, Michael H. Manion, David Eaglen, David Trucksa, Lt. Cols. Timothy J.Cook, Mack R. Coker, and Sgts. Thomas S Cooper and Vegas M. Clark. Air Force officials said they were “aware” of the complaint but would not comment beyond that. The lawyers demanded the government halt all flights out of Incirlik to keep the US officers from fleeing the country, and called on the government to raid the base and seek to capture the officers.

Turkey's Agony Explodes As Trump Doubles Steel, Aluminum Tariffs -- Just when you thought Turkey's moment of agony couldn't get any worse, it did moments ago when watching the collapse of the Turkish Lira and sensing perhaps that Erdogan's end is near, President Donald Trump blindsided the NATO member state with a tweet, announcing that he is doubling Turkey's steel and aluminum tariffs to 50% and 20%, respectively. Why? Because as he said "Our relations with Turkey are not good at this time!"I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!— Donald J. Trump (@realDonaldTrump) August 10, 2018Trump's ask: the release of Pastor Brunson, which Erdogan has so far staunchly refused to agree to.In response, the Turkish Lira which already had its worst day ever, just plunged even more with the USDTRY surging as high as 6.3839, an all time high.

"This Crisis Is Created By America": Turks Blame Trump For Economic Collapse - Turkey's economy may be in freefall with soaring inflation, a plunging currency, sliding stocks and a gaping current account deficit, but don't dare tell the locals that it is president Erdogan's fault for keeping interest rates low and preventing an even greater crisis: according to Serap, a 23-year-old clerk at a clothes store in central Istanbul, there is only one entity to blame for the precipitous slide in Turkey’s lira currency."This crisis is created by America," she said.And a crisis it is: prices are soaring as a result of the collapsing currency - which this year has lost more than 35% against the dollar, and has overtaken the Argentine Peso for the worst performing currency of 2018 - with food, rents and fuel prices in Turkey surging, and the country's pipeline operator raising the price of natural gas for electricity production by 50%.But when one asks the local population who is responsible for this economic inferno, the answer is surprising. Serap’s sentiments about the causes of the crisis are shared by many Turks and hint at why support for President Tayyip Erdogan, who after surviving a fake military coup in the summer of 2016, won re-election in June with super-charged presidential powers, looks untouched, at least for now. Erdogan's loyal supporters see the currency sell-off as a U.S. attempt to undermine their country and president according to Reuters.That's also known as the Maduro defense: blame all domestic problems on "shady" foreign actors, usually involving the US. But while the US certainly has its history of intervening in foreign events, this time the crisis is entirely home grown, although predictably, Erdogan would be the last to admit it."If they have their dollars, we have our people, our God,” Erdogan said in a speech on Friday morning, casting the lira’s slide as a campaign against the nation.His comments were all the rage, in some cases literally, across Turkey’s overwhelmingly pro-government media on Friday. Newspapers and TV stations have cast the lira crisis as a political assault, spiraling out of U.S. sanctions imposed on two Turkish ministers last week in a row over the detention of a U.S. evangelical pastor, Andrew Brunson.“They issued a scandalous decision last week about our ministers,” said Serap, the store clerk. She didn’t know exactly what steps Washington had taken against Turkey, but said her country would not be pushed around. “It’s not so easy to make us bow down to their demands.”

China will buy Turkey on the cheap - Like the fall of the Ottoman Empire after World War I, Turkey’s present financial collapse has been expected for years. The sloth of credit rating agencies and the laziness of bank credit committees allowed Turkey to struggle on a year or two longer than it should have, but the collapse of the Turkish lira this week after a long, sickening decline surprised no-one.Turkey’s volatile president Recep Tayyip Erdogan might have put off the crisis, but instead decided to butt heads with US President Trump over the arrest of an American Protestant minister for alleged terrorism. At 9:20 am Eastern time, Turkey’s lira was trading at 6.5 to the US dollar, or less than a third of what the currency was worth in 2014. Turkey’s economy is headed for extreme levels of inflation as the price of imports jumps, amid a severe contraction of output as the cost of production inputs rises out of the reach of Turkish businesses.Turkey will end up as “an economic satrapy of China,” as I predicted last November. President Erdogan in effect threw himself on the mercy of China in a barely-coherent speech earlier today.Turkey’s economy is likely to shrink by 10% to 20% before the bleeding stops, as I predicted June 12. Erdogan’s supposed economic miracle followed the old formula of Third World kleptocracies of the past, namely massive domestic credit issuance supported by massive foreign borrowing. Turks bought foreign consumer goods with the proceeds and the country’s current account deficit swelled to 6.5% of national output.  That’s close to where the Greek current account deficit stood in early 2012 when the country’s economy imploded. Turkish companies have borrowed roughly US$300 billion in foreign currency, and now have to repay it in devalued Turkish lira. Most of the debt was issued when the Turkish lira traded at less than 2 to the dollar. It now trades at more than 6 to the dollar, so the cost of debt service has tripled for Turkish borrowers with local-currency earnings.

China Imports Jump, Exports Robust as Trade War Yet to Take Toll -  China’s exports grew faster than expected, while imports surged, showing both domestic and international demand continue to shrug off the uncertainty of the trade conflict with the U.S. Exports rose 12.2% in July in dollar terms from a year earlier, the customs administration said Wednesday, faster than the forecast 10%. Imports climbed 27.3%, leaving a trade surplus of $28 billion. As the world’s largest exporter, China is still benefiting from robust global demand, but increasing tensions and rising trade barriers with the U.S. are weighing on the outlook. Although most of the threatened tariffs still haven’t gone into effect yet, the two remain locked in an escalating tit for tat exchange of threats, signaling worse is to come. “The higher-than-expected imports were pushed up by energy prices, which narrowed the trade balance,” said Iris Pang, greater China economist at ING Wholesale Banking in Hong Kong. “The impact of tariffs on exports is yet to be reflected. We will see a full-month tariff effect in August.” The Chinese government last week announced its list of $60 billion worth of U.S. goods it will hit with higher import taxes should the U.S. follow through on a plan to impose duties on an additional $200 billion of Chinese goods. That follows a previous round, where each side imposes tariffs on $34 billion of imports, with promises of $16 billion more. In the meantime, China’s economy is showing signs of weakness -- the yuan has been on a losing streak for more than a month, the equity market has suffered declines, and other early indicators are pointing to a slowdown. The central bank has made it more expensive to bet against the yuan in a bid to ease pressure on the currency. China’s exports to the U.S. in July rose to $41.5 billion, making up 19.3% of its total shipments. The trade surplus with the U.S. stood at $28.1 billion, close to the record-high in June, according to Bloomberg calculations.

Giant shipload of soybeans circles off China, victim of trade war with US - A shipment of soya beans worth more than $20m (£15.5m) has been bobbing aimlessly in the Pacific Ocean for a month, a casualty of the escalating trade war between China and the US. Lingering uncertainty over the cargo’s fate offered a timely reminder of the fallout from a dispute that intensified on Wednesday, as the US president, Donald Trump, unveiled a second round of tariffs on $16bn of Chinese goods, prompting Beijing to respond in kind. The Peak Pegasus, a 229 metre bulk carrier weighing 43,000 tonnes, has become the reluctant symbol of the potential consequences of this tit-for-tat trade spat. The ship, owned by JP Morgan Asset Management, was scheduled to unload about 70,000 tonnes of American soya beans in the Chinese port of Dalian on 6 July, shortly after Trump imposed a first round of tariffs on $34bn-worth of goods. As it rushed to shore in the hope of clearing customs before Beijing imposed retaliatory tariffs, the ship – and its protein-rich cargo – became an unlikely internet sensation on the Chinese social media platform Weibo. However, the vessel arrived just too late and has been sailing around in circles ever since while the cargo’s owners, understood to be the agricultural commodity trading house Louis Dreyfus, decide what to do. The Amsterdam-based company is thought to be paying about $12,500 a day to continue chartering the ship, which is idling in the Yellow Sea off the coast of China, indicating extra costs so far of more than $400,000. 

China Is Now Left With Just Three Options, And They Are All Equally Bad - Last Friday's forceful intervention by the PBOC, in which the central bank hiked the reserve requirement for FX forwards trading from 0% to 20%, was a warning shot at the gathering yuan shorts who managed to briefly send the Chinese currency below 6.90 against the dollar last week, after losing 4% of its value in the past month, and bringing the cumulative decline against the dollar to 10% since April, a far steeper drop than seen during the 2015 devaluation. And yet, despite China's long overdue intervention - after all, once capital flight begins as new holes in the capital account are uncovered, it would be too late to prevent a repeat of the 2015 scenario - the debate about Chinese currency depreciation and what happens next with Chinese policy gathered pace, with ING last week proposingthat this latest attempt to "nuke the shorts" is doomed to failure, just like previous unilateral FX interventions. So how, according to JPMorgan, would Chinese policymakers respond to further depreciation pressures?Their base case is simple: the fiscal response, in particular infrastructure investment, and loan growth will pick up substantially in the coming months but that assumes that trade tensions do not worsen significantly from here. Which - as discussed above - they will, simply because neither Trump nor Xi will concede uncle the market forces them to cry uncle (and with the S&P just shy of all time highs, it certainly won't be the Donald doing so first).On the other hand, JPM writes that if the prospective fiscal and credit stimulus disappoints and/or the trade war with the US escalates, market pressure on the Chinese renminbi will intensify. At that point the threechoices Chinese policymakers would face would all be far more difficult:

  1. intervene in currency markets to offset market pressures risking a new wave of reserve depletion;
  2. raise interest rates to defend the currency causing monetary tightening and risking economic weakness; or
  3. let the currency depreciate beyond the above critical levels along with market pressures risking capital outflows and a more abrupt move

It goes without saying that all three choices have severely adverse consequences for the market and the global economy, and yet Donald Trump would be delighted with any of the three. After all, recall what One River CIO Eric Peters said last week when he explained what the easiest way to bring China's system crashing down was:“The best way to bring Beijing to its knees is by running a tight monetary policy in the US. China has the world’s most overleveraged, fragile financial system.”  In 2008, China’s total debt-to-GDP was 140%. It is now roughly 300%, while GDP is slowing. “The economy is held together by capital controls. If those fail, the whole system fails.” The capital flight in 2015/16 cost the government $1trln in reserves, and that was with ultra-dove Yellen in charge. Imagine what would have happened with Volcker at the helm. The Chinese are dying to get their money out.”

China bans Winnie the Pooh film after comparisons to President Xi - Who’s afraid of Winnie the Pooh? The Chinese government, apparently. Chinese censors have banned the release of Christopher Robin, a new film adaptation of AA Milne’s beloved story about Winnie the Pooh, according to the Hollywood Reporter. The Winnie the Pooh character has become a lighthearted way for people across China to mock their president, Xi Jinping, but it seems the government doesn’t find the joke very funny. It started when Xi visited the US in 2013, and an image of Xi and then president Barack Obama walking together spurred comparisons to Winnie – a portly Xi – walking with Tigger, a lanky Obama.  Xi was again compared to the fictional bear in 2014 during a meeting with Japan’s prime minister, Shinzo Abe, who took on the part of the pessimistic, gloomy donkey, Eeyore. As comparisons grew and the meme spread online, censors began erasing the images which mocked Xi. The website of US television station HBO was blocked last month after comedian John Oliver repeatedly made fun of the Chinese president’s apparent sensitivity over comparisons of his figure with that of Winnie. The segment also focused on China’s dismal human rights record.

U.N. says it has credible reports that China holds million Uighurs in secret camps (Reuters) - A United Nations human rights panel said on Friday that it had received many credible reports that 1 million ethnic Uighurs in China are held in what resembles a “massive internment camp that is shrouded in secrecy.” Gay McDougall, a member of the U.N. Committee on the Elimination of Racial Discrimination, cited estimates that 2 million Uighurs and Muslim minorities were forced into “political camps for indoctrination” in the western Xinjiang autonomous region. “We are deeply concerned at the many numerous and credible reports that we have received that in the name of combating religious extremism and maintaining social stability (China) has changed the Uighur autonomous region into something that resembles a massive internship camp that is shrouded in secrecy, a sort of ‘no rights zone’,” she told the start of a two-day regular review of China’s record, including Hong Kong and Macao. China has said that Xinjiang faces a serious threat from Islamist militants and separatists who plot attacks and stir up tensions between the mostly Muslim Uighur minority who call the region home and the ethnic Han Chinese majority. A Chinese delegation of some 50 officials made no comment on her remarks at the Geneva session that is scheduled to continue on Monday. The U.S. mission to the United Nations said on Twitter that it was “deeply troubled by reports of an ongoing crackdown on Uighurs and other Muslims in China.” “We call on China to end their counterproductive policies and free all of those who have been arbitrarily detained,” the U.S. mission said. The allegations came from multiple sources, including activist group Chinese Human Rights Defenders, which said in a report last month that 21 percent of all arrests recorded in China in 2017 were in Xinjiang.

Number of people sleeping in Hong Kong McDonald’s branches skyrockets, as residents battle high rents and substandard housing -- The number of people sleeping in McDonald’s outlets has increased six-fold over the past five years, a trend partly driven by rising rents and substandard housing that makes life especially unbearable in the city’s baking weather, a study has found.The survey, organised by Junior Chamber International’s Tai Ping Shan branch and conducted in June by volunteers, found 334 people had slept in a McDonald’s outlet nightly over at least the past three months. Of the 110 branches that operate 24 hours in the city, 84 had seen overnight sleepers. This is a six-fold increase from a similar study in 2013, which found only 57 such people, popularly dubbed McRefugees or McSleepers.A branch in Tsuen Wan hosted more than 30 sleepers, the highest among all branches, according to the latest study.Researchers were able to interview 53 McRefugees aged between 19 and 79 in depth, and found 57 per cent of them had a job and 71 per cent of them had flats that they rented or owned, contrary to the common belief that these people tended to be jobless and homeless. Saving on air conditioning costs, as well as comfort and security, topped a list of reasons given by these interviewees, followed by high rents, conflict with family members, the ability to develop social relations at the chain and substandard housing.

Samsung Tries to Navigate Through U.S.-China Trade Crossfire -  The U.S.-China trade fight has put South Korean electronics giant Samsung Electronics Co. in an uncomfortable spot. The two countries are among Samsung’s biggest markets, together accounting for about 40% of its 2017 revenue. Samsung’s challenge is to manage its ties to the U.S. and China without getting caught in the trade crossfire, even as American tariffs threaten its sales of home appliances and device components. Samsung sells TVs, smartphones and appliances to Americans, and its memory chips power millions of Chinese devices. It’s also a big foreign investor in both countries. In recent years, the company has pumped $10 billion into the U.S., including investments in factories that make appliances and semiconductors. In February 2017, President Trump tweeted, “We would love to have you!” before the company made an investment in South Carolina. In China, Samsung has earmarked $7 billion for memory-chip production in Xi’an along the old Silk Road. But Samsung is being bruised by both sides. Its washing machines sold in the U.S., although a fraction of the firm’s overall business, have already been subjected to tariffs of up to 50%. It could also face other levies—or demand declines—for its semiconductors. .At its annual shareholder meeting in March, Samsung Electronics Chairman Kwon Oh-hyun said the company expects “uncertainties such as trade protectionism and geopolitical risks to persist throughout the year.” The overall impact of any new U.S. tariffs on Samsung is hard to gauge because of its global supply chain. Its smartphones are mostly made in Vietnam and India. Its TVs are manufactured all around the world, allowing it to move production to a country not caught in the trade dispute if necessary, analysts say. The global trade battle could trigger a $4 billion drop in yearly South Korean exports of semiconductors to China, according to Mun Byung-ki of the Korea International Trade Association. Samsung would be among the Korean companies most affected if products made in China for the U.S. market using its chips face tariffs. China accounted for about a sixth of Samsung’s annual 2017 revenue of 239.58 trillion South Korean won ($212.7 billion). Such concerns about a slowdown in the semiconductor industry have clouded Samsung’s profit outlook,

Medical School’s Exam-Rigging Against Women Prompts Furor in Japan - Around 2006, executives at Tokyo Medical University saw what they thought was a problem with their applicants: Too many women. At the time, a rapidly aging population was helping propel a doctor crunch in Japan. But women tended to leave the workforce at higher rates than men. ..The executives decided the solution was more male doctors. So they programmed the computer that scored the university’s entrance exam to subtract points from the test results of female applicants each year, according to an investigation released Tuesday by an independent committee hired by the school to look at its admission practices. The result in 2018: an entering class of four men for every woman. “This absolutely should not have happened,” said Tetsuo Yukioka, an executive regent at Tokyo Medical University, bowing deeply in apology at a press conference Tuesday. The news of the exam-rigging at the prominent medical school, part of a larger scandal that also involves suspicions school leaders pocketed money from parents seeking admissions help, has caused a furor in Japan. It led earlier the resignation of the university’s chairman and its president, and prompted the education ministry to call Tuesday for an emergency investigation into admissions practices at all the nation’s medical schools. The exam machinations help explain why Japan—the world’s third-biggest economy and one of its most advanced--has so few women in elite professions and managerial positions. Japan ranked 114 out of 144 countries in terms of gender equality last year, according to an annual survey by the World Economic Forum. One Japanese think tank found the country had the lowest ratio of women managers of any advanced nation, at 13%. In medicine, which many insiders say is one of Japan’s most conservative professions, only 21% of doctors were women in 2016—the lowest among 36 countries surveyed by the Organization for Economic Cooperation and Development. To many women, the revelations are no surprise.   It is not just admissions. When it comes to getting a job and advancing, the medical field is especially tough for women, doctors say. Some doctors and medical-school executives still think that medicine should be a male preserve--particularly fields like surgery that are seen as physically taxing. When Dr. Tsuda was looking for a position in 1969, she recalls some physicians saying their departments “didn’t need women.” That attitude persists in some cases, although most people don’t say it aloud any more, she says.

Pakistan's New Leader Is A Democratically Elected Populist-Visionary -- Imran Khan’s Pakistan Tehreek-e-Insaf, which translates to the Pakistan Movement For Justice and is commonly known by its abbreviation as the PTI, came out on top in the latest elections after campaigning on a strong anti-corruption platform, but it was nevertheless a supposedly “controversial” victory because of the opposition’s claims of “military rigging” and the West’s efforts to “delegitimize” the vote. To briefly explain, the Supreme Court disqualified former Prime Minister Nawaz Sharif from office last summer and he has since been arrested for corruption, but instead of lauding this as a positive move in the right direction by an emerging democracy, it was condemned by some domestic political forces and foreign countries as supposedly being a “military-driven conspiracy” to tilt the future elections to Khan’s favor.  The narrative that his opponents have propagated is that he’s therefore nothing more than a “stooge” of the Pakistani “deep state”. That’s not the case, however, because Pakistan’s democracy is continually improving, and the only way for it to achieve anything sustainable of significance is for the highest law of the land to be upheld irrespective of the polarized political feelings surrounding the Supreme Court’s ruling last year. Without law and order, no matter how controversial its manifestation may be, no country can ever hope to build democracy, and it’s very telling that so many millions of Pakistanis were attracted to the PTI’s anti-corruption message. That in and of itself speaks to the need to proverbially “clean house” by holding elected officials and their business partners to account, which is what the Prime Minister-elect has promised to do. This will in turn improve domestic political administration and encourage the trust that’s needed to attract diaspora investments, which can then contribute to Pakistan pursuing value-added projects that turn the CPEC-transiting country into more than just a “Chinese highway”.

Kashmir’s war gets smaller, dirtier and more intimate --Kashmir’s war, a territorial dispute between India and neighbouring Pakistan, has smoldered for decades. Now it is collapsing into itself. The violence is becoming smaller, more intimate and harder to escape. Years ago, Pakistan pushed thousands of militants across the border as a proxy army to wreak havoc in the Indian-controlled parts of Kashmir. Now, the resistance inside the Indian areas is overwhelmingly home grown. The conflict today is probably driven less by geopolitics than by internal Indian politics, which have increasingly taken an anti-Muslim direction.  Most of the fighters are young men like Sameer Tiger from quiet brick-walled villages like Qasbayar, who draw support from a population deeply resentful of India’s governing party and years of occupation.Anyone even remotely associated with politics is in danger. That included Ahmad, who, when he was not sitting behind the counter of the village pharmacy, was known to host events for a local Kashmiri political party.Just the name Kashmir conjures a set of very opposing images: snowy mountain peaks and chaotic protests, fields of wildflowers and endless deaths. It is a staggeringly beautiful place that lives up to all its fabled charm, yet even the quietest moments here feel ominous. Kashmir sits on the frontier of India and Pakistan, and both countries have spilled rivers of blood over it. Three times, they have gone to war, and tens of thousands of people have been killed in the conflict. It is one of Asia’s most dangerous flashpoints, where one million troops have squared off along the disputed border. Both sides now wield nuclear arms. And the two sides are divided by religion, with Kashmir stuck in the middle.

60,000 Pakistani Troops Headed To The Durand Line With Afghanistan - To improve border security along the Durand Line with Afghanistan, Pakistan will add 60,000 troops to expand patrols on the heavily disputed border region to curb the flow of terrorists operating between both nations, as per Bloomberg citing military officials. The military officials requested for anonymity informed Bloomberg that about forty percent of the troops needed to secure the border have already been recruited, which the total process could take up to two years. About 13 percent of the security fence along the 1,456 mile-long border has been erected, officials said. “The move will consolidate Pakistan’s border operations, which have been beefed-up in recent years after widespread insecurity wracked the country following the U.S. invasion of Afghanistan. Domestic terror-related violence is now at its lowest in more than a decade. The army, which has 661,000 regular and paramilitary troops, have previously been more focused on the country’s eastern border with arch-rival neighbor India, with which it’s fought three wars against since British India’s partition in 1947. The two continue to contest the disputed region of Kashmir,” said Bloomberg.

South African Ruling Party Calls All White People "Murderers" --A tweet on the ANC’s parliamentary Twitter account shocked many on Thursday when it appeared to call all white people murderers. The tweet, which has subsequently been deleted, read: “The biggest mistake we are making is to consult murderers. White people are 9% of the population, they own 79% of land. They never came and consulted us for the land. If they want us to forgive them now, then let us share the land, the mineral resources.”Thanks again for confirming everybodies suspicion. Please see below, and please explain to me how this does not look like your views. pic.twitter.com/LGRj5MBCBe— Geoffness (@TheGeoffness) August 2, 2018It was not in quotation marks, so when it was read out of context it came as a bombshell to many, who assumed that this was the view of the ANC itself.The party then told its critics that it had merely been quoting the remarks of one of the members of the public who had come to parliament’s constitutional review committee’s public hearing on the review of section 25 of the constitution that was being held in the t own of Beaufort West in the Western Cape.However, this didn’t sit well with critics, who pointed out that the party should have made that clearer, by at the very least putting the statement in quotation marks.Subsequent to the criticism, that was what the account began to do, in an attempt to make it clearer that it was not necessarily expressing the views of the ANC itself.Nevertheless, this still didn’t well with some. A legal expert, Helene Eloff, also weighed in to make it clear that the ANC had blundered and could be held liable for the view expressed, since a disclaimer can’t be applied retrospectively.

Venezuela President Maduro ‘survives drone attack’ - BBC --Venezuelan President Nicolás Maduro says he has survived an assassination attempt involving explosive drones. Mr Maduro was speaking at a military event in Caracas when the alleged attack occurred. Live footage of his speech shows the president suddenly looking upwards - startled - and dozens of soldiers running away.Mr Maduro has blamed Colombia for the attack - something denied by Bogota as a "baseless" accusation.Seven soldiers were injured, and several people were later arrested, the Venezuelan authorities said. Two drones loaded with explosives went off near the president's stand, Communications Minister Jorge Rodriguez said.Mr Maduro later said in a national address: "A flying object exploded near me, a big explosion. Seconds later there was a second explosion."Photos on social media showed bodyguards protecting Mr Maduro with bulletproof shields after the alleged attack. Mr Maduro accused neighbouring Colombia and elements within the US of instigating "a right-wing plot" to kill him. He added that he had "no doubt" Colombian President Juan Manuel Santos was "behind this attack".  The Venezuelan leader, who has previously accused the US of plotting against him, provided no evidence to back his claim.

Russia Warns of 'Horrible' Conflict if Georgia Joins NATO (AP) — An attempt by NATO to incorporate the former Soviet republic of Georgia could trigger a new, "horrible" conflict, Russia's prime minister said Tuesday in a stern warning to the West marking 10 years since the Russia-Georgia war. Dmitry Medvedev said in an interview with the Kommersant daily broadcast by Russian state television that NATO's plans to eventually offer membership to Georgia are "absolutely irresponsible" and a "threat to peace." Medvedev was Russia's president during the August 2008 war, which erupted when Georgian troops tried unsuccessfully to regain control over the Moscow-backed breakaway province of South Ossetia and Russia sent troops that routed the Georgian military in five days of fighting. The Russian army was poised to advance on the Georgian capital, but Medvedev rolled it back, accepting a truce mediated by the European Union. After the war, Georgia entirely lost control of both South Ossetia and another separatist region, Abkhazia. Russia has strengthened its military presence in both regions and recognized them as independent states, but only a few countries have followed suit. The European Union on Tuesday reiterated its "firm support to the sovereignty and territorial integrity of Georgia within its internationally recognized borders" and lamented the Russian military presence in Abkhazia and South Ossetia. In a show of support for Georgia, foreign ministers of Latvia, Lithuania and Poland, and a Cabinet member from Ukraine, visited Tbilisi Tuesday, urging Russia to withdraw its troops from Abkhazia and South Ossetia. "Nowadays no country can change the borders of another country by force," said Polish Foreign Minister Jacek Czaputowicz. 

EU Blocks Trump’s Iran Sanctions To Protect Companies Hours Ahead Of Snapback - The European Union issued a statement Monday ahead of when renewed US sanctions are set to snap back against Iran after midnight US Eastern time, saying it "deeply regrets" the sanctions and will take immediate action to protect European companies still doing business with Iran. The statement by EU diplomatic chief Federica Mogherini and the foreign ministers of Britain, France and Germany pledged to also work to keep "effective financial channels" open with Iran. "We deeply regret the re-imposition of sanctions by the US, due to the latter's withdrawal from the Joint Comprehensive Plan of Action (JCPOA)," the statement issued from Brussels begins.The US has ordered all other countries to halt imports of Iranian oil by early November or face punitive measures. In a statement on Sunday Secretary of State Mike Pompeo said the White House will detail implementation of the measures sometime Monday morning. As expected after the Trump administration was unmoved by European leaders' calls for an exemption, the EU will seek legal protection for firms in the 28-nation bloc to work with Iran by invoking its so-called blocking statute, considered the most powerful tool at its immediate disposal. When invoked, it bans any EU company from complying with US sanctions and does not recognize any foreign court rulings seeking to enforce American penalties. According to the statement:We are determined to protect European economic operators engaged in legitimate business with Iran, in accordance with EU law and with UN Security Council resolution 2231. This is why the European Union’s updated Blocking Statute enters into force on 7 August to protect EU companies doing legitimate business with Iran from the impact of US extra-territorial sanctions.The EU also restated its commitment to upholding the Iran nuclear deal (JCPOA), calling the 2015 brokered agreement "a matter of international security":The remaining parties to the JCPOA have committed to work on, inter alia, the preservation and maintenance of effective financial channels with Iran, and the continuation of Iran's export of oil and gas.

EU acts to protect firms from Donald Trump’s sanctions against Iran - The EU has launched an attempt to protect European businesses from Donald Trump’s sanctions against Iran as the US administration voiced its intent to apply maximum pressure on Tehran by vigorously applying its punitive measures.The sanctions came into force at midnight (US east coast time). At the same time, a blocking statute – last used to protect EU firms from US sanctions against Cuba – was brought into force in an attempt to insulate firms and keep alive a deal designed to limit the Iranian government’s nuclear aspirations.European firms have been instructed that they should not comply with demands from the White House for them to drop all business with Iran. Those who decide to pull out because of US sanctions will need to be granted authorisation from the European commission, without which they face the risk of being sued by EU member states.A mechanism has also been opened to allow EU businesses affected by the sanctions to sue the US administration in the national courts of member states.Trump announced his intention to hit firms doing business with Iran when he reneged on a deal struck in 2015 designed to help curtail Tehran’s nuclear ambitions in return for limited sanctions relief. A joint statement issued on Monday by the foreign ministers of the EU’s 28 member states, including the UK’s Jeremy Hunt, said there was a “determination to protect” the bloc’s economic interests and the nuclear deal, which Brussels, along with China and Russia, continues to support. The statement said: “The lifting of nuclear-related sanctions is an essential part of the deal; it aims at having a positive impact not only on trade and economic relations with Iran, but most importantly on the lives of the Iranian people. “We are determined to protect European economic operators engaged in legitimate business with Iran, in accordance with EU law and with UN security council resolution 2231. This is why the European Union’s updated blocking statute enters into force on 7 August to protect EU companies doing legitimate business with Iran from the impact of US extra-territorial sanctions.”

How the EU plans to avoid US Iran sanctions - The European Union's top foreign affairs representative Federica Mogherini and three EU foreign ministers, Jeremy Hunt from the UK, Jean-Yves Le Drian from France and Heiko Maas from Germany, have jointly condemned American sanctions against Iran. While the US has withdrawn from the Joint Comprehensive Plan of Action — otherwise known as the Iran nuclear deal — which aims to ensure Iran's peaceful use of nuclear energy, the EU, China, Russia and Iran continue to uphold the agreement. Now the EU wants to circumvent the current US sanctions, which will also punish European companies that do business with Iran. The EU Commission considers the 'secondary sanctions' imposed by the US on European companies illegal. The Americans are seeking to ban European carmakers, banks and energy companies from doing business with Iran. If they violate the ban, their assets in the US may be seized. Even American companies dealing with European companies, which in turn are engaged in Iran, face penalties. For this reason, the EU has adopted a so-called 'blocking statute' in order to ward off the effects of American sanctions. The updated legislation comes into force on August 7. "European companies should be protected," said an EU official in Brussels. "But we aren't dictating to companies what economic decisions they make. No company can be forced to invest in Iran." With the new rules European companies are granted the right to challenge US sanctions in European courts and seek compensation from the US government or American companies. In practice, this path promises to be cumbersome and costly and even the Commission acknowledged that there is no precedent in such cases. The blocking statute has never been implemented, although one was issued for the first time in 1996 in connection to economic sanctions against Cuba and Iran. Back then, the threat was enough to persuade the US to suspend secondary sanctions.

Daimler abandons Iran expansion plans as sanctions bite -(Reuters) - German car and truck manufacturer Daimler (DAIGn.DE) on Tuesday said it has dropped plans to expand its Iran business in reaction to renewed U.S. sanctions, which come into effect on Tuesday.  “We have ceased our already restricted activities in Iran in accordance with the applicable sanctions”, Daimler told Reuters in a statement. In early 2016, Daimler established a joint venture with Iranian vehicle manufacturer and dealer Iran Khodro Co to make and distribute Mercedes-Benz trucks in the country. Daimler had planned to open a representative office in Teheran. It the statement, Daimler states that as for now, neither its car-related nor truck-related activities in Iran had been resumed.  Daimler said it continues to monitor political developments carefully.

ECB Fears Contagion from Turkish Lira Collapse, Bank Stocks Plunge -On Friday, the Turkish Lira plunged 15% against the US dollar. Over the past two days, it has plunged 18%. Over the past four months — shown in the chart below — it has plunged 38%: Now even the ECB is beginning to fret about the potential impact the plummeting Turkish Lira may have on Eurozone banks that are heavily exposed to Turkey’s economy via large amounts in loans — much of it in euros — through banks they acquired in Turkey. Given the plunge in the lira, companies have trouble servicing their euro loans and are beginning to default. And loans in local currency are plunging in value along with the currency. This is how the currency crisis in Turkey, which is turning into a debt crisis, could set off contagion effects among banks in France, Spain and Italy — a risk we have been exposing for two years.The ECB is concerned that Turkish borrowers might not be hedged against the lira’s weakness and begin to default on foreign currency loans, which account for a staggering 40% of the Turkish banking sector’s assets, the FT reported. Turkey leads all other major emerging markets on total foreign-currency-denominated debt (including public debt), which hit nearly 70% of GDP last year (up from 39% in 2009). Banks in Spain, France and Italy have estimated exposure to Turkey’s banking sector of around €135 billion. Spanish lenders alone reportedly are owed just over €80 billion by Turkish borrowers in a mix of local and foreign currencies. French and Italian banks are respectively due just under €40 billion and €18 billion. If those borrowers begin to default in large numbers, it probably won’t be enough to trigger a full-blown Eurozone credit crisis, according to the brokerage firm Berenberg. But it could cause major headaches for Eurozone banks “that have large credit exposure to Turkey or own Turkish banks.” At the top of the risk list, as we’ve been warning since 2016, is Spain’s second largest lender, BBVA, whose stock on Friday plunged 5.4% on news that the ECB is concerned that the Spanish bank, along with France’s BNP Paribas and Italy’s Unicredit, could be particularly impacted by Turkey’s gathering currency crisis. According to the FT, the ECB has been following developments at the three lenders closely for the last two months.

ECB Fears Contagion from Turkish Lira Collapse, Bank Stocks Plunge -- Yves Smith -  Apparently some Fed insiders have been arguing for more measured rate increases due to the fact that hot money exiting risking emerging economies could put them in a world of hurt, witness that Argentina and Pakistan have gone tin cup in hand to the IMF. But Turkey sits in a critically important location, and Trump’s tariffs have had the effect of kicking the country down the stairs. Turkey has already been Russia and the Chinese have meaningful stakes in the country.On the banking front, the EU implemented the very badly flawed Bank Recovery and Resolution Directive, IIRC in early 2017. It’s a blueprint for creating bank runs. First, there’s no EU level deposit guarantee, and national deposit guarantees are supposed to get to be better funded, but now pretty much none are adequate. Second, it requires bail-ins, meaning creditors take a hit rather than taxpayers. That in theory might be a nice idea but banks are far too opaque for creditor to make intelligent decisions about them. so they can’t effectively discipline management.In fact, CoCo bonds, one of the instruments designed to help ease conversion of debt to equity looks to have decreased rather than increased financial stability. From Bloomberg in March:Bonds that are supposed to make banks stronger may end up causing another crisis.The 178.6 billion euros ($222 billion) of notes that are meant to absorb losses at European banks — while keeping them a going concern — have gone largely untested. Actually triggering these contingent convertible notes, or CoCos, could spook investors and destabilize other lenders, especially if their volume grows, according to Germany’s Bundesbank.Investors had a taste of that in 2016, when some analysts questioned whether Deutsche Bank AG could make payments on its version of those bonds. It did, but a plunge in the notes made waves and caused the bank to lose revenue as worried clients took their business elsewhere.Another problem is that banks in Spain and Italy snookered depositors by selling them subordinated bonds (which would be at the head of the wipeout queue) by telling them they were just as good as deposits but had a better yield. Finally, depositors can get bailed in (witness the resolution of banks in Cyprus). And those were merely deposit-heavy banks. At TBTF type banks, there are lots of secured creditors that are senior to depositors, who are unsecured (of course, you have to look at the legal entities where all these obligations sit to see who gets what, but just sayin’).

Italian Treasury Intervenes To Buy Bonds For Third Time Since May Crash - Italian bond prices rose on Monday after the Italian Treasury announced on Friday that it had intervened in the market with yet another debt buyback operation following a steep price decline on Friday. Unwilling to wait for the ECB's generosity, late last week the Italian government bought back nearly €1bn of its own short-dated debt late last week amid concerns of another breakdown in relations with Brussels after the country’s populist coalition launched negotiations over its debut budget, prompting a sell-off. It was the treasury’s third - and largest to date - intervention in the bond markets since the coalition took power in late May, an event which stunned investors resulting in a record plunge in Italian bond markets and a slide in Italian risk assets.  The intervention propped up yields on 2-year Italian bonds, which dropped to 0.92% in Monday trading, after blowing out as much as 1.35% on Friday. Longer-dated debt also saw selling pressure ease, with the yield on 10Y Italian paper dropping to 2.9%, down from 3.1% on Friday. As shown in the chart below, the Italian Treasury has intervened at the bottom of every recent selloff to avoid further losses.

     Why Italy’s U-turn on mandatory vaccination shocks the scientific community - An amendment from Italy's anti-establishment government that removes mandatory vaccination for schoolchildren is sending shock waves through the country's scientific and medical community. It suspends for a year a law that requires parents to provide proof of 10 routine vaccinations when enrolling their children in nurseries or preschools. The amendment was approved by Italy's upper house of parliament on Friday by 148 to 110 votes and still has to pass the lower house. The law had originally been introduced by the Democratic Party in July 2017 amid an ongoing outbreak of measles that saw 5,004 cases reported in 2017 -- the second-highest figure in Europe after Romania -- according to the European Centre for Disease Prevention and Control (ECDC). Italy accounted for 34% of all measles cases reported by countries in the European Economic Area, the center said.Italy's Five Star movement and its coalition partner, the far-right League, both voiced their opposition to compulsory vaccinations, claiming they discourage school inclusion.League leader and Interior Minister Matteo Salvini said in June that the 10 obligatory vaccinations, which include measles, tetanus and polio, "are useless and in many cases dangerous, if not harmful," according to ANSA news agency."I confirm the commitment to allow all children to go to school," he added. "The priority is that they don't get expelled from the classes."

    Migrants are being 'lured to their deaths' because Facebook is not shutting down trafficking pages, says police chief -- One of Britain's most senior police chiefs says migrants are being "lured to their death" because Facebook is failing to shut down trafficking pages.Tom Dowdall, the deputy director of the National Crime Agency, pointed the finger of blame at Facebook after claiming that it has found more than 800 pages run by organised gangs, which ferry illegal immigrants across Europe on boats unfit for crossing oceans.It remains a major problem in Europe, with the UN revealing last week that more than 1,500 refugees and migrants lost their lives attempting to cross the Mediterranean in 2018 alone.In an interview with The Evening Standard, Dowdall said: "Since December 2016, we have identified over 800 Facebook pages which we consider as being associated with organised immigration crime. That is largely offering vessels, documents, transport services. There is enough we are seeing to indicate to us that it supports criminality."He added: "They are being lured to their deaths using an application that they are using every day of the week."Dowdall said it is problem that needs to be addressed by Facebook, but the National Crime Agency "haven't had enough willingness yet" from the Silicon Valley company. The technology exists, he said, to target the offending pages, but Facebook is "not stepping up in the way we would want."He explained: "Facebook have developed a fantastic ability to be able to identify patterns and how everybody operates on a day to day basis. "This is no different: there will be patterns that are developed here which we know that Facebook and others can be onto really quickly. We need their cooperation to be able to identify and to either close down these sites or be able to further investigate them."

    Press Freedom Is Still Under Attack in Slovakia --Public broadcasters that bow to government pressure have always been a fixture of Central European politics, from Budapest and Warsaw to Bucharest and Prague. And yet, for Slovakia, there is an important distinction: This small, mountainous country is still riding a wave of activism inspired by the massive protests that erupted after the murder of investigative reporter Jan Kuciak and his fiancée in February.Many Slovaks hoped that Kuciak’s death would lead to a push for broader changes in the country. Thousands of people who poured into the streets this spring, in the largest demonstrations since the 1989 Velvet Revolution, created a nonpartisan movement “For a Decent Slovakia,” demanding an end to corruption, an end to clientelism, and, of course, a free and professional media.Reznik, with his ties to both a party in the current ruling coalition and to the dark decade of the 1990s, symbolizes everything that people were protesting against this spring: He is seen as a creature of the ancien régime in its worst manifestations. What made the picture worse was the new management’s criticism of the #AllForJan badges worn by journalists on the air. Reznik argued the management’s anti-badge stance was a recommendation rather than a ban, but it was perceived as pressure.“Memories of Kuciak are fresh, and moods are indeed revolutionary,” Miroslava Kernova, a journalist and media analyst at the website Omediach.com, told me. “I can hardly imagine anyone caring about Reznik or RTVS in general, if it wasn’t for Kuciak.” One of the reasons so many journalists resent Reznik is that they have positive memories of his predecessor at RTVS. Vaclav Mika was a political nominee too, but he was also a professional media manager praised—by all sides of the political spectrum—for transforming the company into a modern, politically independent, and trusted broadcaster, while opening it up to young talent. He sought reappointment in 2017, but, in a move that surprised many, was rejected by the parliament.

    Europe really doesn’t need us as much as we need them - Liam Fox's assertion that the UK sports a 60% chance of falling out of the European Union without a deal got all the headlines. But no less remarkable was another statement, also detailed in the Sunday Times, where the international trade secretary remarked: "If [no deal] is causing some anxiety in Britain - think what it's causing in Brussels." The implication was clear - the EU has more to lose from no deal than us. The problem for Mr Fox is no one in the British government or civil service, in Brussels or across the chancelleries of Europe really believes that. Mr Fox's comments, however, are illuminating in another (unintended) way. They reveal something not just about his own thinking but about the Leavers he represents too. It is connected to the oft-repeated mantra that "they need us just as much as we need them". It is one of the phrases of our Brexit-infused age, one which the public has adopted and repeats themselves. That they do is because it speaks to their own conception of British statecraft - the public views the EU/UK battle as one of two equal powers. As painful as it might be for us to accept, it is not. Yes the UK is the EU's second-largest economy. Yes it is its largest military player. Yes we are a cultural powerhouse. Yes we are their biggest individual market. Britain is powerful - but the EU is more powerful than we are. On paper - this should not be surprising, yet no politician, of any stripe, would ever dare say it. But the facts speak for themselves: We are 65 million of a bloc of 450 million. Ours is a $2.9trn (£2.2trn) economy, they are $19trn (£14.6trn) They represent 44% of our exports. We, just 9% of theirs. They are 27 - we are one. The impact of a no deal (as all the studies show) would be considerable but they have a crucial advantage: they are able to spread the risk and burden. For that reason, the same studies show, it would hurt us far more. We have nowhere else to turn.

    How Australia's Meat Industry Plans to Flood Post-Brexit Britain With Products Banned in EU - Australian meat industry leaders are heavily lobbying their government to put pressure on Britain to accept products currently banned under EU law after Brexit.Among the meat products suggested for export to the UK are hormone-treated beef and “burnt goat heads”.Ministers from both countries met last week to discuss the future of their trading relationship, amid concerns that the Australian government could force the UK to lower food standards. It comes as a petition supporting The Independent’s campaign for a Final Say on Brexit passed 570,000 signatures.Trade minister Liam Fox has long mooted Australia as a key trading partner for the UK when it ceases to be part of the EU.The Department for International Trade has stated it “will not lower food, animal welfare or environmental standards as part of any free trade agreement”.  “Maintaining them is the right thing to do for our consumers and maintains the UK’s world-renowned reputation for high-quality products,” a spokesperson told The Independent. But Kierra Box, Brexit campaign lead at Friends of the Earth(FoE), said the government is "saying one thing but doing something completely different”. “The government can continue to claim they are protecting our environment and health but in reality these promises are flimsy and unconvincing.”

    Brexit: the enemies of reason -- Loyal, tribal Tories – if you give them a chance – will tell you that we should unite as nation behind Mrs May as she attempts to bring Brexit to fruition. Well, the nation is certainly more united on Brexit than it has been for a while, leading Booker in this week's column (no link) to observe that our Treeza has certainly pulled off a truly remarkable feat – uniting Brexiteers and Remainers alike. But the only unity we have is in an almost unanimous rejection of her tortuous Chequers White Paper proposal, where everyone feels free to pour scorn on it as being wholly unworkable. Yet, despite that universal rejection, Mrs May still blindly persists in pushing her make-believe plan as her only offer for the showdown October meeting when the final terms of our leaving were meant to be agreed. Inevitably, therefore, we edge closer to the prospect of crashing out of the EU without a deal, for the practical consequences of which the Government, let alone the British people as a whole, are completely unprepared. And nor do you have to go very far to find warnings of the consequences. Says Booker, ever more anguished voices are now sounding alarm bells over the disaster this threatens to our £270 billion a year export trade with the EU (representing 14 percent of UK GDP) from the car industry to the Food and Drink Federation, the chief executive of which wrote weeks ago to the new Brexit secretary pleading for an urgent meeting, without getting any reply.

    EU patients may miss out on medicines in no-deal Brexit, says AstraZeneca - Pharmaceutical giant AstraZeneca has said patients in the European Union may not be able to receive vital medicines from the UK if the company does not successfully prepare for a no-deal Brexit. The manufacturer of cancer, heart and lung drugs told an official Dutch government website that it was going to have to test medicines in both the UK and the EU to ensure they could cross the border in all Brexit scenarios. But AstraZeneca conceded that it could not guarantee it would succeed, and emphasised that in its case it could be EU citizens who will be at risk, because many of its drugs are manufactured and quality tested in the UK. Ad Antonisse, the company’s Dutch external affairs director, told the Brexitloket website: “If we do not prepare well for Brexit, patients in the EU may no longer be able to receive their medicines. Just because production happens to happen in the United Kingdom.” Ministers have repeatedly talked up the possibility of a no-deal Brexit over the past month as the UK attempts to persuade the European Union that it could walk away unless there is a breakthrough in talks, which have stalled over trade and customs arrangements. Professor Jean McHale, a health care law specialist at Birmingham University, said: “Access to medicines and drugs is one of the most important healthcare issues that will have to be dealt with in an no-deal Brexit scenario. The government has to ensure there will be some sort of reciprocal arrangement to ensure smooth movement of drugs across borders.” AstraZeneca is one of the world’s leading pharmaceutical companies, employing 6,700 people in the UK, and running its worldwide research from Cambridge. It specialises in oncology drugs to treat cancer as well as treatments for respiratory and cardiovascular conditions.

    UK could run out of food a year from now with no-deal Brexit, NFU warns - Britain would run out of food on this date next year if it cannot continue to easily import from the EU and elsewhere after Brexit, the National Farmers’ Union has warned. Minette Batters, the NFU president, urged the government to put food security at the top of the political agenda after the prospect of a no-deal Brexit was talked up this week. “The UK farming sector has the potential to be one of the most impacted sectors from a bad Brexit – a frictionless free trade deal with the EU and access to a reliable and competent workforce for farm businesses is critical to the future of the sector,” she said. Batters’ warning comes a fortnight after the Brexit secretary, Dominic Raab, said Britain would have “adequate food supplies” after Brexit. While Downing Street has insisted it is confident an agreement can be made in time, the international trade secretary, Liam Fox, warned over the weekend that the prospect of a no-deal Brexit was now at “60-40”, fuelling fears at the NFU and among food importers. Food security in Britain is in long-term decline, with the country producing 60% of what it needs to feed itself, compared with 74% 30 years ago, according to figures from the Department for Environment, Food and Rural Affairs (Defra). In a statement issued by the NFU, Batters expressed concern that Britain would not be able to meet its food needs if Brexit was mismanaged. Research showed 7 August 2019 would be the nominal day that Britain would run out of food if it were asked to be wholly self-sufficient based on seasonal growth, the NFU said. The calculation of the "notional date" by which time Britain would run out of food has been used as a measure of Britain's food security for several years by experts concerned about the decline in home-grown food.

    This is what no-deal Brexit actually looks like --No-deal is probably the most demented policy put forward by mainstream British politicians in the modern era. To see how it would work in practice, this piece looks at what would happen on day one. Doing this for the whole economy would take countless pages of Stephen-King-style horror, so it's stripped down to one topic: food. This is the story of how our system for importing and exporting food implodes almost instantly.  March 30th 2019 becomes Year Zero. Overnight, British meat products cannot be imported into the EU. To bring these types of goods in, they have to come from a country with an approved national body whose facilities have been certified by the EU. But there has been no deal, so there's no approval.This sounds insane. After all, British food was OK to enter Europe with minimal checks on March 29th, so why not on March 30? Nothing has changed.  The reason is that food is potentially very dangerous, so we have strict systems in place for it. Imagine that right now someone is eating a burger made from the meat of a cow with a neurodegenerative disease, like BSE. This is what happened in Britain in the late-80s and led to the deaths of 177 people. Tomorrow's tabloid front pages will ask certain very important questions. Where did the meat come from? Was it produced domestically or imported? Who was responsible for its production, transport and storage? The people responsible will be hauled in front of cameras and Commons select committees. Ministers will have to give statements to parliament. The press will demand that heads roll.  And there are plenty more around, including foot and mouth, avian flu, and African swine fever, plus those that do not exist yet. This is why the certification system for food coming into Europe is so stringent and detailed. After Brexit, we will fall out of the eco-system of EU rules, agencies and courts and become an external country. That means certification requirements will apply to us too.

    Brexit: the “no deal” penalty - With the prospect of a "no deal" exit from the EU being taken more seriously, we are starting to see a number of newspapers attempting to predict what the UK would look like in the event of us "crashing out" of the EU. With the best will in the world, though, there are too many variables to anticipate, which remove any certainty. The precise outcome will depend on the assumptions made, the degree to which known factors are accounted for, and then the mitigation - both pre-emptive and reactive – undertaken by government, business and even individuals. As far as variables go, there is probably no more volatile a situation than our food supply, with the more lurid commentators suggesting that we could run out of food within days (or certainly weeks), with the very real prospect of rationing to avoid starvation. Yet, in this one area, mitigation is a practical proposition. Furthermore, given the destructive effect food shortages would have on the maintenance of law and order – with food riots, looting and civil disobedience – it is my view that the government would take any and every effective measure it could to ensure that food supplies are maintained (even if costs of some commodities do increase). Largely, as we see from this article in the Telegraph - where James Rothwell writes a rather lame "explainer" headed: "What does a 'no deal Brexit' mean - and how would it affect the daily life of Britons?" – the media doesn't have a clue. Here, Rothwell actually errs on the side of suggesting rather vague "magic wand" solutions, having noted that Mrs May says voters "should feel reassured", as the government plans to stockpile food. On the basis that the government is set to hire an extra 1,000 customs officers to deal with extra checks, he argues that, "if large numbers of staff are hired, alternative supply chains are put in place and any outstanding legal issues are addressed - all in time for March 2019 - then the adverse effects could be mitigated". However, no one with any sense is going to accept that the government (or even commercial enterprises) will be able to stockpile food, other than for a few very basic commodities. And nor is rationing a workable idea. There simply isn't time to set up a scheme, and nor would it be possible – barring the imposition of draconian emergency powers – to exercise sufficient control over the food chain to make it work.

    Sterling falls against dollar and euro amid fears of no-deal Brexit - The pound has fallen to its lowest level against the dollar and the euro this year, as mounting fears that Britain is at risk of crashing out of the EU without a deal prompted an across-the-board sell-off in the world’s financial markets.Sterling was down heavily against all major currencies as investors sought to insure themselves against the growing possibility that talks between London and Brussels break down over the coming months.Analysts said sterling’s slide – which makes imported goods and foreign travel more expensive but UK exports cheaper – would push up inflation and lead to a renewed squeeze on living standards at a time when support for the government’s handling of Brexit has fallen sharply.Holidaymakers have already seen an impact from the weaker pound. The walk-up rate at Forexchange bureaux de change in Cardiff airport on Wednesday had dropped to just €0.90 to £1 – £200 bought just €177.Speculation against the pound has intensified in the past week as markets have digested warnings from Mark Carney, the governor of the Bank of England, and Liam Fox, the international trade secretary, about the possibility of a chaotic exit from the EU for Britain next March. Although the government has insisted that it still expects negotiations with the EU over the next few months to prove successful, currency traders have been prepared for a deal not to emerge and are now hedging against the possibility of the hardest possible Brexit.

    UK “Housing Downturn” Pushes Biggest Real-Estate Agency with 10,000 Employees to Brink, Shares Collapse -- Countrywide, the UK’s largest real-estate services group with over 10,000 employees in 900 locations, saw its shares plunge over 60% on Thursday after the company asked investors to pony up £140 million of emergency funds to save it from collapsing under the weight of its own debt. At one point the shares were down over 70%. On Friday they fell a further 14%.In the last three months, the stock has crumbled 86%, from £1.10 a share in early May to £0.15 on Friday. The firm’s market cap has plunged to a paltry £37 million — little more than the average house price on Britain’s most expensive street, Kensington Palace Gardens in London.  The company, which owns 50 agency brands, including high street agency brands such as Hamptons International, Bairstow Eves and Bridgfords, attempted to raise £250 million in May by issuing bonds. If offered price the five-year notes at a yield of 8%, but potential investors said they would have to have at least 9%, according to the FT. The bond was supposed to pay off a revolving line of credit, and there would have been some left over to decorate the balance sheet with a little cash. But the effort was scuttled. Now, it hopes to stave off collapse by raising £140 million — more than three times its current market cap — through a heavily discounted share placing and open offer later this month. If successful, the cash will help reduce Countrywide’s net debt, which currently stands at £212 million, by around 60%. If it doesn’t raise the funds, Countrywide could become the first major victim of the UK’s stagnating housing market.

      Britain urged Ireland to reduce emphasis on NI peace in Brexit talks - The British government asked Ireland to ease off on its emphasis on peace inNorthern Ireland as one of the main issues at stakes in the Brexit talks.The request, from representatives of the UK administration, was made in recent months because British prime minister Theresa May was said to be hurt and concerned her credentials as a guarantor of the Good Friday Agreement were not being taken seriously, sources disclosed.However, Dublin did not accede to the call because of a view that the peace process should remain central to the Brexit negotiations.The revelation comes as Mrs May steps up preparations for the UK leaving the bloc without a deal. She is reported to have instructed her officials to make contingencies in such a scenario to ensure the Border is free of customs checks and police. It is understood the request came in meetings between figures from the Irish and UK governments as Mrs May was preparing to secure the backing of her Cabinet for her vision of a future relationship with the European Union after Brexit.

    Ryanair faces largest pilots’ strike in its history - On Friday, simultaneous strikes against Ryanair will take place in several European countries. While workers’ anger about the conditions of exploitation and the arrogance of the airline has grown, the unions are doing everything to isolate the strike.So far, pilots’ organisations in Belgium, Ireland, Sweden and Germany have announced strikes. In the Netherlands, Ryanair is trying today to have a strike by 50 pilots outlawed through a court decision. In Germany, pilots are taking part in a European-wide strike for the first time.The strike is an expression of workers’ tremendous anger about the extremely poor working conditions at the low-cost airline. Across the continent, Ryanair has created new benchmarks for exploitation in the airline industry. Precisely for this reason, workers are seeking ever stronger common international forms of resistance.The Frankfurter Allgemeine Zeitung reports a German worker at Ryanair who was hired a few years ago as a “contract pilot,” on the basis of a fake self-employment contract, who had to hand over an “appraisal fee” of 300 euros when he attended a job interview. “As an employee, you get the impression you are being ripped off by this company from start to finish,” he said. “You have to look after everything and defend yourself. Otherwise you will be constantly bamboozled.”A German flight attendant told Der Spiegel that right after she was hired, she was asked to pay 3,000 euros for a six-week training course. Ryanair also hires flight attendants without preconditions and language skills, and only requires basic English skills. They then undergo an extremely tough and rapid internal training, which until recently they had had to pay for themselves. Only a few weeks ago, Ryanair changed this system. Almost all flight attendants are hired via a temporary employment agency. Generally, flight attendants start with a work agency like Crewlink or Workforce, not with Ryanair itself. They receive a contract of employment under Irish law, even if they work and live in Germany.