reality is only those delusions that we have in common...

Saturday, April 28, 2018

week ending Apr 28

 The Fed Is Wrong: "There Is Everything Unusual About The Current Treasury Curve" - The current US Treasury yield curve in between the 5-year and 10-year maturities is today just 15 bps. It had dropped down to this level of flat about ten days ago. When it did, it had been the first time in almost eleven years. The last time the 5s10s was 15 bps? August 8, 2007.It’s hard not to notice these things, depicting as they might a completed cycle or round trip. August 8 was the day before the system broke for good, and so the Treasury curve was then steepening after having been inverted for a good length of time beforehand. That kind of curve action, as my colleague Joe Calhoun rightly points out, is accepted as the worst kind.You never want to see short-term rates fall faster than those of the long end. It indicates things are about to get serious, or at least that is what the market expects (and it has been the market, not Economists and policymakers, that have been correct about all this).While true in the sense of the future short-term direction, I think there is a level worse below such bear steepening. A much more desperate condition is what we find now, this long end flattening. What’s missing from analysis is the other dimension. Nominally, rates are rising across the Treasury curve. They are increasing much faster and farther at the short end than the long. That seems to be consistent with what’s normal, of course, and we have expected as much at whatever point the Fed had finally gotten around to its “exit.” But not all flattening is the same, either. Many people like to use the 2s10s or as policymakers do (to increase the term distance, to therefore minimize the prospects for inversion) the 3m to 10-year, but to me all the big stuff is in the 5s10s. The 5-year range and in encompasses all the things we talk about with money and even monetary policy (mostly of delusion). The 10-year space is where all the meat of finance and credit meets with economic expectations.

Employment Costs Surge Most since 2008, Fed Raises Eyebrow - Total compensation costs for civilian workers — which include wages, salaries, and benefits of workers in the private sector and in state and local governments — increased 2.7% seasonally adjusted, over the past 12 months ending in March 2018, up from a 2.4% increase in the prior quarter, the Bureau of Labor Statistics reported this morning. This was the fastest 12-month increase since Q3 2008: Wages and salaries account for about 70% of total compensation costs. Benefits account for the remaining 30%. As we’ll see in a moment, the surge was mostly caused by wages and salaries in the private sector. Benefit cost increases, while always too much, were in the middle of the range over the past decade. And wages and salaries for workers at state and local governments inched up less than inflation.  The surge in private sector employment costs – particularly of wages and salaries – has figured high on the Fed’s inflation-worry list, based on the classic theory that rising wages and salaries will help create demand from consumers that have more money to spend which will help push up inflation; and this additional demand will enable employers to raise their prices to maintain their profit margins as their compensation costs rise, now that consumers are making more money. That would the beginning of the circularity that the Fed frets about. This type of data is precisely what confirms the Fed’s more hawkish bent. And it comes on top of the other factors the Fed has been mentioning in past pronouncements, such as “elevated” asset prices, the “search for yield,” and the risks to “financial stability” that they pose in a highly leveraged financial system. But it’s not the type of data, at least not yet, that will make the Fed deviate from its plan to move “gradually” so that the economy has plenty of time — years, as the first rate hike was over two years ago — to adjust to higher rates and tighter financial conditions. 

10-year Treasury yield tops 3% for first time since 2014, a key interest rate milestone that should ripple through the economy - The yield on the benchmark 10-year Treasury note hit the key psychological level of 3 percent Tuesday for the first time since January 2014.The yield on the two-year Treasury note also set a multiyear record Tuesday, topping 2.5 percent for the first time since September 2008. The yield inched past 3 percent shortly after the open of stock trading, before gyrating slightly downward throughout the session. The yield was at 3 percent as of 5:49 p.m. ET. "It's certainly a psychological level for people," said Gary Pollack, head of fixed-income trading at Deutsche Bank Private Wealth Management. "We have a lot of supply this week, and that's certainly putting pressure on the market ... the quarterly refundings have been settings records."Pollack added that this week's Treasury auctions of two-year, five-year and seven-year notes are likely to set a record in terms of size. Increased supply weighs on bond prices and yields move inversely to those prices.Global investors have been fixated on the 10-year note yield in recent days as it climbed upward, concerned that the 3 percent level could trigger a reaction from financial markets around the world.The yield, a barometer for mortgage rates and other financial instruments, has jumped in April on signs of nascent inflation and as the Federal Reserve stood by its plan to gradually tighten monetary policy. A move in the yield above 2.9 percent in February triggered a correction for U.S. stocks.  Billionaire bond investor Jeffrey Gundlach told CNBC on Monday that if the 10-year yield does crack the 3 percent ceiling, traders may then get the confidence to bid rates even higher.

Chicago Fed "Index points to a moderation in economic growth in March" - From the Chicago Fed: Index points to a moderation in economic growth in March:  Led by slower growth in production- and employment-related indicators, the Chicago Fed National Activity Index (CFNAI) declined to +0.10 in March from +0.98 in February. Three of the four broad categories of indicators that make up the index decreased from February, but two of the four categories made positive contributions to the index in March. The index’s three-month moving average, CFNAI-MA3, decreased to +0.27 in March from +0.31 in February. This graph shows the Chicago Fed National Activity Index (three month moving average) since 1967. This suggests economic activity was above the historical trend in February (using the three-month average). According to the Chicago Fed: The index is a weighted average of 85 indicators of growth in national economic activity drawn from four broad categories of data: 1) production and income; 2) employment, unemployment, and hours; 3) personal consumption and housing; and 4) sales, orders, and inventories.

BEA: Real GDP increased at 2.3% Annualized Rate in Q1 - From the BEA: Gross Domestic Product: First Quarter 2018 (Advance Estimate)Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the first quarter of 2018, according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 2.9 percent. The increase in real GDP in the first quarter reflected positive contributions from nonresidential fixed investment, personal consumption expenditures (PCE), exports, private inventory investment, federal government spending, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.  The deceleration in real GDP growth in the first quarter reflected decelerations in PCE, residential fixed investment, exports, and state and local government spending. These movements were partly offset by an upturn in private inventory investment. Imports, which are a subtraction in the calculation of GDP, decelerated.   The advance Q1 GDP report, with 2.3% annualized growth, was above expectations.Personal consumption expenditures (PCE) increased at 1.1% annualized rate in Q1, down from 4.0% in Q4 (this is weak).   Residential investment (RI) was unchanged in Q1. Equipment investment increased at a 4.7% annualized rate, and investment in non-residential structures increased at a 12.3% pace.

Q1 GDP Advance Estimate: Real GDP at 2.3% --The Advance Estimate for Q1 GDP, to one decimal, came in at 2.3% (2.32% to two decimal places), a decrease from 2.9% for the Q4 Third Estimate. had a consensus of 2.0%. Here is the slightly abbreviated opening text from the Bureau of Economic Analysis news release:Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the first quarter of 2018 (table 1), according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 2.9 percent.The Bureau emphasized that the first-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Advance Estimate” on page 2). The "second" estimate for the first quarter, based on more complete data, will be released on May 30, 2018. [Full Release] Here is a look at Quarterly GDP since Q2 1947. Prior to 1947, GDP was an annual calculation. To be more precise, the chart shows is the annualized percentage change from the preceding quarter in Real (inflation-adjusted) Gross Domestic Product. We've also included recessions, which are determined by the National Bureau of Economic Research (NBER). Also illustrated are the 3.21% average (arithmetic mean) and the 10-year moving average, currently at 1.59%.  Here is a log-scale chart of real GDP with an exponential regression, which helps us understand growth cycles since the 1947 inception of quarterly GDP. The latest number puts us 14.4% below trend.

Q1 GDP Beats Despite Consumption Plunge To 5 Year Low - Q1 GDP was expected to be a big slowdown from the Q4 2017 GDP of 2.9%, mostly as a result of slowing consumption now that the front-loaded, credit-card funded euphoria from Trump's tax cuts is long gone, and that's precisely what happened when moments ago, the BEA reported  that in the first quarter, GDP rose at a 2.3% annualized rate, which while the lowest in the past year, was better than the 2.0% consensus estimate. The increase in real GDP reflected increases in business investment, consumer spending, exports, and inventory investment. Imports, which subtract from GDP, increased in the first quarter of 2018. Looking at the components, the biggest cause for the drop in GDP was the sharp slowdown in personal consumption, which rose only 1.1% in 1Q, in line with expectations, after soaring 4.0% prior quarter, this was the weakest quarter for US consumer spending since 2Q 2013. The other components were generally also in line with expectations:

  • Fixed Investment slumped from 1.31% in Q4 to 0.76%: so much for that CapEx boost.
  • Inventories were the biggest swing factor, adding 0.43% to GDP after subtracting 0.53% in Q4
  • Exports dropped from 0.83% to 0.59%, while Imports subtracted 0.39% from GDP vs -1.99% in Q4. On net, trade contributed 0.20% to GDP, after subtracting -1.2% in Q4.
  • Finally government added 0.2% to Q1 GDP, after boosting Q4 GDP by 0.51%.

On the inflation side, the news was a little "flatter" with the GDP price index rising 2% in 1Q after rising 2.3% in the prior quarter, and missing expectations of a 2.2% print. That said, core PCE rose 2.5% Q/Q in 1Q after rising 1.9% prior quarter, and matched expectations.Overall, prices of goods and services purchased by U.S. residents increased 2.8 percent in the first quarter of 2018, after increasing 2.5 percent in the fourth quarter of 2017. Food prices increased 0.4 percent in the first quarter following an increase of 0.1 percent in the fourth quarter of 2017.     Energy prices increased 12.4 percent in the first quarter of 2018 following an increase of 28.2 percent in the fourth quarter of 2017.  Excluding food and energy, prices increased 2.7 percent in the first quarter of 2018, compared with an increase of 2.0 percent in the fourth quarter of 2017. Overall, this was a solid report, certainly better than expected, and with core PCE rising at 2.5%, it provides the Fed with even more reasons to hike rates in coming meetings.

Q1 2018 GDP downshifts slightly; long leading indicators mixed - This morning's preliminary reading of Q1 2018 GDP at +2.3%, down from the previous quarter's +2.9%, was generally in line with forecasts. As usual, my attention is focused less on where we *are* than where we *will be* in the months and quarters ahead. There are two leading components of the GDP report: real private residential investment and corporate profits. Because the latter will not be released until the second or third revision of the report, I make use of proprietors' income as a more timely if less reliable placeholder. So let's take a look at each. Real private residential fixed investment was flat (blue). Measured by the more precise method of its share of the GDP as a whole (red), residential investment actually declined: According to Prof. Edward Leamer, this typically peaks about 7 quarters before the onset of a recession. As it has not made a new high since four quarters ago, and must be considered a signficant leading indicator of recession at this point. Proprietors' income, on the other hand, rose again in the first quarter. The below graph compares it with the less timely but more accurate corporate profits: Remember that the big decline in corporate profits in Q4 of last year had to do with accounting for repatriation of overseas earnings in the recent tax bill, so right now proprietors income is probably giving us the more accurate, positive, signal. While the economy is very likely to continue to grow through 2018, together this most recent data suggests a more questionable picture heading in 2019. In particular, this is the first important housing metric to roll over to negative. This confirms a note I made when discussing Q4 2017 GDP three months ago, At that time I indicated that I wasn't expecting any big positive breakout. This goes back to the relative flatness or restrained growth in housing. The below two graphs show the leading relationship between housing permits (using the less volatile single family measure) and GDP broken up into two roughly 30 year periods: Since the YoY% change in permits for 2015-17 was roughly 10% (divided by 4 for purposes of scale in the above graphs shows a number of ~2.5%), I wrote that a continued roughly 2.5% YoY growth of GDP for the next few quarters is a reasonable projection.

Q1 GDP: Investment -- NOTE: In the GDP report, real residential investment was unchanged in Q1. But residential investment (RI) as a percent GDP actually increased in Q1! How can that be? The answer is that the price index for residential investment increased sharply in Q1 (up 8.5% annualized). The large increase in the residential investment price index follows what we are hearing from home builders - that material costs have increased sharply (the tariffs haven't helped, but other prices are up too). This hurts both builders and home buyers. The first graph below shows the contribution to GDP from residential investment, equipment and software, and nonresidential structures (3 quarter trailing average). This is important to follow because residential investment tends to lead the economy, equipment and software is generally coincident, and nonresidential structure investment trails the economy.In the graph, red is residential, green is equipment and software, and blue is investment in non-residential structures. So the usual pattern - both into and out of recessions is - red, green, blue.The dashed gray line is the contribution from the change in private inventories. Residential investment (RI) was unchanged in Q1 (0.0% annual rate in Q1).  Equipment investment increased at a 4.7% annual rate, and investment in non-residential structures increased at a 12.3% annual rate.On a 3 quarter trailing average basis, RI (red) is up, equipment (green) is solidly positive, and nonresidential structures (blue) is up slightly. Recently real RI has been soft.  The second graph shows residential investment as a percent of GDP.Residential Investment as a percent of GDP increased in Q1, and RI has generally been increasing.  RI as a percent of GDP is only just above the bottom of the previous recessions - and I expect RI to continue to increase for the next couple of years.The increase is now primarily coming from single family investment and home remodeling.  Note: Residential investment (RI) includes new single family structures, multifamily structures, home improvement, broker's commissions, and a few minor categories. The third graph shows non-residential investment in structures, equipment and "intellectual property products".  Investment in equipment - as a percent of GDP - picked up.

Q1 Real GDP Per Capita: 1.53% Versus the 2.32% Headline Real GDP -- The Advance Estimate for Q1 GDP came in at 2.3% (2.32% to two decimals), down from 2.9% in Q4. With a per-capita adjustment, the headline number is lower at 1.53% to two decimal points.Here is a chart of real GDP per capita growth since 1960. For this analysis, we've chained in today's dollar for the inflation adjustment. The per-capita calculation is based on quarterly aggregates of mid-month population estimates by the Bureau of Economic Analysis, which date from 1959 (hence our 1960 starting date for this chart, even though quarterly GDP has is available since 1947). The population data is available in the FRED series POPTHM. The logarithmic vertical axis ensures that the highlighted contractions have the same relative scale.The chart includes an exponential regression through the data using the Excel GROWTH fu nction to give us a sense of the historical trend. The regression illustrates the fact that the trend since the Great Recession has a visibly lower slope than the long-term trend. In fact, the current GDP per-capita is 9.2% below the pre-recession trend.

The fiscal picture is worse than it looks—and it looks bad - On the surface, CBO’s new projections of the federal debt and deficits over the next 10 years paint a troubling picture. But, dig deeper and the story gets … more dire. The Federal government is not only running enormous deficits, but we are doing so at a time of full-employment. When the inevitable recession comes, we will be in deep trouble. Here’s the bad part:  Under current law, CBO projects that the debt—currently 77 percent as large as annual GDP—will rise to 96 percent of GDP by 2028. And that’s if Congress does nothing. If instead, Congress votes to extend expiring tax provisions—such as the many temporary tax cuts in the 2017 tax overhaul—and maintain spending levels enacted in the budget deal (which is called the “current policy” baseline), debt is projected to rise to 105 percent of GDP by 2028, the highest level ever except for one year during World War II (when it was 106 percent).   Under current policy, Federal budget deficits are projected to average 5.9 percent of GDP over the decade and exceed 7 percent of GDP in 2028.  So, even by a conventional historical comparison of debt and deficits, the prospects look bad. Here’s the worse part: The conventional comparison is misleading. The projected budget deficits in the coming decade are essentially “full-employment” deficits. This is significant because, while budget deficits can be helpful in recessions by providing an economic stimulus, there are good reasons we should be retrenching during good economic times, including the one we are in now. In fact, CBO projects that, over the 2018-2028 period, actual and potential GDP will be equal. As President Kennedy once said “the time to repair the roof is when the sun is shining.”  Instead, we are punching more holes in the fiscal roof.

These economists say a $1 trillion deficit is just a good start - WaPo - Members of both parties are rushing to again sound the alarm about America’s rising deficit, warning of its potentially disastrous impact on the nation’s ­financial health. This month, the Congressional Budget Office estimated that the government’s annual deficit would top $1 trillion by 2020, triggering another round of hand-wringing over the budget gap by Republicans, Democrats, tea party­ers and think tanks of all stripes. But what if they’re all wrong?  That’s the view of a small group of heterodox economists — self-described the “deficit owls” — who say that the deficit does not pose a problem, and that the proposals to rein in the deficit represent the real threat to the nation’s well- being. Deficit spending, they say, has given the government extra money to fund social services, stimulate the economy, and react to natural disasters. And all the dire warnings of a coming crisis, they say, are, at best, well-intended alarmism — and, at worst, a sneak attack on welfare, Medicare and other progressive priorities. “Most of the deficit hysteria is political,” said L. Randall Wray, a senior scholar at the Levy Economics Institute at Bard College. “It’s not about economics. The economy is in no danger whatsoever in the foreseeable future of overheating, which is the only time extra deficit spending could be a problem.” Deficit hawks agree that it’s hard to know when a deficit crisis will occur, but they argue that the consequences are so drastic that even the possibility can’t be on the table. They accuse the owls of playing a dangerous game of debt brinkmanship.  “It’s an unlikely scenario that becomes more likely the bigger and the faster-growing our debt it. But these economists don’t ­really address that risk: They just say it wouldn’t happen, which isn’t very reassuring,” said Marc Goldwein of the Committee for a Responsible Federal Budget.This view is supported by Washington’s most prominent think tanks, with some even giving awards for fiscal hawkishness, and widely accepted by much of Congress. Deficit hawks have a list of threats posed by growing U.S. debt, but the owls have their own answer to each one.

Trump aide urges Congress to pare back bipartisan spending deal (Reuters) - Congress needs to consider rolling back the spending deal that U.S. Republicans brokered with Democrats last month, because lawmakers voted to enact the $1.3 trillion legislation without reading it, an aide to President Donald Trump said on Sunday. White House legislative director Marc Short said the spending bill, which ran to more than 2,000 pages, was rushed into place to avoid a government shutdown. He urged Senate Republican leader Mitch McConnell to consider new “rescissions” legislation with spending cuts sought by fiscal conservatives in the House of Representatives. “Nobody saw the text of the bill within 24 hours, because the process in Congress is broken,” Short told NBC’s “Meet the Press” program. “We would ask the Senate to have patience and look at the package that gets sent up,” Short said. “In many cases, what I think you’ll see us putting forward are dollars that have been left over in programs for years, that are not being utilized.” Some Republicans want a recissions bill that would cut up to $60 billion in non-military spending, funds that were crucial to winning Democratic support. But reopening the bipartisan deal could divide Republicans during a midterm election year in which they are vulnerable to a Democratic surge.  A rescissions vote could also raise the prospect of another embarrassing Republican failure in the 100-seat Senate, which the party controls by only a 51-49 margin. Republican Senator Susan Collins said on Sunday that she would not support a bill that unwinds the bipartisan deal. The Senate was unable to repeal former President Barack Obama’s Affordable Care Act last year, due to opposition from Republican lawmakers including Collins. House Majority leader Kevin McCarthy, whom Ryan has endorsed as his replacement, wants to use a rescissions bill to implement big spending cuts. But McConnell warned last week against rescinding the deal: “You can’t make an agreement one month and say: ‘OK, we really didn’t mean it.”

 Trump’s Tax Cut Follows a Pattern of Poor Vetting at White House -  Pam Martens - It’s increasingly looking like President Trump vetted his tax cut plan about as thoroughly as he vetted his cabinets picks. That is likely to have a serious negative impact on U.S. economic growth, the housing market and consumer spending. Yesterday Trump’s pick to head the Veterans Affairs Administration withdrew his name from consideration after allegations of drinking on the job and wrecking a government car while drunk surfaced in statements made by two dozen of his current and former colleagues. Later in the day, Trump’s Senate-confirmed head of the Environmental Protection Agency, Scott Pruitt, was being grilled at two separate House hearings on his wasteful spending of taxpayer dollars for first class travel to Italy and Morocco, a $43,000 soundproof phone booth for his office despite the agency already having secure facilities, and for accepting a dramatically below-market rate of $50 per night for a condo from the wife of an energy lobbyist who had business before the EPA. Those scandals simply add to a growing list of high-profile flameouts of Trump’s poorly vetted picks. National Security Adviser Michael Flynn lasted just 25 days in the job over his communications with Russia during the Trump transition. He has since pleaded guilty to lying to the FBI. Tom Price, Trump’s pick to head Health and Human Services, resigned after reports surfaced that he had used private planes for travel that cost taxpayers hundreds of thousands of dollars. Then there was Brenda Fitzgerald, Trump’s pick for Director of the CDC (Centers for Disease Control and Prevention). Fitzgerald resigned following a Politico article revealing she had purchased tobacco stock after taking her post. And we can’t forget the resignation of Rob Porter, who was allowed to continue his job as White House Staff Secretary to the President for more than a year, despite being denied proper security clearance.  His resignation came after two ex-wives went public with allegations of physical abuse. Shoving people into positions of power at Federal agencies that were created to protect the public interest based on little more than Trump’s gut instinct that his picks will show him the requisite personal loyalty that he demands is undermining the Federal government’s ability to do its job. And now, on top of all this, the poorly vetted tax cuts are exploding the Federal government’s deficit and pushing up interest rates. That’s a dangerous cocktail for a nation already in deep debt.

Stockman Battles Fox Business: No, the Pentagon Doesn’t Need Its Budget Raised to $700B - David Stockman appears on “Mornings with Maria” (Fox Business Network, Apr. 25, 2018)

Iran Warns North Korea: "Never Negotiate With The United States" - In comments that were clearly intended as a warning to North Korean leader Kim Jong Un and his regime a day after the North announced an unprecedented freeze of its nuclear program ahead of bilateral talks with the US, Iran's outspoken Foreign Minister Mohammad Javad Zarif warned that, by pushing to change the Iran deal, the US was sending a dangerous message: Never negotiate with the United States.  Zarif made his comments, which were reported by Reuters and RT, during a brief meeting with reporters in New York, where he's attending a meeting of the United Nations General Assembly. During the meeting, Zarif accused the US of asking for more from Iran, despite not holding up its end of the bargain. "That’s a very dangerous message to send to the people of Iran, but also to the people of the world – that you should never come to an agreement with the United States because, at the end of the day, the operating principle of the United States is 'what's mine is mine, what's yours is negotiable,'" Zarif said.The Iranian FM also warned Washington’s allies, France and Germany, who have not yet definitively ruled out the possibility of 'amending' the deal, that trying to "appease" US President Donald Trump would be "an exercise in futility." President Trump has offered conflicting signals about whether a US withdrawal from the deal is already a forgone conclusion, or whether the US will still push Congress, its European allies and Iran for some "modifications" before the implicit May 12 deadline. Following reports last month that the administration was heavily leaning toward scrapping the deal, Trump has more recently made it clear that the US's continued support is contingent on three factors: expiring limits on Iran's nuclear program, Tehran's ballistic-missile program - which has long angered the US and Israel - as well as the scope of inspections meant to ensure compliance. Trump is expected to meet with French President Emmanuel Macron and German Chancellor Angela Merkel at the White House this week. When asked if Iran would consider remaining in the deal even if the US withdraws, Zarif said it was "highly unlikely". He added that Iran might consider filing a complaint through a mechanism set up by the deal - but more likely Iran would simply restart its nuclear enrichment program, which he insisted was not intended to develop a nuclear weapon

 Yes, Trump and Kim Can Make a Deal That’s Good for Everyone --What’s going to happen when U.S. President Donald Trump and North Korean leader Kim Jong Un finally get together? I don’t know, and neither does anyone else.  Normally you’d expect the two sides to have worked out the outlines of the agreement before the two heads of state sat down together, but that’s unlikely to be the case this time — which means almost anything could happen. An obvious complication is that we are dealing here with two leaders who can’t be trusted at all. North Korea has a long history of lies, prevarications, double-dealing, norm-breaking, and otherwise deceptive behavior, and there’s no reason to take anything Kim or his associates might say at face value. Unfortunately, the current U.S. president is also a proven and chronic liar with a trail of bankruptcies, lawsuits, disgruntled former business partners, and betrayed associates in his past. And it’s not like he suddenly became a truth-teller when he took the oath of office. I guess you could say the two leaders are on equal footing: Neither has any reason to believe a word the other says. Thus far, however, Kim seems to have been the wilier of the two.  The young leader of North Korea is getting a personal, one-on-one meeting with the U.S. president, in the full glare of the international media, with Trump treating him as an equal. He’s already gotten Trump to give him something significant — a face-to-face summit meeting — without surrendering a thing to get it. (Contrary to the administration’s spin, North Korea has made no solid commitments to do anything in advance of the meeting.) Kim Jong Il, the current North Korean leader’s late father, never earned such a privilege, and neither did his grandfather Kim Il Sung. Instead of Kim being seen as the isolated, mysterious, and slightly wacky head of a hermit kingdom, this meeting is a big step toward legitimizing Kim as a significant figure on the world stage. He may be doing this because sanctions are getting to him, or because he fears a U.S. attack, but at this point in the game the score is Kim 1, Trump 0.

Middle East Nightmare, Made in Washington - Even under one of the most rhetorically aggressive leaderships that it has ever had, the United States maintains a rational approach in dealing with nuclear North Korea. Its plans for a meeting between the two heads of state, reflected in the visit of CIA director Mike Pompeo to Pyongyang, attests to Washington’s intent to scale back confrontation.Yet at the same time President Trump’s administration displays a worrying recklessness in stoking a potential confrontation with Iran, playing against and manipulating Saudi fears.North Korea’s “rocket man”, as Trump dubbed Kim Jong-un in his speech at the United Nations in September 2017, is by most measures more dangerous than the Iranian leadership. Without downplaying the perils of Iran’s ideological drive and expansive regional foreign policy, Tehran’s politics are guided by national interest and rational calculations that are not exclusively led by ideology. Why then does the US avoid investing effort and diplomacy to save the already devastated Middle East from yet another threatening war, this time between Saudi Arabia and Israel on the one side and Iran on the other? Instead, Trump is actually paving the way for such a confrontation with his plans to revoke the nuclear agreement that his predecessor Barack Obama managed to conclude with the Iranians. Why should this be? The reasons include the US’s interest in maintaining lucrative arms deals with the Gulf states, primarily Saudi Arabia, and many US leaders’ support for bombing Iran (as demanded by the right-wing Israeli leadership). With regards to the first, Trump has never hidden his intentions to milk the Saudis to the max. In his televised meeting with the Saudi crown prince Mohamed bin Salman (MBS), Trump voiced the hope that in 2018-19 alone the value of arms deals with the Saudis will exceed $700 billion. Continuing to inflame Saudi fears towards Iran is the best guarantee of those current and future deals. Any diplomatic track that might offset such fears would be far less profitable.

Weapons Inspector Refutes U.S. Syria Chemical Claims - (interview) Scott Ritter is arguably the most experienced American weapons inspector and in this interview with Dennis J. Bernstein he levels a frank assessment of U.S. government assertions about chemical weapons use. Ritter was one of the groundbreakers in developing on-site inspection techniques and methodologies. With this unique experience behind him, Ritter was asked in 1991, at the end of the Gulf War, to join the United Nations Special Commission, which was tasked by the Security Council to oversee the disarmament of Iraq’s weapons of mass destruction.  From 1991 to 1998, Ritter served as a chief weapons inspector and led a number of teams into Iraq. According to Ritter, in the following Flashpoints Radio interview with Dennis Bernstein conducted on April 23rd, US, British and French claims that the Syrian Government used chemical weapons against civilians last month appear to be totally bogus.

MSM Is Frantically Attacking Dissenting Syria Narratives, And It Looks Really Bad - Caitlin Johnstone -- I write a lot about how, in a political environment that is saturated in disinformation and propaganda, it’s important to ignore people’s words and watch their actions instead to get a clear picture of what’s really happening. You could not ask for a better illustration of this than the recent behavior of the mass media with regard to Syria.The always excellent Moon of Alabama put out a piece yesterday detailing the immense deluge of attack editorials disguised as information that have been churned out recently about anyone who questions the establishment Syria narrative, including a single day in which no less than seven smear pieces were issued by prominent publications. Seven. In one day.If you look at the words within these smear pieces, you will gather that there has been a sudden disturbing emergence of evil bloggers, tweeters and activists who are hell bent on deceiving you into falling in love with Bashar al-Assad and pledging allegiance to the Russian flag. If you look at what these outlets are actually doing, however, you see a very different picture indeed: an aggressive, spurious campaign to inoculate the English-speaking world against the influence of anyone who disagrees with yet another war against yet another Middle Eastern country. And people are noticing. It’s getting too blatantly obvious, like a stranger coming up to you and talking about climate change while openly masturbating; what he is doing would eclipse interest in whatever he is saying. The frenetic publication of hit pieces against anyone who fails to fall in line with the establishment Syria narrative is fast becoming the real story here.

GOP anxiety grows over Trump’s Iran decision | TheHill: President Trump’s threat to pull out of the Iran nuclear deal is causing anxiety on Capitol Hill, including among GOP lawmakers who opposed the pact but fear there will be grave consequences from withdrawing. Trump has sent mixed signals about what he will do after May 12, the next deadline to recertify what he on Tuesday derided as an “insane” and “ridiculous” agreement with Iran. Republican lawmakers are divided over what Trump should do.Some fear that pulling out of the deal would result in Iran accelerating its weapons programs. They also worry the move will alienate key U.S. allies and make it tougher for Trump to negotiate a nuclear deal with North Korea. Trump hinted at a possible shift on Tuesday after meeting with French President Emmanuel Macron, who is lobbying to keep the United States in the deal. “Nobody knows what I’m going to do on the 12th, although Mr. President, you have a pretty good idea,” Trump said to Macron at a joint press conference. Macron replied with a wink. While Trump slammed the Obama-era agreement, he also said he’s open to a new deal that strengthens and extends some of its terms. That’s music to the ears of those Republicans who want Trump to stick with the deal and work with allies to improve it. Sen. Rand Paul (R-Ky.) didn’t support the agreement, but said it doesn’t make sense for Trump to withdraw now. “I think it’s a bad idea,” Paul said of quitting the accord, which the U.S. negotiated with France, Germany, Britain, China, Russia and the European Union. “This was a multilateral deal, and the reason sanctions work against Iran is because we were unified in negotiating the deal.” 

In Washington, Macron calls for renegotiation of nuclear deal with Iran --On Tuesday, on the second day of his three-day state visit to Washington, French President Emmanuel Macron held a joint press conference with US President Donald Trump to discuss the content of their talks on the Middle East and global trade. At the press briefing, Macron sought to adapt to Trump’s threats to scrap the 2015 Iranian nuclear treaty and pledged France’s continued support for US wars in the Middle East.Paris is joining Washington in telling Iran it must comply with US dictates in the Middle East or face the renewal of trade sanctions that were in place before the signing of the treaty and the possibility of military attack. Despite the debacle of the seven-year NATO proxy war for regime change in Syria, the US and France, the former colonial overlord of Syria, cannot accept any strengthening of the position of Iran, the Syrian regime’s key backer alongside Russia. Instead, barely 10 days after the US-UK-French missile strike on Syria, they are paving the way for a renewed military confrontation with Syria, Iran and nuclear-armed Russia. The move was a significant shift by Macron, who has publicly supported the Iranian nuclear deal and, in an interview with Fox News prior to his visit, claimed there was no “plan B” to replace it. This position received statements of support from governments around the world. Russian Foreign Minister Sergei Lavrov, on a visit to Beijing, said that he and his Chinese counterparts would oppose any attempt to scrap the deal. Key US allies also opposed terminating the agreement. British Foreign Secretary Boris Johnson stressed his “strong view” in favor of the treaty, and German Foreign Minister Heiko Maas warned that ditching the Iranian nuclear treaty would have dangerous consequences for the military situation in the Middle East. “We believe it is extremely important to uphold this agreement,” he declared. “Were it to fail or the US to drop out, we would not have anything comparable to it and we fear that the situation would significantly deteriorate, with everything that goes with it.”

 Macron Tells Trump To Reject Nationalism; Says France Will Not Leave Iran Deal --Speaking before a joint meeting of Congress on Tuesday, French president Emmanuel Macron reiterated that Paris wants to work on a new nuclear deal with Iran, which as we discussed earlier prompted confusion and anger among his European allies, and that France is not going to withdraw from the Iranian nuclear deal, also known as the Joint Comprehensive Plan of Action, which was signed in 2015 by president Obama and remains his landmark foreign policy achievement. "France will not leave the JCPOA because we've signed it," Macron said. "We can work on a more comprehensive deal."  Macron's vow followed statement from the US State Department and EU foreign police chief Federica Mogherini, who reiterated their commitment to the agreement.  On Tuesday, Macron prompted a drop in the price of oil, when during a joint presser with Donald Trump he urged the US president not to "tear apart" the current deal, instead advising to build on it to develop a broader deal. He noted that Paris wanted to work on a new nuclear deal with Iran that would include international players like Russia and Turkey. Macron has pushed for a new approach that would see the United States and Europe agree to block any Iranian nuclear activity until 2025 and beyond, address Iran’s ballistic missile program and generate conditions for a political solution to contain Iran in Yemen, Syria, Iraq and Lebanon.  Trump, who has consistently criticized the 2015 deal and called the accord, which stipulates the gradual lifting of anti-Tehran sanctions in exchange for Iran maintaining the peaceful nature of its nuclear program, the “worst deal ever", last October, Trump refused to re-certify the nuclear deal, accusing Tehran of violating the spirit of the agreement.

 Macron’s Pitch to Trump on a ‘New’ Iran Deal Surprises EU Allies - French President Emmanuel Macron is pushing the limits of international diplomacy, as his last-ditch appeal to salvage the Iran nuclear deal wrong-footed European allies and was met with intransigence by U.S. President Donald Trump. Macron, who has sought to cultivate a personal bond with Trump, made his Iran pitch the centerpiece of his visit to the White House: If the U.S. preserved the existing nuclear accord, that could serve as the cornerstone of a new, expanded deal that would address the Islamic Republic’s ballistic missile program and destabilizing behavior across the Middle East. That case ran headlong into Trump’s competing instincts on foreign policy and caught fellow European powers off guard. Coordination within the European Union took place before Macron left for Washington, but once there the French president introduced elements that hadn’t been discussed in advance, according to two EU officials. The French will need to brief the rest of the EU on those issues, said the officials, who asked not to be named discussing strategy. Macron’s hope is to stave off an American withdrawal next month from the six-party agreement to freeze Iran’s nuclear weapons program. The French leader sought to tempt his American counterpart with the promise of future diplomacy that would not only repair flaws Trump perceives in the original agreement, negotiated by the Obama administration, but resolve a range of security headaches across the Middle East.Trump seemed at least somewhat interested in Macron’s blueprint, calling it a “new deal” with “solid foundations.” Teams of American negotiators have been working with European allies for weeks on a new accord along the lines of what Macron laid out.James Slack, Prime Minister Theresa May’s spokesman, said the U.K. was coordinating closely with its allies “on how to address the range of challenges Iran poses in the Middle East including those President Macron proposed a new deal might cover.”Germany gave a guarded response, saying that upholding the nuclear accord with Iran remains the priority even as Macron floats a broader regional solution. “One has to take a closer look at this proposal,” Foreign Ministry spokesman Rainer Breul told reporters in Berlin. “A new nuclear accord isn’t on the agenda.”

Macron Says His ‘Bet’ Is That Trump Will Withdraw From Iran Nuclear Pact – — French President Emmanuel Macron said it was his “bet” that President Donald Trump would withdraw the U.S. from the Iran nuclear deal, a move he said would lead to a period of heightened tensions with an outcome that was hard to predict. Mr. Macron traveled to Washington this week hoping to persuade Mr. Trump to stay in the 2015 accord, under which Iran agreed to curb its nuclear program in exchange for sanctions relief. Germany’s Chancellor Angela Merkel is bringing a similar case to Washington Friday. After meeting with Mr. Trump on Tuesday, Mr. Macron laid out a proposal for an expanded agreement with Iran. He said Wednesday that this so-called new deal was designed to provide a framework for discussions and not leave a void should Mr. Trump decide by his May 12 deadline to withdraw.Earlier Wednesday he told a joint meeting of Congress that France wouldn’t leave the deal without a viable replacement.Speaking to a small group of reporters Wednesday afternoon, Mr. Macron said he didn’t know what Mr. Trump would decide but “I think he will get rid of it on his own.” He added that the tension a U.S. withdrawal would inevitably create “could be fruitful, if we avoid an increasing tension going to war.”Mr. Trump set a May 12 deadline by which he demanded Europe and Congress must address his concerns with the accord on inspections, expiring restrictions on Iran’s nuclear program and ballistic missiles. Officials from the U.S., France, Germany and the U.K. have been meeting since January to reach a side agreement on these concerns to try to persuade Mr. Trump not to leave the deal.Mr. Macron said he warned Mr. Trump that if he withdrew from the agreement without an alternative, “you open Pandora’s box” and “replicate past mistakes” in the region, including a heightened possibility of war with Iran. On Tuesday, Mr. Trump said no one knows what he will do about the accord, but said to Mr. Macron, “you have a pretty good idea.”

Addressing US Congress, Macron backs neocolonial carve-up of Middle East -- Emmanuel Macron’s address to a joint session of the US Congress on Wednesday was one of the most belligerent public statements ever made by a French president. Hailing the unprovoked bombing of Syria on April 14 by Washington, London and Paris as a model for a new world order in the 21st century, Macron declared his support for US war threats against Iran, North Korea and beyond.The address capped off Macron’s three-day state visit to Washington, amid the deepest crisis of the trans-Atlantic alliance since the end of World War II. Panic is mounting in European ruling circles over US moves to slap trade tariffs on European and Chinese goods, threatening a spiral of retaliation and a global trade war, and Washington’s announced plans to cancel the Iranian nuclear treaty, threatening the eruption of war throughout the entire Middle East. Yet Macron had nothing to propose save more calls for aggressive military action, covered over with hollow bombast about the defense of democracy. Macron’s rhetoric about Washington and Paris carrying out an eternal war for democracy, which takes the form in our epoch of a “war on terror” against Islamist groups, is a pack of lies. The trade rivalries between major US and European corporations, and US-European conflicts over whether to break Europe’s economic ties with Iran and risk war in the Middle East, are not conflicts to save democracy from terrorism. They are inter-imperialist conflicts rooted, as the great 20th century Marxists explained, in the violently clashing interests of rival nationally based capitalist ruling classes. Macron proceeded to contradict his own fraudulent presentation. He appealed to Washington to drop its threats of trade war and coordinate its war policies more closely with Europe—not in order to fight terrorism, but to preserve the dominant role played in world politics by the imperialist powers against unnamed great-power rivals. He said, “We have two possible ways ahead. We can choose isolationism, withdrawal and nationalism. This is an option. It can be tempting to us as a temporary remedy to our fears. But closing the door to the world will not stop the evolution of the world… Other powers with a stronger strategy and ambition would then fill the void we would leave empty. Other powers will not hesitate once again to advocate their own model to shape the 21st century global order.”

The Macron-Trump Summit and the Dandruff Factor - The summit this week in Washington, D.C., between Presidents Emmanuel Macron and Donald Trump has caused an anxious transatlantic exchange between Francophile Americans and French observers of American life over a singular and urgent issue: the proper French translation for the word “dandruff.” The dictionary suggests “pellicules,” but that word, meaning film, or flakes, is far more generalized, and broadly applicable to things besides ugly hair-snow. This implies either that the French have a less particularized relationship with the problem—which rings true; I can’t recall hearing it mentioned often as a problem in France—or that Americans have a specially fraught one with it, which also rings true. Though the condition exists in France, it is governed by the typically French taste for fine discriminations: they don’t treat it as a simple shoulder plague but as a subject for quasi-medical distinctions. (“There exist many kinds of flakes,” one French magazine reports, “including fatty flakes and drier flakes, according to the nature of the particular epidermis.”) Certainly, Donald Trump’s decision on Tuesday, in the Oval Office, to ostentatiously remove a pellicule sèche from President Macron’s jacket was interpreted in France, as it was here, as one more bit of primitive theatricalizing on Trump’s part—a primate dominance display. (Among primates, the less dominant tend to groom the more dominant, though Trump clearly intended his housekeeping to indicate his, well, right to intervene.) But Macron’s ability to, so to speak, brush it off was part of his well-considered long-range manipulation of Trump. It was obvious, and became still more so during Macron’s joint address to Congress, on Wednesday morning, that he sees himself as a kind of wise, old-world counsellor to Trump. He seems to read Trump not as a diehard nationalist authoritarian, with whom no reasonable business can or should be done, but, rather, as one would read a typical American tourist in Paris. That was clearly the measure that Macron took of Trump at the Bastille Day parade last year: not very bright, shallow, but not necessarily possessed of evil instincts if he can be gently cajoled into civilized behavior.

After Macron high, Trump’s Merkel comedown — Au revoir, Macron. Now it’s the bad cop’s turn. After days of pomp, kisses, lavish dinners and a picture-perfect tree planting, U.S. President Donald Trump is about to be confronted with Europe’s sterner side, courtesy of Angela Merkel. When the president sits down opposite the German chancellor in the White House on Friday, the niceties will be kept to a minimum. Unlike French President Emmanuel Macron, Merkel will not be rubbing elbows (either literally or figuratively) with Trump. There will be no white hats. Berlin has stressed that the three-hour meeting will be a “working session.” Their previous encounters would suggest Trump and Merkel are more than happy to keep it that way. The pair went five months without even speaking to one another on the phone, a dry spell that only ended in March. “In a number of important areas, we are now considered by the Americans to be an unreliable partner” — Jan Techau, director at the German Marshall Fund of the U.S. Whether the issue is climate, trade or NATO, there’s not much the pair can agree on. Nonetheless, Merkel has no choice but to try and make the relationship work. The main aim of her Washington mission might best be described as damage control. In contrast to Macron, who took advantage of his camaraderie with the U.S. president to strike a more critical chord about Trump’s leadership, Merkel will stick to brass tacks. “We have a divide on the policy side and a lack of chemistry between the two leaders, the two main political actors, on the personal side.” The difficulty for Merkel is that Germany needs the U.S. as much as ever, especially when it comes to trade. German industry exports more to the U.S. than to any other country — nearly €112 billion worth of goods in 2017 alone. The cars and machinery Germany sells to the U.S. are the core of its economy and, by extension, Europe’s. 

Lead US negotiator says Iran deal's 'weak status' allows US to walk away -- The US is prepared to walk away from the Iran nuclear deal if it cannot reach a side agreement with Europe to toughen the terms, the lead US negotiator in the talks said Wednesday in an interview on NPR. Iranian President Hassan Rouhani warned earlier Wednesday that his country would leave the deal if the US tries to renegotiate the terms. Brian Hook, the US State Department's director for policy planning, said the US and European allies can strike a supplemental agreement without violating the original nuclear deal, called the Joint Comprehensive Plan of Action. "This JCPOA is not a treaty," Hook told NPR. "It's not an executive agreement, it has no signatures, it has no legal status. It is a political commitment by an administration that's no longer in office." Up to 1 million b/d of Iranian exports are at stake in US President Donald Trump's May 12 deadline to decide whether to continue waiving sanctions. Iran has doubled its crude exports to about 2.2 million-2.3 million b/d since the deal took effect in January 2016. Hook said the JCPOA has "this weak status" because of a number of deficiencies that prevented it from receiving enough votes in the US Senate "to make it something permanent and enduring

Iran threatens JCPOA withdrawal if Western powers renegotiate terms - Any renegotiation of the nuclear deal by Western powers would be a violation of its terms and prompt Iran's withdrawal from the agreement, President Hassan Rouhani said Wednesday. The comments came after US President Donald Trump -- who has repeatedly threatened to undo the deal and reimpose sanctions that could impact up to 1 million b/d of Iranian oil exports -- and French President Emmanuel Macron signaled Tuesday some potential changes that would preserve the agreement but add new restrictions on Iran. "The US president says he wants to make a decision with some European leader for a seven-party deal," Rouhani said in a speech in Tabriz, northwestern Iran. "He has no right to make such a decision." Trump should abide by the deal the Obama administration signed, known as the Joint Comprehensive Plan of Action and under which Iran made concessions on its nuclear program in exchange for sanctions waivers that lifted restrictions on sales of Iranian crude, among other things, Rouhani said. "How today can someone who has no clue about politics and international pacts, and is a businessman and tower builder, opine about international issues?" Rouhani said. Iranian Rear Admiral Ali Shamkhani, secretary of the Supreme National Security Council, said Wednesday that renegotiation of the terms of the deal "means destruction of the JCPOA", having said Tuesday Iran could withdraw not only from the nuclear deal but also the UN Treaty on the Non-Proliferation of Nuclear Weapons. "Any agreement by Europe and the US about the future of the JCPOA and Iran's nuclear program for a period after the defined limits set in the JCPOA has no value and validity in our view," Shamkhani was quoted as saying Wednesday at an international summit in Sochi, Russia, by the official IRNA news agency. 

Iranian Naval Commander Threatens To Sink US Ships, Create "Catastrophic Situation" If Trump Kills Deal - President Donald Trump offered some of his most bellicose rhetoric yet about Iran on Tuesday when he said Iran would have "bigger problems than they have ever had before" if the country's leadership dared to restart its nuclear program following a US pull-out of the JCPOA (otherwise known as the Iran deal), per the Times of Israel.And today, a top Iranian general hit back at Trump with an aggressive threat to sink US Navy ships, while warning that the US would find itself in a "catastrophic situation" if it withdraws from the deal and reimposes economic sanctions."The actual information that the Americans have about us is much less than what they think they have. When will they figure this out? When it is too late," the Revolutionary Guard Corps’s navy commander, Admiral Ali Fadavim, told Iranian television on Saturday."They will definitely figure it out when their ships are sunk, or when they find themselves in a catastrophic situation," Fadavi threatened in an interview with IRINN TV, according to a translation by the Middle East Media Research Institute.On Wednesday, a non-proliferation envoy confirmed that the US isn't seeking to renegotiate the JCPOA. Instead, the White House would like to pursue a separate agreement like the one French President Emmanuel Macron proposed during a press conference with Trump. And apparently, Macron's proposal took his European partners by surprise. Admiral Fadavim's remarks followed a similarly stern warning from Iranian President Hassan Rouhani.

Rand Paul Will Support Mike Pompeo for Secretary of State -- After weeks of suggesting he would vote against the appointment of CIA Director Mike Pompeo as secretary of state, Sen. Rand Paul (R-Ky.) flipped on Monday afternoon and now says he will support Pompeo's appointment. The reversal likely smooths Pompeo's path to confirmation in the Senate, where Paul and Sen. Jeff Flake (R-Ariz.) were two crucial GOP hold-outs.Paul, on Twitter, said he was convinced to support Pompeo's appointment after several conversations with President Donald Trump. Paul wrote that he "received confirmation the Director Pompeo agrees" with the president that "the Iraq war was a mistake, and that it is time to leave Afghanistan."With those assurances from the president, who has never changed mind or gone back on a promise, Paul said he was ready to deliver an affirmative vote for Pompeo.Paul had pressed Pompeo on Afghanistan during a confirmation hearing in the Senate Foreign Relations Committee earlier this month. Pompeo said at the time that he "shared the president's view" that it was not yet time for the military to leave the Central Asian nation where the United States has been engaged since shortly after the 9/11 attacks, more than 16 years ago. But Paul faced significant political pressure from the White House to back Pompeo's confirmation. "I still think it's hard for Rand Paul to explain to Kentucky voters how he voted 'yes' for John Kerry for Secretary of State and 'no' for Mike Pompeo," Marc Short, a top legislative liaison for the White House, told Axios' Jonathan Swan over the weekend.

Senate panel narrowly endorses Mike Pompeo for secretary of state after Trump intervenes with key Republican - Secretary of state nominee Mike Pompeo narrowly eked out an endorsement from the Senate Foreign Relations Committee on Monday after President Trump and a Democratic senator intervened at the last minute, all but guaranteeing that he will be confirmed by the full Senate later this week. Pompeo had seemed unlikely to secure a majority of the panel’s support. But Sen. Rand Paul (R-Ky.), who had pledged to oppose him, tweeted moments before the vote that Trump had talked with him and changed his mind. Paul’s key concern had been that Pompeo, currently director of the CIA, would not support Trump’s campaign pledge to pull troops out of Afghanistan. The senator also had called on Pompeo “to support President Trump’s belief that the Iraq war was a mistake.” “Having received assurances from President Trump and Director Pompeo that he agrees with the President on these important issues, I have decided to support his nomination to be our next secretary of state,” Paul said. The panel’s vote was largely symbolic, since Pompeo had secured enough votes to be confirmed by the full Senate earlier in the day, when two Democrats facing difficult reelection challenges in 2018 — Sens. Joe Manchin III (W.Va.) and Joe Donnelly (D-Ind.) — announced that they would back his nomination on the floor. But Trump’s supporters were determined to have Pompeo enter office without the mark of being the first secretary of state in almost a century to fail a committee vote.

Democrats assure confirmation of CIA head as secretary of state - Following Monday’s party-line vote by the Senate Foreign Relations Committee to recommend that the full Senate confirm his nomination, CIA Director Mike Pompeo is set to become secretary of state in time to attend a Friday meeting of NATO foreign ministers in Brussels. Floor debate on the nomination is scheduled Wednesday, and a vote is expected on Thursday. Pompeo’s confirmation was assured regardless of the outcome of Monday evening’s vote on the Foreign Relations Committee because three Senate Democrats had already announced that they would vote for the far-right former congressman from Kansas when the issue came up for a vote by the full chamber. With the confirmation of Pompeo as head of the State Department, joining the equally right-wing and militaristic John Bolton, who this month replaced Gen. H. R. McMaster as national security adviser to President Trump, the administration’s foreign policy team has become even more reckless and war-mongering. Pompeo, a Tea Party Republican and mouthpiece for the billionaire Koch Brothers, and Bolton, a protégé of the fascistic North Carolina Senator Jesse Helms, have advocated war against both Iran and North Korea and a more aggressive and provocative posture toward Russia and China.  Their elevation accelerates a trajectory toward a wider war in Syria and the Middle East, leading inexorably to war with nuclear-armed Russia and China. Pompeo’s confirmation is the outcome of a fraudulent charade of opposition mounted over the past several weeks by the Democratic Party. In fact, the party leadership had no intention of blocking his installation. It staged a show of resistance while ensuring that a sufficient number of Democrats would cast “yes” votes to guarantee Pompeo’s installation.

Senate Confirms C.I.A. Chief Mike Pompeo to Be Secretary of State - — The Senate easily confirmed Mike Pompeo on Thursday as the United States’ 70th secretary of state, elevating the current C.I.A. director and an outspoken foreign policy hawk to be the nation’s top diplomat.In the end, the 57-to-42 tally lacked the drama of other nail-biting confirmation votes in the Trump era. This week, Senator Rand Paul of Kentucky, the nominee’s main Republican antagonist, bowed to pressure from President Trump to drop his objections. Ultimately, seven members of the Senate Democratic caucus — five of whom face re-election this year in states that Mr. Trump won in 2016 — joined a united Republican conference to support Mr. Pompeo’s confirmation.  Shortly after the vote at the Capitol, Mr. Pompeo went across the street to the Supreme Court, where he was sworn in by Justice Samuel A. Alito Jr. Mr. Pompeo then dashed to Joint Base Andrews, where a plane was waiting to fly him to Brussels for a meeting of NATO allies. Senior staff on the plane greeted him with applause. Over the next three days, he will also travel to Riyadh, Saudi Arabia; Jerusalem; and Amman, Jordan. Rex W. Tillerson, Mr. Pompeo’s predecessor, never went to Jerusalem out of deference to Jared Kushner, the president’s son-in-law and senior adviser, whose portfolio included an effort to negotiate a peace deal between Israelis and Palestinians.

 Dems slam CIA offer to view classified Haspel records - The CIA is proposing to let senators weighing Gina Haspel's nomination to lead the spy agency view classified material about her record in a secure setting, an offer quickly dismissed as insufficient by Democrats seeking more transparency about Haspel's past.The CIA released a disciplinary memo late last week that absolved Haspel, a longtime agency veteran who now serves as deputy director, of any improper behavior regarding the destruction of videotapes depicting brutal interrogations of detained terrorism suspects. But Democrats have continued to push for more disclosure of Haspel's role in the George W. Bush-era use of interrogation tactics criticized as torture — and are demanding that more information be declassified and made available to the public. Senate Intelligence Committee Vice Chairman Mark Warner (D-Va.) issued a fresh request for Haspel-related material Tuesday. Warner asked Attorney General Jeff Sessions for access to the Department of Justice's investigative report that resulted in a decision not to pursue charges against any CIA officials involved in the destruction of the tapes.A copy of the DOJ report by special prosecutor John Durham "would be helpful to understand Ms. Haspel's role" in the decision to destroy the interrogation tapes, Warner wrote to Sessions in his letter, a copy of which was obtained by POLITICO. The CIA offered a compromise in a Tuesday letter to Sens. Ron Wyden (D-Ore.), Martin Heinrich (D-N.M.), and Dianne Feinstein (D-Calif.), intelligence committee members who have sought further declassification of Haspel-related records. A CIA official said the agency is "prepared to make classified background materials available in the Office of Senate Security for review by senators considering her nomination."

In Surprise Twist, Europe Now Pushing Trump Administration To Ease Russian Sanctions - Something strange happened in the days immediately preceding Trump's airstrikes on Syria: first Germany, then Italy, refused to join the US-led effort, which ultimately also included the UK and France. Commenting on this curious split within the European core, we said that "there are at least two European nations who remember that when it gets cold in the winter, there is one country they call to provide the natural gas they need for heating. Russia" Fast forward two weeks, and it now appears that most of Europe has also remembered just how critical Russia is to the well-being of the continent, because according to the FT, a Europe-wide diplomatic push is under way to persuade the Trump administration to ease US sanctions targeting Russia, amid growing fears that the restrictions are so severe they threaten unleashing another economic recession across the continent.In a stark reminder that every political action has an unexpected - and usually unpleasant - reaction, Paris, which is in charge of coordinating the anti-sanction effort after business limits on Russian metals companies caused aluminium and nickel prices to soar, "is pushing allies including Berlin, London and Rome to make a joint representation in Washington." As the FT adds, the French-led initiative underscores the widening concern in Europe about the consequences that sanctions could have on key EU industries from cars to aerospace.  Echoing what we said almost two weeks ago when commenting on the Rusal sanctions, a French official warned that the sanctions, which have crippled Russian aluminium producer Rusal, would have a “direct and major impact on the provisioning of key products” and that a number of industrial plants in Europe were threatened with closure. The push for a US truce with Russia - which is taking place under the administration which ironically has been alleged to have colluded with Putin to win the election - comes ahead of separate visits to Washington next week by the two leaders of Europe, German chancellor Angela Merkel and French President Emmanuel Macron. They will meet President Trump as part of broader diplomatic efforts to soothe transatlantic relations, already strained by tension over planned US tariffs on steel and aluminium.

US issues ultimatums to IMF on trade - The growing dangers of trade war dominated the meeting of the International Monetary Fund held in Washington over the weekend. Despite warnings from the leaders of the fund and from major IMF member states that its actions are threatening the global economy, the US is stepping up its demands.The increased US pressure was spelled out in a formal statement issued by US Treasury Secretary Steven Mnuchin to the fund’s governing committee demanding that it do more to reduce large surpluses of countries that trade with the US, such as Germany and China.Adopting the tone of an overlord, he insisted that the IMF back the US in its drive against what it claims are “unfair global trade practices” that impede stronger US growth. He declared that the IMF should be a “strong voice for its members to dismantle trade and non-trade barriers and protect intellectual property rights.”In line with its “America First” agenda, the Trump administration regards the move by China to develop its high-tech industries in the fields of telecommunications, robotics and artificial intelligence as a threat to both US economic and military supremacy. It denounces China for “stealing” US know-how.Addressing the issue of global imbalances—the US trade deficit of $375 billion and the large surpluses of a number of other major economies—Mnuchin’s statement said these were a third larger than in the 1980s and 1990s “and there is no indication they are narrowing.” “The IMF must step up to the plate on this issue,” he said, “providing a more robust voice and consistently noting when members maintain macroeconomic, foreign exchange and trade policies that maintain unfair competitive advantage or lead to imbalanced growth.”

Beijing Welcomes Mnuchin Visit As US Hints At China Trade-War Truce - Following a barrage of warnings that protectionism could unleash stagflation in the US economy, with the latest Beige Book mentioning the word "tariff"  no less than 36 times in the context of higher prices and slower growth, the US Treasury appears eager to ease back on the growing trade war with China, and overnight Treasury Secretary Steven Mnuchin said he is considering a trip to China amid a growing trade dispute that could affect as much as $150 billion in bilateral trade with Beijing, and which central bankers warn could derail a global economic upswing (and also provide them with a perfect excuse to delay tightening).Speaking on Saturday in Washington at the IMF’s spring meetings Mnuchin said he’s "cautiously optimistic" of reaching an agreement with China that bridges their differences over trade, and added that a trip to China "is under consideration." Still, any possibility of a quick truce remains remote as Mnuchin admitted: "I’m not going to make a comment on timing, nor do I have anything confirmed."On Sunday, China’s Commerce Ministry responded that it is aware of and welcomed plans by top U.S. officials to visit the country to discuss trade and economic issues.“The Chinese side has received information that the U.S. side hopes to come to Beijing to discuss economic and trade issues. China welcomes this,” a short statement on the commerce ministry’s website said. As Bloomberg adds, a visit by the U.S. Treasury secretary to China could signal a breakthrough in the spat between the world’s two-biggest economies, whose threats to slap tariffs on each other have rattled markets and raised fears of a trade war. It would also come at a sensitive time for the region’s geopolitics, with negotiations under way on a planned meeting between President Donald Trump and North Korean leader Kim Jong-Un.

US and China to hold trade talks as tariff deadline looms -- US Treasury Secretary Steven Mnuchin will travel to China for trade discussions, possibly next week, ahead of the planned imposition of tariffs on up to $150 billion worth of Chinese goods, due to come into effect by the end of May.Speaking on the negotiations during a press briefing with visiting French President Emmanuel Macron, President Donald Trump said there was “very good chance of making a deal.” But if no agreement were reached, the US would proceed with “very substantial tariffs” on Chinese imports.Mnuchin first raised the possibility of a visit during the International Monetary Fund meetings last weekend. According to a Wall Street Journal report, he initially planned to make a visit on his own. But the negotiating team will include US Trade Representative Robert Lighthizer and possibly White House trade adviser Peter Navarro, both of whom are regarded as “hawks” on the issue of China trade.According to the Journal’s report, the composition of the team “reflects divisions within the administration.” Mnunchin regarded as significant the recent speech by Chinese President Xi Jinping, offering concessions on restrictions on foreign auto firms and investment rules, while Lighthizer and Navarro considered that view to be naïve.In the event, Mnuchin heads the team but he will be accompanied by what could be described as “minders.” The divisions are such that Scott Kennedy, a China specialist at the Washington-based Center for Strategic and International Studies, said his concern was that “the primary negotiations in Beijing will be between members of the American team rather than between the Americans and Chinese.” There is considerable doubt as to whether the talks will produce anything of substance and avoid the measures and counter-measures being put forward by both sides. A decision on the imposition of the initial tariffs on $50 billion worth of Chinese goods is set to be made on May 22. Proposals are also being drawn up for the imposition of tariffs on an additional $100 billion worth of goods, foreshadowed by Trump following China’s counter-measures directed against US agricultural products.

Trump says Mnuchin, USTR to travel to China for trade talks in days - Xinhua | -- U.S. President Donald Trump said on Tuesday that Treasury Secretary Steven Mnuchin and U.S. Trade Representative (USTR) Robert Lighthizer will travel to China in a few days for trade talks."In fact, we're having Secretary Mnuchin and a couple of other folks heading over to -- Bob Lighthizer -- heading over to China," Trump said at a press conference with visiting French President Emmanuel Macron at the White House."They (Chinese officials) came here, as you know, last week. And we're having very substantive discussions on trade," Trump said, referring to bilateral discussions of trade on the sidelines of spring meetings of the International Monetary Fund (IMF) and the World Bank, which concluded here last week.During the spring meetings, Christine Lagarde, managing director of the IMF, and other financial leaders around the world called on the United States and China to resolve trade tensions through dialogues and rules-based multilateral institutions."I believe the trade will work out ... hopefully it'll be good for everybody concerned," Trump said.Trump's remarks came after Mnuchin said Saturday that he was considering a trip to Beijing to discuss trade issues with his Chinese counterparts."China has received the information about the U.S. side hoping to come to Beijing for consultations on economic and trade issues and we welcome it," Chinese Foreign Ministry spokesperson Lu Kang said on Tuesday."I want to stress that China-U.S. economic ties are mutually beneficial in nature and have long been delivering tangible benefits to the business communities and consumers of the two countries," Lu said.

Why this round of U.S. protectionism is different - The escalation of the Sino-U.S. trade war has been worrying the world over the past few weeks. After the Washington’s announcement of punitive tariffs on 1,333 Chinese products with a value of up to $60 billion under the Section 301 of Trade Act, Beijing responded very quickly with a retaliation list of 106 products of the same value. Although it is not the first time that the world has been caught in the China-U.S. crossfire, the U.S.’ protectionist moves against China look different this time. In fact, they are broader-based both as they involve a much larger number of products and in that they also target the global competition for U.S. companies and not only the U.S. market. More specifically, the investigation announced by the U.S. administration on April 4 into as many as 1,333 products on the grounds of potential violations of intellectual property rights exploits Section 301 of the Trade Act. This is surprising in itself as Section 301 has rarely been used in recent times. Because of its unilateral characteristics, which are intrinsically inconsistent with the international dispute settlement system introduced by the WTO in 1995, U.S. trade actions have not usually invoked Section 301 (except for non-WTO members, such as Ukraine in 2001) but rather Section 337 of the Tariff Act. In fact, in the past few decades, the U.S. has only launched five investigations of very specific products under Section 301 against China, and none of them have ever been implemented. Instead, a compromise was always reached before the end of the interim period. However, this time around, the U.S. investigation covers a very long list of products at an approximate value of $60 billion (about half of U.S.’ imports from China according to our own estimations). More importantly, some of the higher-end products included are not yet major exports from China into the U.S., such as aircraft and spacecraft. The magnitude of the list is unprecedented even in the context of Section 301 investigations, but can only be triggered with the Section 301. Moreover, the use of Section 301 is very telling in terms of the U.S.’s final objective with this trade war, namely China’s future production capacity rather than its present capacity and, thus, China’s long-term competition with the U.S. at the higher end of the manufacturing spectrum.

In a First, US Senate Unanimously Passes Resolution on Tibetan Reincarnation - Marking the first time ever that a national legislature has supported the Tibetan Buddhist community’s right to identify and install their religious leaders, the United States Senate unanimously passed S.Res.429, which calls any interference by the Government of the People’s Republic of China (PRC) in the religious process “invalid”. The resolution also commemorated the 59th anniversary of Tibet’s 1959 uprising as “Tibetan Rights Day”. The resolution was introduced by Senator Patrick Leahy on behalf of Senator Feinstein, Senator Cruz, and Senator Rubio, and the Senate passed the resolution on the auspicious occasion of Panchen Lama Gedhun Choekyi Nyima’s 29th birthday.The resolution reiterated His Holiness the 14th Dalai Lama’s declaration in 2011 that the responsibility for identifying a future 15th Dalai Lama rests solely with the officials of his private office; anyone recognised through illegitimate methods or for political reasons should not be accepted. President Dr Lobsang Sangay of the Central Tibetan Administration expressed deep gratitude for the support of the US Senate. He remarked, “This resolution stands up for the Tibetan people’s inalienable rights and opposes any attempt by external actors, specifically the People’s Republic of China, to interfere in the reincarnation selection process. The unanimous support from the US Senate sends a powerful message to the international community and to China in particular. It sets a precedent for other nations to follow.” In addition to affirming the US Senate’s support for the Tibetan people’s fundamental human rights and freedom, the resolution called on the US Ambassador to the PRC to meet with the 11th Panchen Lama, Gedhun Choekyi Nyima, who was disappeared nearly 23 years ago along with his family.

Mayday on May Day? Trump steel tariff deadline looms (Reuters) - While more than 100 countries take a day off for May Day, U.S. President Donald Trump will spend next Tuesday deciding whether to extend a largely U.S.-China trade standoff into a more global dispute. In a week featuring a Federal Reserve monetary policy meeting, U.S. monthly jobs data and first estimates on euro zone inflation and economic growth, Trump's decision on metal tariffs may prove to the be biggest market mover. Those exemptions expire on May 1. Korea secured a permanent exemption for steel within days of agreeing to a revision of its trade pact with the United States. Canada and Mexico may rely on advances in talks on North American Free Trade Agreement (NAFTA) for an extension. Continued exemptions for the other countries, and notably the European Union, remain in doubt. French President Emmanuel Macron and German Chancellor Angela Merkel were meeting Trump in Washington as part of EU lobbying effort in the past week, but German officials played down the chances of a breakthrough before Merkel's Friday visit. "From today's point of view, we must reckon that the tariffs will come on May 1," one official said. The European Commission, which oversees trade policy for the 28-member bloc, has insisted the United States grant it a permanent exemption without conditions. White House economic adviser Larry Kudlow said on Thursday that Trump wanted concessions on automobiles, for which import duties are higher into Europe than into the United States. Behind the scenes, sources say the Commission has offered "scoping discussions" on the possibility of opening free trade talks, an offer rejected by Washington. An alternative suggested would be for Europe to raise a import quota for U.S. beef granted in 2009, that Washington has sought to review. However, the Commission said on Friday this was a long-standing matter with no link to other trade issues. 

U.S. sanctions on Rusal shatter aluminium's supply chain (Reuters) - “Our industry is going to suffer from disruption, distortion and damage. April 2018 has not been a good month for aluminium globally.”  That was the view of Ron Knapp, secretary-general of the International Aluminium Institute (IAI), in his opening address to CRU’s World Aluminium Conference in London. And none of analysts, traders, producers and consumers listening would disagree, given the carnage unleashed by the April 6 imposition of U.S. sanctions on Russian oligarch Oleg Deripaska and his Rusal aluminium empire. The aluminium price has experienced unprecedented turbulence. The raw material supply chain has teetered on the edge of collapse. And the tremors have raced down the value chain through major automakers as far as original equipment suppliers. Shocked by how its precision strike on Deripaska has ruptured the global aluminium market in the space of just two weeks, the U.S. Administration has rapidly rowed back. By extending the sanctions deadline to Oct. 23, 2018, the Treasury Department has given Rusal and the aluminium market some breathing space. Both will need it. Because this has been an alarming wake-up call for an industry that has prided itself on its efficiency, innovation and strong usage growth in the transport sector. The sanctions deployed against Deripaska were draconian, the type of punitive action previously reserved for Latin American drug lords. When one of those companies is the largest aluminium producer outside of China, that was always going to be traumatic. The London Metal Exchange (LME) price rallied over 20 percent in the week after the sanctions were announced. Time-spreads went haywire and volumes surged to fresh daily records. The sanctions’ disruptive power flowed down credit lines in a commodity market that is heavily dependent on bank financing, both for fresh material flows and inventory management, particularly Rusal-brand inventory management. 

Trump administration is likely to extend steel and aluminum tariff exemptions beyond May 1, sources say -- The May 1 deadline for steel and aluminum tariff exemptions for U.S. allies is likely to be extended, according to sources who have been in discussions with the Trump administration. The extensions may vary in length for each country, based on the progress made in talks on this and other trade issues. For instance, Canada and Mexico would be granted an extension because they have made progress on steel and aluminum issues in NAFTA talks, which resume late next week. It's unclear where talks with Brazil, Australia and Argentina stand. South Korea's exemption from tariffs is permanent because it agreed to quotas as part of a new trade deal. Administration officials have asked other countries what level of quotas they would agree to. One person briefed by the administration told CNBC: "Quotas are an active part of the discussion with every country on the exemption list." U.S. Trade Representative Robert Lighthizer is leading the process for country exemptions, except for the European Union, which Commerce Secretary Wilbur Ross is leading. The Department of Commerce is also spearheading to process for product exemptions. The National Security Council is overseeing the entire process. The May 1 deadline on the tariff exemptions was set in a presidential memorandum. An extension would be granted in that same way. The final decision on granting an extension will be up to President Donald Trump.

 Trump Instructs DHS To Block "Caravans" Of Illegals After First Wave Reaches Border -- President Trump has instructed the Department of Homeland Security (DHS) to deny reported caravans of asylum-seekers entry into the United States.  A caravan of over 1,000 mostly Central American refugees attempted to travel by foot, bus and train to the southern U.S. border in hopes of being granted asylum. After President Trump threatened to cut off foreign aid to "Honduras and the countries that allow this to happen," Mexico agreed to disband the group.  Despite their efforts, a group of around 50 asylum seekers have made it to the US border, seeking entry at the Tijuana crossing into California. “Despite the Democrat inspired laws on Sanctuary Cities and the Border being so bad and one sided, I have instructed the Secretary of Homeland Security not to let these large Caravans of people into our Country. It is a disgrace. We are the only Country in the World so naive! WALL,” tweeted Trump. Trump then added in a new tweet that the United States may require Mexico to take active measures to stop groups of migrants from Central America and elsewhere - which may be a "condition of the new NAFTA Agreement." Mexico, whose laws on immigration are very tough, must stop people from going through Mexico and into the U.S. We may make this a condition of the new NAFTA Agreement. Our Country cannot accept what is happening! Also, we must get Wall funding fast.  — Donald J. Trump (@realDonaldTrump) April 23, 2018 Three weeks ago, we reported that the Trump administration is said to be pushing for a new NAFTA deal with Mexico and Canada - though discussions were not advanced enough to be announced at the Summit of the Americas held on April 13-14 as originally hoped for.  Senior trade officials from the three nations will meet again in Washington over the next few weeks for an "intensified push" for a new agreement.

The U.S. Border as a Zone of Profit and Sacrifice - I was on a lonely two-lane road in southern New Mexico heading for El Paso, Texas. Off to the side of the road, hardly concealed behind some desert shrubs, I suddenly noticed what seemed to be a tank.  When I stopped to take a picture, a soldier wearing a camouflage helmet emerged from the top of the Stryker, a 19-ton, eight-wheeled combat vehicle that was regularly used in military operations in Iraq and Afghanistan.  With high-tech binoculars, he began to monitor the mountainous desert that stretched toward Mexico, 20 miles away, as if the enemy might appear at any moment. That was in 2012 and, though I had already been reporting on the militarization of the U.S.-Mexican border for years, I had never seen anything like it. Barack Obama was still president and it would be another six years before Donald Trump announced with much fanfare that he was essentially going to declare war at the border and send in the National Guard. (“We really haven’t done that before,” Trump told the media on April 3rd, “or certainly not very much before.”)A “war” against immigrants had been declared long before Trump signed the memo to deploy 2,000-4,000 National Guard troops to the border. Indeed, there has been a continuous military presence there since 1989 and the Pentagon has played a crucial role in the historic expansion of the U.S. border security apparatus ever since.When, however, Trump began to pound out tweets on Easter Sunday on his way to church, Americans did get a vivid glimpse of a border “battlefield” more than 30 years in the making, whose intensity could be ramped up on the merest whim. The president described the border as “getting more dangerous” because 1,000 Central Americans, including significant numbers of children, in flight from violence in their home countries were in a “caravan” in Mexico slowly heading north on a Holy Week pilgrimage. Many of them were intending to ask for asylum at the border, as they feared for their lives back home.

Third federal judge issues strongest order yet backing DACA - A third federal judge on Tuesday ruled against the Trump administration's campaign to end the Deferred Action for Childhood Arrivals program for undocumented immigrants, ordering the administration not only to continue processing applications but also to resume accepting new ones.U.S. District Judge John Bates of the District of Columbia was withering in his 60-page ruling, calling the administration's attempts to end the program, known as DACA, "arbitrary," "capricious," "virtually unexplained" and "unlawful."Bates stayed the ruling for 90 days to give the Department of Homeland Security time to come up with better arguments for scrapping the program. If it doesn't, he wrote, he will enter an order reinstating DACA in its entirety.  DACA allows children of illegal immigrants to remain in the United States if they were under 16 when their parents brought them into the country and if they arrived by 2007. Those given DACA status must renew it every two years. The Trump administration had sought to phase out the program starting last month, but two previous federal rulings stalled its efforts. Neither of those rulings — by judges in New York and San Francisco — ordered the government to resume accepting new applications for protection under DACA, making Bates' ruling the strongest one so far. "Each day that the agency delays is a day that aliens who might otherwise be eligible for initial grants of DACA benefits are exposed to removal because of an unlawful agency action," Bates wrote. In February, the U.S. Supreme Court declined to hear the administration's appeal of the San Francisco ruling. In his ruling, Bates said the administration failed to give a sufficient reason for moving to cancel the program last fall, finding that a letter from Attorney General Jeff Sessions offered "scant legal reasoning" and failed to cite any federal law with which DACA was in conflict.The government did no better, the judge said, by saying that keeping the program going would probably face a legal challenge from states opposed to it. Bates gave both sides until July 27 to file a joint report "stating whether DHS has issued a new decision rescinding DACA and whether the parties contemplate the need for further proceedings in this case."

 Seven hundred children separated from their families at US-Mexico border since October - The Trump administration’s Department of Homeland Security (DHS) has separated more than 700 children, including infants, from their families at the US-Mexico border since October, according to a New York Times investigation. The Trump administration had declared previously that it was considering taking children away from parents as a deterrent to immigration.  While officials have stated that the number of families separated in this fashion is low, immigrant rights groups have sought official data to determine how many families have been broken up. New data obtained by the Times shows that of those separated in this fashion, more than 100 are under the age of four. The data was released by the Office of Refugee Settlement, a division of the Department of Health and Human Services, which detains children who have been removed from their parents’ custody. While DHS officials initially denied the numbers were so high, a spokesman confirmed there were “approximately 700.” While the DHS denied that it was separating families to deter immigration, John Kelly, Trump’s chief of staff who served last year as Homeland Security secretary, publicly floated the idea late last year. Kelly proposed to shut down immigrant detention camps designed for families and replace them with separate camps for adults and children. The White House supported the idea and convened several government agencies to investigate the possibility, but the DHS denied it was ever adopted it as official policy. Typically, children who are taken away from their families are sheltered by nongovernmental organizations where workers can see if a relative or guardian living in the US can take care of them. But this process is especially difficult for those without documents, and children can languish in these shelters for years. In fact, Border Patrol officials told the Times that there is no firm process to determine whether children were separated from their legitimate parents, or even to reunite children who were mistakenly separated from their families.

Showdown: Hundreds Of "Caravan" Migrants Set To Enter California As US Threatens Mass Arrests -   -- Hundreds of migrants who continued the journey north after a "caravan" of Central American immigrants disbanded earlier this month after being singled out by President Trump have now reunited at a shelter in Tijuana, Mexico, Reuters reported. And if they have their druthers, many of them will be inside the US by the end of the weekend.After crossing through Mexicali earlier this week, the migrants have been gathering in Tijuana since Tuesday. Most members of the group are from El Salvador, Guatemala or Honduras, and are fleeing their homes, they say, because of death threats from local gangs, or political persecution. So many migrants have arrived at the shelter in Tijuana this week that it was overflowing by the end of the day on Wednesday. While some rested in tents, others walked up to the border fence and looked across, giddy at the sight of American soil after a month-long journey across Mexico. As Reuters pointed out, the timing of their arrival could sabotage NAFTA talks after President Trump repeatedly threatened to scrap the deal if Mexico doesn't do more to stop Central American migrants from traveling through its territory.

Democratic Senator Alleges Trump's VA Pick Was Known As "Candy Man" For Handing Out Drugs - Less than 24 hours after President Trump appeared to stand by his nominee for VA Chief, following reports of previous "unprofessional" behavior by Dr. Ronny Jackson, while hitting out at the reports questioning his previous conduct:He is a high-quality person. It's totally his decision,” Trump said during a press conference with French President Emmanuel Macron.“So he'll be making a decision. I don't want to put a man through a process like this. It's too ugly and too disgusting. So, we'll see what happens. He'll make a decision." NewsWeek reports that Democrat Senator John Tester (the ranking member of the Senate Veterans’ Affairs Committee) told CNN, relaying allegations he had received from concerned individuals, that Rear Admiral Ronny Jackson, who has been the White House physician since 2006, was known as the “candy man” for his readiness to distribute prescription drugs. “On overseas trips, the admiral would go down the aisle way of the airplane and say, 'All right, who wants to go to sleep?' And hand out the prescription drugs like they were candy and put them to sleep, and then give them the drugs to wake them back up again,” he said, citing reports from 20 or more people. Tester also cited allegations that Jackson was drunk on duty during his time working for the administration of former President Barack Obama. An overlooked footnote to Trump’s highly publicized health checkup earlier this month was a passing reference at a news conference to his use of the widely abused sleep aid, Ambien. Dr. Ronny Jackson, the White House doctor, then said Trump takes Ambien when he goes on long flights. The drug, approved by the Food and Drug administration in 1992, was meant for short-term use to treat insomnia. Since sleeping pills come with a range of dangerous side effects that can linger into the following day, experts suggest using them sporadically and only in specific instances to avoid health risks. The drug is known to sometimes turn people into “Ambien zombies” who have fixed meals, had sex or gotten in their cars and driven away with no memory of the activities the next day.

Health Insurers Spend $158K to Make Sure ‘Blue Wave’ Is Against Medicare for All - In the current cycle, big health insurers have quietly donated more than $150,000 to Democrats opposed to Medicare for All legislation.One of the internal battles raging within the Democratic Party is whether or not the party should embrace the Medicare for All bill authored by Senator Bernie Sanders (I-Vermont). Big-name Democrats with possible presidential ambitions like Senators Cory Booker (D-New Jersey), Kirsten Gillibrand (D-New York), Kamala Harris (D-California), and Elizabeth Warren (D-Massachusetts) have co-sponsored the bill, but notably, 11 Senate Democrats up for re-election this year have not.If passed, Sanders’ Medicare for All bill would allow Americans to have the option of buying into the Medicare program typically only available to retirees. Medicare is one of the most popular government programs, with 77 percent of Americans saying they viewed the program as “very important” in 2015. A Pew survey from June of 2017 found that 60 percent of respondents felt that providing healthcare should be the responsibility of the government. Health insurers likely see Medicare for All threatening their bottom line in the future, and are spending large sums to keep politicians who are favorable to the private health insurance model. According to federal campaign finance records, the four leading private health insurance providers — Aetna, Anthem, Cigna, and UnitedHealth — have spent $158,000 in the 2017-2018 campaign cycle on Democrats opposed to single-payer healthcare. Here are their names, ordered by who received the most to who received the least

Trump Administration: What Else Can We Fuck Up? Hey, Let's Work to Drive Teen Pregnancy and Abortion Rates Back Up! - Check out the chart in the NPR story linked above: the abortion rate has been in decline since 1980. But it rose toward the end of the Bush years (the fruits of abstinence-only sex ed), then plateaued. The abortion rate went into steep decline during the Obama years, hitting its lowest levels ever this year thanks to Obama's sex-ed policies and Obamacare's contraception mandate. It took a while to get there—it was years before the Obama administration began living up to the promise Obama made during his first inaugural address to restore science to its rightful place, at least where sex ed was concerned. Teenagers who’d had abstinence-only sex ed didn’t wait until marriage to start having that "one-man, one-woman, for life" sex backed by abstinence educators and practiced by no one. (Least of all Donald Trump.) At best, they delayed becoming sexually active for six months—and when these teenagers did become sexually active, they were less likely to use birth control or condoms. Because why bother? They’d been taught by abstinence-only mis-educators that birth control and condoms don't prevent disease or pregnancy. Consequently these kids were more likely to get a sexually transmitted infection or pregnant—the original sexually transmitted infection—than their peers who’d had comprehensive sex ed. Well, we can kiss those upbeat headlines goodbye. Last Friday, the Trump administration announced that it was going to stop funding comprehensive sex ed programs—the programs that helped bring teen pregnancy and abortion rates to historic lows—and re-direct federal funds to abstinence-only programs. The Hill reportsThe Department of Health and Human Services (HHS) announced Friday the availability of grants through the Teen Pregnancy Prevention Program, (TPPP) a grant program created under former President Obama that funds organizations and programs working to reduce teen pregnancy rates. Trump's HHS announced, however, that unlike under the Obama administration, grants will be geared toward organizations that teach abstinence education to teens instead of the comprehensive sex ed approach the previous administration supported.

Copyright Protection for Monkey Selfie Rejected by U.S. Appeals Court - Wall Street Journal - Copyright ownership isn’t monkey business.That is what a federal appellate court ruled Monday, in denying the People for the Ethical Treatment of Animals’ request to bring copyright claims on behalf of a macaque monkey.The animal-rights organization sued a wildlife photographer in 2015, claiming he shouldn’t own the copyright for a series of selfies snapped four years prior by an Indonesian monkey named Naruto. PETA argued Naruto himself is the copyright owner of the photos, which capture the black-haired crested macaque grinning broadly at the camera, amber eyes blazing.But animals have no legal ability to hold copyright claims, the Ninth U.S. Circuit Court of Appeals said in its decision, which also questioned PETA’s motives in bringing the case.  “PETA seems to employ Naruto as an unwitting pawn in its ideological goals,” the court wrote in a footnote.The organization had tried to sue the photographer, David Slater, as a “next friend” of the monkey, a designation sometimes used for a third-party to sue on another’s behalf. PETA’s tie to the macaque, however, doesn’t seem “any more significant than its relationship with any other animal,” the Ninth Circuit found.  As Judge N. Randy Smith added in a concurring opinion, “We have no idea whether animals or objects wish to own copyrights or open bank accounts to hold their royalties from sales of pictures.” Naruto apparently took the photos of himself after coming across Mr. Slater’s unattended camera in a reserve on the island of Sulawesi, Indonesia, according to the opinion. Mr. Slater has said in interviews that he tried to encourage animals to take their own photos. After arguments before a three-judge Ninth Circuit panel last summer, PETA asked the court to withdraw the appeal and announced it struck a settlement with Mr. Slater that included a percentage of his profits from the monkey selfie going toward charities that protect crested macaques and their Indonesia habitats. The monkey, however, wasn’t part of the deal.  That move, Judge Smith wrote in a footnote, leads him to believe “PETA’s real motivation in this case was to advance its own interests, not Naruto’s,” and that PETA moved quickly to protect itself “when it came down to a possible negative, precedential ruling.”

Michael Cohen case shines light on Sean Hannity's property empire - When Sean Hannity was named in court this week as a client of Donald Trump’s embattled legal fixer Michael Cohen, the Fox News host insisted their discussions had been limited to the subject of buying property. “I’ve said many times on my radio show: I hate the stock market, I prefer real estate. Michael knows real estate,” Hannity said on television, a few hours after the dramatic hearing in Manhattan, where Cohen is under criminal investigation. Hannity’s chosen investment strategy is confirmed by thousands of pages of public records reviewed by the Guardian, which detail a real estate portfolio of remarkable scale that has not previously been reported.  The records link Hannity to a group of shell companies that spent at least $90m on more than 870 homes in seven states over the past decade. The properties range from luxurious mansions to rentals for low-income families. Hannity is the hidden owner behind some of the shell companies and his attorney did not dispute that he owns all of them. Dozens of the properties were bought at a discount in 2013, after banks foreclosed on their previous owners for defaulting on mortgages. Before and after then, Hannity sharply criticised Barack Obama for the US foreclosure rate.  Hannity, 56, also amassed part of his property collection with support from the US Department for Housing and Urban Development (Hud), a fact he did not disclose when praising Ben Carson, the Hud secretary, on his television show last year. The real estate holdings linked to Hannity are spread across more than 20 shell companies formed in Georgia. Each of the companies uses a variant of the same name, which combines the initials of Hannity’s children. Public records show the companies have bought up dozens of properties in Alabama, Florida, Georgia, New York, North Carolina, Texas and Vermont. Among the most valuable are two large apartment complexes in Georgia that Hannity bought in 2014 for $22.7m. The developments are in the cities of Perry and Brunswick, which have higher poverty rates and lower median incomes than the US averages. One- and two-bedroom units in Hannity‍‍‍’s apartment complexes are available to rent for $735 to $1,065 per month, according to brochures.

Sessions told White House that Rosenstein’s firing could prompt his departure, too - Attorney General Jeff Sessions recently told the White House he might have to leave his job if President Trump fired his deputy, Rod J. Rosenstein, who oversees the investigation into Russian interference in the 2016 election, according to people familiar with the exchange. Sessions made his position known in a phone call to White House counsel Donald McGahn last weekend, as Trump’s fury at Rosenstein peaked after the deputy attorney general approved the FBI’s raid April 9 on the president’s personal attorney Michael Cohen. Sessions’s message to the White House, which has not previously been reported, underscores the political firestorm that Trump would invite should he attempt to remove the deputy attorney general. While Trump also has railed against Sessions at times, the protest resignation of an attorney general — which would be likely to incite other departures within the administration — would create a moment of profound crisis for the White House.

Sessions Won't Recuse Himself From Trump-Cohen Probe - Attorney General Jeff Sessions will not recuse himself from the investigation into President Trump's personal lawyer, Michael Cohen - however he may "step back" from "specific questions tied to the probe," reports Bloomberg, citing a person familiar with the matter.  This is notable because while Sessions recused himself from special counsel Robert Mueller's probe into Russian interference in the 2016 election, he won't be recusing himself from one of the rabbit holes Mueller's team has now gone down which ostensibly has nothing to do with Russia.   By remaining involved in the probe, Sessions will be entitled to briefings on the status of the investigation currently being conducted by the U.S. Attorney's office of the Southern District of New York. As Bloomberg posits, this could put Sessions in the position of being asked by Trump, "who strongly condemned the FBI raid on his longtime lawyer," to reveal information about the ongoing Cohen investigation. Sessions could also weigh in on specific decisions by prosecutors, including whether to pursue subpoenas and indictments. The attorney general may be asked about his role in the Cohen investigation when he testifies before congressional panels on Wednesday and Thursday. -Bloomberg“The attorney general considers his potential recusal on a matter-by-matter basis as may be needed,” the department said in a statement. “To the extent a matter comes to the attention of his office that may warrant consideration of recusal, the attorney general would review the issue and consult with the appropriate Department ethics experts.” Deputy Attorney General Rod Rosenstein - who approved the raid on Cohen's home, office and hotel room on April 9, will reportedly resolve any conflicts between the Mueller probe and the Cohen investigation.

 Michael Cohen says he’ll plead the Fifth in the Stormy Daniels lawsuit  - Michael Cohen, Trump’s attorney and fixer, said he will plead the Fifth in the ongoing lawsuit with porn star Stormy Daniels. Cohen cited the ongoing federal criminal investigation that he’s caught up in when invoking his Fifth Amendment right against self-incrimination in documents filed in federal court on Wednesday. The FBI raided Cohen’s home, office, and hotel room on April 9, seizing documents and other materials, including those related to the $130,000 hush money payment that Cohen paid Daniels in October 2016 to prevent her from speaking publicly about an alleged affair she had with Donald Trump in 2006. Daniels (whose real name is Stephanie Clifford) is suing Trump, saying the hush agreement she signed is invalid because the president himself never signed it. Trump has denied knowing anything about the $130,000 that Cohen paid to Daniels. Michael Avenatti, Daniels’s attorney, called Cohen’s decision to plead the Fifth a “stunning development” in a tweet. Cohen’s plea is not that stunning a development, considering he’s under criminal investigation, and anything said or discovered in the civil suit could potentially be used against him in the federal probe. Cohen asserted his Fifth Amendment right in backing up his petition last week to get the judge to put the Daniels lawsuit on hold because of the investigation by the FBI and the Southern District of New York.

Giuliani Meets With Mueller To Discuss Trump Interview - After former White House lead attorney John Dowd was pushed out for insisting that President Trump agree to an in-person interview with Special Counsel Robert Mueller, Rudy Giuliani, the newest member of Trump's legal team and also now apparently the de facto leader, has reportedly met with Mueller to begin negotiating the terms of a Trump meeting, the Washington Post reported Wednesday. The irony in Giuliani meeting with Mueller is that Giuliani once served as the US attorney for the Southern District of New York - the same office that is investigating Trump lawyer Michael Cohen. The meeting is also surprising for another reason: Until recently, it had appeared as if Trump would ultimately decline to sit for an interview with Mueller. Furthermore, rumors recently circulated that Mueller and his team were preparing a path forward that didn't involve a presidential interview. During their meeting, Giuliani reportedly sought to wrestle some information out of Mueller about the probe and how much longer it could reasonably be expected to continue. It has previously been reported that Mueller could conclude the probe within a few months of an interview with Trump, and that a presidential interview was the special counsel's last major remaining obstacle. Mueller also reportedly told Giuliani that his questions would mostly pertain to the transition and Trump's first months in office.The face-to-face discussions ­illustrated how Giuliani is functioning as Trump’s chief liaison and lead negotiator with the special counsel. The meeting renewed talks that had largely faltered since the resignation last month of John Dowd, a veteran lawyer who was serving as Trump’s lead outside attorney on the investigation. "I’m doing it because I hope we can negotiate an end to this for the good of the country and because I have high regard for the president and for Bob Mueller," Giuliani said in an interview with The Washington Post last week.

Trump Says "Hands Off" Approach To DOJ "Could Change" - During a call-in interview with Fox & Friends Thursday morning that snowballed into an angry rant about "fake news" organizations, Ronny Jackson, James Comey, Michael Cohen, Kanye West, US relations with Iran, the upcoming talks with North Korea, President Trump lashed out at the FBI and its former director, James Comey, while the president claimed he has "nothing to do" with Cohen's legal troubles.Despite the cloud of the Russia probe hanging over his head, Trump said he's still managed to accomplish a lot during his first term in office. And while Trump says he's tried to "stay away" from interfering with the Department of Justice, at some point his "hands off" approach could change. Of course, his aggressive remarks followed reports last night that the newest member of his legal team, Rudy Giuliani, had restarted talks with Special Counsel Robert Mueller.The interview started with Trump calling out Montana Democratic Sen. John Tester for bringing up allegations about Ja ckson, including his nickname, "the candy man," which he purportedly earned due to his willingness to hand out prescription drugs in his role as personal physician to US presidents. Trump said Jackson had withdrawn his nomination to lead the VA largely to spare his family from Democratic scrutiny. Trump insisted that Jackson is an example of an American who should be admired, and that while nobody is truly qualified to lead the VA, Jackson would've done a great job.Asked about his next pick to lead the VA, Trump said only that the candidate would have a "political" background.

Trump Says He May Curb Russia Probe as Mueller Bill Advances - President Donald Trump hinted he may intervene in the Justice Department’s Russia investigation, as a Senate panel advanced a measure to protect Special Counsel Robert Mueller.“They have a witch hunt against the president of the United States going on,” Trump said Thursday on the “Fox and Friends” morning program. “I’ve taken the position -- and I don’t have to take this position and maybe I’ll change --that I will not be involved with the Justice Department. I will wait until this is over. It’s a total -- it’s all lies and it’s a horrible thing that’s going on.”It was one of Trump’s strongest hints yet that he might act to constrain or end Mueller’s wide-ranging investigation into Russia’s meddling in the 2016 presidential campaign, whether anyone close to Trump colluded in it and whether the president obstructed justice in the matter.Lawmakers of both parties have warned Trump that firing Mueller would create a constitutional crisis, and that was reflected in a bipartisan, 14-7 vote Thursday by the Senate Judiciary Committee for legislation aimed at protecting Mueller from being fired without cause. The action may prove largely symbolic because Senate Majority Leader Mitch McConnell has said it won’t get a vote on the Senate floor and there are questions about the measure’s constitutionality.  Attorney General Jeff Sessions, who the president has criticized and denounced for recusing himself from the Russia probe, said Thursday that he’s sympathetic to Trump’s complaints. “The president is concerned,” Sessions told a House Appropriations subcommittee hearing. “He’s dealing with France and North Korea and Syria and taxes and regulations and border and crime every day. I wish -- this thing needs to conclude. I understand his frustrations and I understand the American people’s frustrations.”

Federal Judge Tosses "Taint Team" For Trump Lawyer Raid, Instead "Special Master" To Handle Seized Documents - Prosecutors seeking to pore over documents seized from President Trump's personal lawyer, Michael Cohen, won't be able to use a "taint team" - a group of lawyers also known as a "privilege team," whose job it is to review materials and remove anything covered by attorney-client privilege. Instead, a federal judge ruled on Thursday that court-appointed independent "special master," former federal judge Barbara Jones, should be the first person to examine the documents seized in the April 9 raid of Cohen's office, hotel and residence. The prosecutors initially said the documents should be reviewed by a "taint team" of lawyers within their own office, who would be walled off from the main prosecution team. Cohen argued that his lawyers should get a first look. -Straits Times    Both sides said they are amenable to a special master as an alternative to the taint team. "The letters I received from counsel for Mr Cohen and the intervenors has convinced me that this process can go quickly with the special master, assuming everyone works as hard as you have represented you will work," said US District Judge Kimba Wood.Jones, 71, started her career in 1973 as a DOJ special attorney in the Organized Crime & Racketeering Criminal division, after which she served as an Assistant US Attorney for the Southern District of New York. Jones was appointed as a Judge in the US District Court for the Southern District of New York in 1995 by President Bill Clinton, on the recommendation of Democratic Senator Patrick Moynihan (D. 2003) - whose Senate seat Hillary Clinton filled in 2001.She is currently a partner Houston-based international law firm, Bracewell LLP.  at teaches trial advocacy at the Practicing Law Institute (PLI) in New York since 2009.

No Official Intel Used To Launch Russia Probe According To Controversial DOJ Document: Nunes - After waiting eight months for the DOJ to turn over the "electronic communication" (EC) - the document which the FBI used to launch the original counterintelligence investigation against the Trump campaign, House Intelligence Committee Chairman Devin Nunes (R-CA) told Fox News that upon review - the EC reveals that no intelligence was used to launch the probe. Nunes also touched on the fact that Hillary Clinton confidant Sidney Blumenthal pushed anti-Trump memos to the Obama State Department, written by Clinton "hatchet man" Cody Shearer and passed to Jonathan Winer, former U.S. Deputy Assistant Secretary of State. “We now know that there was no official intelligence that was used to start this investigation. We know that Sidney Blumenthal and others were pushing information into the State Department. So we’re trying to piece all that together and that’s why we continue to look at the State Department,” Nunes told Maria Bartiromo on “Sunday Morning Futures.” Nunes noted that no intelligence was shared with the U.S. from any of the members of the "Five Eyes" agreement - that being Canada, the UK, Australia, New Zealand and the USA. “We are not supposed to spy on each other’s citizens, and it’s worked well,” he said. “And it continues to work well. And we know it’s working well because there was no intelligence that passed through the Five Eyes channels to our government. And that’s why we had to see that original communication.”This is relevant because the FBI says that the Trump investigation was kicked off after Australian diplomat Alexander Downer told the FBI that Trump campaign associate George Papadopoulos drunkenly admitted in a London pub that the Russians had "dirt" on Hillary Clinton. The New York Times reported last December that "Australian officials passed the information about Mr. Papadopoulos to their American counterparts, according to four current and former American and foreign officials with direct knowledge of the Australians’ role." This was clearly not true according to the EC, which states that no intelligence passed through Five Eyes official channels.

Intelligence report defends Trump, draws attacks from Dems | TheHill: The House Intelligence Committee on Friday released a GOP-authored, heavily redacted report that found no evidence of collusion between President Trump’s campaign and Russia. The document also aims to rebut a series of claims about the campaign’s ties to Russia, devoting an entire chapter, roughly 20 pages, to challenge such points.The tome provides a defense for many of the incidents that have drawn scrutiny as evidence of potential collusion between Trump and Moscow, including the claim that attempts to set up a back channel between the campaign and Moscow “suggest the absence of collusion” because colluding with Russia would’ve rendered such a channel “unnecessary.” Committee Democrats have refused to endorse the document produced by the panel, which conducted a politically fraught investigation dominated by partisanship. The GOP report did find some fault with Trump’s campaign, but it also faulted Democrat Hillary Clinton’s campaign as well as the GOP national security establishment. One finding blames “the Republican national security establishment's opposition to candidate Trump” for “creat[ing] opportunities for two less-experienced individuals with pro-Russia views to serve as campaign advisors.” 

Trump Euphoric After House Intel Report Finds "No Collusion" Between President, Russia -Weeks after the House Intelligence Committee voted to officially close its investigation into whether President Trump colluded with the Russians, it has finally released its official account of its findings in a heavily redacted 253-page report which unambiguously proclaims that the committee "found no evidence that the Trump campaign colluded, coordinated, or conspired with the Russian government." However, the report wasn't entirely devoid of criticism. According to the report, "the investigation found poor judgment and ill-considered actions by the Trump and Clinton campaigns.” Specifically, it cites Trump associates' contacts with Russian nationals and groups like Wikileaks during the campaign as examples of irresponsible behavior. Unwilling to let go of the Russia narrative entirely, Democrats on the committee, led by ranking member Adam Schiff, released a 99-page rebuttal claiming that Republicans on the committee purposefully ignored certain witnesses and failed to file certain subpoenas knowingly based on the expectation that they might uncover evidence of Trump campaign collusion. The committee, which is chaired by Republican Devin Nunes even though he recused himself from the investigation early on and handed supervisory duties over to his second-in-command, Mike Conaway, carried out 73 witness interviews and reviewed 308,000 documents during its investigation. The probe, which was formally launched on Jan. 25, 2017, examined four areas: Russian active measures, intelligence related to any links between Russian operatives and the Trump and Clinton campaigns, the US government's response to intelligence indicating that Russia intended to disrupt its political system, as well as leaks of classified information out of the intelligence community. And in what appears to be one of the report's most important findings, lawmakers said they found no evidence that George Papadopoulos had told anyone working with the campaign about Maltese academic Joseph Mifsud's claim that the Russians had "dirt" on Hillary Clinton.

 Report: Columbia Professor Used By Comey For Leak Was Actually A Special Government Employee With The FBI -- We have been discussing the investigation by the Inspector General of the Justice Department into the leaking of FBI memos by former Director James Comey.  I have previously explained why there are serious questions concerning Comey’s conduct.  Now there is an interesting development after Fox News confirmed that the law professor used by Comey for his leak was in fact a “special government employee” (SGE) for Comey’s FBI.  That status of Columbia Professor Daniel Richman raised new concerns Richman, confirmed  “I did indeed have SGE status with the Bureau (for no pay).” However, that means that Comey not only removed FBI memos (including some classified memos) but he used a Justice Department employee to leak the material to the media.  I have previously discussed my view that Comey had acted unprofessionally and possibly unlawfully.  However, that misconduct is magnified if if used another DOJ employee to carry out the violation.  Not only did Comey not mention that he used a Justice Department lawyer to leak to the press, but Richman’s status did not appear to be known to the media.  It is already problematic that Comey was tasked with finding leakers and then became a leaker himself. If he also used a SGE that he reportedly brought into the Bureau, the IG investigators could look at the added impropriety of the means used for the leak.

Clapper Busted Leaking Dossier Details To CNN's Jake Tapper, Lying To Congress About It - Former Director of National Intelligence (DNI) turned CNN commentator James Clapper not only leaked information related to the infamous "Steele dossier" to CNN's Jake Tapper while Clapper was in office - it appears he also lied about it to Congress, under oath.  Clapper was one of the "two national security officials" cited in CNN's report -published minutes after Buzzfeed released the full Steele dossier.The revelation that Clapper was responsible for leaking details of both the dossier and briefings to two presidents on the matter is significant, because former Federal Bureau of Investigation (FBI) director James Comey wrote in one of four memos that he leaked that the briefing of Trump on salacious and unverified allegations from the dossier was necessary because “CNN had them and were looking for a news hook.” -The FederalistSo Comey said that Trump needed to be briefed on the Dossier's allegations since CNN "had them" - because James Clapper, the Director of National Intelligence at the time, provided that information to the same network he now works for.And who's idea was it to brief Trump on the dossier? JAMES CLAPPER - according to former FBI Director James Comey's memos:  “I said there was something that Clapper wanted me to speak to the [president-elect] about alone or in a very small group,” Comey wrote. The revelations detailing Clapper's leak to CNN can be found in a 253-page report by the House Intelligence Committee majority released on Friday - which also found "no evidence that the Trump campaign colluded, coordinated, or conspired with the Russian government." As Sean Davis of The Federalist bluntly states: "Clapper leaked details of a dossier briefing given to then-President-elect Donald Trump to CNN’s Jake Tapper, lied to Congress about the leak, and was rewarded with a CNN contract a few months later."

WATCH: As Trump fumbles on live TV, Fox & Friends abruptly ends disastrous interview - President Trump’s trainwreck of a phone interview on Thursday’s edition of Fox & Friends came to an abrupt end after hosts basically cut him off.“Our Justice Department, which I try and stay away from, but at some point I won’t,” Trump yelled, striking an authoritarian tone as Steve Doocy let out an uncomfortable groan, “should be looking at that kind of stuff [alleged anti-Trump bias in the FBI], not the nonsense of collusion with Russia.” As soon as Trump stopped talking, Brian Kilmeade brought the interview to a close, informing the president that he had to get going because he had a busy day ahead of him.“We’d talk to you all day, but it looks like you have a millions things to do,” Kilmeade said.Trump seemed a bit surprised to hear it.“You could,” he interjected, suggesting he was in the mood to keep talking. But hosts wrapped it up.After the smoke cleared, Doocy quipped, “You know, I think he was awake,” as his co-hosts chuckled uncomfortably. Watch: You’d think hosts of the president’s favorite show would give him all the air time he wants, but they had good reason to usher him off the air — Trump did a lot of damage to himself over the course of the roughly 25-minute interview.  Trump minimized his relationship to Cohen, which could complicate his lawyers’ effort to shield seized documents from federal investigators in prosecutors. But later, Trump acknowledged that Cohen did in fact represent him during his dealings with a woman who claims to have had an affair with Trump and received a hush payment that may have violated federal law — a claim at tension with the story Cohen has told about the payment. Not even two hours after the interview ended, his words were used against him in federal court. The United States Attorney for the Southern District of New York submitted a letter to a federal judge noting that Trump’s Fox & Friends comments supported their position. The government specifically cited Trump’s assertion that Cohen handled a “tiny, tiny little fraction” of his overall legal work.

Just When You Thought “Russiagate” Couldn’t Get Any Sillier - Blaze up, get silly, file a bizarre lawsuit accusing the Russian government, Donald Trump’s 2016 presidential campaign, and transparency activist group WikiLeaks of conspiring to steal an election. But even that’s a long shot. The only credible evidence produced so far implicates only the Trump campaign, not the other two defendants, and only to the same extent that it likewise implicates the Clinton campaign. That is, both campaigns admittedly tried to tap “Kremlin-connected” sources (defined as “anyone who’s ever been in Moscow”) for dirt on their opponents. Donald Trump Jr. met with a Russian lawyer in hopes of getting the goods on Hillary Clinton. The Clinton campaign commissioned a British former spy to work his Russian regime sources for salacious tidbits on Trump the Elder. Central to the suit’s claims is alleged “Russian hacking” of the DNC’s servers, followed by an embarrassing release of emails showing, among other things, attempts by DNC to rig the 2016 primaries in favor of Clinton and against her main opponent, Bernie Sanders. Problems with the case: First, the DNC refused to turn those servers over to the FBI for forensic analysis, instead hiring a friendly cybersecurity firm to announce the results it wanted announced.Secondly, metadata in the “hacked” files released by “Guccifer 2.0” indicates transfer speeds consistent with an internal source at DNC copying the files directly to a USB drive rather than an external hacker accessing the servers.Thirdly, while the subsequent announcement by the US intelligence community of its conclusions claims methods and IP addresses “consistent with” Russian state hackers, those methods and IP addresses are also “consistent with” every other type of hacker on Earth. Fourthly and probably decisively, the DNC makes the mistake of dragging WikiLeaks into the matter. The next time WikiLeaks gets caught making a false statement will be the first time. On the other hand, the leaked emails themselves demonstrate that the DNC lies constantly and without hesitation. When it comes to credibility, WikiLeaks is the gold standard and the DNC is something one tries to wipe off the bottom of one’s shoe before entering a respectable household. WikiLeaks says no, its source was neither the Russian government nor any other state party.

Trump To "Counter" DNC Lawsuit; Seeks Servers, Clinton Emails And "Pakistani Mystery Man"  -- President Trump is eager to go head-to-head with the DNC which filed a multimillion-dollar lawsuit on Friday against several parties, including the Russian government, the Trump campaign and the WikiLeaks organization - alleging a "far-reaching conspiracy to disrupt the 2016 campaign and tilt the election to Donald Trump."  Hours after the Washington Post broke the news of the lawsuit, Trump tweeted "Just heard the Campaign was sued by the Obstructionist Democrats. This can be good news in that we will now counter for the DNC server that they refused to give to the FBI," referring to the DNC email breach. Trump also mentioned "the Debbie Wasserman Schultz Servers and Documents held by the Pakistani mystery man and Clinton Emails." The "Pakistani mystery man" is a clear reference to former DNC CHair Debbie Wasserman Schultz's longtime IT employee and personal friend, Imran Awan - whose father, claims a Daily Caller source, transferred a USB drive to the former head of a Pakistani intelligence agency - Rehman Malik. Malik denies the charge. Of note, the DNC would not allow the FBI to inspect their servers which were supposedly hacked by the Russians - instead relying on private security firm Crowdstrike.  Meanwhile, the "Wasserman Schultz Servers" Trump mentions is likely in reference to the stolen House Democratic Caucus server - which Imran Awan had been funneling information onto when it disappeared shortly after the House Inspector General concluded that the server may have been "used for nefarious purposes."  The server may have been “used for nefarious purposes and elevated the risk that individuals could be reading and/or removing information,” an IG presentation said. The Awans logged into it 27 times a day, far more than any other computer they administered. Imran Awan, his wife Hina Alvi and several other associates ran IT operations for at least 60 Congressional Democrats over the past decade, along with the House Democratic Caucus - giving them access to emails and computer data from around 800 lawmakers and staffers - including the highly classified materials reviewed by the House Intelligence Committee.

WikiLeaks To Countersue Democrats; "Discovery Is Going To Be Amazing Fun" - WikiLeaks has hit back against a multimillion-dollar lawsuit filed by the Democratic National Committee (DNC), announcing over Twitter that they are seeking donations for a counter-suit, noting "We've never lost a publishing case and discovery is going to be amazing fun," along with a link which people can use to donate to the organization. The Democrats are suing @WikiLeaks and @JulianAssange for revealing how the DNC rigged the Democratic primaries. Help us counter-sue. We've never lost a publishing case and discovery is going to be amazing fun:  More options: — WikiLeaks (@wikileaks) April 20, 2018 Discovery is a pre-trial process by which one party can obtain evidence from the opposing party relevant to the case. The Trump campaign, which is also named in the DNC filing, says the lawsuit will provide an opportunity to "explore the DNC's now-secret records." Hours after the Washington Post broke the news of the lawsuit, President Trump tweeted "Just heard the Campaign was sued by the Obstructionist Democrats. This can be good news in that we will now counter for the DNC server that they refused to give to the FBI," referring to the DNC email breach. Trump also mentioned "the Debbie Wasserman Schultz Servers and Documents held by the Pakistani mystery man and Clinton Emails."  In a statement which goes into the various items they'll be pursuing in court, the Trump campaign said the following: While this lawsuit is frivolous and will be dismissed, if the case goes forward, the DNC has created an opportunity for us to take aggressive discovery into their claims of 'damages' and uncover their acts of corruption for the American people,"  Everything will be on the table, including:

  • • How the DNC contributed to the fake dossier, using Fusion GPS along with the Clinton Campaign as the basis for the launch of a phony investigation.
  • • Why the FBI was never allowed access to the DNC servers in the course of their investigation into the Clinton e-mail scandal.
  • • How the DNC conspired to hand Hillary Clinton the nomination over Bernie Sanders.
  • • How officials at the highest levels of the DNC colluded with the news media to influence the outcome of the DNC nomination.
  • • Management decisions by Debbie Wasserman Schultz, Donna Brazile, Tom Perez, and John Podesta; their e-mails, personnel decisions, budgets, opposition research, and more.

What's interesting is that of all the sources the DNC cites in their massive lawsuit - the Steele dossier they paid for isn't one of them.

Jill Stein Defies Senate Intelligence Document Request, Calling It “Overbroad” and Unconstitutional - The Jill Stein campaign is refusing to comply fully with a Senate intelligence committee request for documents and other correspondence, made as part of the committee’s probe into Russian activities in the 2016 election, according to a letter to be delivered Thursday to the panel by an attorney for the campaign.The Green Party campaign will agree to turn over some documents, but raised constitutional objections to the breadth of the inquiry, which was first made in November 2017, arguing that elements of it infringe on basic political rights enshrined in the First Amendment.In the letter responding to committee chair Richard Burr, R-N.C., and ranking member Mark Warner, D-Va., Stein’s campaign has now said it will refuse some of the requests, calling them “so overbroad in reach as to demand constitutionally protected materials.”The campaign provided that letter to The Intercept and it is posted below.  For instance, the committee asked for all communications between the campaign and “Russian media organizations, their employees, or associates” between February 6, 2015, and the present.Stein’s campaign is willingly providing these.The committee also asked for communications from the “campaign’s policy discussions regarding Russia” during the same time frame.Verheyden-Hilliard wrote that the campaign will decline to produce these materials “on the basis of constitutional privilege arising from the First Amendment to the U.S. Constitution.” She also wrote that internal campaign communications of this nature are “not pertinent to the subject of Russian interference” in the elections. The letter says that if the investigators are interested in the campaign’s foreign policy plans, the Stein campaign is providing material related to those and there is also additional material available publicly on the internet.

Pelosi: “I Don’t See Anything Inappropriate” In Rigging Primaries - Caitlin Johnstone - The Intercept has published a secretly taped audio recording of one of the most powerful Democrats in America pressuring a progressive candidate to drop out of a Colorado congressional primary race. It hasn’t been getting as much attention as the WikiLeaks drops on the DNC’s sabotage of the Sanders campaign because it’s not about a presidential race, but make no mistake: this is the single most damning piece of evidence ever published exposing the Democratic Party’s war on progressives.The recording features House Minority Whip Steny Hoyer, the second-highest ranking Democrat in the House of Representatives, informing primary challenger Levi Tillemann that if he runs, he will be running against not just the chosen establishment candidate Jason Crow, but against Hoyer and the full might of the Democratic Congressional Campaign Committee (DCCC) as well.“Which means effectively, Congressman Hoyer,” Tillemann is heard saying toward the end of the recording, “I’m running a campaign against Crow, and against you, and against the DCCC, because you guys are on Crow’s side.”“Yeah,” replied Hoyer. “You know, frankly, that happens in life all the time.” [transcript] So there you have it. It simply doesn’t get any more incriminating than a published recording of a top Democrat informing a progressive candidate that the party will be placing its thumb on the scale against his primary opponent if he doesn’t drop out. Or at least, that’s what I would have thought.Nancy Pelosi, the only House Democrat who outranks Hoyer, somehow surpassed the jaw-dropping revelations in the audio recording by giving Hoyer’s actions her full-throated endorsement.“I don’t know that a person can tape a person without the person’s consent and then release it to the press,” Pelosi told reporters today. “In terms of candidates and campaigns I don’t see anything inappropriate in what Mr. Hoyer was engaged in — a conversation about the realities of life in the race as to who can make the general election.” That’s right, instead of blaming this evidence on Russian hackers, Democratic Party leadership has opted to try a brand new approach: they’re openly admitting to knowingly rigging their primaries against progressive candidates and saying that it’s the right thing to do. 

Kogan Exposes "Hypocrite" Zuckerberg: "Tens Of Thousands" Of Data Harvesting Apps Out There - Aleksandr Kogan, the computer scientist at the center of the Facebook data harvesting scandal, said Mark Zuckerberg is "totally" a hypocrite in a Monday CNBC interview. Kogan made headlines in March after the New York Times and The Guardian reported that political data firm Cambridge Analytica bought data on as many as 87 million Facebook users - harvested by Kogan's personality app, thisismydigitallife. The Moldovan-born researcher from Cambridge University says he's being used as a scapegoat, and that there are "tens of thousands" of other apps do the same thing, Kogan said. "It's certain""In reality, I think, the truth is we’ve got tens of thousands of over apps that did the same thing, probably on a much bigger scale than me," Kogan told CNBC's Power Lunch. "And they’re all out there and Facebook has no accounting for it." "The amazing thing is if you go and look at Facebook apps literally right now, many, if not most will have language in the terms of service that say they can transfer the data to third parties. I’m not talking about small companies, I am talking about some of the biggest companies in the world. And you can go and do this yourself right now. And Facebook is still not policing it."Kogan says that Facebook is "trying to distract," adding "they're trying to make this story about, 'Hey, it's a rogue agent and he transferred the data.'" He insists that, far from being a rogue, he had a close relationship with the company. "I was working with [Facebook] for a long time," said Kogan, who was the former co-director of global science research at the University of Cambridge. "I was a great ally. They hired my students. The fact that we were doing this project, it seemed like something super normal. I never expected anything to go wrong." "Their business model is built on selling ads," Kogan said. "To sell ads in social media, you want to find the right person and the right place at the right time and serve them the right ad. That's your advantage over TV. To do that, you want to know as much as possible about people. Now, if Facebook actually has to back up a minute and get less data and get people to opt in, it's a real threat to the business model." Kogan also said that Cambridge Analytica paid his company, Global Science Research, £230,000 (approx. $321,453 USD) for their service, most of which went into failed start  ups and legal fees.

 How Fake Mark Zuckerbergs Scam Facebook Users Out of Their Cash — A Facebook notification on Gary Bernhardt’s phone woke him up one night last November with incredible news: a message from Mark Zuckerberg himself, saying that he had won $750,000 in the Facebook lottery.“I got all excited. Wouldn’t you?” said Mr. Bernhardt, 67, a retired forklift driver and Army veteran in Ham Lake, Minn. He stayed up until dawn trading messages with the person on the other end. To obtain his winnings, he was told, he first needed to send $200 in iTunes gift cards.  Hours later, Mr. Bernhardt bought the gift cards at a gas station and sent the redemption codes to the account that said it was Mr. Zuckerberg. But the requests for money didn’t stop. By January, Mr. Bernhardt had wired an additional $1,310 in cash, or about a third of his Social Security checks over three months. Mr. Bernhardt eventually realized that he had been the unwitting victim of a scam that has thrived on Facebook and Instagram by using the sites’ own brands — and its top executives — to lure people in. At a time when the real Mr. Zuckerberg has vowed to clean up Facebook, the Silicon Valley company has failed to eliminate impostor accounts masquerading as him and his chief operating officer, Sheryl Sandberg, to swindle Facebook users out of thousands of dollars. An examination by The New York Times found 205 accounts impersonating Mr. Zuckerberg and Ms. Sandberg on Facebook and its photo-sharing site Instagram, not including fan pages or satire accounts, which are permitted under the company’s rules. At least 51 of the impostor accounts, including 43 on Instagram, were lottery scams like the one that fooled Mr. Bernhardt.

Dodd-Frank revamp in limbo as House, Senate refuse to budge -- A bill to provide community banks with regulatory relief remains stuck as House and Senate lawmakers are still at odds over whether to add additional provisions to the Senate effort.  Senators on the Banking Committee are standing firm that no further measures should be added for fear it will jeopardize a bipartisan agreement in the chamber. They argue the House should pass the Senate version and send it to President Trump. “This bill will not pass if it comes back to the Senate,” Sen. Mark Warner, D-Va., said at an American Bankers Association conference here Tuesday. “We stretched this about as far as we can go. The House of Representatives needs to accept this legislation. We included huge amounts of bipartisan legislation from the House.” Senate Banking Committee Chairman Mike Crapo, R-Idaho, agreed, saying he favors provisions that would reform the Consumer Financial Protection Bureau, but there wouldn't be enough support from Democrats to get the necessary 60 votes to avoid a filibuster. As a result, lawmakers should focus on passing the Senate bill in its current form, he said.  “The plan right now is to get S 2155 passed,” Crapo said. But Reps. Blaine Luetkemeyer, R-Mo., and Patrick McHenry, R-N.C., said the House will continue to push their own measures, focusing on ones that received bipartisan support in their chamber.  “The Senate can tell us to pass the bill, but we still have to do our job, which is look at the bill, decide if it’s something we can accept, decide if it’s something we want to improve,” said Luetkemeyer, who chairs the financial institutions and consumer credit subcommittee. “Let’s look at the range that has two-thirds of our members supporting and take a look at the bill. If there’s something that’s controversial, then kick it out.”

Hensarling signals he may leave Senate reg relief bill unchanged   — House Financial Services Committee Chairman Jeb Hensarling, R-Texas, on Thursday suggested he is open to keeping regulatory relief provisions passed by his panel out of a more comprehensive bill that originated in the Senate. Hensarling and other House members have pushed for the Senate bill — known as S.2155 — to be expanded with additional measures to ease regulatory burdens on community banks. But he appeared to acknowledge concerns that expanding the bill could compel key Senate Democrats to withdraw their support. Speaking before the U.S. Chamber of Commerce, Hensarling said he would support the House-passed measures advancing even if they move independently of the Senate bill.   “I’d be happy to attend multiple signing ceremonies in the White House,” Hensarling said at the Chamber of Commerce's Capital Markets Summit. “I would prefer that it be in 2155, but if not, we are certainly open to other pathways.” The comments came as members of the Senate Banking Committee — including the bill's chief sponsor, Chairman Mike Crapo, R-Idaho — appear to want the House to move their legislation without adding further measures for fear that it will jeopardize the bipartisan agreement. The success of Crapo's bill relies on a group of moderate Democrats who have backed it but said they oppose going further. But Hensarling is asking the Senate to consider a number of bills passed by the House with bipartisan or unanimous support. He said the Senate should tell the House which bills it won’t pass and offer a “pathway to success” for the bills that could get enough votes in the chamber. Crapo and other Senate Republicans have admitted that they wanted other measures included in their deregulatory bill, such as provisions that would reform the Consumer Financial Protection Bureau, but there would not be enough support from Democrats to get the necessary 60 votes to avoid a filibuster.

The death of the Basel Committee has been greatly exaggerated — The winter of 2016-17 was a dark time for the Basel Committee. Britain's vote to leave the European Union and the election of Donald Trump had ushered in an era of isolationism and suspicion of international organizations. The committee itself was showing potential fissures — leading some analysts to doubt its relevance — as members balked over the final details of Basel III. But fast forward to the present, and dire predictions of the Basel Committee's impending demise have not been realized. An agreement on capital floors that had caused much grief among members was finally completed late last year, albeit with lower risk weights than expected and longer phase-in deadlines, and new regulators are supportive of Basel's mission.  In the wake of Brexit and the 2016 U.S. election, such optimism was rare. At that time, the debate over capital floors in Basel III was intense, taking on a life of its own. Skeptics saw the changes as too extreme, referring to them derisively as “Basel IV.” The negotiations had grown so laborious that the EU signaled that it would not implement the standards, despite assurances from Basel representatives that the final rules would not require significant increases in bank capital.But in the end, the EU got on board with the deal.Just last week, Federal Reserve Vice Chairman for Supervision Randal Quarles — a Trump appointee — defended the value of international forums like the Basel Committee and the Group of 20’s Financial Stability Board, saying the U.S. has a “strong national interest” in participating on those committees. “To ensure a level playing field for our banks, we need to be able to influence those decisions,” Quarles said. “I think that we can improve their transparency — even they have acknowledged that. But I do think that we should remain engaged in them.” Quarles comments came as U.S. officials appear to be floating his name as the next president of the FSB, to succeed Mark Carney. The governor of the Bank of England has headed the international board since 2011, but his term expires in December.

Treasury’s Phillips pleads for caution on implementing Basel standards -- A top Treasury official cautioned regulators against rushing to complete certain final aspects of the Basel III capital and liquidity standards, suggesting the agencies should take more time to ensure that the new standards are in line with existing rules. Craig Phillips, who serves as counselor to Treasury Secretary Steven Mnuchin, said at a conference hosted by the International Swaps and Derivatives Association in Miami Thursday that so-called gold-plated capital standards — that is, standards that exceed the minimums set by the Basel Committee on Banking Supervision — “create challenges” for banks’ competitiveness in global markets.  While the Treasury supports foreign investment and global capital and liquidity rules, he said, some of the specific agreements are “miscalibrated.”“The initial iteration of the fundamental review of the trading book and the Net Stable Funding Ratio — both Basel standards — were widely recognized as being miscalibrated,” Phillips said. “We do support their adoption in principle, but they have to be thoughtfully implemented on top of the capital and liquidity regimes that we have present here in the U.S.”Phillps noted that the Treasury Department's June 2017 report on revamping the regulatory structure called for the U.S. to delay implementation of the NSFR and FRTB. The report said they should be delayed until “they can be appropriately recalibrated and assessed.” Phillips said the Basel Committee appeared to agree with the Treasury’s assessment when it included an implementation deadline of 2022 for its highly contentious capital floors standard in December. Phillips’ comments come only days after Federal Reserve Gov. Lael Brainard said in a speech that the agency is “close to finalizing” the NSFR proposal that the agency published in April 2016. The rule would require banks to have stable funding for their baseline operations for one year.

Bank Watch: Wells Fargo Fined $1 Billion -  Jerri-lynn Scofield - Wells Fargo is in the news again, for agreeing last week to pay $500 million to the Consumer Financial Protection Bureau, and $500 million to the Office of the Comptroller of the Currency (OCC), for abuses in its automobile lending and mortgage units. (For the most recent posts by Yves about Wells, see here, here, here, here, and here, specifically concerning the unnecessary auto insurance covered by this settlement). More fines, more sound and fury, as reported by Bloomberg in Wells Fargo’s $1 Billion Pact Gives U.S. Power to Fire Managers:The nation’s third-largest bank submitted to an unprecedented order Friday that would give the Office of the Comptroller of the Currency the right to remove some of the lender’s executives or board members. That comes on top of the penalties Wells Fargo will pay to settle U.S. probes into mistreatment of consumers, the largest sanction of a U.S. bank under President Donald Trump.The OCC said it “reserves the right to take additional supervisory action, including imposing business restrictions and making changes to executive officers or members of the bank’s board of directors.” The agency could also veto potential executive candidates.…Wells Fargo warned shareholders last week it would soon face a fine of that size, which it will book retroactively in the first quarter. The bank remains under a Federal Reserve penalty that bans growth in total assets.Yet still no sign of criminal charges, for the bank or its executives, and as for jail time…. I don’t think so.(See here for OCC’s press release and here for its order).   As Vox reported on Friday, in a headline that summarises the crux of the matter,Wells Fargo just got fined $1 billion. Republicans cut its taxes by $3.7 billion.. the $1 billion in fines levied by the OCC and the CFFPB is roughly a quarter of the $3.7 billion tax cut the bank received this year. So, set against this background, what worries James Stewart of the New York Times most? The headline of his piece tells us where he’s going:  Punishing Wells Fargo: Just Deserts, or Beating a Dead Horse?:

Penalties levied against Wells Fargo miss top execs. Again --   Despite its recent $1 billion penalty, Wells Fargo and its top executives are having a pretty good spring. The bank reported quarterly earnings earlier this month of nearly $6 billion. And executives appear to be getting off the hook for problems in the bank’s mortgage and auto businesses, which spurred the latest penalty from the Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau. No executive is even named in the government’s documents. On top of that, the bank is doing well as a result of the tax-cut package passed late last year. Goldman Sachs’ investment research team estimated that Wells Fargo would see the biggest windfall out of all financial institutions from that law going into effect — gains worth an estimated $3.7 billion annually. And unlike the one-time penalty it now faces, the benefits occur this year, next year and so on into the future.President Trump’s tax-cut apologists, led by Treasury Secretary Steven Mnuchin, claimed that American corporations would return these savings to employees. Wells Fargo announced it would spend about $78 million increasing the hourly wage for workers. What about the other $3.622 billion? Much of it seems intended for share buybacks. The bank announced in January that its board approved the repurchase of 350 million shares, which, according to one estimate of its share price, equals $22.6 billion worth of stock. Knowing this fine was coming, the Wells Fargo board nevertheless gave Tim Sloan, the bank’s chief executive, a 36% pay raise, announced last month. In total, Sloan’s 2017 compensation exceeded $17.5 million. Of this, $15 million comes in the form of stock awards. However, that’s only an estimate of what the shares would be worth when he’s allowed to sell them. They could be worth much more. One way to help make them worth more is through a share buyback that raises the stock price. Thanks to the corporate-tax giveaway, Sloan and other senior executives who oversee a bank that the Trump administration claims committed a massive fraud will be able to pocket millions more than under the previous tax rates. Compare this to the median paid Wells Fargo employee who received total compensation of $60,000, including health care and other noncash benefits.

How huge Wells Fargo fine could leave customers in the cold - The Consumer Financial Protection Bureau's $1 billion fine against Wells Fargo was a record, but it also set another precedent: Not a penny of that will go to Wells customers harmed by the practices at issue.In fact, federal regulators did not specify how much Wells must refund its customers, including more than 27,000 who had their vehicles repossessed after the bank forced them into auto insurance policies. Even though Wells will pay a sizable price, critics say the lack of a minimum restitution threshold is a departure for the CFPB. Under former Director Richard Cordray, the CFPB always set a minimum amount that firms had to pay affected customers, and monitored those reimbursements. But the agency under acting Director Mick Mulvaney appeared to jettison that approach in the order against Wells over abuses in its auto insurance and mortgage units.  Critics say that gives banks too much leeway to underpay consumers harmed by practices or not pay them at all.

Deutsche Bank Reports Disastrous Results As It Retreats From US Investment Banking -- This morning, Germany's biggest bank reported its first earnings under its new CEO, Christian Sewing, which missed across the board: Q1 net revenue missed the lowest analyst estimate, coming at €6.98 billion, down 5% and below the estimate €7.27 billion, also missing the low end of the range (€7.12 billion to €7.33 billion), and unlike other banks where at least the rebound in equity trading helped offset stagnant FICC, that was not the case for DB where sales and trading crashed by 17% to €2.45 billion - compared with a an average 10% increase at the big 5 US banks - resulting in a 74% collapse in pre-tax income for the corporate investment bank. Summing it up, Deutsche’s pre-tax income more than halved to €432MM from a year prior, missing average analyst expectations by almost a third, and resulting in a paltry €120 million in after tax profits, a 79% plunge Y/Y. Christian Sewing, DB's new CEO, who unceremoniously replaced John Cryan one month ago, did not mince his words when slamming the abysmal results: "We are on a good track both in the DWS asset management business and in our Private & Commercial Bank, although we need to substantially improve profitability in both. Our Corporate & Investment Bank is also doing well in some areas and held or gained market share in certain areas. However, we are not strong enough in other areas of this business. Therefore we have to act decisively and to adjust our strategy. There is no time to lose as the current returns for our shareholders are not acceptable.”

The Purge Begins: Deutsche Bank Fires 400 US Bankers - As part of its latest disastrous earnings, which saw trading revenues tumble by 17% as new CEO Christian Sewing took over, we reported that Deutsche Bank announced a sweeping restructuring plan, abandoning its long-running ambitions to be a top global securities firm, scaling back U.S. rates sales and trading, reducing the corporate finance business in the U.S. and Asia, and reviewing its global equities business with a view toward cutting it back, the bank said in a statement. The measures will lead to a “significant reduction” in the 97,130-person workforce this year, Deutsche Bank said. We translated it more simply: massive layoffs. Predictably, the German bank wasted no time, and according to Reuters and Bloomberg, the purge began overnight when Deutsche fired 300 U.S.-based investment bankers on Wednesday with another 100 pink slips expected over the next 24 hours. In total, the biggest German bank plans to cut more than 1,000 jobs, or over 10%, of total US jobs in its initial restructuring phase. According to Bloomberg, the US hosts about 10,300 Deutsche Bank employees, or about a tenth of the firm’s global workforce. In his earnings call comments, CEO Sewing stopped short of disclosing how many of the bank's 97,103 jobs would be let go... ... while CFO James von Moltke also gave few clues as to how much of its massive 1.4 trillion euro ($1.7 trillion) balance sheet would be shed in the process. Von Moltke estimated restructuring costs for 2018 would rise to 800 million euros, up from an earlier estimate of 500 million euros, according to Bloomberg. “These cutbacks will be painful, but they are unfortunately unavoidable if we want to be sustainably profitable in the best interests of our bank, our clients and our investors,"

 Are banks heading for a Facebook-style data crisis? - Banks are increasingly relying on nontraditional data from third-party providers and partners for credit, marketing and other purposes, but many executives say it is hard to verify much of this information. Even before the details of Facebook’s Cambridge Analytica scandal became public, there were many questions about banks' use of data from external, unstructured sources.While banks have long relied on proprietary data to make business decisions, not all are investing properly in the capabilities to verify these new sources of data, said Alan McIntyre, senior managing director and head of Accenture’s banking practice.“Inaccurate, unverified data will make banks vulnerable to false business insights that drive bad decisions,” said McIntyre. “Banks can address this vulnerability by verifying the history of data from its origin onward — understanding the context of the data and how it is being used — and by securing and maintaining the data.”According to the firm’s Banking Tech Vision 2018 report released last week, 28% of the 800 bankers surveyed said that they do not validate or examine the data they receive from outside sources "most of the time," while 24% validate the data but recognize they should do a lot more to ensure quality. The issue is distinct from cybersecurity — banks have a responsibility to keep bad actors from accessing customer data, McIntyre said. Rather, it is about ensuring the explosion of external data used in areas like marketing accurately reflects customer sentiments and preferences, he said.    The challenge reflects how banks are starting to face some of the same issues tripping up social media companies that aggregate news stories and other information. “We’ve seen this with fake news and what’s going on with Facebook,” McIntyre said. "With all the data sources they’re using now — including fintechs and startup, smaller firms — banks have to be careful this information is accurate.”

Energy secretary's son expands private energy fund - A private investment firm led by Energy Secretary Rick Perry’s son has notified the Securities and Exchange Commission that it’s seeking investors for a new energy fund, raising concerns about the potential for private businesses run by the offspring of high-ranking government officials to benefit from their parents’ policy decisions without the public being aware.Griffin Perry is one of three owners of Dallas-based Grey Rock Energy Partners, which runs pooled investment funds that take stakes in active U.S. oil and natural gas drilling projects on behalf of wealthy investors who can meet a hefty minimum investment threshhold. On April 19, the SEC published Grey Rock’s latest regulatory filing, which created Grey Rock Energy Fund III-B. It marked the first new fund the group is offering since Griffin Perry’s father became President Donald Trump’s energy secretary, and comes amid escalating concerns about conflicts of interest in the Trump administration.Watchdog groups have two worries about situations like this. One is that existing investment rules allow for little public disclosure about private funds like Grey Rock, making possible conflicts of interest nearly impossible to spot. Neither the names of the investors nor their individual stakes are shared with the SEC, which requires just minimal information on the number of investors and sum of investment money under management. “The lack of transparency in these types of funds greatly inhibits our ability to meaningfully identify and monitor conflicts of interest arising from his son's business,” said Virginia Canter, legal counsel on executive branch issues for the watchdog group Citizens for Responsibility and Ethics in Washington. “Conflicts can arise from both the underlying assets being managed by Grey Rock and the investors in Grey Rock.” The other concern is that conflict-of-interest rules for politicians extend only to spouses and young kids, not grown ones.

GOP split as banks take on gun industry -- Major banks are cutting off business with the gun industry, roiling Republicans who want to respect the financial decisions of private institutions while still showing their unyielding support of the Second Amendment. Some Republicans, enraged at moves by Citigroup and Bank of America to distance themselves from some retailers and gun manufacturers, have called on government agencies to cancel contracts with the banks and defer deregulation proposals that would benefit them. But other Republicans want to keep their hands off, saying lenders are free to decide who they do business with. ..It's a conundrum that puts the free-market principles at odds with gun rights, and Republicans across the board are genuinely split over how to react to moves by some of the biggest financial institutions in the country. "I'm not writing a law that says you can't do it — I just think it's dumb and it's dangerous waters," Rep. Bill Huizenga (R-Mich.) said. "I have a pretty high bar before I'm going to go in and tell the private sector what they should and shouldn't be doing." Conservatives who have begun to speak out say it's justified given the fundamental role the government plays in allowing the giant banks to operate, including the massive bailouts that shored up their operations during the Wall Street meltdown a decade ago. "It is a blurrier area," said Senate Banking Chairman Mike Crapo (R-Idaho), the most senior lawmaker to have started to push back against the banks, which his powerful panel oversees. 

Gun issue is a lose-lose for banks (whatever their stance) — How banks come down on the politically divisive issue of gun sales is increasingly a case of damned if you do, damned if you don't. While Citigroup and Bank of America face GOP heat over their restricting services to firearms sellers and manufacturers — criticism that could affect the outcome of regulatory relief negotiations — bankers in New York State now face the potential of regulatory blowback if they don't crack down on gun promoters under new Department of Financial Services guidance.“One of the problems with any issue like this in today’s world, you are going to have people agree with you and disagree with you, often passionately, from both sides,” said Chip MacDonald, a financial services lawyer at Jones Day. “The banks ought to be able to make reasonable decisions consistent with law on how their brand is used and who they do business with.” To some observers, the issue of gun violence — amplified by mass shootings like that in Parkland, Fla., in February — is hard for banks to ignore. Their public stance could affect customer perceptions and regulators may take notice of the reputational risk.“Banks increasingly must consider political issues as part of their risk management decision-making process,” said Rolland Johannsen, a senior consulting associate at Capital Performance Group. “This requires new processes and more proactive and broader considerations of reputation risk as part of risk models and calculations.”But regulatory pressure on banks to act is also drawing criticism, with bankers and other industry observers questioning the move by the NYDFS.The guidance appeared somewhat benign, calling on state-chartered banks and other financial services firms to rethink ties they have with the National Rifle Association and other firearms-industry groups in the wake of the mass shootings. The regulator encouraged banks to weigh reputational risk and other corporate responsibility factors in assessing their relationships. But bankers say such regulatory guidelines are frustratingly vague, and can effectively compel institutions to cease catering to legal businesses.

Bankers can't be too cautious with crypto  - Despite all of the hype around the rise of virtual currencies, banks have been conspicuously cautious in their approach, including their handling of potential customer involvement in the space. This is a smart approach.  Large U.S. and U.K. banks have barred credit cardholders from using bank-issued plastic to purchase cryptocurrencies. Some banks have refused to process international wire transfers relating to cryptocurrency transactions. A number have either declined to clear trades in bitcoin futures trading on U.S. exchanges or significantly limited the circumstances for doing so, including the customers for which they’ll clear trades. And many businesses in this space have found it difficult to establish traditional banking relationships. This cautious approach is sensible; banks have reasonable apprehensions that credit and reputational risk is amplified when dealing with cryptocurrencies and their derivatives. For example, card issuers are concerned that unsophisticated and/or insolvent customers might use their cards to finance purchases of unregulated and highly volatile products — sticking the issuers with significant losses if customers, having speculated unsuccessfully, are unable to pay their credit card debt. The use of stolen cards to buy cryptocurrencies exacerbates the risk. As for bitcoin futures introduced by the CME and Cboe in recent months, trading in those derivatives have been subject to wide — at times extreme — price volatility, making clearing difficult and risky. Some observers, moreover, consider bitcoin futures to be subject to significant manipulation risks — concerns have been raised, for example, as to how the underlying reference rates are determined.

Harvard Teens Raise $1M For Crypto Fund Despite "Not Knowing A Lot  - Teens are now setting up crypto hedge funds despite not having much of a clue as to what they're doing. And they don't seem to have trouble finding capital, either.If you are in the process of trying to gauge whether or not the world of crypto is achieving new highs in bubble status, then look no further than today’s perfunctory Bloomberg article on the crypto world.Our daily dose of crypto "must have" news comes in the form of an article, published Friday, that details several Harvard undergrad students who woke up one morning and decided they wanted to start a crypto hedge fund. Bloomberg reported, Bushra Hamid, the 19-year-old daughter of Syrian immigrants, has teamed up with three schoolmates to form Plympton Capital, a hedge fund for investing in digital currencies. Hamid says they aim to launch in six to eight weeks, starting with $1 million. Plympton, named for a street in Cambridge, Massachusetts, has already raised $700,000 from friends and family. And to give you some indication as to exactly how ready people are to throw money at crypto right now, the article states that they were able to raise $700,000 million from family and friends despite the fact that they may have no clue as to what they are doing: “We don’t necessarily know a lot, but they have full trust in us,” Hamid said. Friends - rather, investors - in the fund seem to be a little light on the "due diligence" angle, investing because founder Hamid had one run of success with cryptos:

“‘OK, I’ll say it: bitcoin is a scam,’ says the former CEO of PayPal and Intuit” -  Bitcoin has enjoyed a nice stretch lately, breaking through the $9,000 level earlier this week and leading a broad advance in the crypto space, which, before Wednesday’s dip, had seen a $100-billion surge in market cap to $425 billion in a matter of daysSo, Bill Harris, are you warming up to bitcoin as an investment?‘It’s a colossal pump-and-dump scheme, the likes of which the world has never seen... the losers are ill-informed buyers caught up in the spiral of greed. The result is a massive transfer of wealth from ordinary families to internet promoters.’Bill Harris  We’ll take that as a no. Clearly, Harris, the founder of Personal Capital Corp. who served as CEO at both PayPal and Intuit, is not a fan, and he laid out the reasons why Tuesday in a piece for Recode.“I’m tired of saying, ‘Be careful, it’s speculative.’ Then, ‘Be careful, it’s gambling.’ Then, ‘Be careful, it’s a bubble.’” Harris continued. “Okay, I’ll say it: bitcoin is a scam.”He went on to refute all the reasons promoters claim it has value. It’s not a means of payment since it’s accepted almost nowhere, he said. Bitcoin’s extreme volatility makes it undesirable as a store of value. And finally, he said its perceived value is merely an example of the Greater Fool Theory. “Cryptocurrency is best-suited for one use: Criminal activity,” Harris said, pointing to the likes of Silk Road and WannaCry ransomware. What’s more, even the regular users are flouting the law, he says, by avoiding paying taxes on every sale. “All of this would be a comic sideshow if innocent people weren’t at risk,” he said. “But ordinary people are investing some of their life savings in cryptocurrency.” In conclusion, he called on the SEC and other regulators to step in. “It’s time we gave them the legislative authority to do their job,” he said.

 Pump And Dump Schemes Take Over Crypto Markets  - In the largely unregulated environment of cryptocurrency trading, however, bold and daring pump and dump groups of anywhere from 2,000-200,000 traders are slowly brewing.Pump and dump schemes are some of the oldest tricks in the playbook of stock market scammers. In its simplest incarnation, a pump and dump scheme involves an investor or group of investors promoting a stock they own and then selling as soon as the price rises as the result of the endorsement.The details of each pump and dump scheme tend to differ but the basic principle is that they all involve an attempt to shift supply and demand.In the U.S., pump and dump is an illegal activity that can attract misdemeanor or felony charges including fines or jail-time depending on the extent of the scheme.  In the crypto world, these pump and dump groups operate on a simple ethos: well-coordinated trades to buy low and sell high.Pump and dump schemes tend to work best on small- and micro-cap stocks, and this fact is not lost on these crypto pump groups as they mostly target little-known altcoins.The modus operandi of these schemes is quite thorough and ingenious: the group leaders recruit new members by sending promotional messages and spamming join links promising quick and massive returns to prospects via platforms such as Telegram and Discord. They then look for obscure coins and set a price target. The leaders provide specific instructions to members including the exact time a pump will occur, the exchange and how the pump signal will be provided (images are mostly preferred over text to counter bots).

Gillibrand aims to 'wipe out' payday lenders with postal banking bill — Sen. Kirsten Gillibrand, D-N.Y., on Wednesday unveiled a bill that would empower the U.S. Postal Service to take deposits and make loans, a move she said would "wipe out" predatory lending and improve consumers' access to financial services. The Postal Banking Act would place a retail bank branch in each of the Postal Service’s 30,000 locations — branches that would provide “low-cost, basic financial services to all Americans,” according to a press release.  In a tweet, Gillibrand said that the legislation would “wipe out the predatory practices of the payday loan industry overnight by providing an accessible and low-cost alternative."“The federal government has backed financial institutions directly and indirectly for decades with FDIC insurance, FHA backing, and bailouts,” Gillibrand tweeted. “But those 'for-profit' banks have left too many behind. It's time to close the gap — and this time, no one will get rich on the taxpayers' dime. This is a simple solution to a problem facing every state in this country.”Legislative language has not yet been released for the bill, but a Gillibrand spokesperson said that the text should be introduced later Wednesday. The idea of having the Postal Service offer banking services goes back more than a century, and the Postal Service’s inspector general reignited the debate in 2014 with a white paper suggesting that the agency could and should provide financial services at its offices in order to meet consumer demand in locations that lack traditional banking alternatives. Many influential Democrats — including Sens. Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vt. — have endorsed the idea. It has also won support from community activists and was included in the Democratic Party’s 2016 platform.  But some advocates, including the USPS inspector general who sparked renewed interest in the idea, have acknowledged that Congress may need to pass legislation to make postal banking a reality.

Postal banking is back on the table. Here's why that matters - Whether you like the idea or hate it, expect to hear a lot more about postal banking over the next two and a half years. That’s because the concept of offering retail banking services at all 30,000 U.S. Postal Service locations will almost certainly be part of the Democratic Party’s economic agenda during the 2020 presidential campaign. The latest sign of what’s ahead came on Wednesday, when Sen. Kirsten Gillibrand unveiled new legislation to create a postal bank. Gillibrand, D-N.Y., frequently appears on lists of potential presidential candidates, and her endorsement of postal banking comes after two other would-be Democratic presidential contenders, Sens. Bernie Sanders and Elizabeth Warren, staked out the same position. Add to the mix the fact that economic populism is ascendant in the Democratic Party, and it seems likely that postal banking will quickly congeal into party orthodoxy. Maybe it has already. While postal banking did not get much attention on the 2016 campaign trail, the proposal nonetheless made its way into the Democratic Party’s platform.  Postal banking is an idea tailor-made for the political environment. Under Gillibrand’s proposal, the Postal Service would offer not only low-cost small-dollar loans, but also remittance services and checking and savings accounts that would come with debit cards and online services. The deposit accounts could be as large as $20,000 per account, according to the legislative text. They might be offered by the Postal Service alone or in partnership with banks and credit unions. Gillibrand’s legislation embraces a far more expansive vision of postal banking than has ever been adopted in the United States. 

Small businesses hit by disaster struggle with credit, too  - Small businesses that suffer losses from natural disasters tend to need smaller amounts of financing, they are more likely to seek it from online lenders or other nonbanks than regular businesses, and it's relatively hard for them to get what they need.That is the conclusion of a report issued Tuesday by several regional Federal Reserve banks about the availability of credit to small firms in disaster-hit areas. The study tracked the credit-seeking experiences of businesses that suffered losses and those that did not to see how the two groups fared.About half of the small businesses that sought financing after a calamity, regardless of whether they were damaged, filed applications with big banks. Unaffected businesses were more likely to apply to small banks for credit than their counterparts who had suffered financial losses (44% versus 37%). More tellingly, businesses that suffered disaster-related losses were more likely to apply to online lenders for credit than those that had not (31% versus 23%). And damaged businesses were far more likely to tap other nonbank sources of credit (34% versus 15%) such as specialty lenders, friends or family, or nonprofits. The amounts sought were relatively modest. Sixty-two percent of small businesses that experienced losses from natural disaster sought financing of $100,000 or less, the report said. But the bar for success was high. The number of the companies that suffered losses that actually obtained all the financing they applied for was 34%, compared with 45% of those that had not suffered losses.

House bill aims to improve transparency of CFPB guidance process — Rep. Sean Duffy, R-Wis., has introduced legislation designed to make the Consumer Financial Protection Bureau’s guidance process more transparent. The bill, co-sponsored by Rep. Ed Perlmutter, D-Colo., would require the CFPB director to issue “guidance” that "is necessary or appropriate to enable the bureau to carry out federal consumer financial law, including facilitating compliance with such law." It also prohibits penalizing institutions that rely in good faith on guidance from the bureau.“I’m proud to sponsor bipartisan legislation to bring predictability and transparency to the CFPB’s rule-making process,” Duffy said in a press release last week. “The CFPB should focus on its mission to actually protect consumers rather than play ‘gotcha’ with ambiguous and surprising guidance for mortgage lenders.” The bill was introduced as the CFPB's guidance process has encountered significant pushback, with companies objecting to the bureau and other regulators issuing guidance that operates more like a binding regulation. The Senate recently overturned a 2013 CFPB guidance restricting indirect auto loan markups after the Government Accountability Office had ruled that the guidance constituted a rule. A House vote on the Senate measure is scheduled for this week.The CFPB would be required under Duffy's legislation to establish time limits to provide answers in response to requests for guidance, as well as create a process for amending and revoking guidance, including public notice and comment.

Mulvaney response to CFPB data security gaps baffles cyber experts - Acting Consumer Financial Protection Bureau Director Mick Mulvaney has repeatedly pointed to data security as a defect in the agency's supervisory program, but security experts are scratching their heads over the bureau's response to such problems. Mulvaney has said hundreds of CFPB-related data breaches justified his announcement in December that the agency would halt collecting personally identifiable information from companies it supervises.But industry experts say such a data freeze is unusual in the government, where security gaps are somewhat common. More unusual, they say, is that the CFPB apparently resumed data collection after only a few weeks, without investigating or remedying the cybersecurity problems that it identified. "I have not seen a single federal agency that stopped collecting data after getting breached," said Daniel Tobok, the CEO of Cytelligence, a Toronto cyber-breach response company that employs former law enforcement, military and intelligence agents. "From what I've read there was not a single mention that the matters [at the CFPB] have been investigated and security has been plugged."Some observers have speculated that the CFPB's unique response to its data security issues could further indicate that Mulvaney attempted to draw attention to the agency's cyber-related problems simply to cast the bureau in a negative light. "Government agencies all over the country have security problems, but it's not a viable option for most agencies to stop collecting data," said Kirk Nahra, a partner at Wiley Rein. "I can't imagine the Department of Health and Human Services saying we had a security breach last week, so we're going to stop Medicare."Nahra added that federal agencies typically move quickly to root out the problem and then resume data collection. "We don't know details or what actual information is the source of those [CFPB] breaches, but there's a disconnect there," Nahra said. "If there's a problem and they can't fix it right away, they hire a contractor. Saying they're having issues so they're not going to do enforcement — no one else is making that connection. You go out and fix the problem."

Mulvaney to drop public complaints against firms, change CFPB name -  — Acting Consumer Financial Protection Bureau Director Mick Mulvaney vowed to bankers on Tuesday that he would halt the agency’s actions against indirect auto dealers, stop posting consumer complaints online and change the bureau's name.  Mulvaney, speaking to more than 1,300 bankers at an American Bankers Association conference, addressed two major areas that the industry has long argued was statutory overreach by the prior leadership at the agency.  “We are going to do what the law says, but not what the law doesn’t say,” said Mulvaney, who brought the bureau’s statutory book to point to where the agency had limitations. For example, Mulvaney cited a statute in the Dodd-Frank Act that restricted the CFPB from going after auto dealerships. The CFPB, under previous director Richard Cordray, did not cite auto dealers directly but went after a handful of major lenders that partner with dealerships, arguing the lender was responsible for unintentional discriminatory lending at the dealer.   Mulvaney added that the bureau is “going to pay attention to these sorts of limitations” that restricted the CFPB from citing auto dealerships.  Another area that Mulvaney plans to rein in is the CFPB’s public consumer complaint portal. The industry has argued the complaints are not fully vetted before being posted online, which can create reputational harm.  “I don’t see anything in here that says I have to make all of this public,” he said. “We are going to maintain the consumer database. It is mandated by law,” but “I don’t see anything in here that I have to run a Yelp for financial services sponsored by the federal government.” Mulvaney also said he wants to change the name of the CFPB to the Bureau of Consumer Financial Protection, its official name in the Dodd-Frank Act that created the agency in 2010.

Clock's ticking: White House should name a permanent CFPB director - The Trump administration is running out of time to put its stamp on the Consumer Financial Protection Bureau.  Recent polls suggest that political change is coming in November, and Democrats have an opportunity to gain control of one or both houses of Congress. Nationally, political sentiments in midterm elections tend to shift away from the sitting president’s party — and this time around, polls suggest the nation appears to be shifting left.  The odds of Democrats taking back the House have been growing stronger in recent months, though they face a much tougher battle in the Senate where they must defend a considerably larger number of seats than their Republican colleagues. But if Democrats are able to pull off a wave election, winning a majority in both chambers, it could spell trouble for the financial industry and the Trump administration. Even if the risk is somewhat remote, it’s a risk worth considering before it’s too late.  This looming shift has already compressed the time frame for the financial services industry to enact regulatory relief, and there are important implications for federal financial regulators. At the forefront is leadership of the CFPB. The Federal Vacancies Reform Act, which President Trump used to install acting Director Mick Mulvaney over the continued objections of Democrats, permits Mulvaney to serve as acting director for only 210 days. Since Mulvaney’s tenure began on November 25, 2017, his term will expire on June 22, 2018. President Trump has not yet provided a nomination for a permanent leader of the CFPB, but if he does so before June 22, Mulvaney can continue to serve as acting director while the permanent director’s nomination is pending.  Having a permanent director is critical because the president cannot simply award Mr. Mulvaney a second 210-day term. To not name a permanent director — who would serve a five-year term — risks ceding that ability to the opposing party, or at the very least watering down his ability to name a long-term leader in his ideological vein.

 Mulvaney’s Advice to Bankers: Up Campaign Donations to Diminish Consumer Watchdog — Mick Mulvaney, the interim director of the Consumer Financial Protection Bureau, told banking industry executives on Tuesday that they should press lawmakers hard to pursue their agenda, and revealed that, as a congressman, he would meet only with lobbyists if they had contributed to his campaign. “We had a hierarchy in my office in Congress,” Mr. Mulvaney, a former Republican lawmaker from South Carolina, told 1,300 bankers and lending industry officials at an American Bankers Association conference in Washington. “If you’re a lobbyist who never gave us money, I didn’t talk to you. If you’re a lobbyist who gave us money, I might talk to you.” At the top of the hierarchy, he added, were his constituents, said Mr. Mulvaney, who received nearly $63,000 from payday lenders for his congressional campaigns.Mr. Mulvaney, who also runs the White House budget office, is a longtime critic of the Obama-era consumer bureau, including while serving in Congress. He was tapped by President Trump in November to temporarily run the bureau, in part because of his promise to sharply curtail it. Since then, he has frozen all new investigations and slowed down existing inquiries by requiring employees to produce detailed justifications. He also sharply restricted the bureau’s access to bank data, arguing that its investigations created online security risks. And he has scaled back efforts to go after payday lenders, auto lenders and other financial services companies accused of preying on the vulnerable.

CFPB's Mulvaney gives unexpected gift to Democrats - Acting Consumer Financial Protection Bureau Director Mick Mulvaney has caught a classic Washington bug: a serious case of foot-in-mouth disease. Mulvaney is getting flak for comments he made Tuesday at an American Bankers Association conference regarding his decisions as a congressman about when — and when not — to meet with lobbyists and constituents. “We had a hierarchy in my office in Congress. If you were a lobbyist who never gave us money, I didn’t talk to you,” he said. “If you were a lobbyist who gave us money, I might talk to you. If you came from back home and sat in my lobby, I talked to you without exception — regardless of the financial contributions.”  The remarks have since hit a nerve, following a New York Times report about the incident.  Whether Mulvaney was speaking literally is up for debate, although it is worth noting that the comments were made in the broader context of encouraging conference attendees to visit their lawmakers.“People coming from back home to tell people in Congress what issues are important to them is one of the fundamental underpinnings of our representational democracy, and you have to continue to do it,” he said just after the now-scrutinized remarks. But the story has taken on a life of its own. Regardless of the acting director’s intent, the remarks appear to confirm the public’s worst fears about how Washington operates. They suggest a pay-for-play strategy that encapsulates what observers find so venal about This Town — a city awash in corporate funding where money can and does open doors.  The dust-up is good news for Democrats, who have a powerful new weapon against the senior Trump administration official overseeing an overhaul of the CFPB. It’s a setback for the acting director, who has already taken heat for previously calling the consumer agency a “sick, sad joke.” Rallying cries from consumer advocates and official letters from congressional Democrats — if not more serious actions, such as an ethics inquiry — are likely to follow.

What's in a name? For Mulvaney's CFPB, quite a lot - Would the Consumer Financial Protection Bureau by any other name still protect consumers? It's a question many in Washington are asking amid acting Director Mick Mulvaney’s curious quest to invert the CFPB’s name back into the Bureau of Consumer Financial Protection.  “I don't know why we call it the CFPB, but that is not the name of the organization,” he told Congress earlier this month.  He reiterated those comments Tuesday morning at an American Bankers Association conference, insinuating that the change came from Sen. Elizabeth Warren, D-Mass., the bureau’s founder. Mulvaney has suggested the move is an effort to hew more closely to the statutory language of the Dodd-Frank Act, which spells out the bureau’s name that way — although it’s worth noting that the phrase “Consumer Financial Protection Bureau” is also contained at least twice in the law.The agency has gone so far as to request a name change with The Associated Press, whose stylebook is used by newsrooms across the country. The acting director hinted at the switch last month, with the introduction of an old-school seal for the bureau, featuring an eagle with a decorative shield. Encircling the illustration is the agency’s name, spelled out as the Bureau of Consumer Financial Protection. The question is why Mulvaney is picking this seemingly superficial fight, even as he looks to overhaul central aspects of the bureau’s very functioning. This may prove yet another way for Mulvaney to leave a visual mark on the agency — on top of all that frosted glass.  “Mulvaney's efforts to downgrade ‘Consumer’ in favor of ‘Bureau’ reflect his attempt to not only weaken but also depersonalize the only federal agency with only one job, protecting consumers,” said Ed Mierzwinski, senior director of the federal consumer program at U.S. Public Interest Research Group.

The Consumer Complaints Database That Could Disappear From View -- When a consumer has a complaint about a bank, whether it's dealing with a mortgage or a credit card, right now there's a place to lodge that complaint online.It's easy to click around and search for other similar complaints. And it's a tool consumers can use when trying to weigh whether to do business with a particular bank or other kind of financial firm. Investigators like this database as well, because when thousands of similar complaints pop up, it could be a red flag that there's a problem at a bank that they need to dig into.The Trump administration's Mick Mulvaney was in the news again this week because he said he wanted to shut down public access to this popular government database at the Consumer Financial Protection Bureau.The industry likes this idea and has long complained about the database, because it says the complaints aren't vetted enough. Consumer groups say that keeping the public from seeing the database is a move that panders to companies the consumer regulator is supposed to be policing. The CFPB is a powerful watchdog regulator set up after the financial crisis. It's currently being run by Mulvaney, who once sponsored legislation to abolish the bureau when he was in Congress. He has often called the bureau too powerful and aggressive.

Warren fires off 100-plus questions for CFPB's Mulvaney — Sen. Elizabeth Warren, D-Mass., is continuing to press acting Consumer Financial Protection Bureau Director Mick Mulvaney, sending him a list of more than 100 questions about the current operations of the agency she created.  After Mulvaney’s testimony to Congress earlier this month, Warren is calling on the acting CFPB director to answer questions “for the record” about his actions on the payday lending rule, his data freeze, and his hiring of political appointees, among other things.Warren is also asking Mulvaney to clarify what he means when he says the CFPB will no longer do “regulation by enforcement” and explain why the Office of Fair Lending was stripped of its enforcement powers.Warren has sparred with Mulvaney over his leadership at the CFPB since he was designated by President Donald Trump to serve as acting director after former director Richard Cordray resigned in November 2017.Since taking over at the agency, Mulvaney, who also serves as Trump’s budget director, has halted enforcement actions against payday lenders, issued numerous public comment requests on the agency’s operations, and called on Congress to rein in the agency's power. He also told a group of bankers Tuesday that he would halt the agency’s actions against indirect auto dealers, stop posting consumer complaints online and change the agency’s name to the Bureau of Consumer Financial Protection, or BCFP.

Warren probes CFPB over lobbyists’ influence on Mulvaney —Sen. Elizabeth Warren is pressing the Consumer Financial Protection Bureau over what arrangements the agency has made to ensure that acting Director Mick Mulvaney is excluded from decisions that affect banks and other firms that previously gave him campaign contributions.In a letter to Sonya White, the agency’s ethics official, the Massachusetts Democrat asked for details on what matters Mulvaney is recused from following comments he made earlier this week in which he said campaign contributions were a key factor in whether he took meetings with lobbyists. “After Mr. Mulvaney's recent comments about the pay-to-play culture he maintained in his congressional office, I'm eager to learn more about safeguards the CFPB put into place to ensure that Mr. Mulvaney was excluded from decisions that affected the financial institutions that had given him campaign contributions,” Warren said in a letter to White dated Thursday. In a separate letter directly to Mulvaney, Warren also cited those comments to renew questions about campaign donations from the payday lending industry and whether they affected his decision to delay implementation of a final rule creating new rules for such firms. Mulvaney has been sharply criticized for comments he made at the American Bankers Association earlier in the week in which he said “we had a hierarchy in my office in Congress.”“If you were a lobbyist who never gave us money, I didn’t talk to you,” he said. “If you were a lobbyist who gave us money, I might talk to you. If you came from back home and sat in my lobby, I talked to you without exception — regardless of the financial contributions.” A number of lawmakers have since blasted Mulvaney, including Sens. Bernie Sanders, I-Vt., and Bob Casey, D-Pa., as well as the Senate Banking Committee’s top Democrat, Sen. Sherrod Brown of Ohio, who called on Mulvaney to resign.

CFPB finalizes rule to fix TRID 'black hole' --In a big win for the mortgage industry, the Consumer Financial Protection Bureau finalized an amendment to its "know before you owe" mortgage disclosure rule that gives lenders more flexibility to adjust closing cost estimates and pass those increases on to borrowers. The rule was initially designed to eliminate the sticker shock to borrowers who often faced significantly higher charges at the closing table than what was originally disclosed. Ted Eytan However, the rules created a situation that lenders have called the "black hole," when deadlines for delivering revised upfront and closing disclosures overlapped, forcing mortgage companies to absorb cost increases through no fault of their own. The amendment, originally proposed last July, is designed to address the black-hole issue, which industry groups told the CFPB was a frequent and costly compliance pain point. "Creditors may use Closing Disclosures to reflect changes in costs for purposed of determining if an estimated closing cost was disclosed in good faith, regardless of when the Closing Disclosure is provided relative to consummation," the final rule states. The Dodd-Frank Act directed the CFPB to integrate the loan disclosures required by the Truth in Lending Act and Real Estate Settlement Procedures Act, known as TRID. The disclosure rule took effect on Oct. 3, 2015. Some industry advocates have expressed concern that the change could create confusion for borrowers and allow lenders to provide closing disclosures early in the homebuying process that may actually be estimates and might not include all of the costs of the mortgage transaction. 

Freddie Mac: Mortgage Serious Delinquency Rate Decreased in March -- Freddie Mac reported that the Single-Family serious delinquency rate in March was 0.97%, down from 1.06% in February. Freddie's rate is up from 0.92% in March 2017. Freddie's serious delinquency rate peaked in February 2010 at 4.20%.These are mortgage loans that are "three monthly payments or more past due or in foreclosure".  The recent increase in the delinquency rate was due to the hurricanes - no worries about the overall market (These are serious delinquencies, so it took three months late to be counted). After the hurricane bump, maybe the rate will decline to a cycle bottom in the 0.5% to 0.8% range.

Rising Sea Levels Reshape Miami’s Housing Market – WSJ —Concerns over rising sea levels and floods are beginning to reshape one of the country’s largest housing markets, with properties closer to sea level now trading at discounts to those at higher elevations. Research published Friday in the journal of Environmental Research Letters shows that single-family homes in Miami-Dade County are rising in value more slowly near sea level than at higher elevations, as buyers weigh the possibilities of more-frequent minor flooding in the short term and the challenge of reselling properties that decades from now could be permanently submerged. Jesse Keenan, a real-estate professor at the Harvard University Graduate School of Design and author of the paper, said he was initially surprised to see ordinary homeowners already seeming to factor future sea-level rise into their calculations.  Low-elevation properties are becoming Miami’s laggards, he said. “To see them really separate is pretty shocking, because you can infer that this is a pricing signal from climate change.” Miami is a testing ground for the vulnerability of housing markets in other coastal cities, such as New York and Boston, because its elevation is as little as one foot above sea level and its porous limestone makes it especially vulnerable to rising sea levels.  Another new paper, from researchers at the University of Colorado at Boulder and Pennsylvania State University, shows that the trend in Miami is playing out across the country, with homes that are vulnerable to rising sea levels now selling at a 7% discount compared with similar but less-exposed properties. The paper, which is under peer review, shows that the size of the coastal discount has grown over time.  Ryan Lewis and his co-authors noticed the strongest discounting among investors and second-home owners, who have the most choices about where to buy. Increasingly, he said, ordinary home buyers in places such as Miami, where there is strong awareness of the risks, also are starting to discount. Market forces, he said, could cause migration away from the coasts. “As prices decline, that’s a signal to developers and investors that maybe you shouldn’t be investing a lot of money in an area that will be flooded in 20 years,” he said.

Mortgage, title insurers must file disaster plans with New York -- Mortgage and title insurance companies licensed in New York need to file disaster response plans this year in line with increased state attention to business continuity planning.The New York Department of Financial Services previously directed property and casualty companies to fill responses to a pre-disaster data survey by May 19, and most insurers need to respond to related online questionnaires by June 29. But the updated guidance "now also requires mortgage insurers and title insurers to file a disaster response plan and questionnaire" by Sept. 28.“When disaster strikes, as it did when Hurricanes Maria and Irma devastated Puerto Rico and the Virgin Islands last year, it is important for all insurers to be able to respond quickly and to be able to continue operations to ensure they can serve the increased needs of consumers resulting from the emergency, whether it’s a storm, a data breach or a terrorist attack," said New York Financial Services Superintendent Maria Vullo in a NYDFS press release. Private mortgage insurers, who primarily provide coverage in the government-sponsored enterprise market that dominates the home lending business, already must address business continuity planning as part of GSE eligibility requirements and are examining whether New York's requirements are appreciably different.  "USMI member companies have robust and comprehensive business continuity and disaster recovery plans in place," USMI President Lindsey Johnson said in a statement emailed to National Mortgage News. "Business continuity planning is required as part of the Private Mortgage Insurer Eligibility Requirements set by the government sponsored enterprises and approved by the Federal Housing Finance Agency and are a topic that are routinely covered during audits with Fannie Mae and Freddie Mac.” New York's oversight of business continuity planning tends to be more detailed than the federal guidance some other states look to in their licensing requirements.

MBA: Mortgage Applications Decrease Slightly in Latest Weekly Survey From the MBA: Mortgage Applications Slightly Decrease in Latest MBA Weekly SurveyMortgage applications decreased 0.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 20, 2018. .. The Refinance Index decreased 0.3 percent from the previous week. The seasonally adjusted Purchase Index was unchanged from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 11 percent higher 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) increased to its highest level since September 2013, 4.73 percent, from 4.66 percent, with points increasing to 0.49 from 0.46 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.  The first graph shows the refinance index since 1990.

Average mortgage rates hit four-year high on 10 year Treasury yield spike - Mortgage rates rose to their highest level in over four years, as 10-year Treasury yields broke the 3% ceiling this past week. - The 30-year fixed-rate mortgage averaged 4.58% for the week ending April 26, up from last week when it averaged 4.47%. This rate averaged 4.03% for the same week last year. "Mortgage rates are now at their highest level since the week of Aug. 22, 2013," said Sam Khater, who just joined Freddie Mac as its new chief economist, in a press release. "Higher Treasury yields, driven by rising commodity prices, more Treasury issuances and the steady stream of solid economic news, are behind the uptick in rates over the past week." The 10-year Treasury yield crossed and remained above the 3% threshold on April 25 for the first time since January 2014. But overnight, it dipped back below 3% and at 10:45 a.m. on April 26 it was at 2.99%. "Despite the increase in borrowing costs, demand for home purchase credit remains solid. The Mortgage Bankers Association reported in their latest mortgage applications survey that activity was up 11% from a year ago," Khater said. The 15-year fixed-rate mortgage this week averaged 4.02%, up from last week when it averaged 3.94%. A year ago at this time, the 15-year fixed-rate mortgage averaged 3.27%. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.74% this week with an average 0.3 point, up from last week when it averaged 3.67%. A year ago at this time, the five-year adjustable-rate mortgage averaged 3.12%.

FHFA House Price Index: Up 0.6% in February --The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for February. Here is the opening of the report:  – U.S. house prices rose in February, up 0.6 percent from the previous month, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI). The previously reported 0.8 percent increase in January was revised upward to 0.9 percent.The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. From February 2017 to February 2018, house prices were up 7.2 percent. ​ [Read more] The chart below illustrates the monthly HPI series, which is not adjusted for inflation, along with a real (inflation-adjusted) series using the Consumer Price Index: All Items Less Shelter.

Case-Shiller: National House Price Index increased 6.3% year-over-year in February -  S&P/Case-Shiller released the monthly Home Price Indices for February ("February" is a 3 month average of December, January and February prices). This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index. From S&P: S&P CoreLogic Case-Shiller Home Prices: Cities in the West Continue to Lead Housing Momentum The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 6.3% annual gain in February, up from 6.1% in the previous month. The 10-City Composite annual increase came in at 6.5%, up from 6.0% in the previous month. The 20-City Composite posted a 6.8% year-over-year gain, up from 6.4% in the previous month. Seattle, Las Vegas, and San Francisco continue to report the highest year-over-year gains among the 20 cities. In February, Seattle led the way with a 12.7% year-over-year price increase, followed by Las Vegas with an 11.6% increase and San Francisco with a 10.1% increase. Thirteen of the 20 cities reported greater price increases in the year ending February 2018 versus the year ending January 2018.  ..Before seasonal adjustment, the National Index posted a month-over-month gain of 0.4% in February. The 10-City and 20-City Composites both reported increases of 0.7%. After seasonal adjustment, the National Index recorded a 0.5% month-over-month increase in February. The 10-City and 20-City Composites both posted 0.8% month-over-month increases. All 20 cities reported increases in February before and after seasonal adjustment.  “Increasing employment supports rising home prices both nationally and locally. Among the 20 cities covered by the S&P CoreLogic Case-Shiller Indices, Seattle enjoyed both the largest gain in employment and in home prices over the 12 months ended in February 2018. At the other end of the scale, Chicago was ranked 19th in both home price and employment gains; Cleveland ranked 18th in home prices and 20th in employment increases. In San Francisco and Los Angeles, home price gains ranked much higher than would be expected from their employment increases, indicating that California home prices continue to rise faster than might be expected. In contrast, Miami home prices experienced some of the smaller increases despite better than average employment gains.” The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000). The Composite 10 index is off 1.6% from the peak, and up 0.7% in February (SA). The Composite 20 index is 1.3% above the bubble peak, and up 0.8% (SA) in February. The National index is 8.2% above the bubble peak (SA), and up 0.5% (SA) in February.  The National index is up 46.3% from the post-bubble low set in December 2011 (SA).

Home Price Surge Continues in February, Led by Western States -- With today's release of the February S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.83% month over month. The seasonally adjusted national index year-over-year change has hovered between 4.2% and 6.3% for the last two-plus years. Today's S&P/Case-Shiller National Home Price Index (nominal) reached another new high. The adjacent column chart illustrates the month-over-month change in the seasonally adjusted 20-city index, which tends to be the most closely watched of the Case-Shiller series. It was up 0.83% from the previous month. The nonseasonally adjusted index was up 6.8% year-over-year. had forecast a 0.7% MoM seasonally adjusted increase and 6.3% YoY nonseasonally adjusted for the 20-city series. Here is an excerpt from the analysis in today's Standard & Poor's press release. The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 6.3% annual gain in February, up from 6.1% in the previous month. The 10-City Composite annual increase came in at 6.5%, up from 6.0% in the previous month. The 20-City Composite posted a 6.8% year-over-year gain, up from 6.4% in the previous month.  Seattle, Las Vegas, and San Francisco continue to report the highest year-over-year gains among the 20 cities. In February, Seattle led the way with a 12.7% year-over-year price increase, followed by Las Vegas with an 11.6% increase and San Franciscowith a 10.1% increase. Thirteen of the 20 cities reported greater price increases in the year ending February 2018 versus the year ending January 2018.  “Home prices continue to rise across the country,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “The S&P CoreLogic Case-Shiller National Index is up 6.3% in the 12 months through February 2018. Year-over-year prices measured by the National index have increased continuously for the past 70 months, since May 2012. Over that time, the price increases averaged 6% per year. This run, which is still ongoing, compares to the previous long run from January 1992 to February 2007, 182 months, when prices averaged 6.1% annually. With expectations for continued economic growth and further employment gains, the current run of rising prices is likely to continue." [Link to source] The chart below is an overlay of the Case-Shiller 10- and 20-City Composite Indexes along with the national index since 1987, the first year that the 10-City Composite was tracked. Note that the 20-City, which is probably the most closely watched of the three, dates from 2000. We've used the seasonally adjusted data for this illustration.

Home prices in 20 cities in February rise by most since 2014 - Home prices in 20 U.S. cities grew in February at the fastest pace since mid-2014, underscoring the persistent scarcity of inventory amid strong demand, according to S&P CoreLogic Case-Shiller. The 20-city property values index increased 6.8% year-over-year after rising 6.4% the previous year, making this the fastest gain since June 2014. The national home-price gauge rose 6.3% year-over-year. The seasonally adjusted 20-city index rose 0.8% compared with January. The current index level of 209.29 is highest in records dating back to 2000 The data showed monthly gains in all 20 cities, including strong advances in expensive areas such as Seattle and Los Angeles, along with cheaper regions including Cleveland and Detroit. Sales are getting a boost from the strong labor market and borrowing costs that are still relatively low, though they've been edging up in recent weeks. (Andy Dean Photography) Andy Dean Photography At the same time, a shortage of available and affordable listings, especially of previously-owned houses, is sending prices higher and limiting purchases. Growth in property values continues to outpace wages, another hurdle for younger or first-time buyers looking to enter the housing market. Meanwhile, the ongoing price gains are translating into rising home equity for owners. "With expectations for continued economic growth and further employment gains, the current run of rising prices is likely to continue," David Blitzer, chairman of the S&P index committee, said in a statement. All 20 cities in the index showed year-over-year gains, led by a 12.7% increase in Seattle and an 11.6% advance in Las Vegas; Washington was the slowest gainer at 2.4%. After seasonal adjustment, Cleveland had the biggest month-over-month rise at 1.6%, followed by Detroit and Seattle with a 1.4% increase. A separate report from the Federal Housing Finance Agency showed its home-price index climbed 0.6% in February from a month earlier after a revised 0.9% increase. The FHFA price index advanced 7.2% from February 2017. 

Home Prices In 80% Of US Cities Grew 2x Faster Than Wages... And Then There Is San Francisco - The housing market is starting to overheat. Again.According to the latest BLS data, average hourly wages for all US workers in November rose at a relatively brisk 2.7% relative to the previous year, if below the Fed's "target" of 3.5-4.5% as countless economists are unable to explain how 4.1% unemployment, and "no slack" in the economy fails to boost wage growth. Another problem with tepid wage growth, in addition to crushing the Fed's credibility, is that it keeps a lid on how much overall price levels can rise by, i.e. inflation. Meanwhile, with record global debt, it has been the Fed's imperative to boost inflation at any cost to inflate away the debt overhang, however weak wages have made this impossible.Well, not really. Because a quick look at US housing shows that while wages may be growing at roughly 2.7%, according to the latest Case Shiller data, 18 of 20 metro areas in the US saw home prices grow at a  higher pace, while 16 of 20 major U.S. cities experienced home price growth of 5.4% or higher, double the average wage growth, and something which even the NAR has been complaining about with its chief economist Larry Yun warning that as the disconnect between prices and wages becomes wider, homes become increasingly unaffordable for most Americans. Confirming the recent jump in home prices, at the national level in February home prices for the Top 20 metro areas soared 6.8% YoY according to Case Shiller, the fastest rate since June 2014... ... and hitting a new all time high nationwide. And while this should not come as a surprise - considering we have pointed it out on numerous occasions in the past - one look at the chart below confirms that something very troubling is taking place in San Francisco, which has either become "Vancouver South" when it comes to Chinese hot money laundering, or the second housing bubble has finally arrived on the West Coast. And while according to Case-Shiller data, home prices in San Francisco rose "only" 10.1% Y/Y, a more accurate breakdown of San Fran housing prices from Paragon Real Estate indicates a record 24% annual increase in San Francisco home prices, which increased by $110,000 in just the past quarter.

Zillow Case-Shiller Forecast: More Solid House Price Gains in March - The Case-Shiller house price indexes for February were released Tuesday. Zillow forecasts Case-Shiller a month early, and I like to check the Zillow forecasts since they have been pretty close.  From Aaron Terrazas at Zillow: February Case-Shiller Results and March Forecast: Home Prices Pushed Higher by Inventory Crunch  The kind of sustained, rapid home price growth we’ve been seeing in Case-Shiller and other indices for the past few years is enough to give home buyers of all stripes a headache. And don’t expect things to slow down any time soon.  The pain this rapid growth is causing is widespread, but is especially acute for first-time and lower-income buyers at the bottom end of the market in search of entry-level homes that are appreciating the fastest, in large part because they are in the most demand.  Competition is fierce, offer windows are short and tensions will inevitably run high for many buyers as the spring shopping season unfolds.  More inventory is the one cure sure to take this edge off, and there are some faint signals in more recent data that a shift may be coming – inventory of existing homes has risen for the past three months, and construction activity is at its highest point in a decade.but buyers in the market now shouldn’t hold their breath. Even if inventory does begin to recover, it will be rising from incredibly low levels and will likely take years to get back to a more ‘normal’ level.Zillow predicts the March S&P/Case-Shiller U.S. national index, which will not be released until May 29, will climb 6.5 percent year-over year.The Zillow forecast is for the year-over-year change for the Case-Shiller National index to be larger in March than in February.

What Will Rising Mortgage Rates Do to Housing Bubble 2? -- Wolf Richter:  The average interest rate for 30-year fixed-rate mortgages with conforming loan balances – $453,000 or less – and a 20% down-payment jumped to 4.73% for the week ending April 20, from 4.66% in the prior week, according to the Mortgage Bankers Association. This was the highest rate since September 2013. So far in 2018, this measure of the average mortgage rate has risen half a percentage point (chart via Trading Economics): And since mid-2016, mortgage rates have now risen a full percentage point.Points – these pesky upfront fees, such as origination fees, that are usually plowed into the mortgage balance – rose 3 basis points during the week to 0.49% of the mortgage amount.If the average mortgage rate rises to 4.81% — at the pace the average rate has been increasing, this might happen in a few weeks or less – it will be the highest since 2011 (chart via Trading Economics): If the average mortgage rate rises to 5.2% — perhaps in the second half of this year — it will be the highest since 2010. And 5.5% would take mortgage rates back to levels not seen since 2008 (chart via Trading Economics):But there is a difference between those higher mortgage rates now and the same rates back then: Home prices! Depending on the metro area, home prices have surged over those years, while incomes have not, and now the free lunch – the combination of rising home prices and falling mortgage rates – is over. Since 2010, the last year when mortgage rates where at 5% for a significant amount of time, home prices as measured by the nationwide Case-Shiller home price index have surged 33%:  Fearing even higher mortgage rates in the future, home buyers are rushing to take out mortgages while they still can: the Mortgage Bankers Association’s Purchase Index, which tracks the number of purchase mortgages (as opposed to refis) that were originated during the week increased 11% compared to the same week a year ago. The pain threshold for the US housing market is at 6% (average 30-year fixed-rate mortgage, as measured by the MBA, conforming, with 20% down). That’s my story, and I’m sticking to it.

The Amazon Effect On Housing Markets - Having hit major sweepstake proportions, the competition to play host to Amazon’s second headquarters is down to 20 finalists, but it might end up being an expensive economic transformation for the citizens of the lucky city.Real estate site Zillow is now cautioning that rents in the chosen city will rise exponentially as a result of hosting Amazon, which is due to makes its decision later this year--and in some places it will hurt more than others.Nashville, for instance, might be really looking forward to the chance to become a major economic force and branch out beyond country music, but at the end of the day, playing host to Amazon will be more people, traffic and higher rents. Ten years on, that could me $400 more per month for rent.So, not everyone’s bristling with optimism, and some may even be planning an out-of-state move in advance—just in case.According to Zillow, if chosen, Nashville would see rents rise 3.3 percent per year—or, from another perspective—four times faster than would without Amazon.So much for affordable housing. This form of prestige will come with a hefty price tag for some. And Nashville might not be the worst-case scenario. Zillow’s data predicts that Denver would see rent increases at a rate of nearly 6 percent a year.

NAR: "Existing-Home Sales Climb 1.1 Percent in March" - From the NAR: Existing-Home Sales Climb 1.1 Percent in March - Existing-home sales grew for the second consecutive month in March, but lagging inventory levels and affordability constraints kept sales activity below year ago levels, according to the National Association of Realtors®.   Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 1.1 percent to a seasonally adjusted annual rate of 5.60 million in March from 5.54 million in February. Despite last month's increase, sales are still 1.2 percent below a year ago. Total housing inventory at the end of March climbed 5.7 percent to 1.67 million existing homes available for sale, but is still 7.2 percent lower than a year ago (1.80 million) and has fallen year-over-year for 34 consecutive months. Unsold inventory is at a 3.6-month supply at the current sales pace (3.8 months a year ago).This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993. Sales in March (5.60 million SAAR) were 1.1% higher than last month, but were 1.2% below the March 2017 rate. The second graph shows nationwide inventory for existing homes. Existing Home InventoryAccording to the NAR, inventory increased to 1.67 million in March from 1.59 million in February. Headline inventory is not seasonally adjusted, and inventory usually decreases to the seasonal lows in December and January, and peaks in mid-to-late summer. The last graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

Existing-Home Sales Grows in March, Low Supplies - This morning's release of the March Existing-Home Sales increased from the previous month to a seasonally adjusted annual rate of 5.60 million units. The consensus was for 5.55 million. The latest number represents a 1.1% increase from the previous month and a 1.2% decrease year-over-year.Here is an excerpt from today's report from the National Association of Realtors.Lawrence Yun, NAR chief economist, says closings in March eked forward despite challenging market conditions in most of the country. "Robust gains last month in the Northeast and Midwest – a reversal from the weather-impacted declines seen in February – helped overall sales activity rise to its strongest pace since last November at 5.72 million," said Yun. "The unwelcoming news is that while the healthy economy is generating sustained interest in buying a home this spring, sales are lagging year ago levels because supply is woefully low and home prices keep climbing above what some would-be buyers can afford.""Although the strong job market and recent tax cuts are boosting the incomes of many households, speedy price growth is squeezing overall affordability in several markets – especially those out West," said Yun. [Full Report] For a longer-term perspective, here is a snapshot of the data series, which comes from the National Association of Realtors. The data since January 1999 was previously available in the St. Louis Fed's FRED repository and is now only available from January 2014. It can be found here.

    Existing Home Sales Resume Annual Drop Despite Weather-Driven Rebound - Existing Home Sales saw a better than expected 1.1% MoM jump in March...(largely thanks to rebounds in the Northeast and Midwest after weather-related weakness)...March existing-home sales in the Northeast jumped 6.3 percent to an annual rate of 680,000, but are still 9.3 percent below a year ago. The median price in the Northeast was $270,600, which is 3.3 percent above March 2017.In the Midwest, existing-home sales increased 5.7 percent to an annual rate of 1.29 million in March, but are still 1.5 percent below a year ago. The median price in the Midwest was $192,200, up 5.1 percent from a year ago.Existing-home sales in the South decreased 0.4 percent to an annual rate of 2.40 million in March, but are 0.4 percent above a year ago. The median price in the South was $222,400, up 5.7 percent from a year ago.Existing-home sales in the West declined 3.1 percent to an annual rate of 1.23 million in March, but are still 0.8 percent above a year ago. The median price in the West was $377,100, up 7.9 percent from March 2017.But, existing home sales dropped 1.2% YoY to 5.6million SAAR. Inventories rose 5.7% - a positive for affordability; but median prices rose 5.8% YoY to $250,400 (more than double wage growth). Lawrence Yun, NAR chief economist, says closings in March eked forward despite challenging market conditions in most of the country."Robust gains last month in the Northeast and Midwest – a reversal from the weather-impacted declines seen in February – helped overall sales activity rise to its strongest pace since last November at 5.72 million," said Yun."The unwelcoming news is that while the healthy economy is generating sustained interest in buying a home this spring, sales are lagging year ago levels because supply is woefully low and home prices keep climbing above what some would-be buyers can a fford.""Although the strong job market and recent tax cuts are boosting the incomes of many households, speedy price growth is squeezing overall affordability in several markets – especially those out West," said Yun.

    A Few Comments on March Existing Home Sales -  Bill Mcbride - A few key points:
    1) As usual, housing economist Tom Lawler's forecast was closer to the NAR report than the consensus. See:Lawler: Early Read on Existing Home Sales in March.
    2) Inventory is still very low and falling year-over-year (down 7.2% year-over-year in March). More inventory would probably mean smaller price increases, and less inventory somewhat larger price increases.    This was the 34th consecutive month with a year-over-year decline in inventory. The following graph shows existing home sales Not Seasonally Adjusted (NSA). Sales NSA in March (434,000, red column) were above sales in March 2017 (355,000, NSA). Sales through March are down about 2% from the same period in 2017.   This is a small decline - and it is too early to tell if there is an impact from higher interest rates and / or the changes to the tax law on home sales.

     New Home Sales Up in March, Better Than Forecast -- This morning's release of the March New Home Sales from the Census Bureau came in at 694K, up 4.0% month-over-month from a revised 667K in February. The forecast was for 625K.  Here is the opening from the report:  Sales of new single-family houses in March 2018 were at a seasonally adjusted annual rate of 694,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 4.0 percent (±18.6 percent)* above the revised February rate of 667,000 and is 8.8 percent (±17.0 percent)* above the March 2017 estimate of 638,000. The median sales price of new houses sold in March 2018 was $337,200. The average sales price was $369,900. [Full Report] For a longer-term perspective, here is a snapshot of the data series, which is produced in conjunction with the Department of Housing and Urban Development. The data since January 1963 is available in the St. Louis Fed's FRED repository here. We've included a six-month moving average to highlight the trend in this highly volatile series.

    A few Comments on March New Home Sales - Mcbride - New home sales for March were reported at 694,000 on a seasonally adjusted annual rate basis (SAAR). This was well above the consensus forecast, and the three previous months were revised up, combined.  This graph shows new home sales for 2017 and 2018 by month (Seasonally Adjusted Annual Rate). Sales are up 10.3% through March compared to the same period in 2017. Solid growth, and the next five months will be an easy comparison to 2017. And here is another update to the "distressing gap" graph that I first started posting a number of years ago to show the emerging gap caused by distressed sales.  Now I'm looking for the gap to close over the next several years. The "distressing gap" graph shows existing home sales (left axis) and new home sales (right axis) through March 2018. This graph starts in 1994, but the relationship had been fairly steady back to the '60s. Following the housing bubble and bust, the "distressing gap" appeared mostly because of distressed sales.   The gap has persisted even though distressed sales are down significantly, since new home builders focused on more expensive homes. I expect existing home sales to move more sideways, and I expect this gap to slowly close, mostly from an increase in new home sales.However, this assumes that the builders will offer some smaller, less expensive homes. If not, then the gap will persist. Another way to look at this is a ratio of existing to new home sales. This ratio was fairly stable from 1994 through 2006, and then the flood of distressed sales kept the number of existing home sales elevated and depressed new home sales. (Note: This ratio was fairly stable back to the early '70s, but I only have annual data for the earlier years). In general the ratio has been trending down since the housing bust, and this ratio will probably continue to trend down over the next several years. Note: Existing home sales are counted when transactions are closed, and new home sales are counted when contracts are signed. So the timing of sales is different.

    Home Ownership Rate: Up 0.9% YoY in Q1 -- Over the last decade, the general trend has been consistent: The rate of home ownership continues to struggle. The Census Bureau has now released its latest quarterly report with data through Q1 2018. The seasonally adjusted rate for Q4 is 64.2 percent, up from 64.0 in Q4. The nonseasonally adjusted Q1 number is 64.2 percent, unchanged from the Q4 figure.The Census Bureau has been tracking the nonseasonally adjusted data since 1965. Their seasonally adjusted version only goes back to 1980. Here is a snapshot of the nonseasonally adjusted series with a 4-quarter moving average to highlight the trend. The consensus view is that trend away from homeownership is a result of rising residential real estate prices in general and limited supply of entry-level priced homes that would attract first-time buyers. Here is the YoY version of the chart going back to 1965.

    Owning Is the New Renting: Homeownership Trends Upward as U.S. Loses Renter Households -The homeownership rate rose last year for the first time in 13 years. That marked a turning point in the recovery, during which home prices have risen sharply and credit standards were initially very tight, blocking many renters from buying homes. The U.S. added 1.3 million owner households over the last year and lost 286,000 renter households, the fourth consecutive quarter in which the number of renter households declined from the same quarter a year earlier. That could pose challenges for apartment landlords, who are bracing this year for one of the largest infusions of new rental supply in three decades. Rising wages and looser credit standards have helped bolster demand for homes in the last year. Fannie Mae made it easier for borrowers to take on more debt in the middle of last year, which coincided with a significant rise in the homeownership rate. Demographics trends also increasingly favor homeownership, as members of the large millennial generation are entering their early to mid 30s, when people typically marry, have children and purchase their first home. Nonetheless, challenges remain. Rising interest rates this year and a tax bill that passed late last year that diminished the tax benefits of homeownership were expected to dampen demand for homes this year. The rate for a 30-year, fixed-rate mortgage hit 4.58% this week—the highest level since August 2013, according to data released by Freddie Mac on Thursday. Limited inventory and rising prices are also making it difficult for young people to buy their first homes, as they compete in fierce bidding wars and often lose out to downsizing baby boomers or investors able to pay cash or make large down payments. The homeownership rate for households headed by someone 35 years or younger declined to 35.3% from 36% the prior quarter. Nonetheless, it rose a full percentage point from 34.3% in the first quarter a year ago—the fifth consecutive quarter it has gone up on an annual basis.

    HVS: Q1 2018 Homeownership and Vacancy Rates - Mcbride - The Census Bureau released the Residential Vacancies and Homeownership report for Q1 2018. This report is frequently mentioned by analysts and the media to track household formation, the homeownership rate, and the homeowner and rental vacancy rates.  However, there are serious questions about the accuracy of this survey. This survey might show the trend, but I wouldn't rely on the absolute numbers.  The Census Bureau is investigating the differences between the HVS, ACS and decennial Census, and analysts probably shouldn't use the HVS to estimate the excess vacant supply or household formation, or rely on the homeownership rate, except as a guide to the trend. The Red dots are the decennial Census homeownership rates for April 1st 1990, 2000 and 2010. The HVS homeownership rate was unchanged at 64.2% in Q1, from 64.2% in Q4. I'd put more weight on the decennial Census numbers - and given changing demographics, the homeownership rate has probably bottomed. The HVS homeowner vacancy decreased to 1.5% in Q1. The rental vacancy rate increased to 7.0% in Q1. The quarterly HVS is the most timely survey on households, but there are many questions about the accuracy of this survey. Overall this suggests that vacancies have declined significantly, and my guess is the homeownership rate has bottomed - and that the rental vacancy rate has bottomed for this cycle.

    Black-White Homeownership-Rate-Gap Has Widened Since 1900 - via,

    • In 1900, the gap in the homeownership rate between black and white households was 27.6 percentage points. It’s now 30.3 percentage points.
    • It’s the widest gap among whites, blacks, Hispanics and Asians – although the difference between white and Hispanic homeownership rates has more than tripled.
    • Asians have seen the largest gains, although their homeownership rate still lags whites.

    At the dawn of the 20th century, the end of slavery was still within living memory. Lynching was widespread. Segregation was the law in some states and practiced in others. Under those conditions, it probably is not surprising that black citizens had nothing approaching economic parity with whites. In 1900, 48.1 percent of whites in the United States owned homes, while only 20.5 percent of blacks did – for a homeownership gap of 27.6 percentage points.More disturbing is that that gap is even wider today.While more households of each race own homes now – 71.3 percent of whites and 41 percent of blacks – the gap is 30.3 percentage points, according to 2016 U.S. Census data.It’s the widest gap among whites, blacks, Hispanics and Asians – although the difference between white and Hispanic homeownership rates has more than tripled over the past century from 7.9 percentage points in 1900 to 25.7 percentage points in 2016. Asians have seen the largest gains: By 2016, 58.1 percent of Asian households owned a home – up from 10.1 percent in 1900. New Zillow research shows that in 2017, Asian home buyers had the most buying power and could afford a home worth $155,000 more than the typical U.S. buyer. A white household could reasonably afford a home almost two-thirds more expensive than a black household.It’s important to remember that the demographic makeup of the U.S. Hispanic and Asian populations was far different in 1900. Beginning in the 1960s, more immigrants joined their ranks, and new immigrants tend to have different challenges and experiences with homeownership.While homeownership is not the only measure of economic well-being, it can be a strong stabilizing force. Roughly half of the total wealth accumulated by the typical U.S. homeowner is tied up in a primary residence – and that share is even higher for black and Hispanic homeowners.

    Homeownership Does Not Guarantee Middle-Class Prosperity - Something has gone wrong with homeownership in America. Once the ladder to wealth, economic divides in real estate have increasingly become a driver of inequality, further entrenching political and economic privilege. Not only does this trend have knock on effects for the younger generation, but it’s not unique to the United States. The United Kingdom, Canada and possibly other countries are also feeling the shock of changing real estate markets.On the surface, at least viewed from prosperous places, things look pretty good. According to Bloomberg, homeowners in some of America’s major coastal cities gain as much as $100 in wealth through equity each hour of the working day. Collectively, reports CNBC, U.S. homeowners are sitting on $5.4 trillion in property equity, the most ever reported.And yet these gains are not realized equally across the country. For every suburb where 1950s starter homes once sold for less than $10,000 are now worth around $700,000, there are places like Baltimore, Detroit, Buffalo, or Rochester, where many homes are basically worthless. In many areas, no matter how much money people invest in their homes, they are not sitting on hundreds of thousands of dollars in equity. In fact, since the Recession, the primary assets of millions of ordinary Americans have most likely lost value. But what should be even more alarming than these troubling disparities is the underlying fragility of real-estate markets, and the increasing folly of government policies that promote suburban property development. Today’s trends are merely a symptom of a larger delusion—homeownership as the path to middle-class wealth and status—and have exposed it as the lie it always was.

    Foreclosure hangover: How the 2008 crisis created a new class of renter - For decades, the single-family house surrounded by a white picket fence has symbolized the American dream of homeownership. But these days those picture-perfect homes increasingly are occupied by renters, not owners — a new trend with roots in the foreclosure crisis 10 years earlier, according to a recent study by UC Berkeley's Terner Center for Housing Innovation.Tenants renting single-family homes make up the fastest growing segment of the U.S. housing market, but they are vastly overlooked, unable to benefit from some protections enjoyed by tenants living in apartments, the Terner Center researchers found. It's an issue in the Bay Area — where high home prices and a shortage of houses for sale have locked many renters out of ownership."We did this study really to understand the rise of single-family rentals from the perspective of the tenants themselves," said Carolina Reid, faculty research adviser for the Terner Center, and one of the report's lead authors.The story starts a decade earlier, when the housing market crashed and a wave of foreclosures swept the country. Suburban communities in California and other states that had been building rapidly during the boom were left with a surplus of vacant single-family homes. Meanwhile, families who once owned their homes but lost them to foreclosure were forced into renting — and thanks to ruined credit and high prices, many still haven't been able to buy again. As a result, more than 3.8 million new households became renters of single-family homes between 2006 and 2015 — an increase of 34% — and by 2015, renters lived in nearly one in five single-family homes, according to the Terner Center report.   In 2016, 21% of single-family homes in the San Francisco metro area, which includes the East Bay, were rentals, compared to 17% in 2000, according to Zillow data. In the San Jose metro area, 20% were rentals in 2016, compared with 18% in 2000. In the Bay Area, which wasn't as devastated by the foreclosure crisis as other regions, the spike in single-family home rentals is partly a result of rising home prices, Terrazas said. People who want to downsize or move are holding onto their homes and renting them instead of selling, hoping to capture more value, he said. And while it's usually the single-family homes on the low end of the spectrum that wind up as rentals in other regions, in the Bay Area, it's the high-end homes that get rented out.

    NMHC: Apartment Market Tightness Index remained negative for Tenth Consecutive Quarter -From the National Multifamily Housing Council (NMHC): April NMHC Quarterly Survey Shows Greater Supply Improving Affordability: Apartment market conditions were uneven, according to results from the April National Multifamily Housing Council’s (NMHC) Quarterly Survey of Apartment Market Conditions. The Market Tightness (38), Sales Volume (43) and Debt Financing (36) Indexes landed below the breakeven level of 50, while the Equity Financing Index decreased to 54.“Apartment markets continue to send mixed signals,” said NMHC Chief Economist Mark Obrinsky. “While respondents indicated more markets are loosening than tightening, this was focused in markets that have experienced greater supply. So, the message is clear, if unsurprising: Increasing supply improves affordability.”  The Market Tightness Index increased two points to 38. This was the tenth consecutive quarter of overall declining conditions. Thirty-eight percent of respondents reported looser market conditions than three months prior, compared to only 14 percent who reported tighter conditions. Meanwhile, nearly half of respondents (47 percent) felt that conditions were no different from last quarter.

    2.3 million evictions across the US in 2016 - A team of researchers from Princeton University, led by sociologist Matt Desmond, has begun compiling a database of evictions throughout the United States. The first of its kind, the database found that at least 2.3 million evictions were filed in 2016, a rate of 4 evictions per minute, underscoring the heightening housing crisis in the United States a decade after the collapse of the housing market.Desmond’s project, Eviction Lab, has thus far collected 83 million records from 48 states and the District of Columbia. “We’re in the middle of a housing crisis, and that means more and more people are giving more and more of their income to rent and utilities. Our hope is that we can take this problem that’s been in the dark and bring it into the light,” Desmond recently told NPR.This scourge of evictions, Desmond reports, is rooted in the stagnation of wages combined with escalating housing prices. “Incomes have remained flat for many Americans over the last two decades,” Desmond explained, “but housing costs have soared… between 1995 and today, median asking rents have increased by 70 percent, adjusting for inflation.” As a result, he notes, there is a “shrinking gap” between families’ income and their rent expenses.Desmond’s assertion is borne out by research done by other organizations. According to the National Low Income Housing Coalition (NLIHC), workers earning the federal minimum wage ($7.25 hourly) would have to work an average of 94.5 hours weekly in order to afford a basic, one-bedroom apartment. The NLIHC’s annual report on low income housing, released in March, states that about 8 million people nationwide pay greater than 50 percent of their income for rent.“The problem is not that low-income people aren’t working hard enough. The problem, rather, is that many jobs don’t pay enough for low-income people to afford to pay the rent,”

    US housing secretary proposes tripling rent for poorest households --Housing and Urban Development (HUD) Secretary Ben Carson proposed sweeping changes to federal housing subsidies Wednesday, which would triple rent for the poorest households while making it easier for local housing authorities to impose work requirements on assistance recipients.The move by the multi-millionaire HUD secretary comes following a Republican proposal in the 2018 farm bill now going through Congress to impose work requirements on recipients of Supplemental Nutrition Assistance Program (SNAP), better known as food stamps.At the same time, the Trump administration is approving waivers for states to impose work requirements on recipients of Medicaid, the health insurance program for the poor jointly administered by the federal government and the states.Earlier this month, Trump signed an executive order directing federal agencies to expand work requirements for people receiving food stamps, public housing benefits and welfare. Agency heads were ordered to issue recommendations to the White House within 90 days, whether for administration changes or new legislation.This concerted attack on the most vulnerable segments of society is part of a deliberate ruling class policy to drive already impoverished people further into poverty, forcing them into competition with other workers for low-wage employment at new centers of capitalist exploitation set up by automakers, electronics producers and other manufacturers. Carson’s Making Affordable Housing Work Act proposal comes amidst a housing crisis that is forcing millions to live in squalid and unsafe conditions and driving increasing numbers of people into homelessness.

    Consumer Confidence Increased Moderately in April -- The latest Conference Board Consumer Confidence Index was released this morning based on data collected through April 12. The headline number of 128.7 was an increase from the final reading of 127.0 for March, a downward revision from 127.7. Today's number was above the consensus of 126.0.  Here is an excerpt from the Conference Board press release. “Consumer confidence increased moderately in April after a decline in March,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers’ assessment of current conditions improved somewhat, with consumers rating both business and labor market conditions quite favorably. Consumers’ short-term expectations also improved, with the percent of consumers expecting their incomes to decline over the coming months reaching its lowest level since December 2000 (6.0 percent). Overall, confidence levels remain strong and suggest that the economy will continue expanding at a solid pace in the months ahead.” The chart below is another attempt to evaluate the historical context for this index as a coincident indicator of the economy. Toward this end, we have highlighted recessions and included GDP. The regression through the index data shows the long-term trend and highlights the extreme volatility of this indicator. Statisticians may assign little significance to a regression through this sort of data. But the slope resembles the regression trend for real GDP shown below, and it is a more revealing gauge of relative confidence than the 1985 level of 100 that the Conference Board cites as a point of reference.

    Michigan Consumer Sentiment: April Final Improves --The University of Michigan Final Consumer Sentiment for April came in at 98.8, down 2.6 from the March Final reading of 101.4. had forecast 98.0. Surveys of Consumers chief economist, Richard Curtin, makes the following comments:Consumer sentiment improved slightly in the 2nd half of the month, shrinking the small overall decline for April. The final April figure was nearly identical to its 2018 average (98.9)-which was higher than any other yearly average since 107.6 was recorded in 2000 (which was, in turn, the highest yearly average in more than a half century). Tax reform and trade policies continue to spark spontaneous, or unaided, comments. The spontaneous comments about the tax reform legislation had a positive balance of opinion, but the trade tariffs generated a negative balance of opinion. The difference in the Expectation Index was striking: positive views on tax reform had Index values 28 points higher than those who made no mention of the tax reform legislation, and negative views on tariffs had Index values that were 28 points lower than those who didn’t spontaneously mention trade. Aside from the offsetting impact of Trump’s tax and tariff policies, the best simple summary of the current state of consumer confidence is that the economy is "as good as it gets." While consumers do not anticipate an economic downturn anytime soon, the long expansion has made consumers (and economists) somewhat apprehensive about future trends. Overall, the data are consistent with a growth rate of 2.7% in real personal consumption in the year ahead. [More...See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.

    Amazon edging closer to No. 1 in US apparel - Retail Dive - After taking another 1.5% of market share in U.S. apparel sales last year, Amazon is edging closer to becoming the nation’s top apparel retailer, according to a note from Morgan Stanley cited by CBNC. Department stores, in particular Sears Holdings and Macy’s, appear to be bearing the brunt of Amazon’s rise. Morgan Stanley predicts they’ll have just 8% of the American apparel market in 2022, down from 24% in 2006, according to the report. But large mall-based chains, including those of Ascena Retail Group, L Brands, Ralph Lauren and Chico’s, are also losing share. Amazon’s Prime members are twice as likely as non-Prime customers to buy clothes there, up from 1.5 times more likely last year, according to the Morgan Stanley note. And brands themselves in some cases — including Nike, Ugg and Calvin Klein — are moving to sell on Amazon rather than through department stores, the analysts said.  The e-commerce giant's success in apparel is hard won. Amazon has steadily worked to develop private label clothing in several segments and recently expanded its test of try-before-you-buy service, Prime Wardrobe, to address the pain points of not shopping in stores. But there's no guarantee or inevitability in any retailer's rise in a given segment, and many rivals are making their own adjustments to apparel merchandising. Target and Walmart, for example, have recently introduced new private apparel lines for women, men and kids.  Both have much to lose from Amazon's rise. Among apparel shoppers who have switched to Amazon, Target was previously their go-to apparel retailer, according to research from retail think tank Coresight. Target apparel shoppers are also more likely than average to say they expect to buy apparel on Amazon in the next 12 months. Meanwhile, Walmart lost the second most share, according to the report. Department stores are also losing to Amazon in the category with Macy's and J.C. Penney ranking "disproportionately high" in terms of how many apparel shoppers they have lost in part or in full to Amazon Fashion, according to that report.

    Merchants use Facebook to flood Amazon with fake reviews — On Amazon, customer comments can help a product surge in popularity. The online retail giant says that more than 99 percent of its reviews are legitimate because they are written by real shoppers who aren’t paid for them. But a Washington Post examination found that for some popular product categories, such as Bluetooth headphones and speakers, the vast majority of reviews appear to violate Amazon’s prohibition on paid reviews. Such reviews have certain characteristics, such as repetitive wording that people probably cut and paste in. Many of these fraudulent reviews originate on Facebook, where sellers seek shoppers on dozens of networks, including Amazon Review Club and Amazon Reviewers Group, to give glowing feedback in exchange for money or other compensation. The practice artificially inflates the ranking of thousands of products, experts say, misleading consumers. banned paying for reviews a year and a half ago because of research it conducted showing that consumers distrust paid reviews. Every once in a while, including this month, Amazon purges shoppers from its site whom it accuses of breaking its policies. But the ban, sellers and experts say, merely pushed an activity that used to take place openly into dispersed and harder-to-track online communities. There, an economy of paid reviews has flourished. Merchants pledge to drop reimbursements into a reviewer’s PayPal account within minutes of posting comments for items such as kitchen knives, rain ponchos or shower caddies, often sweetening the deal with a $5 commission or a $10 Amazon gift card. Facebook this month deleted more than a dozen of the groups where sellers and buyers matched after being contacted by The Post. Amazon kicked a five-star seller off its site after an inquiry from The Post. 

    Walmart's CEO earns 1,188 times as much as the company's median worker: Walmart's CEO makes a lot more than the company's median worker. 1,188 times more, to be exact. Doug McMillon earned $22.8 million during the retailer's last fiscal year, which ended on January 31, according to a company filing. Walmart's median employee, meanwhile, earned $19,177 in the same period. The retailer, which is the nation's largest private-sector employer, has about 2.3 million global employees, including full-time and part-time workers. Roughly 1.5 million are in the United States. Many companies have recently had to release CEO pay ratios for the first time. The move is newly mandated under a provision of the Dodd-Frank financial reforms passed during the Obama administration. The ratios show that even after the 2008 financial crisis, chief executives continue to make exponentially more than their employees.

    Vehicle Sales Forecast: Sales Around 17 Million SAAR in April -- The automakers will report April vehicle sales on Tuesday, May 1st.  Note: There were 24 selling days in April 2018, down from 26 in April 2017. From WardsAuto: U.S. Light-Vehicle Forecast: April Sets Stage for Strong Q2 The Wards Intelligence forecast calls for U.S. automakers to deliver 1.35 million light vehicles in April. ... The report puts the seasonally adjusted annual rate of sales for the month at 17.1 million units, below last month’s 17.4 million but slightly above year-ago’s 17.0.   It appears April will be another solid month.  So far sales in 2018 are running at about the same rate as in 2017.

    Ford announces plans to slash US car production, cut billions in costs - Ford Motor Company announced Wednesday that it plans to slash both production and sales of passenger car sedans in the US, gambling on continued demand for more profitable SUV and pickup truck models. Ford will eliminate the Taurus, Fusion, Fiesta, and C-Max from its line-up, leaving only the Mustang sports model and next year’s Focus Active crossover.In addition, the company revealed its intention to cut $11.5 billion in costs between 2019 and 2022. The cuts come on top of $14 billion previously announced last fall.Ford’s historic shift away from traditional cars and other restructuring measures are being driven by Wall Street’s relentless demands for greater efficiency, cost-cutting, “labor flexibility,” and investment returns from the automaker, which is facing flat sales and flagging profit margins.A Morgan Stanley investment firm analyst told CNBC, “Virtually eliminating Ford’s NA [North American] car portfolio makes a lot of sense, in our view. No more Fusion. No more Focus. No more Fiesta. No more Taurus.” In their drive to overhaul their operations and lower workers’ living standards still further, Ford and the other auto companies are fully expecting to rely upon the United Auto Workers union to suppress growing opposition and act as a partner in the attacks, as it has done for the last four decades.

    Chemical Activity Barometer "Eases" in April  --Note: This appears to be a leading indicator for industrial production. From the American Chemistry Council: Chemical Activity Barometer Eases Following Six Consecutive Monthly Gains; Trends Suggest Growth into Early 2019The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), slipped 0.1 percent in April to 121.6 percent on a three-month moving average (3MMA) basis. This follows six consecutive monthly gains and a dip from the barometer’s highest point since modeling began. The barometer remains up 3.8 percent on a 3MMA compared to a year earlier. Applying the CAB back to 1912, it has been shown to provide a lead of two to fourteen months, with an average lead of eight months at cycle peaks as determined by the National Bureau of Economic Research. The median lead was also eight months. At business cycle troughs, the CAB leads by one to seven months, with an average lead of four months. The median lead was three months. The CAB is rebased to the average lead (in months) of an average 100 in the base year (the year 2012 was used) of a reference time series. The latter is the Federal Reserve’s Industrial Production Index.

    Headline Durable Goods Orders Up 2.6% in March - The Advance Report on Manufacturers’ Shipments, Inventories, and Orders released today gives us a first look at the latest durable goods numbers. Here is the Bureau's summary on new orders:New orders for manufactured durable goods in March increased $6.4 billion or 2.6 percent to $254.9 billion, the U.S. Census Bureau announced today. This increase, up four of the last five months, followed a 3.5 percent February increase. Excluding transportation, new orders were virtually unchanged. Excluding defense, new orders increased 2.8 percent. Transportation equipment, also up four of the last five months, drove the increase, $6.4 billion or 7.6 percent to $91.4 billion. Download full PDFThe latest new orders number at 2.6% month-over-month (MoM) was better than the Investing.comconsensus of 1.6%. The series is up 9.5% year-over-year (YoY).If we exclude transportation, "core" durable goods came in with no change MoM, which was worse than consensus of 0.5%. The core measure is up 6.7% YoY.If we exclude both transportation and defense for an even more fundamental "core", the latest number is up 0.1% MoM and up 7.6% YoY.Core Capital Goods New Orders (nondefense capital goods used in the production of goods or services, excluding aircraft) is an important gauge of business spending, often referred to as Core Capex. It is down 0.1% MoM and up 7.0% YoY. For a look at the big picture and an understanding of the relative size of the major components, here is an area chart of Durable Goods New Orders minus Transportation and Defense with those two components stacked on top. We've also included a dotted line to show the relative size of Core Capex.

    Kansas City Fed Survey: Growth Accelerated in April - The Kansas City Fed Manufacturing Survey business conditions indicator measures activity in the following states: Colorado, Kansas, Nebraska, Oklahoma, Wyoming, western Missouri, and northern New Mexico.Quarterly data for this indicator dates back to 1995, but monthly data is only available from 2001.Here is an excerpt from the latest report:  – The Federal Reserve Bank of Kansas City released the April Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity expanded more rapidly in April, and optimism remained high for future activity.“Factory activity accelerated in April despite concerns among many firms about changes in international trade policy,” said Wilkerson. “Price indexes also continued to rise.” [Full PDF release here]   Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.

    Kansas City Fed: Regional Manufacturing Activity "Expanded More Rapidly" in April -- From the Kansas City Fed: Tenth District Manufacturing Activity Expanded More RapidlyThe Federal Reserve Bank of Kansas City released the April Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity expanded more rapidly in April, and optimism remained high for future activity.“Factory activity accelerated in April despite concerns among many firms about changes in international trade policy,” said Wilkerson. “Price indexes also continued to rise.”  The month-over-month composite index was 26 in April, up from readings of 17 in March and 17 in February. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Factory activity accelerated at both durable and nondurable goods plants, particularly for machinery, plastics, and chemicals. Month-over-month indexes increased considerably. The production index jumped from 20 to 33, and the shipments, new orders, and order backlog indexes also rose. The employment and new orders for exports indexes were unchanged. The raw materials inventory index increased from 11 to 17, while the finished goods inventory index fell slightly.So far most of the regional Fed surveys have been solid in April, although Richmond showed some slowing.

    Richmond Fed Manufacturing: Weakening Activity in April - Today the Richmond Fed Manufacturing Composite Index was at -3 for the month of March, down from last month's 15. had forecast 16. Because of the highly volatile nature of this index, we include a 3-month moving average to facilitate the identification of trends, now at 13.3, which indicates expansion. The complete data series behind today's Richmond Fed manufacturing report, which dates from November 1993, is available here. Here is a snapshot of the complete Richmond Fed Manufacturing Composite series.

     US PMIs Show Q2 Rebound As Manufacturing Hits 43-Month High - Despite US 'soft' survey data serially disappointing (and following a mixed picture from European PMIs), Markit reported April's flash PMIs better-than-expected with Manufacturing at a 43-month high and Services rebounding. In line with stronger client demand, and rising cost burdens, average prices charged for goods and services increased solidly. The rate of input price inflation was the quickest since July 2013, with panelists noting that the introduction of tariffs had been a key factor pushing raw material costs higher.  Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:“The US economy picked up pace again at the start of the second quarter. The April PMI surveys registered the second-strongest monthly expansion since last October. Manufacturing is leading the upturn, with factories reporting the strongest output gains for 15 months, and the vast service sector is enjoying a steady, robust expansion.“First, growth in new orders accelerated to show the largest surge in demand for goods and services for just over three years.Second, companies’ expectations of growth over the coming year jumped to a three-year high. Third, hiring remains robust as firms struggle to cope with demand. The surveys point to non-farm payroll growth of approximately 200,000 in April.“The details of the survey therefore suggest that output growth is on course to accelerate as we move into the summer. Prices are meanwhile being pulled upwards by the strength of the upturn, however, sending hawkish signals for policy makers.”And while the initially exuberant Atlanta Fed's GDPNOW model is forecasting sub-2% growth now... Williamson says PMIs are more optimistic... “After a relatively disappointing start to the year, the second quarter should prove a lot more encouraging. The current data point to an annualised GDP growth rate of 2.5%, with scope for some substantial upside surprises in coming months."

    Econoday Economic Report: International Trade in Goods April 26, 2018: Highlights A decline in imports eased the nation's goods deficit in March which came in much better than expected, at $68.0 billion and well under February's revised $75.9 billion. Imports fell 2.1 percent with declines nearly across the board including a sharp 3.1 percent drop for capital goods and a 2.3 percent dip for consumer goods. Tariffs on steel and aluminum were imposed in March but there's no clear evidence of its effects in the initial data though imports of industrial supplies did fall 1.9 percent. Exports have been very solid and rose 2.5 percent in March with gains led by a 4.0 percent jump in capital goods, which is the nation's key strength, and an 8.5 percent burst for food products. After today's report, net exports don't look to be as much of a challenge for tomorrow's first-quarter GDP results as had been expected.

    Weekly Initial Unemployment Claims decrease to 209,000 --  The DOL reported:In the week ending April 21, the advance figure for seasonally adjusted initial claims was 209,000, a decrease of 24,000 from the previous week's revised level. This is the lowest level for initial claims since December 6, 1969 when it was 202,000. The previous week's level was revised up by 1,000 from 232,000 to 233,000. The 4-week moving average was 229,250, a decrease of 2,250 from the previous week's revised average. The previous week's average was revised up by 250 from 231,250 to 231,500. Claims taking procedures in Puerto Rico and in the Virgin Islands have still not returned to normal. The previous week was revised up. The following graph shows the 4-week moving average of weekly claims since 1971.

    Don't sweat the Q3 2017 job losses -- Yesterday the BLS issued its report on Q3 2017 Business Employment Dynamics. This has gotten some notice because, for the first time in 7 years, it showed a net loss last summer of -140,000 jobs.As an initial matter, this is a good time to remind you that the data is the data is the data. It's not partisan. I've seen some of the same people who were touting "It's still Obama's economy" all last year (and I agree with that) now suddenly saying that the Q3 BED job losses show that "the Trump/GOP economy is tanking" No,  they don't.The big flashing red neon sign is in this state by state map (h/t Bloomberg):  While job losses in Michigan and Ohio might not be so unexpected, for major job losses to happen in Florida sticks out in the data like a sore thumb.While hurricanes and wildfires occur every summer, last year was a particularly bad one.  And a look at the three states most directly involved -- Florida, Texas, and California -- tells us exactly what happened. The BLS appended a note expressly stating that they did not adjust for this. Here's a chart of the net job gains and losses over the last 5 quarters for each of the 3 affected states. The last line is the net change compared with the previous quarter:

     Econoday Economic Report: Employment Cost Index April 27, 2018 -  Highlights The isolated hints of emerging price pressures now include employer costs. The employment cost index rose 0.8 percent in the first quarter which is the high end of expectations. The year-on-year rate is up 1 tenth to 2.7 percent for the highest reading of the last 10 years. Wages & salaries, not benefits, are the leading source of pressure, up 0.9 percent in the quarter for an annual 2.7 percent increase. But benefits are also up, climbing 0.7 percent for 2.6 percent year-on-year. This report is a red flag for next week's FOMC meeting and will certainly be cited, along perhaps with recent acceleration in average hourly warnings, as an indication of tightness in the labor market, conditions that point to the risk of wage-push inflation.

    US Wages And Salaries Rise At Fastest Pace In 10 Years - While the GDP print came in stronger than expected, despite a sharp drop in consumption, the big news in today's data had nothing to do with GDP and everything to do with employment costs, and wages and salaries in particular, which both rose at the fastest pace in nearly a ten years, confirming that inflationary wage pressures are growing.Specifically, wages and salaries rose 0.9%QoQ, up from 0.6% in the previous quarter. Total compensation, which includes wages and benefits, rose 2.7% over past 12 months, up from 2.4% a year ago, while private-sector wages and salaries advanced 2.9%YoY, also above the 2.6% printed in Q1 2017. Both were the strongest prints since Q3 2008, if slightly below the 3% pace observed heading into the financial crisis as shown below.In kneejerk response the dollar spiked higher, although it has since faded much of the move, although more ominously, the 2s10s flattened once again, and is back to 48 bps, just shy of fresh post-crisis lows.

    Philly Fed: State Coincident Indexes increased in 47 states in March -- From the Philly Fed: The Federal Reserve Bank of Philadelphia has released the coincident indexes for the 50 states for March 2018. Over the past three months, the indexes increased in 49 states and decreased in one, for a three-month diffusion index of 96. In the past month, the indexes increased in 47 states, decreased in one, and remained stable in two, for a one-month diffusion index of 92. Note: These are coincident indexes constructed from state employment data. An explanation from the Philly Fed: The coincident indexes combine four state-level indicators to summarize current economic conditions in a single statistic. The four state-level variables in each coincident index are nonfarm payroll employment, average hours worked in manufacturing by production workers, the unemployment rate, and wage and salary disbursements deflated by the consumer price index (U.S. city average). The trend for each state’s index is set to the trend of its gross domestic product (GDP), so long-term growth in the state’s index matches long-term growth in its GDP. Here is a map of the three month change in the Philly Fed state coincident indicators. This map was all redduring the worst of the recession, and all or mostly green during most of the recent expansion.

    Goldman: "Moving Beyond Full Employment" -- A few brief excerpts from a note by Goldman Sachs economist David Mericle:  ... Are we really at full employment? Won’t job growth naturally slow down soon? Why is wage growth so much lower than in previous expansions? ...  We now see the labor market as at or a bit beyond full employment. ... we estimate a structural unemployment rate of about 4.5%, modestly above the current 4.1% rate. While the cyclical participation gap has recovered more slowly, it too now appears closed. A further cyclical boost to participation is possible, but we expect it to be quite limited. Meanwhile, the pace of job creation shows no sign of slowing. ... We see little evidence that supply constraints will impose a forceful natural deceleration any time soon, and instead expect robust labor demand to drive the unemployment rate to 3.6% by end-2018 and 3.3% by end-2019, the lowest rate since the Korean War. We have long stressed that wage growth expectations need to be recalibrated to the meager rate of productivity growth seen this cycle, implying a full employment rate of wage growth of roughly 3%. ... our wage tracker, now running at 2.5%, looks only moderately disappointing. ... signs of acceleration are emerging, notably in our wage survey leading indicator, now running at 3.2% ... Mericle argues that the US economy is at or close to "full employment", that job gains will remain healthy for some time, and that wage growth is only "moderately disappointing".

    Bernie Sanders to announce plan to guarantee every American a job - Sen. Bernie Sanders (I-Vt.) will announce a plan for the federal government to guarantee a job paying $15 an hour and health-care benefits to every American worker “who wants or needs one,” embracing the kind of large-scale government works project that Democrats have shied away from in recent decades.Sanders's jobs guarantee would fund hundreds of projects throughout the United States aimed at addressing priorities such as infrastructure, care giving, the environment, education and other goals. Under the job guarantee, every American would be entitled to a job under one of these projects or receive job training to be able to do so, according to an early draft of the proposal.A representative from Sanders's office said they had not yet done a cost estimate for the plan or decided how it would be funded, saying they were still crafting the proposal.Sanders joins two other rumored 2020 Democratic presidential contenders who have expressed support for the idea of a jobs guarantee. The push reflects a leftward move in the party's economic policy, away from President Barack Obama's use of public-private partnerships or government incentives to reshape private markets and toward an unambiguous embrace of direct government intervention.Job guarantee advocates say their plan would drive up wages by significantly increasing competition for workers, ensuring that corporations have to offer more generous salaries and benefits if they want to keep their employees from working for the government. Supporters say it also would reduce racial inequality, because black workers face unemployment at about twice the rates of white workers, as well as gender inequality, because many iterations of the plan call for the expansion of federal child-care work.“The goal is to eliminate working poverty and involuntary unemployment altogether,” said Darrick Hamilton, an economist at the New School who has advocated for a jobs guarantee program along with Stony Brook University's Stephanie Kelton and a group of left-leaning economists at the Levy Economics Institute at Bard College. “This is an opportunity for something transformative, beyond the tinkering we've been doing for the last 40 years, where all the productivity gains have gone to the elite of society.” The idea is also dead on arrival with Republicans in control of Congress, and conservatives have trashed the idea of a jobs guarantee as impractical, impossibly expensive and dangerous to the private sector.

    The Federal Job Guarantee Is Not Just “Better” Than a Universal Basic Income. It’s the Only Reasonable Option. Universal Basic Income Is Sinister - The Federal Job Guarantee is not just better than Universal Basic Income, it’s the only good option. The UBI is a Trojan Horse for the reduction and elimination of wages and safety net programs for the powerless. UBI is sinister. UBI adds money to the economy without increasing production or output. This is how you cause inflation: The creation of money without consideration of the real resources available to you. (Sure, everyone can have a pony, but not tomorrow!) If the government is now paying your salary, even if you are performing poorly, even if you are not working:

    • This incentivizes private industry to further reduce wages, which logically extends to the reduction – or elimination – of minimum wage laws.
    • Then what’s the point of social safety net programs such as welfare, food stamps, subsidized housing, Medicaid, Social Security, etc.? These programs would necessarilybe eliminated.
    • Then what’s the point of fighting so hard for free healthcare and free tuition and lower prescription drug costs and so on? Now people can, at least somewhat, at least temporarily, afford the private industry alternatives. The fights for these progressive programs would just…end.
    • Now, all of the sudden, everyone can afford shit. All at the same time. Competing with everyone for the same stuff, with no increase in productive capacity. UBI is therefore, by its very definition, inflationary. This governmental salary, this “negative tax” for those at the bottom, is instantly devalued. At best, income and wealth inequality is not reduced.
    • Would this increase or decrease the incentive to get or keep a job? At least at first…

    Here’s the true sinister plot behind UBI: Picture a future and less-friendly Congress, after all these safety nets have been reduced or eliminated. They come in and eliminate or dramatically reduce the UBI program because “these deadbeats want everything for free?!” Our nation is instantly plunged into a private corporation slave-wage hellscape. No wage or workplace protections, no safety net programs at all.UBI risks putting the United States into a much much worse position than it already is today…. Well, that is, if you care about the powerless.

    After mass layoffs at Ohio plant, UAW gives GM greenlight to hire lower-paid temps  --Within days of announcing the elimination of an entire shift and 1,500 jobs at the giant Lordstown, Ohio assembly plant, General Motors announced that its subsidiary, known as the Lordstown GM Subsystems Manufacturing LLC, will be hiring low-paid temporary workers under an agreement the United Auto Workers signed behind the backs of rank-and-file workers.  “People out here are very angry,” a GM Lordstown worker with 30 years seniority told the World Socialist Web Site Autoworker Newsletter. “I’m going to be out the door and laid off, and they are going to bring these people in with low pay and no rights.” She went on to explain that her stepson who had been working at the plant as a Temporary Part-Time worker (TPT) had received an email from the dummy company offering him a job at vastly reduced pay.“Our plant is known as a high seniority plant,” she explained. “This is the second shift we have lost.” Echoing the widespread contempt for the UAW among workers, she added that the union and the company “have been opening the contract and changing things to suit themselves for years. We don’t have rights and conditions anymore.” The company and the union, she said, were seeking to drive out the older, high-paid workers and create a workforce largely made up of low-paid temps. “The union is just one false move after another. When we get a profit-sharing check, the union takes out a big portion for themselves.”

    Why Working on the Railroad Comes With a $25,000 Signing Bonus - Railroad workers are being offered signing bonuses of up to $25,000 to join BNSF Railway and Union Pacific Corp. as the freight railroads struggle to fill jobs in a historically tight labor market.BNSF and Union Pacific are hauling more products across the Western U.S., where their networks are based, and trying to ease congestion in areas with high demand. Freight volumes are rising on strong economic growth and industrial expansion, and a shortage of available truck capacity is pushing more shipments onto rails.At the same time, the unemployment rate has fallen to 4.1% in the U.S., and as low as 2.8% in some markets where railroads are hiring.In response, the companies are dangling incentives that analysts and union leaders say are the highest they can recall.Union Pacific is offering $10,000 to $20,000 “hiring incentives” to train crews in cities like Denver, Kansas City, Mo., and North Platte, Neb., where its largest rail yard is located. Those jobs average $40,000 in pay over the first year and $60,000 the next, according to job listings.Electricians to inspect, repair and maintain locomotives are being wooed with $25,000 signing bonuses to Union Pacific locations outside Milwaukee; in Hinkle, Ore., a three-hour drive from Portland; and elsewhere.A Union Pacific spokeswoman said the hiring bonuses are for certain positions in “tight labor markets.”BNSF, owned by Berkshire Hathaway has hiring incentives starting at $15,000 for some new hires, according to a document reviewed by The Wall Street Journal. A BNSF spokeswoman said the railroad is facing a talent shortage across its system and is extending the offer to diesel mechanics, electricians and conductor trainees. “We are constantly evaluating the market and will use this approach when it makes sense to recruit talented individuals for hard to fill positions or locations,” spokeswoman Amy Casas said.

     Why We Have to Go Back to a 40-Hour Work Week to Keep Our Sanity - If you’re lucky enough to have a job right now, you’re probably doing everything possible to hold onto it. If the boss asks you to work 50 hours, you work 55. If she asks for 60, you give up weeknights and Saturdays, and work 65.Odds are that you’ve been doing this for months, if not years, probably at the expense of your family life, your exercise routine, your diet, your stress levels, and your sanity. You’re burned out, tired, achy, and utterly forgotten by your spouse, kids and dog. But you push on anyway, because everybody knows that working crazy hours is what it takes to prove that you’re “passionate” and “productive” and “a team player” — the kind of person who might just have a chance to survive the next round of layoffs.This is what work looks like now. It’s been this way for so long that most American workers don’t realize that for most of the 20th century, the broad consensus among American business leaders was that working people more than 40 hours a week was stupid, wasteful, dangerous, and expensive — and the most telling sign of dangerously incompetent management to boot.It’s a heresy now (good luck convincing your boss of what I’m about to say), but every hour you work over 40 hours a week is making you less effective and productive over both the short and the long haul. And it may sound weird, but it’s true: the single easiest, fastest thing your company can do to boost its output and profits — starting right now, today — is to get everybody off the 55-hour-a-week treadmill, and back onto a 40-hour footing. Yes, this flies in the face of everything modern management thinks it knows about work. So we need to understand more. How did we get to the 40-hour week in the first place? How did we lose it? And are there compelling bottom-line business reasons that we should bring it back?

     Illinois’ past-due debts come with a steep price: $1.14 billion in late fees  (AP) – Illinois has racked up more in late-payment fees in less than 3 years than it did in the 18 years combined, according to a report The Associated Press obtained Monday, and some major creditors say they’ve waited more than a year to receive the interest they’re owed. The report by state Comptroller Susana Mendoza found that the $16 billion in past-due debt that piled up during a 2-year budget stalemate comes with a steep price. Since July 2015, Mendoza reported, prompt-payment penalties have totaled $1.14 billion, $100 million more than the total from 1998 up to then. Mendoza, a Democrat, was scheduled to release the report today, the first accounting of past-due bills and accrued interest since she was successful in getting a law requiring state agencies to report their incurred bills monthly. Earlier Monday, private companies, which have kept government vendors afloat by paying their bills and relying on state reimbursement with interest, told lawmakers they’ve waited months for late-penalty payments, threatening the program. Representatives of the four so-called qualified purchasers told the Commission on Government Forecasting and Accountability that banks and other lenders could dry up without timely late-fee payment. “We essentially get slapped in the face when we’re paid the base invoice amount and none of the $100 million in prompt payment penalty due,” said Gregory Gac, secretary-treasurer of Illinois Financing Partners, a qualified purchaser. Mendoza spokeswoman Jamey Dunn said Mendoza is “still in triage mode” in paying what ballooned to $15.9 billion in overdue bills last summer after a historic, 2-year budget standoff between Republican Gov. Bruce Rauner and Democrats who control the General Assembly. Additional borrowing – at a lower interest rate – through a $6.5 billion bond issue last fall cut that backlog in half, but Dunn said vendors statewide “are still experiencing payment delays.” Mendoza is prioritizing education and assistance to the “most vulnerable residents,” Dunn said. The state has paid roughly $300 million in penalties since the beginning of 2017, Dunn said. With bills paid from the bond issue, interest-payment vouchers have been ticking up. The comptroller held $553 million in penalty vouchers on March 31, up from $116 million at the end of December. 

    "Real Indian" Running Against Elizabeth Warren Sues City For Telling Him To Stop Calling Her "Fake" -- A self-described “real Indian” who is running against Massachusetts Democratic Senator Elizabeth Warren is suing after city officials demanded he take down his signs calling her a “fake Indian.” The independent Senate challenger, Shiva Ayyadurai, filed a federal lawsuit alleging his free speech rights were violated. Infamously described as “Pocahontas” by president Donald Trump, Elizabeth Warren has lied for years about being of Native American heritage to secure jobs, including one as a Harvard law professor. She’s also refused genealogy tests to prove her heritage and Ayyadurai is finally taking her to task for it.According to The Washington Times, since March 17, Ayyadurai’s campaign bus has sported two identical signs picturing himself and a rendition of Warren wearing Indian attire. Emblazoned next to the images are the words: “Only a REAL INDIAN Can Defeat the Fake Indian.” The bus has reportedly been stationed in a parking lot in front of an office building owned by Ayyadurai for more than a month, just a mile from Warren’s home. Earlier this month, the Ayyadurai campaign received a notice from Cambridge building inspector Branden Vigneault that the signs lacked the appropriate “approvals and permits,” according to local reports and the Ayyadurai campaign. Vigneault threatened fines of $300 per day plus additional legal penalties if the signs remain in place, according to Ayyadurai.  But he’s fighting back.  “We will not remove the slogan from our bus,” Ayyadurai toldThe Washington Times. “We will defend the First Amendment, and we will fight this egregious attack on the First Amendment, at any cost.” Ayyadurai’s campaign also said that the building code doesn’t apply to the signs because they’re on a bus, not a structure.

    Secretly Taped Audio Reveals Democratic Leadership Pressuring Progressive to Leave Race -- Steny Hoyer, the No. 2 Democrat in the House of Representatives, has for years been a prolific campaigner on behalf of current and potential members of Congress. It was no surprise, then, that December found him in Colorado, where the party has hopes of knocking off Republican incumbent Mike Coffman. Before Donald Trump had even been inaugurated, local resistance groups began deluging Coffman’s public appearances, pressing him not to repeal the Affordable Care Act, and putting him back on his political heels. Levi Tillemann, an author, inventor, and former official with the Obama administration’s Energy Department, moved back home to make a run against Coffman. With Hoyer in Denver, Tillemann met the minority whip at the Hilton Denver Downtown to make the case that the party should stay neutral in the primary and that he had a more plausible path to victory than the same centrism that Coffman had already beaten repeatedly. Hoyer, however, had his own message he wanted to convey: Tillemann should drop out. In a frank and wide-ranging conversation, Hoyer laid down the law for Tillemann. The decision, Tillemann was told, had been made long ago. It wasn’t personal, Hoyer insisted, and there was nothing uniquely unfair being done to Tillemann, he explained: This is how the party does it everywhere. Tillemann had heard the argument before from D.C. insiders and local Democratic bigwigs, all of whom had discouraged him from challenging the establishment favorite. The only difference was that for this conversation, the candidate had his phone set to record.

    Police Entered Funeral Home To Unlock iPhone With Dead Man's Finger - Amidst the variety of fourth amendment and online privacy and protection issues that rapid advances in technology have raised over the past decades, it appears that Florida police have just given us something truly unprecedented and disturbing.According to the AP, "Florida authorities went to a funeral home and used a dead man’s finger to try to unlock his cellphone as part of their investigation."While it's easy to imagine that detectives or FBI agents have likely quietly crossed this line before with no one looking while working murder or kidnap cases, this is the perhaps the first time police have entered a funeral home with no warrant and as family grieved in order access the body in an attempt to unlock the deceased's iPhone. It also appears this was done without notification or approval of family members - simply put, detectives entered the funeral home and simply did it, though they still weren't able to successfully unlock the phone. The AP describes the circumstances as follows:Thirty-year-old Linus Phillip was killed by a Largo police officer last month after authorities say he tried to drive away before an officer could search him.At the funeral home, two detectives held the man’s hands up to the phone’s fingerprint sensor but could not unlock it.Phillip’s fiancee Victoria Armstrong says she felt violated and disrespected.Phillip's fiancé , Victoria Armstrong, who happened to be at the funeral home when two detectives showed up with the deceased suspect's iPhone, told the Tampa Bay Times, "I just felt so disrespected and violated." She further told a local ABC News affiliate, "So they are allowed to pull him out of the refrigerator and use a dead mans finger to get to his phone. Its disgusting."  Further disturbing is the fact that the series of events that led Linus Phillip's death began when police sought to pull him over and search him merely for having illegally tinted windows.

    The Backfire Continues: NRA Breaks Fundraising Records In Wake Of Gun Control Demands - The NRA continues to rake in money in the wake of gun control activists vocally demanding the government strip away the rights of gun owners.  The gun rights lobbying group broke fundraising records in March largely thanks to the gun control crowd. The numbers don’t lie either. The National Rifle Association’s Political Victory Fund raised $2.4 million from March 1 to March 31 of this year, according to The Tampa Bay Times. As the March for Our Lives movement captured the mainstream media’s attention because it fit their carefully crafted pro-government narrative, in the weeks after the Parkland shooting, the other side of the gun control debate enjoyed a big month of its own.The $2.4 million haul is the most money raised by the NRA’s political arm in one month since June 2003, the last month when electronic federal records were readily available.It surpasses the $1.1 million and $1.5 million raised in January and February 2013, the two months after the Sandy Hook school shooting in Newtown, Connecticut.Note that many of the NRA’s  highest fundraising months are those after shootings when gun control Nazis seek to disarm the innocent over the actions of a lunatic. Another important tidbit to recognize about this particular fundraising month is that most of the donations, $1.9 million of the $2.4 million total, came from small donors who gave less than $200.  That means regular, everyday Americans are paying what little they have to avoid having even more of their basic fundamental human rights stripped away.

      Protesters target NRA lobbyist's home and wife's business - National Rifle Association lobbyist Chris Cox says his house was splashed with fake blood — twice. Then, someone made a fake website for his wife’s interior design business, altering images of artwork to show photos of child gun-violence victims. Last week, two gun-control activists protested outside Cox’s Alexandria, Va., home and handed out fliers outside his wife’s nearby business. “Mr. and Mrs. Cox have been targeted over the past few months by repeated acts of criminal and unlawful conduct, including having their home vandalized on two occasions,” Elizabeth Locke, attorney for the Cox family, said in a statement. “These coordinated tactics have crossed the line of civility and human decency.” An attorney for Patricia Hill, the alleged vandal, did not immediately provide a comment regarding the fake-blood incidents. The other protesters say they have been careful not to cross legal lines and knew nothing of the vandalism. They are all part of a growing movement that insists gun-control advocacy should be more aggressive — and more personal. Students held a moment of silence outside the White House on April 20 to mark the 19th anniversary of the massacre at Columbine High School. The event was part of a nationwide protest in favor of gun reform. (Reuters) Amanda Gailey, from Nebraska, and Catherine Koebel, from southwestern Virginia, met through gun-control-activist circles and connected over agreement that the movement has been too timid. Calling themselves “The Great American Gun Melt,” they want to pull gun-control politics to the left with more radical action. So does Betsy Riot, the anonymous group that said it created the anti-Cox website. “We know we’re out there; we know we’re a left flank,” said a woman who identified herself as a co-founder but would not provide her name. “But this movement has needed a left flank for decades.”

      Medical Marijuana and Gun Laws Collide - If you have a medical marijuana card, the 9th U.S. Circuit Court of Appeals says that you can’t buy a gun. The court ruled 3-0 on Wednesday that a ban preventing medical marijuana card holders from purchasing firearms is not in violation of the Second Amendment, the Associated Press reports. There are nine western states under the appeals court’s jurisdiction, including Nevada, where the case originated. A lawsuit was filed in 2011 by Nevada resident S. Rowan Wilson after she tried to purchase a gun for self-defense and was denied based on a federal ban on the sale of guns to users of illegal drugs. Though marijuana has been legalized in some places on a state-by-state basis, it remains illegal under federal law. The court maintained that drug use “raises the risk of irrational or unpredictable behavior with which gun use should not be associated.” Wilson claimed that she doesn’t actually use marijuana, she simply obtained a card to show her support for its legalization. The appeals court agreed with guidelines from the federal Bureau of Alcohol, Tobacco, Firearms and Explosives that firearms sellers should assume that medical marijuana card holders use the drug.

      Broward Sheriff Israel To Face No-Confidence Vote For "Suspected Malfeasance" - The Broward County Sheriff's Office Deputies Association has scheduled a no-confidence vote for Sheriff Scott Israel for "many instances of suspected malfeasance" among several claims that his conduct leading up to, and following, the Feb 14th Parkland school shooting. Union president Deputy Jeff Bell announced the upcoming vote on Friday. Of note, Florida governor Rick Scott can fire Israel for "malfeasance, misfeasance, neglect of duty (or) incompetence." To that end, Israel is accused by the Association of "many instances of suspected malfeasance, misfeasance, failure to maintain fiduciary responsibility by the sheriff, failure to properly investigate possible criminal conduct by members of his senior command staff and the lack of leadership that has crushed morale throughout the agency." Seems like the Deputies Association is about to give Governor Scott exactly what he needs to get rid of Israel, right down to the official language. While multiple agencies failed in the lead-up to the Parkland shooting, the Broward County Sheriff's Department - led by Sheriff Israel, had directly interfaced with self-confessed killer Nikolas Cruz - having received nearly 50 calls about him.

      Parkland Shooting Survivor "Interrogated" After Going To Gun Range - Parkland shooting survivor Kyle Kashuv was subjected to a harsh interrogation by school officials after he went to a shooting range with his father and posted about it on Twitter. It was great learning about our inalienable right of #2A and how to properly use a gun. This was my first time ever touching a gun and it made me appreciate the #Constitution even more. My instructor was very informative; I learnt a lot. #2A is important and we need 2 preserve 2A — Kyle Kashuv (@KyleKashuv) April 21, 2018    Kashuv appeared on Fox's Tucker Carlson Tonight on Tuesday, where he recounted the "clear attempt to intimidate" him after being called into the school office for questioning by school officials - including a school resource officer, before a sheriff's deputy arrived. Kyle Kashuv: It was an interrogation. It was a clear attempt to intimidate me. They used very, very, very harsh interrogation tactics against me. I mean, at the end of the day I went shooting with my dad at a gun range. I posted a video of me showing I have admiration for the Second Amendment and telling people to educate themselves about the Second Amendment because we can’t trust our government to defend ourselves… It was all very, very weird. I get to sit down and the school resource officer goes, “Kyle, you’re taking five AP classes. You’re such a good student. Why would you do it?” It went something like this and I was in shock. And I said, “What do you mean?” And they came in there with the notion that I had done something wrong by going to gun range.

      Trump admin announces abstinence-focused overhaul of teen pregnancy program | TheHill: The Trump administration will shift federal funding aimed at reducing teen pregnancy rates to programs that teach abstinence. The Department of Health and Human Services (HHS) announced Friday the availability of grants through the Teen Pregnancy Prevention Program, (TPPP) a grant program created under former President Obama that funds organizations and programs working to reduce teen pregnancy rates. Trump's HHS announced, however, that unlike under the Obama administration, grants will be geared toward organizations that teach abstinence education to teens instead of the comprehensive sex ed approach the previous administration supported. In a funding announcement released Friday, the administration announced two tiers of funds for the TPP program. In the first, grantees would have to follow one of two abstinence programs to receive funding.One of the programs uses a "sexual risk reduction model," which is designed to reduce sexual risk behaviors. The other program uses a "sexual risk avoidance model," which teaches teens to avoid sex completely. "Projects will clearly communicate that teen sex is a risk behavior for both the physical consequences of pregnancy and sexual transmitted infections; as well as sociological, economic and other related risks," the funding announcement reads. "Both risk avoidance and risk reduction approaches can and should include skills associated with helping youth delay sex as well as skills to help those youth already engaged in sexual risk to return toward risk-free choices in the future." 

        Students as Teachers: Facing the World Adults Are Wrecking -- During the first week of May 1963, more than 800 African-American students walked out of their classrooms and into the streets of Birmingham, Alabama, to call for an end to segregation. Despite frequent arrests and having dogs and high-pressure firehoses turned on them, they kept marching. Their determination and ceaseless bravery — later called the Children’s Crusade — was captured in photographs and newspaper articles across the country. Through acts of peaceful and defiant civil disobedience, these students accomplished what their parents had failed to do: sway public opinion in support of the civil rights movement. Fast forward to March 24, 2018. Naomi Wadler, a fifth grader, is standing at a podium in front of hundreds of thousands of protesters at the March for Our Lives in Washington, D.C. Young as she was, Wadler, who organized a walkout at her elementary school to honor the 17 victims of the Parkland massacre, delivered a searing and heartfelt speech about the countless gun-related deaths of African-American women in America. Her steely resolve and the power of her message brought me to tears. I wondered: Is this what it will take? Will a new generation of fearless student-leaders be the agents of change that America so desperately needs? As a teacher, it took me a while to begin to see just what my students truly had in them. During my first two years of high school teaching, I’m not sure I loved or even liked my teenage students.  Much of my initial experience in the classroom was emotionally draining, engaged as I was in power struggles with those students, trying to assert my influence and control over them.  I was their teacher; they were my students. So I set out to establish a dynamic of one-way respect.  I was — I could feel it — actively disregarding the emotional and intellectual capacities of my students, unwilling to see them as informed, competent, and worthy of being heard. I was, I realized, becoming the very kind of person I hated when I was in high school: the adult who demanded respect but gave none in return.  The best decision I ever made in a classroom was to start listening to my students.

        A single high school in India has produced the CEOs of Microsoft, Adobe, and Master-card - If you're looking to raise one of the most powerful business leaders in the world, you might want to send your kid to Hyderabad Public School, Begumpet, in India.In an interview with Stephen Dubner on an episode of the "Freakonomics" podcast, Microsoft CEO Satya Nadella mentioned that not only did he attend the high school, but so did Shantanu Narayen, the CEO of Adobe, and Ajay Banga, the CEO of Mastercard.Hyderabad Public School is what Americans would consider a private school — though in India, like England, such schools are called public schools.According to Hyderabad Public School's website, it was established in 1923 as a school for the sons of aristocrats, modeled after Eton College in London. Last year, it was ranked one of the top 10 schools in India.Schoolchildren do yoga at Delhi Public School in Hyderabad, India, in 2014.Mahesh Kumar A./AP ImagesThe school is in Hyderabad, the southern Indian city that has become a tech hub. Since 1990, Hyderabad has been home to the headquarters of Microsoft India."Attending the HPS was the best break I had in my life," Nadella said when he visited the school last year, according to The Hindu.Nadella played cricket at the school, and he has spoken before about how the sport influenced his career. In a recent interview at Wharton Business School, Nadella said he learned from his high-school cricket coach how to walk the line "between having confidence in your own capability yet having the ability to learn." Nadella also met his wife, Anupama Nadella, at Hyderabad Public School. The school's core values, according to its website, include "strong self-esteem" and "tolerance and respect for others." The school motto? "Be vigilant."

        Oklahoma teachers warn: Don’t trust the unions -- As teachers in Arizona and Colorado prepare to go out on strike next week, educators in Oklahoma are warning teachers that they must take the struggle into their own hands and seek to unify across state lines in order to prevent their strikes from being betrayed by the unions.  On Thursday, Arizona teachers voted by 78 percent for a state-wide walkout. They have demanded an immediate 20 percent pay rise for teachers, wage increases for all other school employees and the restoration of more than $1 billion in school funding cuts imposed over the past decade. Arizona teachers are among the lowest paid in the nation. Many teachers work two or three jobs, including as Uber drivers and pizza deliverers. . “Per pupil funding is below 2008 levels,” she said. “We’ve lost librarians, computer teachers, paraprofessionals. We used to have a full-time counselor, now we have no one in that role. We have increased class sizes. Everyone is paying more for benefits. Our governor keeps signing tax cuts for corporations.”The Arizona Educators United Facebook page, which was set up by Arizona teachers and has grown to nearly 50,000 members, together with the teachers union, the Arizona Education Association, has delayed the walkout date until April 26. The union’s aim is to give Republican Governor Doug Ducey and the state legislature time to come up with a gesture and avert a walkout.There have been growing demands for a strike in Arizona for more than a month, but the unions worked to delay a strike vote until they had succeeded in selling out and shutting down the strikes by teachers in Oklahoma and West Virginia. The unions are seeking above all to prevent teachers in different states from linking up so as to prevent a nationwide struggle.In Colorado, school districts are continuing to announce that they will be forced to close on Friday, April 27, the day after the Arizona walkout, because hundreds of teachers are declaring that they will not report to work. The districts that have already announced they will be closing include Jeffco (86,000 students), Cherry Creek (54,000), Poudre (30,000), Thompson (16,000) and Adam 12 (38,000). Jeffco will also be closing the day before, on April 26.

          Teachers stage protests in lead-up to Arizona, Colorado walkouts this week - Thousands of teachers across Arizona participated in “walk-in” protests yesterday and today, lining up outside schools with students and parents before walking in together, in the lead-up to this Thursday’s statewide walkout. The walkout will coincide with strikes by teachers in Colorado, which have forced school districts to close on Thursday and Friday.In the wake of this year’s nine- and ten-day walkouts by educators in Oklahoma and West Virginia, which were only ended due to the betrayals of the National Education Association (NEA) and American Federation of Teachers (AFT), there is enormous support among teachers for a united struggle in defense of the right to public education.Arizona teachers have rejected the proposal by Republican governor Doug Ducey for a 20 percent wage rise, staged over three years, which would do nothing for other school employees, or resolve the systematic cuts to the education budget over the past decade by more than $1 billion. The raise would also be funded through brutal cuts to programs for people with developmental disabilities, state universities and hospitals, and Medicaid for low-income adults and children. Arizona educators are among the lowest-paid in the country, many of them working one or two extra jobs, and pay anywhere from $500 to $2,000 per year out of pocket for school supplies for their students.While the Arizona Education Association, the state affiliate of the NEA, has called for a walkout only on Thursday, a number of school districts have already been forced to announce they will close on Friday, and some on Monday, due to the large number of teachers who have already declared they will not be coming to work. Phoenix United High School District has signaled it will be forced to close until Monday.

          The teachers’ struggle spreads to Arizona and Colorado --The resistance movement of teachers in the United States is entering a new stage.On Thursday, nearly 60,000 educators in Arizona are scheduled to launch the first statewide teachers’ strike in the history of that southwestern state. They are demanding a 20 percent raise and the restoration of more than $1 billion in school funding cuts over the last decade.On Friday, thousands of teachers in neighboring Colorado are expected to converge on the state capitol in Denver to demand improved wages and pensions. On Tuesday, 3,000 teaching and research assistants began a four-day strike at Columbia University in New York City. The wave of teachers’ strikes, which began in West Virginia and Oklahoma over the last two months, is an expression of an objective process with far-reaching consequences. As the Trump administration and its opponents in the ruling class remain locked in a ferocious conflict centered on issues of foreign policy and war, an altogether different conflict has emerged between the working class and the entire capitalist ruling elite.  The teachers’ revolt in the US is part of an international resurgence of the class struggle that has drawn in educators and public- and private-sector workers across Europe, Latin America, Africa, Asia and Australia. The decades-long period in which the unions could suppress the class struggle—giving the ruling class a free hand to drive down the social position of the working class and transfer wealth to the corporate and financial oligarchy—is coming to an end. The teachers’ strikes are the precursors of immense class battles on the horizon.

          Rural Teachers Working Second Jobs, Struggling To Make Ends Meet – This week teachers from across Colorado are walking out of school and rallying at the state Capitol to protest a lack of school funding. In the northeast corner of the state, 124 miles away, Samantha Fennell teaches kindergarten at Ayres Elementary School in Sterling, where teachers earn 26 percent below the state average. “I wanted the small town feel,” said Fennell, who moved from the Front Range to the Eastern Plains.On the day CBS4 visited, she was teaching her 21 students how to read.“I love working with kids,” she said. “Grown-ups can get a little iffy sometimes.”After four years of teaching in the RE-1 Valley School District, Fennell earns $31,229. She hasn’t received a raise since she was hired.“The first two years it was kind of disheartening,” she said, “It was hard to keep trucking through.”Teachers generally don’t get promotions. Instead, they build their salaries little-by-little, one step at a time.A rookie teacher in the RE-1 Valley school district in Sterling makes $29,793. After 10 steps, of about $700 each, she can expect to make $36,256. In most school districts, a step equals a year. But, Fennell has been locked in at Step 3 since she started.“The dream would be to have children and raise them here in Sterling, where I love to teach,” she said. “But, the reality right now I can’t. There is no way I can afford it.” With student loans of about $25,000 lumped on top, even in Sterling, it’s tough to make it work.

          Arizona strike biggest yet in teachers’ revolt in US -- Arizona teachers walked out Thursday in the first statewide teachers strike in the history of the southwestern US state. A massive crowd of 75,000 educators and their supporters marched and rallied, voicing their demands for better teacher pay and more funding for schools. The same day, several thousand teachers in neighboring Colorado walked out in some of the largest school districts and rallied at the state capitol in advance of a walkout by teachers in Denver and other cities on Friday.  The Arizona march began at Chase field in Phoenix and proceeded two miles to a rally outside the state capitol where legislators were in session. Teachers, support staff and site administrators were joined by other workers in a show of solidarity. Many educators felt exhilarated for finally standing up to fight for public education. One teacher from Rio Rico told WSWS reporters “When conversations about the strike started happening we were very for the message, it felt overdue.”    By noon, when the end of the march was reaching the capitol, the state senate arrogantly adjourned until Monday ensuring that no funding proposals would be heard or voted. Protest organizers, which included the Facebook group Arizona Educators United in conjunction with the Arizona Education Association (AEA), hoped to limit the action to an impotent lobbying of state legislators. With the senate adjourning, the protest leaders had nothing further to propose to the mass of striking teachers so they called off the rally three hours early at 1:30 p.m., citing excessive heat as the justification. Noah Karvelis, the administrator of the AEU Facebook page, called for the protest to resume Friday, “What I think we’re going to do is come down here and say, ‘We’re here, where are you?’” The walkout is the biggest yet in a wave of militant struggles to defend public education, with an estimated 840,000 students in Arizona affected. As in West Virginia and Oklahoma, the movement was initiated by rank-and-file teachers, using social media, not the National Education Association (NEA), the American Federation of Teachers (AFT) or their state affiliates. Since betraying the strikes in West Virginia and Oklahoma, the NEA and AFT have been doing everything to prevent teacher rebellions from spreading across the country.

          ‘He’s not listening’: Teachers and Arizona governor at odds — As thousands of teachers and supporters gathered at the Arizona Capitol to protest inadequate public school funding for a second day Friday, Gov. Doug Ducey again skipped the chance to address them.  Instead, the Republican governor’s public relations machine sent out links to a series of interviews the previous day with TV news reporters where Ducey pushed his plan to boost teacher pay by 20 percent by 2020, talking point by talking point. Ducey, who is seeking re-election this year, never showed up to address the 50,000 educators and supporters Thursday or the thousands at the Capitol on Friday. He has called the leaders of the grassroots group that organized the walkout with the Arizona Education Association politically motivated. “He’s not listening,” said Kelly Grant, a Mesa teacher. “There’s five demands, there has been from the beginning. So we just want someone to sit down with our people, make some effort. They’re not making an effort.” Ducey has refused to meet with walkout leaders, instead inviting a handful of selected educators to meetings. Just two weeks ago, he was ignoring the demands of teachers who began protesting in early March, after educators in West Virginia went on strike and won big raises. Educators in Oklahoma and Kentucky followed. In a surprise move on April 12, Ducey tried to sideline the protests by announcing he had found a way to boost teacher pay by 9 percent this year, followed by 5 percent raises in 2019 and 2020. He also is counting a 1 percent raise he gave last year to come to the 20 percent figure. That would cost about $650 million a year by 2020 in a state that has consistently cut taxes as the governor moves to shrink government and enact more tax cuts. Late Friday afternoon, Ducey’s office announced he had reached a deal on a state budget with majority Republican leaders of the House and Senate. The deal gives the 20 percent raise by 2020 and an extra $100 million for school districts the governor proposed in January as start to restoring recession-era cuts. But the plan does not doesn’t address other demands of striking educators.

          State takeover looms for Kentucky’s largest school district -- Tuesday evening was the occasion of a contentious meeting called by Kentucky’s Jefferson County Public Schools (JCPS) board of education. Hundreds of parents, teachers, principals and community members, urging against a state takeover of the school district, turned out on the eve of a two-day tour and review of the district by Wayne Lewis, the newly-appointed commissioner of education. Also attending the meeting was a contingent from the Kentucky Pastors in Action Coalition, who favor a state takeover, which could herald the first charter schools opening in the Commonwealth. The Jefferson County district is the largest in the state, encompassing 172 schools, 6,600 teachers and 101,000 students, throughout the Louisville metropolitan area. About 15 percent already attend charter schools. Lewis “has begun announcing changes,” according to an April 24 article in the Lexington Herald-Leader. The article, headlined “New education commissioner making changes. Is action on charter schools next?” mentions Lewis’ decision to spend Wednesday and Thursday touring schools throughout JCPS, which has been under a state audit since 2016. The author then poses the question: “Will re-energizing Kentucky’s stalled charter school effort be his next step?” The drive for charter schools is now on the fast track. Also on Tuesday, the Louisville Courier-Journal reported that the Kentucky Pastors in Action Coalition, alongside the right-wing libertarian Bluegrass Institute, held a press conference announcing their support for a state takeover of JCPS. The pastors’ coalition advocated for the passage in 2017 of a controversial charter school bill—which was signed into law last year—and supported other school-choice initiatives, including a scholarship tax credit program and publicly funded vouchers for preschool, according to the Courier-Journal .

          Teacher Pension Crisis Overwhelms California And Kentucky - The pension crisis that’s been sweeping through the U.S. is certainly no secret, but many aren’t aware of just how bad things have gotten. States are struggling to come up with solutions to the budget gaps that exist in their public pension funds, including those affecting their education systems. States that are attempting fixes can’t find agreement on the best way to handle the teacher pension crisis.California is currently dealing with unfunded liabilities in its education systems, which are sinking fast under rapidly rising pension costs Meanwhile, Kentucky lawmakers attempted to deal with their state’s future unfunded liabilities by sneaking a major change to teacher pension funds into an unrelated bill, but all they managed to do was spark a strike among educators in the state. Just about the only thing they do agree on is that there isn’t enough money to go around.The San Francisco Chronicle warned late last week that California’s aging population is weighing heavily on its public pension programs and outlined the massive budget deficits in the state’s school systems. The San Diego Unified School District alone faces a $124 million deficit in 2019, even after slicing millions of dollars off its budget, and it’s far from the only school district in the state to face such a massive spending gap.A sign of just how serious the teacher pension crisis is that California isn’t even facing a budget crunch at the state level. In fact, according to the Chronicle, state funding has improved, while local school district budgets have gotten worse, and soaring pension costs are fingered as one of the main culprits. In the coming years, more and more areas of the public sector are being weighed down as Baby Boomers retire, causing a severe imbalance between the money paid out to the growing number of retirees and the money being paid in by teachers who are currently working. Over the years, lawmakers just kept kicking the can down the road, choosing not to worry about the upcoming crisis because it was decades away, but unfortunately for some states and school districts, the end of the road is suddenly looming just ahead.

          Why More Than A Million Teachers Can't Use Social Security - Teachers have staged protests in recent weeks in West Virginia, Oklahoma, Kentucky, Colorado and Arizona. Some are fighting lawmakers who want to scale back their pensions.It's no secret that many states have badly underfunded their teacher pension plans for decades and now find themselves drowning in debt. But this pensions fight is also complicated by one little-known fact: More than a million teachers don't have Social Security to fall back on. To understand why, we need to go back to Aug. 14, 1935. That is when President Franklin Delano Roosevelt signed the original Social Security Act. "This Social Security measure gives at least some protection to at least 50 million of our citizens," Roosevelt intoned. But of those 50 million citizens, one big group was left out: state and local workers. That was because of constitutional concerns over whether the federal government could tax state and local governments, says Alicia Munnell, director of the Center for Retirement Research at Boston College.  "So, in the 1950s," Munnell says, "there were amendments added to the Social Security Act that allowed governments to enroll their workers."  And many did, leading the Social Security Administration to trumpet in one 1952 promotional film that "most American families are now able to ensure for themselves an income that is guaranteed for life." Most American families ... except for a lot of teachers, says Chad Aldeman, editor of

          Health Insurance Costs Could Drive Texas Teachers To Leave – Another increase in health insurance costs could drive some Texas teachers out of the classroom. For a teacher making $40,000 a year to have average health insurance for themselves and their family, it is now going to cost them half of their paycheck. Since 2002, health insurance premiums have more than doubled for Texas teachers. The Teacher Retirement System board voted last week to increase premiums by an average of 5.7 percent starting in September. Some premiums rates will increase by as much as 9.5 percent. Specialist copays, deductibles, and maximum out-of-pocket amounts will also increase. Despite the increase in health care costs, the state’s contribution to teacher’s health care has remained the same since 2002. Alliance-AFT Dallas President Rena Honea said many veteran public teachers are contemplating leaving the profession because of the health care expenses. “Many have said they are actually taking home less money because of the increases in health care in TRS so they are actually seeing a demotion as far as the money,” Honea explained. “Many are leaving the profession because they can’t afford to make ends meet.” Honea said the hardest hit by the insurance changes are the hourly support staff employees, such as cafeteria workers and custodians. Even the catastrophic insurance plans are often more than they can afford. Teacher groups are calling on lawmakers to help offset some of these expenses by increasing the state’s contribution to the teacher health insurance program. 

          Syracuse fraternity members removed from classes following racist video  - Syracuse University removed more than a dozen Theta Tau fraternity members from classes on Sunday after video emerged showing members participating in racist, homophobic and anti-Semitic skits, according to to school officials.   The university said 18 students had been "removed from academic participation" in connection with the video, which it said showed Theta Tau members acting in an "extremely racist" and "homophobic" manner.   One of the videos -- made public by the school's independent newspaper, The Daily Orange, last week -- showed members of the engineering fraternity using racist, ethnic and sexist slurs while pretending to perform sexual acts on each other. The paper published a second video over the weekend which it said showed people in Theta Tau’s house miming the sexual assault of a person with disabilities.   The students removed were all "present at the sponsored event" where the video was filmed, the central New York school's chief of the Department of Public Safety, Bobby Maldonado, said in a statement Sunday.   "Out of an abundance of caution and ongoing concern for our campus community, Provost Michele Wheatly and Dean of Students Rob Hradsky notified the 18 students of their removal from academic participation, effective immediately," Maldonado said. "Alternative class and study arrangements will be made for these students as the judicial process moves forward."

          Syracuse University suspends 18 Theta Tau members after second offensive video emerges -- Over a dozen members of the Theta Tau fraternity at Syracuse University have been suspended after a second video of lewd behavior emerged over the weekend. Eighteen students were pulled “from academic participation” after a pair of videos showed them taking part in offensive skits, the latest of which showed a mock assault on a handicapped person, Department of Public Safety Chief Bobby Maldonado said in a statement Sunday night.The decision was made out of “an abundance of caution and ongoing concern for our campus community,” the safety official added.  “Alternative class and study arrangements will be made for these students as the judicial process moves forward,” he said. The Central New York school has condemned the contents of the first video, which Chancellor Kent Syverud said in a separate statement displayed “extreme and egregious racism, sexism, ableism, anti-Semitism and homophobia.”The second recording showed frat members pretending to sexually assault a disabled person.  “I ask all of us who care about our community and its values to reaffirm them by emphatically rejecting all this video represents,” Syverud said of the second recording. “There is absolutely no place at Syracuse University for tolerance of this behavior.” Maldonado, the public safety chief, said all 18 suspended students were present at the time of the recordings.  The Daily Orange obtained the videos, originally displayed on the frat’s secret Facebook group, and posted them on its website. Syracuse University doesn’t plan to release them to the public.

          Why we should bulldoze the business school - Visit the average university campus and it is likely that the newest and most ostentatious building will be occupied by the business school. The business school has the best building because it makes the biggest profits (or, euphemistically, “contribution” or “surplus”) – as you might expect, from a form of knowledge that teaches people how to make profits. Business schools have huge influence, yet they are also widely regarded to be intellectually fraudulent places, fostering a culture of short-termism and greed. (There is a whole genre of jokes about what MBA – Master of Business Administration – really stands for: “Mediocre But Arrogant”, “Management by Accident”, “More Bad Advice”, “Master Bullshit Artist” and so on.) Critics of business schools come in many shapes and sizes: employers complain that graduates lack practical skills, conservative voices scorn the arriviste MBA, Europeans moan about Americanisation, radicals wail about the concentration of power in the hands of the running dogs of capital. Since 2008, many commentators have also suggested that business schools were complicit in producing the crash. Having taught in business schools for 20 years, I have come to believe that the best solution to these problems is to shut down business schools altogether. This is not a typical view among my colleagues. Even so, it is remarkable just how much criticism of business schools over the past decade has come from inside the schools themselves. Many business school professors, particularly in north America, have argued that their institutions have gone horribly astray. B-schools have been corrupted, they say, by deans following the money, teachers giving the punters what they want, researchers pumping out paint-by-numbers papers for journals that no one reads and students expecting a qualification in return for their cash (or, more likely, their parents’ cash). At the end of it all, most business-school graduates won’t become high-level managers anyway, just precarious cubicle drones in anonymous office blocks.

          Columbia University graduate students set to strike in New York City - Amid an international wave of educators’ struggles, 3,000 graduate students at Columbia University in New York City are set to begin a weeklong strike today after the university refused to negotiate with the Graduate Workers of Columbia-United Auto Workers (GWC-UAW) Local 2110. The students, who work as teaching and research assistants (TAs and RAs, respectively), voted 93 percent in favor of a strike.The union said the walkout would begin at 10 am Tuesday if the university does not agree to bargain. The strike is scheduled to last from April 24 to April 30, with picketing in front of academic buildings and delivery entrances.Columbia TAs and RAs make poverty-level wages: less than $23,000 for a teaching assistant, on average. The median teaching assistant salary is about $4,000 higher, according to 2016 figures from, which aggregates salaries. The national average for part-time work, in comparison, is $24,500, still more than what Columbia TAs make. Graduate students must often take on exorbitant debt—above and beyond the debt they have from their undergraduate degrees—in order to finance their education. Graduate students also lack essential benefits like vision and dental insurance, despite Columbia having an endowment of $10 billion. According to the College Hill Independent, “Researchers and TAs also face late or irregular paychecks, jeopardizing their housing and financial security.” These stipends must sustain university workers in one of the most expensive cities on Earth, especially in terms of housing. A 2015 report estimated that a worker would need to make $44.60 an hour to have the median Manhattan rent be considered affordable (under 30 percent of income).

          Columbia University teaching assistants launch week-long strike -- Three thousand graduate student workers at Columbia University in New York City went out on strike Tuesday, building on the growing wave of education workers’ struggles taking place nationally and internationally this year. Like their counterparts in West Virginia, Oklahoma and elsewhere, striking teaching and research assistants at the elite private university are battling over low wages and inadequate healthcare coverage, along with other workplace and social issues. The immediate trigger for the walkout was the Columbia administration’s refusal to bargain with the recently certified union, Graduate Workers of Columbia-United Auto Workers (GWC-UAW) Local 2110. The university refuses to recognize student workers as employees, claiming their status as students precludes them from also being employees. Columbia University has followed the broader trend within higher education of relying upon highly exploited, part-time labor for a growing share of university work. Average earnings for teaching assistants, under $23,000 a year, places them below New York City’s official poverty threshold for an individual. New York City’s metric is more accurate than federal thresholds in that it considers the higher cost of housing and other expenses in New York.The struggle of part-time workers to maintain a decent standard of living stands in stark contrast to the wealth of Columbia University and its top administrators. Lee Bollinger, Columbia’s president, takes in $1.4 million a year, a level once unheard-of for a college administrator. Columbia, which holds an endowment of around $10 billion, is engaged in a multibillion-dollar expansion, which is transforming upper Manhattan and driving up rents far beyond the means of the area’s working-class residents. A large percentage of the graduate student workers at Columbia are international students. Typically prohibited from taking on other jobs, these students are often wholly dependent on the university to stay in the country and have little recourse for unpaid or delayed stipends, a common complaint among student assistants.

          Graduate student-workers strike faces continued intransigence from Columbia University - Three thousand graduate student workers at Columbia University in New York City are continuing their strike amidst and expanding wave of teacher protests throughout the US and internationally. Many participated in a rally on Thursday in New York City.The graduate students make a living as research and teaching assistants while pursuing their academic degrees. The trigger for the walkout that began April 24 was the refusal of the university administration to bargain with the recently certified union, the Graduate Workers of Columbia–United Auto Workers (GWC-UAW) Local 2110.  Institutions of higher education have been increasing the proportion of lower-paid, part-time, temporary teachers and other support workers, which are replacing higher-paid, tenured faculty, even as tuitions soar. The GWC is made up of research and teaching assistants who average less than the poverty wage of $23,000 in one of the most expensive cities in the world. The teachers at Columbia have faced the intransigence of government, business and university officials, raising fundamental strategic and political issues.Under the mistaken belief that the UAW would lead a struggle for their rights, graduate students placed themselves under the guidance of what is essentially a business organization. The UAW has collaborated in the restructuring of the auto industry, including the imposition of poverty-level wages for new hires and a growing workforce of temporary, part-time and outsourced labor with low or no benefits. Columbia University is one of the most highly selective universities, geared especially toward training the future ruling elite. Its attitude toward the graduate student workers is in line with the ruthless stance of the ruling class to the working class.

          Judge finalizes $25 million settlement in Trump's fraud case -  It took a while, but the Trump University fraud case officially reached its end last week. The political fallout, however, hasn’t quite run its course.USA Today reported the other day on the end of the settlement agreement.A federal judge finalized the $25 million settlement between President Trump and students of his now shuttered Trump University on Monday, with New York’s attorney general claiming “victims of Donald Trump’s fraudulent university will finally receive the relief they deserve.”The order from U.S. District Judge Gonzalo Curiel – the same Indiana-born judge Trump called biased because of his “Mexican heritage” – comes a year after he first approved the settlement. It marks the end of two class-action lawsuits and a civil lawsuit from New York accusing Trump of “swindling thousands of Americans out of millions of dollars through Trump University,” in the words of New York Attorney General Eric Schneiderman.The circumstances are nothing short of bizarre: a sitting president of the United States has written a check for $25 million to a group of Americans who credibly claimed that he ripped them off by perpetrating a fraud.You know things are bad for a president when a story like this goes almost entirely unnoticed by the public, eclipsed by a dozen or so more pressing scandals.Regardless, after keeping a close eye on this case for a long while, I think it’s a shame to see the case end – because I’ve long believed this is one of the underappreciated controversies of Trump’s recent career. Indeed, as regular readers may recall, the finalized settlement agreement wasn’t supposed to happen at all – according to the president.

          Happy birthday, America's $1 trillion student-debt problem -- Student debt has been a $1 trillion problem for at least six years. Six years ago today, on April 25, 2012, activists took to the streets to mark the country’s outstanding student-loan debt surpassing $1 trillion. And in the years since, many of the trends that pushed student debt levels to climb have persisted and in some cases gotten worse.Focusing on the $1 trillion mark is somewhat “arbitrary,” given that it doesn’t change the debt burdens individuals are managing every day, said Mark Huelsman, a senior policy analyst at Demos, a left-leaning think tank. (Outstanding student debt reached $1 trillion during the second quarter of 2012, according to the Federal Reserve, which includes April.)  Still, Huelsman said these kinds of “big round numbers” can help galvanize people around the issue. “Rising student debt has really happened over a 20-year period,” he said. A variety of trends are fueling that growth. At the same time the cost of college has climbed —caused in part by state disinvestment in public higher education — a college degree has become more necessary to earn a decent living. That means that as more people are attending college, they’re increasingly relying on debt to finance their schooling, pushing the level of overall student debt up. Sluggish wage growth and the rising cost of other necessities, such as child care, also mean that families have less money to rely on to pay for school. And once students leave college those stagnant wages can make it difficult for them pay down their debt effectively. “There are broader issues in the economy that show up in the student debt figures,” Huelsman said. “But it’s also a set of deliberate policy choices that we’ve made at the federal or state level to not meet the rising demand with the investment that previous generations have received.”

          For The First Time Ever, Millennials With Student Debt Have Negative Net Wealth - On Thursday, Young Invincibles released a troubling update to their report, “The Financial Health of Young America: Measuring Generational Declines Between Baby Boomers & Millennials.” This report includes a cross-generational study of the financial well-being of Millennials today versus Baby Boomers when they were in their adolescence. The update covers the economic challenges facing millennials age 25 to 34 between 2013 and 2016. Despite the fact that this is the second most extended economic expansion/central bank induced channel of financial capital into speculation and financialization, the update reveals how the millennial generation has transformed into the lost generation, as their financial security has eroded late in the business cycle. For the first time, young adults age 25 to 34 with college degrees and student loans have a median net wealth of negative $1,900, said the advocacy group.The report states that this lost generation had a positive net wealth of $9,000 in 2013, but since, the accumulation of debt has turned America’s future leaders into the walking dead.The report update shows new, disturbing trends for Millennials, including:“For the first time, young adults who graduated college with student debt have negative net wealth. Today’s young adults with student debt have a median net wealth of -$1,900. That’s down from a median net wealth of $9,000 in 2013.”“Homeownership among young people continues to trend downward. A primary means for families to build and transfer wealth, homeownership among young people dipped by 3 percent. This trend is entirely driven by college graduates with student debt, as the rate of homeownership for young people with degrees but no debt, as well as those with no degree, remained stable.”“This financial decline has been especially devastating for young African Americans, regardless of student debt. Between 2013 and 2016, homeownership among all young African Americans declined 6 percent, median net wealth has dropped nearly 19 percent, and the retirement saving rate also declined.”

          Mainstream Media Duped By "Student Loan" Expert Who Never Existed -- While searching for sources for their stories about America's blossoming student-loan debt, CNBC, Fox News And the Washington Post all cited the work of a self-styled "journalist" and "student loan expert" who portrayed named David Cloud, the founder of an "independent" news outlet the Student Loan Report. But as a report published this week by the Chronicle of Higher Education revealed, Cloud has a serious credibility problem: He doesn't exist.   The Chronicle became suspicious after Cloud "authored" an article about a survey about students using financial aid money to fund cryptocurrency investments. According to Cloud, the "survey" revealed that an astonishing 21% of student loan borrowers had used the money they received to fund crypto investments.  Several reporters immediately suspected that this sounded like a specious claim, and decided to do a little more digging into Cloud's background...which is when they learned that he was a fabrication invented by several writers at the Student Loan Report. After The Chronicle spent more than a week trying to verify Cloud’s existence, the company that owns The Student Loan Report confirmed that Cloud was fake. "Drew Cloud is a pseudonym that a diverse group of authors at Student Loan Report, LLC use to share experiences and information related to the challenges college students face with funding their education," wrote Nate Matherson, CEO of LendEDU. Before his true identity (or lack thereof) was discovered, Cloud's work had been used in many salacious stories about the tremendous lengths that US students would supposedly go to live an existence free of debt.

          1 In 4 Millennials Rely On Their Parents To Pay Some Bills - Even While Working Full Time - Time and time again, we've discussed how America's millennial generation is burdened by debt, effectively precluded from home ownership and increasingly disgruntled and pessimistic about their future prospects for wealth and happiness.  In its latest Global Wealth Report, Credit Suisse said the millennial generation has faced "a run of bad luck", much of which was centered around the financial crisis."The “Millennials” – people who came of age after the turn of the century – have had a run of bad luck, most clearly in developed markets. Capital losses in the global financial crisis of 2008-2009 and high subsequent unemployment have dealt serious blows to young workers and savers. Add rising student debt in several developed countries, tighter mortgage rules after 2008, higher house prices, increased income inequality, less access to pensions and lower income mobility and you have a “perfect storm” holding back wealth accumulation by the Millennials in many countries."  And maybe as a consequence of this "bad luck" (or perhaps because of their sense of entitlement and their unwillingness to seek challenging careers in the sciences or engineering fields), millennials also outrank previous generations in another area: The unprecedented number of people in their mid-to-late 20s (and some even later) who are still living with their parents, or relying on some form of financial help from their parents. Even some who have full time jobs.

          The next generation of doctors may be learning bad habits at teaching hospitals with many safety violations -- The patient’s breaths had become labored.  The complaint traveled from the nurse to a doctor, who looked at the patient’s records and quickly saw the problem: a feeding tube had been placed into the side of his lung. An anesthesiology trainee had inserted the tube without proper supervision, a federal health inspection later determined, and over the coming weeks, the patient developed pneumonia and sepsis related to the medical error. He was in the hospital two months longer than initially planned.  Teaching hospitals like Jackson South, located in metro Miami, are where physician trainees get practice treating patients. They prepare the next generation of doctors, and they have a reputation as places of cutting-edge patient care, given their ties to academic institutions. But at some of these hospitals, residents may be learning bad habits. A STAT analysis of federal inspection data finds that there’s a wide gap in the quality of training at teaching hospitals, as shown by how frequently these hospitals are cited for deficiencies by the Centers for Medicare and Medicaid Services. While the majority of the roughly 1,200 teaching hospitals received no citations each year from 2014 to 2017, others racked up dozens of safety violations in that time period — putting patients at risk, and compromising the training that students receive.

          Express Scripts targets Amgen, Lilly migraine drugs in pricing shift  (Reuters) - The largest U.S. manager of prescription benefits is telling drugmakers that the current pricing model is broken, and taking aim at Amgen Inc, Eli Lilly and Co and other makers of new migraine medicines to try and fix it.  Express Scripts told Reuters it is pressing them to forego the usual strategy of setting a high U.S. list price, then lowering the cost for health plans through hefty rebates. It is also seeking a refund if the drugs don’t work within a defined timeframe.The shift could help Express Scripts and other pharmacy benefits managers (PBMs) bring prices down, and deflect growing criticism of their role as “middlemen” in the drug supply chain.  The Trump administration and members of Congress have demanded that PBMs pass on more of the rebates they receive to consumers outraged over rising costs at the pharmacy counter. Many Americans now have health plans with higher deductibles or co-payments, making them responsible for more of their medical costs.  Express Scripts is advising drugmakers to take that shift into account as they launch a new class of migraine drugs.  “If your expectation is that you are not going to actually get that high list price, then don’t do that to patients who have high co-pays,” Chief Medical Officer Steve Miller said in an interview, describing his message to Amgen and its rivals. “Let’s be more balanced. Let’s get back to where gross-to-net is not so different.”Amgen’s Aimovig is expected to be approved next month, followed by similar drugs from Teva Pharmaceutical Industries Ltd and Lilly that the companies say could benefit up to 4 million people in the United States.

          Patent ‘Death Squad’ System Upheld by U.S. Supreme Court - The U.S. Supreme Court upheld an administrative review system that has helped Google Inc., Apple Inc. and other companies invalidate hundreds of issued patents.The justices, voting 7-2, said Tuesday a U.S. Patent and Trademark Office review board that critics call a patent "death squad" wasn’t unconstitutionally wielding powers that belong to the courts.Silicon Valley companies have used the system as a less-expensive way to ward off demands for royalties, particularly from patent owners derided as "trolls" because they don’t use their patents to make products. Drugmakers and independent inventors complain that it unfairly upends what they thought were established property rights.“It came down to this: Is the patent office fixing its own mistakes or is the government taking property?” said Wayne Stacy, a patent lawyer with Baker Botts. “They came down on the side of the patent office fixing its own mistakes.”The ruling caused shares to drop in companies whose main source of revenue -- their patents -- are under threat from challenges. VirnetX Holding Corp., which is trying to protect almost $1 billion in damages it won against Apple, dropped as much as 12 percent and closed down 8.5 percent. The patent office has said its patents are invalid in a case currently before an appeals court. The court’s ruling “will reassure, if not embolden, patent challengers,” said Christopher Bruno, a patent lawyer with Schiff Hardin. Patent owners are likely to turn their focus to asking courts to scrutinize some of the procedures used by the board, he said.

          Some antidepressants linked to dementia risk - Some antidepressants and bladder medicines could be linked to dementia, according to a team of scientists who are calling for doctors to think about “de-prescribing” them where possible. Tricyclic antidepressants such as amitriptyline, which are also prescribed for pain and to help with sleeping, and one of the SSRI class, paroxetine (also known as Seroxat), are implicated by the largest ever study to look at this possible risk. Amitriptyline was in the news in February, named as the most effective of the antidepressants in a study. Some Parkinson’s drugs are also linked to a raised dementia risk. As a group, these are known as anticholinergic drugs. There are 1.5 to 2 million people in England alone on this type of drug. It is already known that they can cause short-term confusion and raise people’s risk of a fall. One in five people taking an antidepressant is on an anticholinergic drug, usually amitriptyline. The researchers warn that the increasing tendency for older people to be taking a cocktail of drugs for different conditions may be part of the problem. “In the last 20 years, the number of older individuals taking five or more medicines has quadrupled,” said Dr Ian Maidment, senior lecturer in clinical pharmacy at Aston University. “Many of these medicines will have some anticholinergic activity and, in the light of today’s findings, we have to consider whether the risks of dementia outweigh the benefits from taking a cocktail of prescribed drugs. “The focus should be on de-prescribing at least some medicines. That means pharmacists, doctors and nurses working with patients who are prescribed multiple drugs, to ascertain if the benefits clearly outweigh the potential harm that could be caused by anticholinergics.” The drugs for various conditions have in common their mode of action – they work by blocking a neurotransmitter – chemical messenger – called acetylcholine which has effects on the bladder, mouth, stomach, eye and heart but is also present in the brain and important in cognition, memory and learning. 

          Bill Gates Warns "Millions Could Die" If US Doesn't Prepare For Coming Pandemic - Should a deadly pandemic comparable to the 1918 influenza outbreak reach the US in the relatively near future, the US government would be powerless to stop it. And in all likelihood, hundreds of thousands - if not, millions - of Americans will die. That's the message from a Washington Post interview with Microsoft founder Bill Gates, which touched on many of the same subjects from a talk he gave Friday before the Massachusetts Medical Society. Bill Gates says the U.S. government is falling short in preparing the nation and the world for the "significant probability of a large and lethal modern-day pandemic occurring in our lifetimes." Gates discussed his efforts to convince the Trump administration to set aside more funding for the Centers for Disease Control and Prevention and to prioritize the creation of a national response plan that would govern how resources are deployed during a pandemic or biological weapons attack.    Gates may have a point: Even this winter's flu season - the worst in years - overwhelmed hospitals, some of which were forced to pitch tents outside the facilities and deploy other emergency accommodations. Gates, whose Gates Foundation focuses on public health initiative, has shifted his focus in recent years to international pandemic awareness and preparation. To be sure, he's not the only one who believes the developed world is dangerously ill-prepared to beat back such a threat.Gates and his wife, Melinda, have repeatedly warned that a pandemic is the greatest immediate threat to humanity. Experts say the risk is high, because new pathogens are constantly emerging and the world is so interconnected.Many experts agree that the United States remains underprepared for a pandemic or a bioterrorism threat. The government’s sprawling bureaucracy, they say, is not nimble enough to deal with mutations that suddenly turn an influenza virus into a particularly virulent strain, as the 1918 influenza did in killing an estimated 50 million to 100 million people worldwide.Even this winter’s harsh seasonal flu was enough to overwhelm some hospitals, forcing them to pitch tents outside emergency rooms to cope with the crush of patients. If a highly contagious and lethal airborne pathogen like the 1918 influenza were to take hold today, nearly 33 million people worldwide would die in just six months, Gates noted in his prepared remarks, citing a simulation done by the Institute for Disease Modeling, a research organization in Bellevue, Wash.

          New Zealand Braces For "Super Gonorrhea": It's A Matter Of "When, Not If" - A historically-resistant strain of gonorrhea has made its way from South East Asia to the United Kingdom and Australia, and experts are warning New Zealand will be struck next by the antibiotic-resistant super-bug gonorrhea strain. It’s in Eastern Australia, and it’s in Queensland, Australia, so those in New Zealand are rightly concerned.Last month, it was reported a British man had contracted what was dubbed the world’s ‘worst ever’ case of gonorrhea, that he picked up in southeast Asia. It was the first documented case of the sexually transmitted infection that could not be cured with a combination of standard antibiotics. England’s public health agency even launched an “incident response” after discovering more cases of gonorrhea recently that are resistant to nearly all antibiotics currently available.So, how long will it be before it makes its way to New Zealand?According to Family Planning’s Christine Roke, “if it isn’t here now, it will be very soon.” Auckland University associate professor of infectious diseases Mark Thomas agrees, telling Morning Reportit’s “almost certain” there will be cases within the next year or two. It’s simply a matter of “who has sex with who,” he said.Gonorrhea is caused by the Neisseria gonorrhoeae bacteria. The symptoms of the disease are difficult for men to live with, so most know fairly soon if they’ve contracted the infection. Symptoms can include d iscolored discharge, stomach pain, various forms of bleeding from the genitalia, discharge or bleeding from the anus and, for the fellas, sore testes. Women often are unaware of an infection, as it normally infects the cervix,which has no sensation. Occasionally you may also get a dry throat if you’ve contracted the bacteria.  Normally, it has been easily treated with antibiotics, however, this new strain, appears to be resistant.

          Antibiotic resistance can be caused by small concentrations of antibiotics -- Antibiotic-resistant bacteria are a global and growing problem in health care. To be able to prevent further development of resistance developing, it is important to understand where and how antibiotic resistance in bacteria arises. New research from Uppsala University shows that low concentrations of antibiotics, too, can cause high antibiotic resistance to develop in bacteria.In the present study in question, published in Nature Communications, the researchers have investigated how prolonged exposure to low levels of antibiotics contributes to the development of bacterial antibiotic resistance. During a course of antibiotics, a high proportion of the antibiotic dose is excreted in the urine in unchanged, active form, and can then spread into watercourses, lakes and soil in the wastewater. Consequently, these environments may contain low levels of antibiotics. In some parts of the world, large quantities of antibiotics are used in meat production and aquaculture, where small doses of antibiotics are added to the animal feed to make the animals grow faster. This means that the bacteria in their intestines are exposed to low levels of antibiotics over long periods and these bacteria can then, in turn, infect people via food, for example. In the paper, the researchers show that low concentrations of antibiotics, too, play a major part in the development of resistance. The study showed that, over time, bacteria exposed to low doses of antibiotics developed resistance to antibiotic levels that were more than a thousand times higher than the initial level to which the bacteria were subjected. It was also found that the mutations in the bacterial DNA that cause resistance are of a different type than if they have been exposed to high doses. During the experiment, the bacteria eventually acquired several mutations. Each of these yielded low resistance, but together they brought about very high resistance. In addition, the mutations took place mainly in genes that have not previously been regarded as typical resistance genes, suggesting that the number of genes capable of promoting development of resistance has been greatly underestimated.

          Climate Change Is Making Deadly Air Pollution Worse in Cities Across the U.S - Environmentalists worry that climate change could cause problems with rising sea levels and crop failures in the coming decades, but one group of researchers has found it’s already causing health problems now.  Temperature increases linked to climate change are worsening air pollution in communities across the country right now contributing to a range of health problems from asthma to premature death, according to a new report from the American Lung Association.The total number of Americans exposed to unhealthy air rose to nearly 134 million, according to the group’s 2018 State of the Air report. That represents a spike from 125 million in the previous year.Ozone pollution — commonly known as smog — sits at the heart of America’s worsening air pollution problem. Warmer temperatures create conditions conducive to smog formation and lead air to stagnate, keeping dirty air from leaving a given area. The number of days with unsafe levels of ozone pollution increased significantly in 2014 – 2016, the timeframe evaluated in the report, at the same time as the planet experienced the hottest years on record. “Climate change makes it harder to protect human health” the report says. “Too many cities suffered increased ozone from the increased temperature.”The worsening ozone problem hit both the country’s largest population centers such as New York City and Los Angeles as well as smaller communities like Bakersfield and Fresno, according to the report.  The findings come as the federal government — led by Trump’s Environmental Protection Agency — has sought to slow programs aimed at addressing air pollution. Earlier this month, Trump signed an executive order asking the EPA to change federal air quality standards to reduce “unnecessary impediments to new manufacturing and business expansion essential for a growing economy.”

          Republicans, states alarmed about EPA action on groundwater -- Battlefronts fell along party lines at a Senate Environment and Public Works Committee hearing yesterday about whether EPA should regulate pollutants that make it to surface water via groundwater. Republicans on the committee argued that to regulate such pollutants would amount to government overreach, with Chairman John Barrasso (R-Wyo.) calling any potential oversight "a disturbing development" that could create duplicative permit requirements. "Under the misguided theory, everyday activities including farming, ranching or having a septic tank in your backyard could require a federal discharge permit," he said. "This is not what Congress intended when it passed the Clean Water Act." Ranking member Tom Carper (D-Del.) disagreed. "The bottom line is this: If pollution travels from a defined point source, like a coal ash pond, to surface water by way of a direct hydrological connection, like groundwater, then the Clean Water Act regulates that pollution," he said. The hearing was the first since EPA requested public comment on whether it should regulate such pollutants earlier this winter. The input is due by May 21. Advertisement The Clean Water Act only applies to surface water, leaving groundwater regulation largely to the states. But environmentalists in recent years have sued in an effort to force scrutiny of contaminants that travel from point sources through groundwater and end up in surface water. 

          Chicago's drinking water is full of lead, report says - Toxic lead has been seeping into Chicago’s drinking water, and the city is dragging its feet to fix the problem, according to an analysis published Thursday by the Chicago Tribune. Lead was found in 70 percent of the 2,797 homes the Tribune sampled across the city since January of 2016. And three in 10 of those had lead concentrations higher than 5 parts per billion (ppb), the Food and Drug Administration’s upper limit for lead in bottled water. Since the lead crisis in Flint, Michigan, Chicago has distributed thousands of free lead-testing kits to its residents in an attempt to figure out how bad the problem was. But once the results started coming in, the city buried them: Chicago hadn’t updated the city-run website tracking the results of its own tests in more than six months — until the Tribune started asking questions. “Chicago’s water consistently meets and exceeds the U.S. EPA’s standards for clean, high-quality drinking water,” Megan Vidis, a spokesperson for the city’s water department, told VICE News. “The Department of Water Management proactively uses corrosion-control measures to ensure that it stays that way.” “We can't be held to standards that we're not held to,” Vidis added, referring to the Tribune’s using the FDA’s benchmark for lead levels in bottled water in its report. “We're a huge municipal water system.”There’s no known safe level of lead in children's blood, according to the EPA and the Centers for Disease Control. Ingesting the metal can cause irreversible brain damage and learning disabilities. And children who regularly drink water with more than 5 ppb of lead content have been found to have lead levels in their blood, according to a recent study from EPA scientists.

          Chronic Wasting Disease: Real Risk or Irrational Hype? -- In August, Silver Creek Specialty Meats sent out a letter notifying customers that it would no longer accept venison for processing. “As you are probably aware,” the letter said, “chronic wasting disease in the wild deer population of the State of Wisconsin has been steadily spreading. The disease has now been found in wild deer in 19 counties throughout the state. Due to the spread of the disease it has become extremely difficult to screen out any venison coming from CWD infected areas.” Deer with chronic wasting disease, or CWD, tremble and drool. They often cannot hold their heads up. Eventually, they lose so much weight that they are little more than hide and bone. The disease arises from a particular prion — single-protein infectious agents linked to various neurodegenerative diseases in mammals. And prion diseases are always fatal. Even though chronic wasting disease hasn’t been shown to be a risk to human health, its similarity to other prion diseases that are — including “mad cow disease” and Creutzfeldt-Jakob disease, which has symptoms resembling Alzheimer’s disease — has been cause for concern for years. News last summer about an ongoing Canadian study in which two macaque monkeys contracted the disease after eating meat from a CWD-infected deer — the first time an animal so closely related to humans developed CWD — only exacerbated the worries.

          Camels in Africa may have been quietly spreading prion disease for decades - A newly identified form of prion disease may have been quietly spreading in the brains of African camels for decades, according to a report published in the June issue of Emerging Infectious Diseases.  The spread of the new, fatal neurodegenerative disease—similar to the well-known “mad cow disease” caused by misfolded proteins in the brain—is a major concern for communities and public health. There are tens of millions of camels in Africa in a rapidly evolving camel farming system. The animals are crucial sources of meat, milk, and transportation for millions of people there. But perhaps most concerning is that prion diseases are known to be able to spread across species, potentially posing a disease risk to consumers. This "makes it necessary to assess the risk for humans and develop evidence-based policies to control and limit the spread of the disease in animals and minimize human exposure,” the authors of the new report conclude. The Italian and Algerian researchers behind the report were first clued into the new prion disease after accounts from slaughter houses described camels with telltale neurological symptoms. These include tremors, aggressiveness (biting and kicking), hyperactivity, distinct up and down head movements, a hesitant and faltering gait, loss of limb control, occasional falls, and difficulty getting up. The researchers confirmed the suspicion after inspecting three camel brains collected from symptomatic animals that arrived at a slaughterhouse in Ouargla, Algeria. All three had clear signs of prion deposition and damage. Generally, prions are infectious, deformed versions of the normal prion protein (PRNP), which functions on the outside of healthy cells in the brain. The gnarled versions prompt normal prion proteins to deform and malfunction, setting off a cascade that leads to telltale clumps of contorted proteins. This leads to progressive damage, marked by a sponge-like appearance of brain tissue as well as the behavioral symptoms

          This animal kills more people in a day than sharks do in a century - Bill Gates --Mosquitoes keep me up at night. If you ask someone about what things scare people the most, there’s a list of usual suspects: shark attacks, heights, enclosed spaces, etc. Mosquitoes usually don’t make the cut—but they frighten me more than almost anything else.  This fear might be a bit irrational in Seattle, where I live. Our climate is too mild for the types of mosquitoes that harbor serious diseases. In other parts of the world, however, families have good reason to be afraid. Mosquitoes and the diseases they carry kill more than half a million people every year. Consider this mind-blowing statistic: Of all the illnesses mosquitoes spread, malaria is the worst by far. More than 200 million people suffer from it every year, and a child dies from malaria every other minute of every day. If you survive, it can leave you vulnerable to other debilitating diseases and chronic anemia. It’s an awful, painful disease (I wrote about what it feels like to have malaria a couple years ago).Melinda and I encounter a lot of suffering through our work, but one of the worst things I’ve ever seen is a child having seizures from cerebral malaria in Tanzania. I will never forget watching his small body twist in agony, as his parents waited to find out if he would survive. I wouldn’t wish that experience on anyone. So why exactly are people more afraid of sharks than mosquitoes? The late Hans Rosling would argue that humans are hardwired to fear things that cause us physical harm. This instinct is practical if you live in poverty (on level 1 or 2), where an animal attack is more likely to kill you. But if you can afford life-saving healthcare, it can distort your perception of how significant a threat really is.Even if you know that you’re 50,000 times more likely to get killed by a mosquito than a shark, human instinct wins out. A photo of a shark attack victim on the evening news evokes a visceral reaction, because the threat is obvious. A picture of a malaria victim in a hospital ward doesn’t trigger our fear instinct in the same way.  Despite this, I’m determined to spread the word about mosquitoes—which is why I’m bringing back Mosquito Week here on Gates Notes.

          Ticks rising -- In the tally of species that will evolve or perish as temperatures rise, now consider the moose. The lumbering king of the deer family, known for antlers that can span six feet like giant outstretched fingers, the moose faces a litany of survival threats, from wolves and bears to brain worms and liver fluke parasites. But in the late 1990s in many northern states and Canada, something else began to claim adult cows and bull moose and, in even greater numbers, their single or twin calves. Lee Kantar is the moose biologist for the state of Maine, which means that he makes a living climbing the rugged terrain of north-central Maine when a GPS collar indicates a moose has died.  Kantar tagged 60 moose in January of 2014 around Moosehead Lake in the Maine Highlands. By the end of that year, 12 adults and 22 calves were dead – 57 per cent of the group. When biologists examined the carcasses, they found what they thought was the cause. Calves not even a year old harboured up to 60,000 blood-sucking arthropods known as winter ticks. In Vermont, dead moose were turning up with 100,000 ticks – each. In New Hampshire, the moose population had dropped from 7,500 to 4,500 from the 1990s to 2014, the emaciated bodies of cows, bulls and calves bearing similar infestations of ticks. These magnificent animals were literally being bled to death.Bergeron Winter ticks have been known to afflict moose since the late-1800s. In a normal year, a single moose might carry 1,000 or even 20,000 ticks. In a particularly harsh winter, when moose are underfed and weak, anaemia and hypothermia wrought by ticks can make the difference between life and death.

          Winter didn't kill this invasive tick. Now it may stick around - The East Asian tick has survived New Jersey's winter, researchers confirmed last week. Now the invasive species could be a permanent fixture in the state.  A Hunterdon County resident in August reported an unusual tick found on a sheep. By October, the resident's land was completely infested.  The ticks had congregated "mostly on the sheep's ears and face," according to a paper by Rutgers University, the Hunterdon County Health Department and the Smithsonian Institution. Investigators found no evidence of the ticks after several below-freezing nights in November — but they were back in the spring. The tick "has possibly become established in the state," said the New Jersey Department of Agriculture. Officials say the ticks are dangerous for animals like deer, cattle, horses, goats and sheep (Philadelphia Inquirer, April 23).

          How migratory birds are moving Lyme disease to new places and peoples - In the United States, where disease-ridden ticks had already spread widely in the Northeast and Midwest, dogs had long served as loyal if hapless sentinels of Borrelia burgdorferi infection. Twenty years earlier, Tufts University researchers had found they could use cases of Lyme disease in dogs to predict risk factors for the disease, human and otherwise. Dogs that lived at lower altitudes, namely near the coast, were five times more likely to be infected than others. Sporting dogs, those that romped through fields, were four times as likely.  After collating reports from 238 veterinary practices involving more than 80,000 dogs, the Canadian study indeed found Lyme disease moving steadily, but ominously, north of the U.S. border, at least in dogs. The risk was "low but widespread," the study found, but with distinct areas of higher prevalence. It was these areas, and what the researchers did not report in their data, that intrigued bird and tick researcher named John D. Scott.  In a three-year study, he and two colleagues pulled 481 ticks from forty-two species of migrating birds, from Oregon juncos, spotted towhees, swamp sparrows, and American robins. That the birds were carrying fifteen different species of ticks was one thing. Quite another was what these ticks brought along. Nearly 30 percent of 176 Ixodes ticks were infected with the Lyme pathogen. As concerning was this: half of the larval ticks—namely, tick babies that usually hatch clean and pathogen-free—were now infected after taking their first meal. That could mean only one thing: The "larvae almost certainly acquired borreliae directly" from the migrating birds, which themselves were "competent reservoirs" of infection.   Not only could the birds import ticks into Canada. They could also infect them with the pathogen.

          Some birds are so stressed by noise pollution it looks like they have PTSD --  “Noise is causing birds to be in a situation where they're chronically stressed . . . and that has really huge health consequences for birds and their offspring,” said Rob Guralnick, associate curator of biodiversity informatics at the Florida Museum of Natural History. It would be a stretch to say noise hurts birds' mental health — the animals have not been evaluated by an avian psychologist. But in a paper published Monday in the Proceedings of the National Academy of Sciences, Guralnick and his colleagues say there is a clear connection between noise pollution, abnormal levels of stress hormones, and lower survival rates. Humans suffering from PTSD or chronic fatigue syndrome, and lab mice that have been put through traumatic experiences, respond by muting their hypothalamic-pituitary-adrenal (HPA) axis — the cascade of chemical responses that is triggered by stress. “You can imagine being in a state of constant arousal and hypervigiliance,” Lowry explained. “If there was not some way to desensitize these systems, that would result in a state of chronic fatigue. No organism is capable of essentially running on turbo all the time. So after a period of time the physiology adapts — perhaps to conserve resources.” It's an adaptation to an untenable situation, Lowry said, but not a particularly good one; this tamping down of the HPA axis is tied to an overall deterioration of health. A human is likely to experience cardiovascular problems, gastrointestinal issues, extreme fatigue.

          One in eight bird species is threatened with extinction, global study finds - One in eight bird species is threatened with global extinction, and once widespread creatures such as the puffin, snowy owl and turtle dove are plummeting towards oblivion, according to the definitive study of global bird populations. The State of the World’s Birds, a five-year compendium of population data from the best-studied group of animals on the planet, reveals a biodiversity crisis driven by the expansion and intensification of agriculture.  In all, 74% of 1,469 globally threatened birds are affected primarily by farming. Logging, invasive species and hunting are the other main threats. One victim of illegal hunting is the yellow-breasted bunting, which the report warns could repeat the cautionary tale of the passenger pigeon, once a common bird across North America before being rapidly driven to extinction in 1914. The yellow-breasted bunting was one of the most widespread birds across Europe and Asia but its population has declined by 90% since 1980 and its range has contracted by 5,000km. Although officially banned, large-scale hunting of this Chinese delicacy continues with the birds caught while roosting communally in reedbeds. Overfishing and climate change is affecting seabird species, particularly the Atlantic puffin and the black-legged kittiwake, which are both now considered “vulnerable” on the International Union of Conservation of Nature (IUCN) Red List of imperilled species. The decline of the snowy owl is linked to climate change, with snowmelt in the Arctic affecting the availability of prey, while the European turtle dove’s rapid disappearance is caused by both hunting and habitat loss through modern farming. Neonicotinoids – widely implicated in flying insect declines (a key bird food source) – have also been found to be directly detrimental to some bird species. One recent study from the US found that migrating white-crowned sparrows exposed to neonicotinoids lost a quarter of their body mass and fat stores. The neurotoxin also impaired the birds’ migratory orientation.

          Alarming 'Salmon Extinction Act' Passes in U.S. House -- A small group led by Republicans in Congress spearheaded a bill that passed in the U.S. House of Representatives on Wednesday. If the bill becomes law, it could lead to the eventual extinction of wild salmonin the Columbia and Snake rivers—iconic species in the Pacific Northwest that the federal government is required by law to protect.House Resolution 3144 seeks to overturn multiple federal court decisions that protect endangered salmon and steelhead. It undermines bedrock environmental laws and forbids any action that might reduce power generation at Columbia and Snake River dams without an act of Congress—from spilling more water overdams in the spring to help endangered fish migrate, to studying the possibility of removing the four aging lower Snake River dams.Further, it mandates that salmon populations be managed based on a 2014 federal plan that was rejected in two court decisions as being illegal, for not doing enough to save the fish from extinction. "HR 3144 is a giant step backwards in our region's effort to restore salmon populations," said Todd True, anEarthjustice attorney who has been at the forefront of this issue for more than two decades. "The entire goal of the bill is to circumvent the law and the courts, because a few legislators want to put a narrow set of economic interests ahead of the broad support in our region for salmon restoration. They have inserted themselves into the process, without considering the true consequences—for the fish, our energy future, or the Northwest economy."

          One of World’s Most Endangered Wolf Species Could Go Extinct in 8 Years - A Species Status Assessment (SSA) released by the U.S. Fish and Wildlife Service (FWS) Tuesday revealed that there are only 44 red wolves left in North Carolina, the only place they exist in the wild, and that they could go extinct within eight years. The SSA was released along with a Five-Year Status Review , which the FWS undertakes for every species offered protections under the Endangered Species Act to determine if they should retain their endangered status. Given the population's vulnerabilities, the FWS recommended that red wolves remain listed as endangered. According to the FWS website , red wolves are one of the most endangered wolf species in the world. "Time is running out for red wolves. We need to move fast if we're going to keep them from disappearing forever," biologist and senior attorney at the Center for Biological Diversity Collette Adkins said in a press release . "For starters, we need immediate measures in place to stop people from killing them." The 2007 Five-Year Status Review found that there were 114 red wolves in the wild as of 2006. But the most recent status review said those numbers had gone down due to an increase in human-caused deaths from gunshots, car collisions, poisoning and illegal activity.

          Wildlife Services Killed 1.3 Million Native Animals in 2017, Including Coyotes, Bears, Wolves - The arm of the U.S. Department of Agriculture known as Wildlife Services killed more than 1.3 million native animals during 2017, according to new data released by the agency last week. The multimillion-dollar federal wildlife-killing program targets wolves, coyotes, cougars, birds and other wild animals for destruction—primarily to benefit the agriculture industry. Of the 2.3 million animals killed in total last year, more than 1.3 million were native wildlife species. "The Department of Agriculture needs to get out of the wildlife-slaughter business," said Collette Adkins, a biologist and attorney at the Center for Biological Diversity. "There's just no scientific basis for continuing to shoot, poison and strangle more than a million animals every year. Even pets and endangered species are being killed by mistake, as collateral damage." According to the latest report, the federal program last year killed 357 gray wolves; 69,041 adult coyotes, plus an unknown number of coyote pups in 393 destroyed dens; 624,845 red-winged blackbirds; 552 black bears; 319 mountain lions; 1,001 bobcats; 675 river otters, including 587 killed "unintentionally"; 3,827 foxes, plus an unknown number of fox pups in 128 dens; and 23,646 beavers. The program also killed 15,933 prairie dogs outright, as well as an unknown number killed in more than 38,452 burrows that were destroyed or fumigated. These figures almost certainly underestimate the actual number of animals killed, as program insiders have revealed that Wildlife Services kills many more animals than it reports.  According to the new data, the wildlife-killing program unintentionally killed nearly 3,000 animals last year, including wolves, badgers, bears, bobcats, foxes, muskrats, otters, porcupines, raccoons and turtles. Its killing of nontarget birds included chickadees, bluebirds, cardinals, ducks, eagles, grouse, hawks, herons, swans and owls. Dozens of domestic animals, including pets and livestock, were also killed. Such data reveals the indiscriminate nature of painful leghold traps, strangulation snares, poisons and other methods used by federal agents.

          Trump’s Wall Would Devastate Big Bend National Park -- The lower Rio Grande forms the border between Texas and Mexico. Although it’s the fourth-longest river in the U.S. and feeds wildly diverse ecosystems along its 2000-mile course, the Rio Grande is treated like an irrigation ditch and what writer Nick Paumgarten calls a “moat” dividing the two nations. Trump’s proposed border wall would follow a large portion of it, devastating its fragile ecology without slowing the trafficking of hard drugs. For The New Yorker, Paumgarten floated the rugged river canyons through Big Bend National Park. Camping on both sides of the border, his flotilla included such esteemed companions as Democratic Senator Tom Udall, from an influential conservation-minded family, and Teddy Roosevelt’s great-grandson.You have to see certain places to understand why they must be protected. Paumgarten’s story lets readers experience this landscape themselves, to appreciate what Trump’s wall would destroy: not only the landscape, but the opportunity to experience tranquility around campfires, for wildlife encounters, starlit nights and spiritual experiences, and the chance for future generations to connect with nature.

           Monsanto Bullies EPA on Glyphosate Ruling - The U.S. Environmental Protection Agency ( EPA ) is seeking public input on the health impacts of glyphosate, the active ingredient in Monsanto's Roundup herbicide. But despite mounting evidence, the EPA continues to ignore glyphosate's hazards, and it looks like Monsanto's under-the-table influence may be a reason why. Monsanto has launched a campaign to pressure the EPA into declaring glyphosate safe. It is terrified of losing the profits from selling this ubiquitous herbicide.The use of glyphosate on U.S. farmland has exploded in recent years. A recent study found that Americans' exposure to the pesticide has increased fivefold since it was first introduced more than 20 years ago.As use of glyphosate has increased, so have concerns about its health hazards.In 2015, the International Agency for Research on Cancer classified glyphosate as a probable human carcinogen. Earlier this year, California added glyphosate to the state's Proposition 65 registry as a chemical known to cause cancer . A 2018 study out of Indiana University linked glyphosate to shorter pregnancy, which can increase a child's risk of chronic diseases later in life.California's Proposition 65 listing would require cancer warning labels on Roundup. A group of Big Ag lobbyists, backed by Monsanto, has taken action to stop the labeling rule from taking effect. Meanwhile, unsealed court documents have revealed Monsanto's efforts to collude with the EPA to cover up glyphosate's cancer risks. In lawsuits against Monsanto by cancer victims, an EPA official who was in charge of evaluating the herbicide's cancer risk has been accused of aiding the company's efforts to kill the agency's investigation.

          Quitting a Bad Habit: Germany to Massively Restrict Monsanto Weedkiller - On Tuesday, German Agriculture Minister Julia Kloeckner announced that legislation is being drafted to end the use of glyphosate in the country’s home gardens, parks and sports facilities.Glyphosate, the active ingredient in agricultural giant Monsanto's Roundup product, is used to kill weeds. In Germany, an estimated 40 percent of all crop-growing land is treated with the toxic chemical.  The German minister is also planning on establishing additional restrictions for the use of glyphosate in agriculture, except in areas that easily erode and cannot be exposed to heavy machinery."I am planning a regulatory draft as a first building block in the strategy to minimize the use of glyphosate," Kloeckner said, cited by Reuters. The poisonous herbicide has faced extensive controversy since 2015 when the World Health Organization's (WHO) International Agency for Research on Cancer classified it as "probably carcinogenic." The US Environmental Protection Agency (EPA) and the European Food Safety Authority (EFSA) claim the widely-used plant-killing toxin is safe.

          EU Approves Ban on 'Bee-Killing' Neonicotinoids -  European governments approved Friday a proposal to widen a ban on neonicotinoid pesticides that studies have found are harmful to bees and other pollinators . The move completely bans the outdoor uses of three neonicotinoids , or neonics, across the European Union. They include Bayer CropScience's imidacloprid, Syngenta's thiamethoxam and clothianidin developed by Takeda Chemical Industries and Bayer CropScience. The EU had already opted for a partial ban in 2013 on the use of the three chemicals on flowering crops that attract bees, such as maize, wheat, barley, oats and oil seed rape (canola)."All outdoor uses will be banned and the neonicotinoids in question will only be allowed in permanent greenhouses where exposure of bees is not expected," the European Commission said in a statement.In February, the European Food Safety Authority issued a report adding to the mounting scientific evidence that neonics are a risk to wild bees and honeybees, whose numbers have been plummeting in recent years."The Commission had proposed these measures months ago, on the basis of the scientific advice from the European Food Safety Authority," Vytenis Andriukaitis, the European commissioner for Health and Food Safety said today. "Bee health remains of paramount importance for me since it concerns biodiversity, food production and the environment."

          Americans waste 150,000 tons of food each day – equal to a pound per person - Americans waste about a pound of food per person each day, with people who have healthier diets rich in fruit and vegetables the most wasteful, research has found.About 150,000 tons of food is tossed out in US households each day, equivalent to about a third of the daily calories that each American consumes. Fruit and vegetables were the most likely to be thrown out, followed by dairy and then meat. This waste has an environmental toll, with the volume of discarded food equivalent to the yearly use of 30m acres of land, 780m pounds of pesticide and 4.2tn gallons of irrigated water. Rotting food also clogs up landfills and releases methane, a powerful greenhouse gas. Researchers at the US Department of Agriculture analysed eight years of food data, up to 2014, to see where food is wasted and also what members of the public say they do at mealtimes. The research has been published in Plos One. The study found that the healthiest Americans are the most wasteful, because of their high consumption of fruits and vegetables, which are frequently thrown out. Fruit and vegetables require less land to grow than than other foods, such as meat, but require a large amount of water and pesticides.

          Ethics debate as pig brains kept alive without a body -- Researchers at Yale University have restored circulation to the brains of decapitated pigs, and kept the organs alive for several hours. Their aim is to develop a way of studying intact human brains in the lab for medical research.Although there is no evidence that the animals were aware, there is concern that some degree of consciousness might have remained.Details of the study were presented at a brain science ethics meeting held at the National Institutes of Health (NIH) in Bethesda in Maryland on 28 March.The research has also been reported on this week in the MIT Technology Review.The work, by Prof Nenad Sestan of Yale University, was discussed as part of an NIH investigation of ethical issues arising from neuroscience research in the US. Prof Sestan explained that he and his team experimented on more than 100 pig brains. They discovered that he could restore their circulation using a system of pumps, heaters, and bags of artificial blood.  As a result the researchers were reportedly able to keep the cells in the brain alive and capable of normal activity for as long as 36 hours.  Prof Sestan is said to have described the result as "mind-boggling". If this could be repeated with human brains, researchers would be able to use them to test out new treatments for neurological disorders.

           Ohio's spending on algal blooms isn't paying off — study - Pricey state efforts to combat algae blooms in Lake Erie have not been very effective, according to a new study from the Ohio Environmental Protection Agency.Ohio has spent more than $3 billion to combat the murky, toxic blooms since 2011. Michigan has spent millions of dollars, too, to fight the fertilizer runoff from farms that feeds the algae.Despite those investments, an analysis of nutrient loads in the lake between 2013 and 2017 "show no clear trend of an overall decrease" in most watersheds, the study found."We believe it has helped, but it has not helped enough," Ohio EPA spokeswoman Heidi Griesmer said of the spending efforts.For Jill Ryan, executive director of the environmental group Freshwater Future, the results show that the states need mandates for farmers, rather than allowing them to voluntarily reduce their fertilizer runoff. "If we don't set some sort of floor on how we apply and use fertilizer on agricultural fields, we could spend another five or seven years looking for positive results that never materialize," Ryan said. "We have to go beyond voluntary, in my opinion" (Detroit Free Press, April 26). — NS

          California’s Trees Are Dying At A Catastrophic Rate - John Muir, naturalist and cofounder of the Sierra Club, wrote of the forests in the Sierra Nevada, "Going to the woods is going home." Unfortunately, since 2014 that home has seen unprecedented levels of tree mortality with as many as 129 million trees across 8.9 million acres lost. Where once stood a lush, green forest, there are now trees turning yellow and brown. The alarmingly accelerated pace of their death has been linked to the stress caused by climate change, more specifically increased temperatures, years of severe drought, and an unhealthy overgrowth due to years offire suppression, which led to a significant spike in bark beetle infestations. Photographer Mette Lampcov spent three days in November 2017 in California documenting the Sierra National Forest's dead trees, as well as the homeowners forced to reckon with their dying surroundings. According to the US Forest Service's 2017 Tree Mortality Aerial Detection Survey results, the Sierra National Forest has seen the largest number of tree deaths in California national forests, with nearly 32 million since 2010. The change in landscape was immediately noticeable, said Lampcov: "As you drive up a steep road heading into the Sierras, you start seeing the dead trees. It's overwhelming and hard to explain what endless views over mountains look like with a sea of brown and yellowing trees. The area is so affected by dead trees; you smell fires and hear chainsaws all day long. Everywhere you look there are dead trees."

          Drought and wildfires force cattle ranchers in Colorado, four other states to scramble for feed— Ongoing drought and wildfires have cattle ranchers in at least five Southwestern U.S. states scrambling for hay or pastureland, while others are selling off some of their herds.Extreme and exceptional drought conditions have contributed to wildfires in Colorado, Kansas, Oklahoma, Texas and New Mexico, delaying the growth of or destroying grass and wheat used to feed cattle in spring.“Finding hay out here in this part of the state is next to impossible,” according to rancher Darrel Shepherd of Custer, Oklahoma, about 80 miles (129 kilometers) west of Oklahoma City. “Pastureland is really hard to find right now … the wheat, with the drought and all, the wheat is no good.”Northwestern Oklahoma and the Oklahoma Panhandle — nearly 20 percent of the state — are rated in exceptional drought, the most severe category. Exceptional drought is also reported in parts of the Texas Panhandle, Colorado, Kansas, New Mexico and in Utah and Arizona.Federal agriculture officials in New Mexico said ranchers may not have feed to maintain their herd sizes and that some are already trimming their herds, while farmers along the Rio Grande are bracing for less water to irrigate their crops. In northwestern Oklahoma, two large wildfires that burned about 545 square miles (1412 sq. kilometers) destroyed pastures, but rains this past weekend helped firefighters bring the flames under control and began the process of restoring grassland. Rains are needed to continue through at least the beginning of June in order to prevent Oklahoma ranchers from being faced with downsizing herds, Peel said, but even if that happens, he doesn’t expect any impact on the price of beef. “I don’t think this area is big enough,” Peel said. “We’re still seeing an increase in beef production” nationwide.

          A fire in the US Midwest is so big you can see it from space — two people have been killed in the blaze so far - A blaze that broke out in Oklahoma earlier this week has claimed at least two lives, injured 20 others, and is still raging as of Thursday. The largest of the fires, the Rhea Fire, has scorched over 250,000 acres. Firefighters are continuing to battle the blaze as of Thursday, reports a local Fox News affiliate, but it's only about 15% contained. The fires have gotten so large that they're visible from space. The European Space Agency (ESA) captured a few striking images from a satellite that illustrate the scale of the damage. The image below shows a fire raging just west of Putnam, Oklahoma. The fires, spurred by strong winds, have forced many Oklahoma residents to evacuate their homes. Firefighters are battling searing walls of flame over 70 feet tall, according to local reports. "You can't even imagine the scale of how big they are, how fast they move, and how far they can jump ahead of themselves," Tulsa Deputy Fire Chief Andy Teeter told Tulsa World.

          UN environment chief calls for full probe into Brazil land activists' murders (Thomson Reuters Foundation) - The escalation of violence against land rights activists in Brazil is of “deep concern”, the United Nations’ environment chief said on Wednesday, calling for a full and impartial investigation into the recent killings of three of them. Erik Solheim, executive director of UN Environment, said land rights that are guaranteed under the Brazilian constitution must be implemented by government and respected by businesses. “UN Environment notes with deep concern the escalation of violence against land rights activists in Brazil,” Solheim said in a statement. “The recent murder of Nazildo dos Santos and two other environmental activists in the state of Para is indicative of a worrying pattern of retaliation against those protecting their environmental and human rights,” Solheim said. The government was not immediately available for comment. Brazil is rich in land ripe for development and low on deeds and property records, leading to widespread tension and conflict. Nazildo Dos Santos Brito, 33, the head of a community association of farmers and quilombolas, as slave descendants are known, was killed earlier this month in northern Para, police said. He was the subject of lawsuits filed by palm oil company Biopalma da Amazonia SA, a subsidiary of giant mining company Vale, which accused him of disturbance, invasion, threats and other crimes, according to local media. 

          Exclusive New Video from Greenpeace Reveals Massive Deforestation in Indonesia -- A palm oil supplier to Mars, Nestlé, PepsiCo and Unilever is destroying rainforests in Papua, Indonesia, a new investigation by Greenpeace International has revealed. Satellite analysis suggests that around 4,000 hectare of rainforest were cleared in PT Megakarya Jaya Raya concession between May 2015 and April 2017—an area almost half the size of Paris.Photos and video (below) taken in March and April 2018 show massive deforestation in PT MJR, a palm oil concession controlled by the Hayel Saeed Anam Group (HSA), including in an area zoned for protection by the Indonesian government in response to the devastating forest fires in 2015. Development is prohibited in these areas. The footage is being released soon after Greenpeace revealed that these leading global brands are falling behind in their publicized commitments to eliminate deforestation from their supply chains by 2020. "Just weeks ago we asked major consumer brands like Pepsi and Nestlé to confirm that they were making good on their commitments to stop buying palm oil from companies that destroy forests, but this footage reveals just how far behind they really are," said Palm Oil Campaigner at Greenpeace USA Diana Ruiz. "Brands need to ensure their supply chains are free from deforestation and the only way to do this is to proactively monitor and enforce their no deforestation standards."

          Deforestation Has Driven Up Hottest Day Temperatures, Study Says  - The average hottest day of the year in Europe, North America and Asia has been made significantly more intense as a result of deforestation since the start of the industrial revolution, a study finds.  The research considers the dual impact that deforestation has on the climate: first, that clearing forests releases CO2 into the atmosphere where it contributes to rising global temperatures; and second, the large impact it can have on physical processes in the local climate—which can have a net warming or cooling effect more widely. The new study, published in Nature Climate Change , estimates how deforestation from the start of the industrial era to recent times has affected temperatures on the hottest day of the year for a range of countries. Deforestation is a key contributor to human-caused climate change. When forests are cleared or burnt, they release the carbon they store. Removing trees also diminishes an important carbon "sink" that takes up CO2 from the atmosphere. Since 1990, around 129m hectares of forest —an area roughly the size of South Africa—have been chopped down by humans. Deforestation, along with other types of land use change, accounts for close to 11 percentof annual global CO2 emissions. From 1861-2000, deforestation accounted for 30 percent of CO2 emissions, according to the new research. Deforestation can also affect temperatures through its effect on a range of different physical processes. These effects occur at local and regional scales, but can have global repercussions. One such process is evapotranspiration , a term describing the exchange of water between the land and the atmosphere.As part of this process, forests absorb water from the soil through their roots and later release it into the air as moisture, which has a cooling effect on the air above. When trees are cut down, this cooling effect disappears.

          March 2018 was one of six warmest Marches on record - March 2018 was +0.89 °C warmer than the average March of the 1951-1980 period. This value is lower than the two hottest years of the record — March 2016 (+1.30 °C) and March 2017 (+1.12 °C) — and is comparable with the years 2002, 2010, and 2015, which cluster tightly around +0.9 °C. The corresponding number for all other years in our 138 years of modern record-keeping is at or below +0.77 °C.  The monthly analysis by the GISS team is assembled from publicly available data acquired by about 6,300 meteorological stations around the world, ship- and buoy-based instruments measuring sea surface temperature, and Antarctic research stations. The modern global temperature record begins around 1880 because previous observations didn't cover enough of the planet. Monthly analyses are sometimes updated when additional data becomes available, and the results are subject to change.

          Did You Know the Greatest Two-Year Global Cooling Event Just Took Place? - Would it surprise you to learn the greatest global two-year cooling event of the last century just occurred? From February 2016 to February 2018 (the latest month available) global average temperatures dropped 0.56°C. You have to go back to 1982-84 for the next biggest two-year drop, 0.47°C—also during the global warming era. All the data in this essay come from GISTEMP Team, 2018: GISS Surface Temperature Analysis (GISTEMP). NASA Goddard Institute for Space Studies (dataset accessed 2018-04-11 at This is the standard source used in most journalistic reporting of global average temperatures. The 2016-18 Big Chill was composed of two Little Chills, the biggest five month drop ever (February to June 2016) and the fourth biggest (February to June 2017). A similar event from February to June 2018 would bring global average temperatures below the 1980s average. February 2018 was colder than February 1998. If someone is tempted to argue that the reason for recent record cooling periods is that global temperatures are getting more volatile, it's not true. The volatility of monthly global average temperatures since 2000 is only two-thirds what it was from 1880 to 1999. None of this argues against global warming. The 1950s was the last decade cooler than the previous decade, the next five decades were all warmer on average than the decade before. Two year cooling cycles, even if they set records, are statistical noise compared to the long-term trend. Moreover, the case for global warming does not rely primarily on observed warming; it has models, historical studies and other science behind it. Another point is both February 1998 and February 2016 were peak El Niño months so the record declines are starting from high peaks—but it's also true that there have been many other peak El Niño months in the past century and none were followed by such dramatic cooling.

          Global temperatures have dropped since 2016--here’s why that’s normal   - It was only two years ago that a new record-warm global temperature was set, but things have already cooled off significantly. Temperature anomalies hit record peaks in 2016 but have been sliding since then. Global temperatures are still much warmer than normal, but according to NASA, the first quarter of 2018 (January-March) was the fourth warmest, behind 2015, 2016, 2017 and tied with 2010.This is normal, of course. The world has not seen the last of global warming. The long-term upward trend in temperatures is the result of  man-made fossil fuel emissions, but natural processes that affect global temperature — like El Niño — still play a role. Sometimes they make things warmer and sometimes they make things cooler. The current cooling episode is mostly the result of a reversal of waters in the Tropical Pacific, which can modulate global temperature. Since the Pacific Ocean is our largest global body of water, what it does makes a big difference on global climate. A similar reversal followed the super El Niño in the late ’90s — 1998 was the hottest year on record at the time in part because of the warm El Niño water pushing global temperatures over the brink. Earth went from having one of the strongest El Niño events on record (very warm waters in the central Tropical Pacific) to a few years of cooler waters, thanks to a La Niña period.Natural processes like El Niño and La Niña are why we end up with graphs like this. There’s a lot of fluctuation, but overall the trend is up. Following the super El Niño of 2015-2016, we similarly hit a new warm global record in 2016, and since then, the waters have cooled back in the Tropical Pacific with a two-year La Niña period (This “ENSO” cycle oscillates back and forth every three to seven years).

            Twisters missing from Tornado Alley - In a twist that would ruin the storyline to the Wizard of Oz, the USA's 'Tornado Alley' has been strangely quiet this year.  In fact, if there are none reported in Oklahoma or Kansas on Thursday, 2018 will officially be the quietest start to the tornado season in both states …on record! The "Alley" covers an area surrounding north Texas, Oklahoma, Kansas, Nebraska, Louisiana, Arkansas, Missouri and Iowa (as well as the fringes of bordering states). It is in this zone that the USA records some of its most frequent and devastating tornadoes. Late spring sees the peak of the tornado season in these areas due to the clashing of air masses. The normal weather set-up at this time of year sees the jet stream dipping southwards just to the west of Tornado Alley. This encourages warm, moisture-laden air to be drawn up from the Gulf of Mexico. Overlaying this is usually a layer of drier air originating from southwest USA and northern Mexico.  This behaves like a lid, trapping all that warmth and moisture in the lower atmosphere. However, as the jet stream continues to bring in colder air above that lid, it eventually breaks down, allowing all that pent up energy and moisture to burst skywards into massive tornado-spawning thunderstorms. . Kansas and Oklahoma would expect to see close to 19 tornadoes between the start of the year and now, with around 13 or 14 in April alone.  But this April, there hasn't been one! Even in the tornado-barren Aprils of 1987 and 1988, Oklahoma had already seen them earlier in the year.

          Air Quality Report Calls Into Question Pittsburgh's Recovery -  For the first time in more than 15 years, the Pittsburgh region's air quality last year got worse, according to the American Lung Association's "State of the Air" report issued last week, which awarded the city a failing grade in each of three categories. The report comes on the heels of a warning issued earlier this month by the Environmental Protection Agency instructing Pennsylvania, and Pittsburgh's Allegheny County in particular, to reduce soot pollution. Now experts and local advocates are not certain that the gas, petrochemicals and plastics industries – and the emissions they'll inevitably vent – will be compatible with continued growth in the other, cleaner sectors in biomedicine, tech and education that have also helped fuel Pittsburgh's recent boom.  The consequence, she and others fear, could be that the city's fragile recovery is suffocated. Air quality is a sensitive topic for the region, where streetlights were once switched on at noon to cut through the soot from the coal plants and steel mills. Although the region's air has slowly but steadily improved since most of those sites have closed, the American Lung Association has repeatedly awarded it a failing grade. Residents of Allegheny County have consistently ranked in the top 2 percent for cancer risk in the United States. As many as 260 county residents a year die of causes related to air pollution – far more than in motor vehicle collisions or falls or homicides, according to an estimate calculated by Neil Donahue, a chemistry professor at CMU.

          As seas rise, SC legislators move to derail tighter limits on coastal development -- In a state battered by hurricanes and rising seas, legislators are siding with oceanfront landowners in a fight against tighter controls on beach development. The S.C. Senate voted 41-0 on Wednesday for a bill that abandons the state’s 30-year-old policy of retreat, an effort to push new development away from the state's storm-scarred beaches. Senators also agreed to block looming rules that would restrict development near the ocean. Already approved by the House, the bill needs only a routine final Senate vote before it goes back to the House for its action on Senate-added amendments. It then would go to Republican Gov. Henry McMaster, who has expressed sympathy for property owners. One prominent coastal geologist blasted the Senate’s action, saying it will help oceanfront landowners at the public’s expense. Blocking tighter oceanfront building rules could allow for more intense development close to the ocean — and that’s a problem, said Western Carolina University scientist Rob Young. Buildings constructed on the beach limit public access for vacationers, while putting more pressure on the state to launch expensive, taxpayer-funded renourishment projects to protect the seaside investments, said Young, director of the Program for the Study of Developed Shorelines. Taxpayers also face the cost of bailing out oceanfront property owners after major storms damage homes and hotels. 

          Global Warming’s Impact on Ocean Currents to Amplify Sea Level Rise (video & transcript) In this Real News Network interview, Levke Caesar, discusses how Atlantic ocean currents have weakened due to global warming and are closer to catastrophic collapse than any time in the last 1,600 years. This decline could cause rapid sea level rise on the East Coast of North America. Caeser is lead author of one of two peer-reviewed studies published in Nature that reported these findings.

          These whales will be extinct in 25 years, scientists say — unless we act now to save them -  For years, spring has signaled the return of North Atlantic right whales — one of Earth’s most endangered species — to Cape Cod Bay.But lately the imperiled animals have acted in strange and disturbing ways. Females are having fewer calves; not a single newborn was seen this year. The whales are skipping favored feeding grounds and showing up in unusual places. And in the past 11 months, 18 whales have been found floating, dead — the worst mortality event since scientists began keeping records decades ago. In an era when species are vanishing 100 times faster than usual, “the whales are a metaphor for what we have done to the planet,” Mayo says.A century ago, humans had slaughtered nearly every right whale in the Atlantic. Now climate change seems to be shifting the animals’ food source. Their habitat has been polluted with sewage and made noisy by construction and seismic tests. Speeding ships and tangles of hard-to-break fishing rope pose deadly threats.  New technology and tightened regulations could protect the whales from some of the biggest hazards. Yet political efforts have stalled, lawsuits linger unresolved, and fishermen fear what potential remedies might cost them.  Fewer than 450 North Atlantic right whales remain, including just over 100 breeding females. With so many dying and so few being born, it is thought that the population will no longer be viable in 25 years unless something changes.

          What Is Eating Away at the Greenland Ice Sheet? -- In the high-stakes race against sea level rise, understanding what's causing the Greenland Ice Sheet to melt is critical. The problem isn't just rising temperatures: soot from ships, wildfires and distant power plants, as well as dust and a living carpet of microbes on the surface of the ice, are all speeding up the melting. Right now, predictions for sea level rise range from about 1 to 10 feet by 2100—a wide difference for coastal communities trying to plan seawalls and other protective measures.  In areas near the edge of the ice sheet, things get even more interesting: a carpet of microbes and algae mixed with dust and soot, a short-lived climate pollutant, is darkening the ice sheet, absorbing the sun's rays and accelerating the melting of the ice. New research shows this dark zone is growing. Roughly 70 percent of Greenland's contribution to sea level rise today comes from the melting of the ice sheet, rather than from glaciers calving, so what happens in these acceleration zones matters for Miami and other cities along the coasts. In western Greenland, the dark zone is about the size of West Virginia. It grew by 12 percent between 2000 and 2012, and new research suggests it's likely to continue to expand, according to climate researcher Jason Box, who travels wide swaths of the ice sheet each summer to collect samples for the Geological Survey of Denmark and the Dark Snow project. The new research, published in the journal Nature Communications, describes a geological feedback loop on the ice that's expanding the dark zone: Warming melts the western edge of the ice sheet, releasing mineral dust from rock crushed by the ice sheet thousands of years ago. That dust blows to the surface of the ice, nurturing the microbes and algae living there. Those organisms produce colored pigments as sunscreen, which contribute to the darkening of the surface, reducing reflectivity and increasing melting.

          Researchers measure a record concentration of microplastic in Arctic sea ice - Experts at the Alfred Wegener Institute, Helmholtz Centre for Polar and Marine Research (AWI) have recently found higher amounts of microplastic in Arctic sea ice than ever before. However, the majority of particles were microscopically small. Ice samples from five regions throughout the Arctic Ocean contained up to 12,000 microplastic particles per litre of sea ice. Further, the types of plastic showed a unique footprint in the ice, allowing the researchers to trace them back to possible sources. This involves the massive garbage patch in the Pacific Ocean; the high percentage of paint and nylon particles pointed to intensified shipping and fishing activities in some parts of the Arctic Ocean. The new study has just been released in the journal Nature Communications.   "During our work, we realised that more than half of the microplastic particles trapped in the ice were less than a twentieth of a millimetre wide, which means they could easily be ingested by Arctic microorganisms like ciliates, but also by copepods," says AWI biologist and first author Dr. Ilka Peeken. The observation is a very troubling one because, as she explains, "No one can say for certain how harmful these tiny plastic particles are for marine life, or ultimately also for human beings." Microplastic refers to plastic particles, fibres, pellets and other fragments with a length, width or diameter ranging from only a few micrometres—thousandths of a millimetre—to under five millimetres. A considerable amount of microplastic is released directly into the ocean by the gradual deterioration of larger pieces of plastic. But microplastic can also be created on land—e.g., by laundering synthetic textiles or abrasion of car tires. The plastic initially floats through the air as dust, and is then blown to the ocean by the wind, or finds its way there through sewer networks.

          Melting sea ice may release huge volume of plastic waste  -- Scientists have discovered a surprising consequence of Arctic climate change: Melting sea ice may release a large volume of frozen plastic waste into the ocean.Research published today in Nature Communications finds that Arctic sea ice is full of trapped microplastics — plastic waste that the ocean has broken down into tiny bits, sometimes smaller than the eye can see. The study confirms that even the remote Arctic waters are no longer safe from human pollution."We were quite surprised," said lead study author Ilka Peeken of the Alfred Wegener Institute for Polar and Marine Research. Although previous studies have also found waste in the Arctic, in the new research "the values were quite high," she said.And as sea ice melts — at ever-increasing rates, thanks to climate change — it may release large quantities of that trapped plastic back into the sea, where it could either linger in the Arctic or flow back out into other parts of the world.Plastic waste is already a major problem in the oceans, and a subject of growing concern among scientists. One particularly alarming 2015 paper published in Science estimated that anywhere from about 5 million to 13 million metric tons of plastic waste moved from the land to the ocean in 2010 alone. And the researchers estimated that this amount could increase tenfold by the year 2025.

          Plastics Pollution Policies– “Bold” or Pathetic?  -  Jerri-lynn Scofield - During last week’s Commonwealth summit in London, UK prime minister Theresa May called for a new alliance to combat plastic pollution, as part of which “she was prepared to ban plastic straws and coffee stirrers” according to a Saturday piece in the FT. In December, her government had committed to eliminating all avoidable plastic waste by 2042, as well as implementing new measures such as a bottle deposit scheme.Seriously? This is intended as a serious assault on plastics, but appears to me to be as well thought through and sufficient to confront the magnitude of the problem as her government’s Brexit plans.Some were willing to describe the plan as “bold”. From the FT: “Definitely the UK is taking a very bold approach to plastics right now. It is very visible,” said Kim Christiansen, regional director for PlasticsEurope, an association of plastics producers. “It is a high-profile issue here in the UK, and higher than I think you would find in other European countries.”Not me. But then, I don’t draw a paycheck from an association of plastics producers.  The UK’s plan is as manifestly inadequate as the EU’s first-ever European Strategy for Plastics in a Circular Economy, announced on January 16 (which I discussed further here). The average EU citizen generates 31 kg of plastics waste each year, according to statista. The figures vary widely among EU members: Ireland is the highest, 61 kg per person on average, and Bulgaria, the lowest, at 14 kg; the UK is a smidge more than 10% higher than the average, at 35 kg. The UK recycles only about a third of the plastics waste it generates, due to limited recycling capacity, and exports the rest to developing countries. The current UK plastics recycling system creates incentives to export plastics waste.

          The military paid for a study on sea level rise. The results were scary. - More than a thousand low-lying tropical islands risk becoming “uninhabitable” by the middle of the century — or possibly sooner — because of rising sea levels, upending the populations of some island nations and endangering key U.S. military assets, according to new research published Wednesday. The threats to the islands are twofold. In the long term, the rising seas threaten to inundate the islands entirely. More immediately, as seas rise, the islands will more frequently deal with large waves that crash farther onto the shore, contaminating their drinkable water supplies with ocean saltwater, according to the research.The islands face climate-change-driven threats to their water supplies “in the very near future,” according to the study, published in the journal Science Advances.The study focused on a part of the Marshall Islands in the equatorial Pacific Ocean. Hilda Heine, president of the Marshall Islands, said in an interview that Wednesday’s journal article “brings home the seriousness” of the predicament facing her island nation. “It’s a scary scenario for us,” she said.The research also has ramifications for the U.S. military, whose massive Ronald Reagan Ballistic Missile Defense Test Site sits, in part, on the atoll island of Roi-Namur — a part of the Marshall Islands and the focus of the research.  The U.S. military supported the research in part to learn about the vulnerability of its tropical-island installations. The Pentagon base on Roi-Namur and surrounding islands supports about 1,250 American civilians, contractors and military personnel.

          One of the most worrisome predictions about climate change may be coming true - Two years ago, former NASA climate scientist James Hansen and a number of colleagues laid out a dire scenario in which gigantic pulses of fresh water from melting glaciers could upend the circulation of the oceans, leading to a world of fast-rising seas and even superstorms. Hansen’s scenario was based on a computer simulation, not hard data from the real world, and met with skepticism from a number of other climate scientists. But now, a new oceanographic study appears to have confirmed one aspect of this picture — in its early stages, at least. The new research, based on ocean measurements off the coast of East Antarctica, shows that melting Antarctic glaciers are indeed freshening the ocean around them. And this, in turn, is blocking a process in which cold and salty ocean water sinks below the sea surface in winter, forming “the densest water on the Earth,” in the words of study lead author Alessandro Silvano,  This Antarctic bottom water has stopped forming in two key regions of Antarctica, the research shows — the West Antarctic coast and the coast around the enormous Totten glacier in East Antarctica.These are two of Antarctica’s fastest-melting regions, and no wonder: When cold surface water no longer sinks into the depths, a deeper layer of warm ocean water can travel across the continental shelf and reach the bases of glaciers, retaining its heat as the cold waters remain above. This warmer water then rapidly melts the glaciers and the large floating ice shelves connected to them.  In other words, the melting of Antarctica’s glaciers appears to be triggering a “feedback” loop in which that melting, through its effect on the oceans, triggers still more melting. The melting water stratifies the ocean column, with cold fresh water trapped at the surface and warmer water sitting below. Then, the lower layer melts glaciers and creates still more melt water — not to mention rising seas as glaciers lose mass.

          The world needs to store billions of tons of carbon--it could start in a surprising place - The corn-based ethanol industry could become a surprising leader in a technology that the world needs to fight climate change, an economic analysis published Monday suggests — a development that could scramble the intense environmental politics of the ethanol issue.The technology in question is carbon capture and storage, or CCS — widely believed to be necessary to save the climate but still in a fledgling state, with relatively few large-scale installations around the world. But fitting corn-ethanol refineries with carbon-storing technologies would be a winning financial proposition that could simultaneously advance the CCS industry’s growth, the research finds.“We think it’s a big opportunity to improve the carbon intensity of existing biofuels, help meet the low-carbon fuel standard, reduce emissions [and] start building out CCS pipelines all across the United States,” said Daniel Sanchez, a researcher at the Carnegie Institution for Science who led the research published in the Proceedings of the National Academy of Sciences.The fermentation process in which ethanol is created generates a nearly pure stream of carbon dioxide, and right now, for the most part, it ends up in the atmosphere. The United States’ 216 ethanol refineries emit 45 million tons of the global-warming gas each year in this manner, reports the study, which was co-authored by scientists from institutions in the United States and Austria. But one installation, Archer Daniels Midland’s Decatur Plant in Illinois, is now burying some of that carbon dioxide instead, amounting to an expected 1 million tons or more per year. Other plants could follow, attracted by the relative simplicity of separating carbon dioxide from the ethanol-making process and incentivized by legislation that just passed Congress that gives a $50-per-ton tax credit for storing large volumes of carbon deep underground.

          The machines that could darken the sun to stop climate change - Climate change is an increasingly dangerous antagonist, and we’re not doing a great job curtailing it. Which is why, in the not too distant future, we may have to undertake a new, Manhattan Project-style endeavor to hold back the rising mercury. Once a fringe idea, there’s now a growing possibility we’ll build machines that will, in a manner of speaking, darken the Sun. There are several variations on the so-called solar geoengineering theme, but they all have the same end-goal: using aerosols to blanket our atmosphere with reflective particles in order to quickly lower global temperatures. There’s been a lot of discussion of how this might go wrong, but much less on the technology needed to make it work. So, what would our hypothetical, sky-altering, solar radiation management (SRM) machines look like?To answer that question, we first need to understand what these machines would actually be putting in the sky. The ingredients required to create a nebulous skyward mirror range from table salt and aluminum oxides to obliterated diamond dust. The one that receives the most attention, however, is sulfur. There are several reasons for this, but perhaps most importantly, we know with near-absolute certainty that this aerosol would work.Volcanic eruptions are known to sometimes effuse vast amounts of sulfur aerosols into the stratosphere, a layer of our atmosphere that starts at a height of nine miles up. Once there, the aerosols transform into droplets of reflective sulfuric acid. From geological records and from present-day observations (see, for example, Tambora’s 1815 outburst, or Pinatubo’s 1991 furious firework show), we know sulfur-rich eruptions can briefly chill the planet by a degree or more, and sometimes even rob the world of a summer or two. This, crudely speaking, is natural SRM.All we have to do to postpone the apocalypse, then, is reproduce this artificially—and that’s where things get complicated. Machines capable of directly depositing a payload of sulfur gas into the stratosphere will need to be perfectly situated, operated and designed. The quantity of aerosols they’ll deploy will be in the millions of tonnes. Unlike carbon dioxide emissions, which linger up there for decades or centuries at a time, sulfur sifts out from the atmosphere in just a handful of years. Our SRM machines, then, would have to operate perhaps perpetually, continually refueling the shield.

           ‘We’re doomed’: Mayer Hillman on the climate reality no one else will dare mention -- “We’re doomed,” says Mayer Hillman with such a beaming smile that it takes a moment for the words to sink in. “The outcome is death, and it’s the end of most life on the planet because we’re so dependent on the burning of fossil fuels. There are no means of reversing the process which is melting the polar ice caps. And very few appear to be prepared to say so.” Hillman, an 86-year-old social scientist and senior fellow emeritus of the Policy Studies Institute, does say so. His bleak forecast of the consequence of runaway climate change, he says without fanfare, is his “last will and testament”. His last intervention in public life. “I’m not going to write anymore because there’s nothing more that can be said,” he says when I first hear him speak to a stunned audience at the University of East Anglia late last year. From Malthus to the Millennium Bug, apocalyptic thinking has a poor track record. But when it issues from Hillman, it may be worth paying attention. Over nearly 60 years, his research has used factual data to challenge policymakers’ conventional wisdom. In 1972, he criticised out-of-town shopping centres more than 20 years before the government changed planning rules to stop their spread. In 1980, he recommended halting the closure of branch line railways – only now are some closed lines reopening. In 1984, he proposed energy ratings for houses – finally adopted as government policy in 2007. And, more than 40 years ago, he presciently challenged society’s pursuit of economic growth.   Hillman is anxious we are not side-tracked by his best-known research, which challenged the supremacy of the car. “With doom ahead, making a case for cycling as the primary mode of transport is almost irrelevant,” he says. “We’ve got to stop burning fossil fuels. So many aspects of life depend on fossil fuels, except for music and love and education and happiness. These things, which hardly use fossil fuels, are what we must focus on.”

          The fighting has begun over who owns land drowned by climate change -  One April morning in 2016, Daryl Carpenter, a charter boat captain out of Grand Isle, La., took some clients to catch redfish on a marsh pond that didn’t use to exist. Coastal erosion and rising seas are submerging a football field’s worth of Louisiana land every hour, creating and expanding ponds and lakes such as the one onto which Carpenter had piloted his 24-foot vessel. Suddenly, another boat pulled up beside Carpenter’s. “You’re trespassing,” the other driver declared, before chasing him and his clients down the bayou. The sheriff’s office later threatened to arrest Carpenter if he ever returned to the pond. There was just one problem: Under Louisiana state law, any waterways that are accessible by boat are supposed to be public property, argued Carpenter—even what was previously unnavigable swampland. Carpenter sued the sheriff, as well as Castex Energy Inc., which owns the property around the pond, for interfering with his business. A district court decided against him in March, noting that an earlier ruling found that the territory was unnavigable swampland when the state sold it into private ownership in the 1800s. Carpenter is appealing that ruling. Carpenter’s suit reflects a legal and political dilemma that’s beginning to reverberate around the country: As seas rise and coasts wash away, who owns the land that goes underwater? Versions of that debate are taking place in courtrooms, legislatures, and government offices, raising the question of whether and when climate change justifies seizing private property. The stakes are enormous, affecting not just ownership of offshore mineral and fishing rights but also potentially trillions of dollars of coastal real estate.

          Stop and Assess --Kunstler - America has become Alzheimer Nation. Nothing is remembered for more than a few minutes. The news media, which used to function as a sort of collective brain, is a memory hole that events are shoved down and extinguished in. An attack in Syria, you ask? What was that about? Facebook stole your…what? Four lives snuffed out in a… a what? Something about waffles? Trump said… what? Let’s pause today and make an assessment of where things stand in this country as winter finally coils into Spring.As you might expect, a nation overrun with lawyers has litigated itself into a cul-de-sac of charges, arrests, suits, countersuits, and allegations that will rack up billable hours until the Rockies tumble. The best outcome may be that half the lawyers in this land will put the other half in jail, and then, finally, there will be space for the rest of us to re-connect with reality.What does that reality consist of? Troublingly, an economy that can’t go on as we would like it to: a machine that spews out ever more stuff for ever more people. We really have reached limits for an industrial economy based on cheap, potent energy supplies. The energy, oil especially, isn’t cheap anymore. The fantasy that we can easily replace it with wind turbines, solar panels, and as-yet-unseen science projects is going to leave a lot of people not just disappointed but bereft, floundering, and probably dead, unless we make some pretty severe readjustments in daily life. We’ve been papering this problem over by borrowing so much money from the future to cover costs today that eventually it will lose its meaning as money — that is, faith that it is worth anything. That’s what happens when money is just a representation of debt that can’t be paid back. This habit of heedless borrowing has enabled the country to pretend that it is functioning effectively. Lately, this game of pretend has sent the financial corps into a rapture of jubilation. The market speed bumps of February are behind us and the road ahead looks like the highway to Vegas at dawn on a summer’s day.

          Oil Industry Pushes Back on Climate Suits With Dubious Claims on Bond Issue - In defending climate liability lawsuits brought by several U.S. communities, the fossil fuel industry is arguing that local governments are telling courts they face staggering climate-related costs but are not disclosing those risks to potential municipal bond investors. The argument implies that the communities are trying to mislead investors. Yet interviews with experts and a review of bond documents suggest this argument has little substance. The National Association of Manufacturers (NAM), a trade group waging a campaign against the communities pursuing climate suits, sent a letter to the Securities and Exchange Commission, asking it to investigate the municipalities’ statements about climate impacts in their bond offerings. The same claim of deception was included in ExxonMobil’s petition to a Texas court in response to the California communities’ suits.  In its letter to the SEC, NAM wrote that the lawsuits had “asserted specific impacts of climate change. Separately, these same cities and counties have issued municipal bonds in which the respective prospectuses omit the same climate-related liabilities detailed in their civil suits or state their inability to predict such future damage.”  A document search by Climate Liability News showed that many of the municipalities named in the letter, including San Francisco, San Mateo County and Imperial Beach, did indeed disclose details about climate change risks.

          Climate change: Michael Bloomberg pledges $4.5m for Paris deal - BBC News: Former New York City Mayor Michael Bloomberg says he will pay $4.5m (£3.2m) to cover some of the lapsed US commitment to the Paris climate accord. He said he had a responsibility to help improve the environment because of President Donald Trump's decision to pull out of the deal. The withdrawal was announced last June and sparked international condemnation. It will make the US in effect the only country not to be part of the Paris accord. The Paris agreement commits the US and 187 other countries to keeping rising global temperatures "well below" 2C above pre-industrial levels. As part of the agreement, the US had pledged $3bn to the Green Climate Fund, set up by the UN to help countries deal with the effects of global warming.The money promised by Mr Bloomberg does not aim to cover this, but the US contribution to the UN's climate change secretariat."America made a commitment and, as an American, if the government's not going to do it then we all have a responsibility," Mr Bloomberg said on CBS."I'm able to do it. So, yes, I'm going to send them a cheque for the monies that America had promised to the organisation as though they got it from the federal government." His charity, Bloomberg Philanthropies, offered $15m to cover a separate climate change shortfall last year. It said the money would go to the United Nations Framework Convention on Climate Change (UNFCCC).

          Trump’s next NASA administrator is a Republican congressman with no background in science -- The US Senate on Thursday confirmed Jim Bridenstine, a Republican Congress member from Oklahoma, to be the next administrator of NASA. The post has remained vacant since January 2017, when Charles Bolden, the space agency’s leader under President Barack Obama, stepped down.Bridenstine, 42, brings some odd qualifications to the job, and some controversy.Typically, NASA administrators are chosen from within NASA’s ranks, come up through the military, or have a background in science. Bridenstine has none of that. His qualifications: He’s former Navy pilot who once ran the Air and Space Museum in Tulsa. He also sits on the House Committee that oversees NASA. The third-term representative is now the first member of Congress to hold the administrator job.Even members of Bridenstine’s own party have voiced concerns over what putting a politician in charge could mean for the future of the agency. As a politician, Bridenstine has hedged on climate change, an issue NASA scientists study and track in many different ways. During his confirmation hearing in November, Bridenstine agreed that humans are the driving force behind climate change, but he would not agree with the assertion that human activity is the primary cause of it. NASA has a staff of 17,000 and a budget of nearly $19 billion (not to mention the numerous contractors it works with). Bridenstine’s experience of managing a museum in Tulsa pales in comparison to the enormous complexity of NASA. Plus, there are new questions, raised by reporting from the Daily Beast, about whether Bridenstein used funds from the Tulsa Air and Space Museum to prop up a private venture. He reportedly ran the museum into a financial loss.

          Two people who helped Scott Pruitt buy an Oklahoma City house now hold top jobs at the EPA -  Environmental Protection Agency (EPA) Administrator Scott Pruitt has been embroiled in scandal for weeks, ever since it was revealed that he got a sweetheart deal last year on a Capitol Hill condo linked to an energy lobbyist. But as new details revealed by the New York Times this weekend show, this wasn’t the first time Pruitt turned to a lobbyist for his housing needs.In 2003, while working as a state senator, Pruitt bought an Oklahoma City property from a retiring telecommunications lobbyist. But Pruitt was not the sole owner. Instead, the house was bought through a shell company linked to a friend and business partner — Kenneth Wagner — and the mortgage was financed by a bank run by another friend — Albert Kelly. Both Kelly and Wagner now hold top positions in the EPA. Kelly, who was banned from the banking industry for life for violating federal banking laws, is in charge of the EPA’s Superfund program. Wagner is a senior advisor for regional and state affairs. As with Pruitt’s $50 a night condo deal, Pruitt got a good price on the house which boasts a grand staircase and a view of the State Capitol’s white dome.  According to the Times’ investigation, the home was bought for $375,000. This is $100,000 less than what the lobbyist — Marsha Lindsey — paid for it just one year prior. Reports state that Lindsey’s employer, telecom giant SBC Oklahoma picked up the difference. (State records show that during the early 2000s Pruitt sided with the telecom company on several of its lobbying issues, including a deregulatory bill that would allow it to raise rates.)

          Scott Pruitt is the target of no less than 10 federal investigations -  The feds are really, really curious about what Scott Pruitt’s been up to.As the controversies surrounding the EPA chief have mounted in recent weeks, so have the federal investigations. Now, the EPA’s internal watchdog has lots of questions for Pruitt, as does the top federal ethics watchdog, and the House Oversight Committee, led by Republican Trey Gowdy.There are at least 10 federal investigations focused on Pruitt’s first-class travel, unusually large security detail, frequent association with lobbying interests, pay raises for staffers, and, somehow, more. The mounting appearance of misconduct and corruption at the EPA has started to attract not just the attention of Democrats — 170 of whom have called for Pruitt’s resignation — but Republicans, too. Amid all the scrutiny, Pruitt’s office has been quick to deny any wrongdoing. EPA spokesperson Jahan Wilcox has repeatedly responded to allegations by saying, “This is not news.” The denials, however, haven’t stopped federal agencies from poking around. Here are the big probes currently roiling Pruitt’s scandal-ridden EPA:

          Scott Pruitt admits little culpability in EPA controversies, mostly blames aides and staff -- Scott Pruitt gave little ground Thursday as he testified before two House panels about controversial spending and management decisions he has made while at the helm of the Environmental Protection Agency, blaming aides for exorbitant spending and saying career officials signed off on other controversial decisions. Bolstered by Republican lawmakers, who praised his push to unravel Obama-era regulations and cut the agency’s workforce, Pruitt suggested that the censure he’s faced in recent months stems largely from opponents who want to stall President Trump’s environmental policies. “Those who have attacked the EPA and attacked me are doing so because they want to derail the president’s agenda. I’m not going to let that happen,” Pruitt told members of the House Energy and Commerce environment subcommittee during the morning. “A lie doesn’t become true just because it appears on the front page of the newspaper.” Whether Pruitt’s composed performance will be enough to preserve his job remains unclear, but there were few signs Thursday that House Republicans were ready to abandon him. Few GOP lawmakers — among them, Rep. Ryan Costello (Pa.), who is retiring, and Rep. Leonard Lance (N.J.), who is locked in a tough reelection fight — criticized Pruitt during more than five hours of questioning. Three White House officials said Pruitt’s testimony — while “not good,” in the words of one — did not deliver a knockout blow to his tenure. The EPA chief has little support among senior aides there, and the president has voiced more concern as allegations and investigations involving Pruitt have accelerated. Multiple probes are underway by the agency’s inspector general, as well as by the House Oversight Committee, the Government Accountability Office and the White House itself. 

           Pruitt Prepares Block on Scientific Studies That Protect Public Health - Under the guise of "transparency," U.S. Environmental Protection Agency ( EPA ) Administrator Scott Pruitt signed a controversial proposed rule Tuesday that actually limits the type of scientific studies and data the agency can use in crafting public health and environmental regulations.The change—long championed by conservative lawmakers, chemical manufacturers and the fossil fuel industry—would only allow the EPA to consider scientific findings whose data and methodologies are publicly available and can be replicated."The era of secret science at EPA is coming to an end," Pruitt said. "The ability to test, authenticate and reproduce scientific findings is vital for the integrity of the rule-making process. Americans deserve to assess the legitimacy of the science underpinning EPA decisions that may impact their lives."The industry friendly EPA boss has already made major changes in how the agency uses scientific work. Last year, Pruitt announced a policy that would limit the presence of researchers who have received EPA research grants on the agency's Scientific Advisory Board.A press release for Pruitt's latest move touts that it builds on President Trump's executive orders on regulatory reform and energy independence. Environmental and scientific organizations warn this new policy would disqualify many types of landmark, peer-reviewed research in setting important health safeguards. Many medical studies, clinical reports and real-world field studies include information that cannot be made public without violating confidentiality and patient protection rules, the Natural Resources Defense Council pointed out.’

          Rollout of Lautenberg law divides senators who championed it - A conservative and a liberal stood side by side in June 2016 as President Obama signed into law the senators' hard-fought compromise legislation to overhaul the nation's bedrock chemical safety law for the first time in its 40-year history. Today, Louisiana's David Vitter is out of Congress, lobbying for the chemical industry that long supported him, and Sen. Tom Udall (D-N.M.), who remains in office, is battling his former legislative partner over the implementation of the Toxic Substances Control Act reform they championed. With his party now in control of EPA and the Congress that oversees it, Vitter thinks that Administrator Scott Pruitt is doing a great job putting into practice the Frank R. Lautenberg Chemical Safety for the 21st Century Act — the law named for the longtime New Jersey Democratic senator who championed TSCA reform until his death in 2013. "I'm very encouraged," Vitter said earlier this year in the offices of Mercury LLC, the public affairs firm in Washington where he works part-time.  "TSCA implementation is a big challenge, but I think they're clearly taking it seriously," Vitter said of EPA.  After a failed bid for governor, Vitter left the Senate last January. A month later, he joined Mercury and began lobbying for the American Chemistry Council and other clients (Greenwire, April 6, 2017). The chemical industry group paid Mercury $100,000 last year for advocacy work, according to disclosures analyzed by the Center for Responsive Politics, a money-in-politics watchdog group. Vitter, who cannot legally begin meeting with his former Senate colleagues until 2019, was one of three lobbyists at the firm on that account.

          EPA asks court to rethink nixing parts of ozone rule - The Trump administration wants a federal court to reconsider tossing out key portions of an Obama-era rule for implementing the 2008 ozone standard. In February, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit found that EPA unlawfully weakened protections when it decided to revoke an earlier standard as part of the rule.  But the Trump administration, which is considering a similar move in the implementation rule for the 2015 ozone standard, argued in a motion for panel rehearing yesterday that EPA acted reasonably.  "The court overlooked two critical points of law," EPA argued. "In both instances, the court failed to recognize that the Clean Air Act ... is silent or ambiguous." "As a result, the court never meaningfully considered — as it should have — why EPA's construction of these fundamental provisions in the present context was reasonable." EPA's rule, issued in 2015, laid out guidelines for states on how to improve air quality in areas that exceed the 2008 national ambient air quality standard (NAAQS) for ozone of 75 parts per billion. The agency later lowered the ozone NAAQS to 70 ppb.As part of the rule, EPA eliminated the old 1997 standard of 84 ppb for regulatory purposes, saying it had become largely superfluous because "it is mathematically impossible to attain the 2008 ozone NAAQS without first attaining the 1997 ozone NAAQS." But environmental groups led by the Sierra Club characterized the rule as an attempt to weaken protections against smog, which is formed when nitrogen oxides react with volatile organic compounds in sunlight. In February, the D.C. Circuit agreed with the greens, ruling that the agency had unlawfully allowed areas that still hadn't met the 1997 limit to avoid deadlines associated with that standard.

          Pruitt says biomass plants are carbon neutral. Greens gape - Scott Pruitt suggested yesterday that U.S. forests would offset potential carbon dioxide emissions released by burning wood for energy. But his controversial decision on biomass was rejected by critics as an unscientific step to help the forest industry.   The EPA administrator announced yesterday at a Georgia elementary school that the agency now considers biomass to be carbon neutral for the purposes of regulating emissions from stationary sources, like power plants that burn wood. The agency went out of its way to note that the decision isn't based on a scientific determination. Biomass has been at the center of a decadelong debate among scientists over its emissions. The amount of CO2 that's released changes with the type of wood, or feedstock, that's cut down. Older trees contain more carbon. The act of burning wood also produces carbon dioxide. In a six-page policy statement, the agency argued that the nation's forests are a net carbon sink, offsetting about 11.2 percent of gross U.S. greenhouse gas emissions in 2015. "While there is some uncertainty within the scientific community about whether U.S. forests will remain a net carbon sink over the coming years, recent research shows that under current market and environmental conditions, continued forest land investment and management can allow for continued and even increased U.S. forest carbon stocks in the future," the agency said. The document also notes that the carbon neutrality of biomass could be revisited in the future. Environmental groups aren't buying the argument that U.S. forests may offset emissions related to biomass development. They maintain that burning biomass releases more carbon at the smokestack than coal to produce the same amount of energy. At the same time, it can take decades for trees to sequester the amount of carbon released by producing biomass energy.

          Pruitt declares that burning wood is carbon neutral | TheHill: The Environmental Protection Agency (EPA) declared Monday that burning trees is carbon neutral. The announcement, made by EPA Administrator Scott Pruitt during a meeting with Georgia forestry leaders, signals an administrative policy shift that will treat all burning of biomass as carbon-neutral "when used for energy production at stationary sources," according to an EPA statement. The administration likened the new policy decision to a clarification, saying it will help streamline regulations for forest and paper industries. "Today’s announcement grants America’s foresters much-needed certainty and clarity with respect to the carbon neutrality of forest biomass,” Pruitt said in a statement. “Managed forests improve air and water quality, while creating valuable jobs and thousands of products that improve our daily lives. This is environmental stewardship in action.” Members of Congress have made similar legislative pushes to recognize wood burning as carbon neutral. In 2016, a group of Senators tried to pass the policy change through larger bipartisan energy bill. More recently, a provision included in the fiscal 2018 federal spending bill unveiled in March urged the heads of the EPA and Energy Department to “reflect the carbon-neutrality of forest bioenergy and recognize biomass as a renewable energy source.” Donna Harman, president of the American Forest and Paper Association, said the policy decision reflects "long-standing scientific principles and Congressional direction."

          As wood pellet industry booms, so do emissions — report -- The rapidly growing wood pellet industry in the Southeast has become a major air polluter, an environmental group said in a report that detailed Clean Air Act violations by plants in the region.The Environmental Integrity Project found that seven of 21 wood pellet plants from Virginia to Texas released amounts of pollution above legal limits, and that an additional four were granted state permits even though they didn't install pollution control equipment.In its report, the group also said at least eight plants experienced fires or explosions since 2014, including a facility in Texas where a fire burned for two months last year."EIP's survey reveals that these facilities emit dangerous amounts of air pollution, and further finds that state agencies consistently fall well short of their duty to ensure that these facilities control their pollution to the levels required by law, frequently due to misleading information supplied by the industry," the group said.The organization's 44-page report was prepared before EPA Administrator Scott Pruitt's announcement this week that his agency would consider forest biomass used in energy production to be carbon-neutral, for regulatory purposes (E&E News PM, April 23). A spokesman for the Environmental Integrity Project, Tom Pelton, told E&E News that the report is the first to compile publicly available information on plants' permits and emissions records. The survey debunks EPA's position that using biomass for energy is carbon neutral, said Pelton, who called the industry "a real lawbreaker." The U.S. Industrial Pellet Association defended the industry in a statement to E&E News, calling the criticism "tired propaganda peddled by activist environmental groups."

          Nearsighted Legislation Prohibits Grid Upgrade in Puerto Rico --Puerto Rico suffered another island-wide power outage this week — seven months after it was hit by Hurricane Maria. This new setback highlights a trap the island finds itself in: forced to repair an antiquated power grid dependent upon imported fossil fuels, with no real hope of adopting new technologies that Americans on the mainland take for granted. The problem is legislative. The Robert T. Stafford Disaster Relief and Emergency Assistance Act sets the terms for how emergency funds are allocated, and dictates that infrastructure must be restored to its original state after a disaster. That, in effect, precludes improvements. The Puerto Rican government is also dragging its feet regarding legislation for renewable energies.As Puerto Rico’s power supply was substandard before the hurricane wreaked havoc with it, the US Army Corps of Engineers finds itself having to repair equipment so outdated that replacement poles and other parts have to be custom-made. This has added delays to restoring power to the islanders, and blocked any possibility of adopting innovative solutions such as solar arrays and advanced battery storage.The pre-Maria grid was in such disrepair because Puerto Rico’s power company, PREPA, was $9 billion in debt and had stopped maintenance work to save money — a misguided strategy that has had disastrous consequences. Hurricane Maria delivered a one-two punch: flooding the power stations and ports on the south side of the island where it made landfall, then decimating trees all over the island, including under-maintained trees close to power lines that PREPA had neglected to cut back. The flooding wouldn’t have been so hard to deal with, but fixing snapped lines and poles all over the mountainous island has been difficult and frustratingly slow.

          Controversial Contractor Was Behind Island-Wide Blackout, as Puerto Rico Debates Full Privatization - The bulldozer that accidentally triggered an island-wide blackout in Puerto Rico last week was operated by D. Grimm Inc., a company that reports up to the Oklahoma-based firm Mammoth Energy Services. The same subcontractor was blamed for another blackout two weeks ago that affected 870,000 homes. Attempting to repair a downed wire on Wednesday, a bulldozer got too close to a live, high-voltage line, triggering a chain reaction that left most of the island’s 3.4 million residents without power. D. Grimm is a subcontractor hired by Cobra Acquisitions LLC, itself a subsidiary of Mammoth.  First signed in October, Cobra’s contract is reminiscent of the one negotiated between the Puerto Rico Electric Power Authority, or PREPA, and novice Montana-based firm Whitefish Energy Holdings LLC, a $300 million agreement that generated international controversy.    Unlike the Whitefish contract, it was arrived at with the blessing of the Federal Emergency Management Agency, which Mammoth claims was in the negotiating room “every step of the way” and will ultimately reimburse PREPA for payments it makes to Cobra. Over the last several months, Cobra’s initial 90-day, $200 million contract ballooned to $445 million in late January and more than doubled again to $945 million about a month later, reportedly allowing it to source construction materials itself, rather than work through third-party contractors. Wednesday’s blackout took place in the context of a concerted push from both the Puerto Rican government and the Washington-appointed Financial Oversight Management Board, or FOMB, to privatize PREPA, bringing its transmission and distribution capacity under private management and selling pieces of its generation capacity off to different bidders. With these contracts and more federal funding potentially up for grabs via privatization, Martínez predicted “there will be more Whitefishes and more Cobras — more animals of those species — lurking around trying to bite again.”

           China Installs Nearly 10 Gigawatts Of Solar In First Quarter, Up 22% - China’s National Energy Administration announced on Tuesday that the country installed an impressive 9.65 gigawatts (GW) of new solar PV capacity in the first quarter of 2018, up 22% on the same period a year earlier and up on analysts’ projections. At a press conference held on Tuesday, China’s National Energy Administration (NEA) published new data revealing the country’s solar PV performance for the first quarter. The data comes to us courtesy of Asia Europe Clean Energy (Solar) Advisory, (AECEA), based in Beijing, which covers the Chinese solar industry closer than many non-Chinese analysts are capable of doing.Specifically, China installed a total of 9.65 GW worth of new solar PV capacity in the first quarter, made up of 1.97 GW worth of utility-scale solar capacity, and 7.68 GW worth of distributed solar capacity. This represents a 22% increase on the same quarter a year earlier, however, this doesn’t tell the whole story.  China’s utility-scale segment actually decreased by 64% in the first quarter, as compared to a year earlier, while the country’s distributed solar segment increased by a mind-boggling 217%. It’s a strong start to the year for China’s solar industry, which broke all sorts of records in 2017 by installing a massive 52.83 GW worth of solar capacity after a year of repeated revisions to analyst expectations. Looking forward, there is no communal agreement on how much solar China will install in 2018, but AECEA currently expects China to install between 40 GW and 45 GW

          Can China's EV Industry Survive Without Subsidies? -- A Chinese electric vehicle maker, BYD, is attracting a lot of positive sentiment from analysts covering the company, according to a Bloomberg poll among 27 analysts. A total 18 of these have a “buy” stance on the company despite it losing US$3 billion in market cap because of lower government subsidies and intensified competition from foreign manufacturers. The revision in the subsidy regime for electric vehicles hurt the company badly. BYD recently said its first-quarter income would be a staggering 92 percent lower than in the previous quarter because of the lower subsidies. Yet the company will later benefit from higher subsidies that Beijing will continue providing for longer-range electric vehicles. Speaking of long-range electric vehicles, BYD is one of the Chinese companies driving a potentially major decline in diesel fuel demand in China with their fast-growing electric bus fleet. This fleet could displace almost 280,000 bpd in fuel demand. Bloomberg reported today that electric bus fleets across Chinese cities are expanding at the rate of 9,500 every five weeks. Last year, 99 percent of all electric buses in the world—some 380,000 of them—were in China. BYD’s electric bus production to date is 35,000, but it now has the capacity to roll out 15,000 annually. China is pushing electric vehicle adoption urgently as part of efforts to deal with pollution. Beijing has a target of a sevenfold increase in the sales of the so-called new energy vehicles and is considering a ban on gas guzzlers. Still, the subsidies for new energy vehicles are planned to be phased out by 2020, which means that local and international EV makers have less than three years to find ways to survive on their own without subsidies.

          Electric Buses Are Hurting the Oil Industry - Electric buses were seen as a joke at an industry conference in Belgium seven years ago when the Chinese manufacturer BYD Co. showed an early model.“Everyone was laughing at BYD for making a toy,” recalled Isbrand Ho, the Shenzhen-based company’s managing director in Europe. “And look now. Everyone has one.”  Suddenly, buses with battery-powered motors are a serious matter with the potential to revolutionize city transport—and add to the forces reshaping the energy industry. With China leading the way, making the traditional smog-belching diesel behemoth run on electricity is starting to eat away at fossil fuel demand.The numbers are staggering. China had about 99 percent of the 385,000 electric buses on the roads worldwide in 2017, accounting for 17 percent of the country’s entire fleet. Every five weeks, Chinese cities add 9,500 of the zero-emissions transporters—the equivalent of London’s entire working fleet, according Bloomberg New Energy Finance. All this is starting to make an observable reduction in fuel demand. And because they consume 30 times more fuel than average sized cars, their impact on energy use so far has become much greater than the passenger sedans produced by companies from Tesla Inc. to Toyota Motor Corp.

          Trump administration plans to freeze Obama-era fuel standards - The Trump administration plans to try and freeze Obama-era fuel-efficiency standards starting in 2021 in a bid to reverse another of the former president’s crowning policies aimed at combating climate change, according to a report from The Washington Post. The report, which cites a federal official who has viewed the drafted proposal, says the Trump administration would go even further by restricting a state’s ability to set its own fuel standards, which would be a strike against California and its strict state-specific emissions rules. The proposal has been reportedly drafted by the Department of Transportation’s National Highway Traffic and Safety Administration, and the plan right now is to freeze standards for cars and light trucks at levels set for the year 2021 and keep them there for five years.  The Obama administration’s rules, which involved a partnership with California and car makers, set standards at 50 miles per gallon for cars and light trucks by 2025. Obama also, through the Clean Air Act, granted California a waiver to set its own, higher standards. That way, if automobile manufacturers wanted to maintain a presence in the lucrative California market, they’d have to abide by the new rules. The Trump administration now says a separate law overrules that arrangement, The Washington Post reports. The news comes after Environmental Protection Agency chief Scott Pruitt, who was grilled by Congressional lawmakers this week over his myriad ethical scandals, said earlier this month that the EPA plans to roll back the emissions standards to appease automakers who say more fuel-hungry vehicles like SUVs and pick-up trucks were more popular than electric cars and other low-emission vehicles.

          Canary in the Coal Pond -  In tests conducted in late 2017, one in three coal-fired power plants nationwide detected “statistically significant” amounts of contaminants, including harmful chemicals like arsenic, in the groundwater around their facilities.This information, which utility companies had to post on their websites in March, became public for the first time under an Obama-era environmental rule regulating coal ash, the waste generated from burning coal.Mixed with water and stored in ponds and landfills at nearly 300 facilities across the country, coal ash has been found to contain carcinogens and toxins like mercury and lead. For decades, people living near coal-fired plants have feared the ash was seeping into the ground and contaminating their drinking water.But now, just as residents are getting their first indication of whether neighboring plants might pose a threat, Environmental Protection Agency Administrator Scott Pruitt is advancing a proposal to amend the rule, giving states the authority to lessen consequences and weaken requirements for polluting power plants.  As the rule stands today, if a plant exceeds federal limits for certain pollutants in groundwater and the utility company can’t prove its coal ash pond has an adequate liner to hold in the toxins, the pond would be shut down. The new proposal would give states the power to allow the pond to remain open while the plant cleans up the contamination. It would also set more lenient thresholds for types of contaminants that trigger mandated cleanups.Pruitt has said the plan would save utilities an estimated $31 million to $100 million per year in compliance costs and give states flexibility to set their own standards that are “at least as protective” as the federal ones, rather than simply installing the EPA’s nationwide.The EPA didn’t respond to requests to elaborate on the reasoning behind the proposal.

          Kentucky is giving this coal company tax breaks worth millions to keep 250 jobs -  A representative from Alliance Coal came to the Pike County Fiscal Court with a difficult proposition last week: provide a tax break worth millions over the next 12 years, or say goodbye to the 250 jobs the company provides in the county.The company told officials it needs the local tax break to qualify for state incentives through the Kentucky Industrial Revitalization Act, a tax credit program that might be suspended in coming days. KIRA is designed to save businesses that would be forced to shut down without financial assistance. If Alliance does not receive those tax credits, the company said it would be forced to shut down its Pike County operation — which Alliance subsidiaries have operated since 1996 — because the coal reserves currently being mined will run out in just a few years."We’ve known about declining coal reserves for 50 years. For this to happen just when this program is about to go away raises questions," said Jason Bailey, executive director of the Kentucky Center for Economic Policy. "I think the suspension of the program is what’s driving the urgency." Kentucky lawmakers voted to suspend the program under a tax overhaul bill they passed earlier this month, but in a separate tax "clean up" bill, lawmakers voted to undo that suspension. Gov. Matt Bevin could still veto the second tax bill later this week, so the tax break remains in limbo for now.On Tuesday, Pike County officials gave approval for the local tax credit, which will cost the county about $159,000 annually over the next 12 years. The Kentucky Economic Development Finance Authority will meet Thursday to consider the company's application for state-level tax breaks.

          Mines owned by Gov. Justice missed deadline for installing safety tech - Two mines owned by Gov. Jim Justice are among only three across West Virginia that failed to install life-saving technology to prevent miners from being crushed to death by fast-moving machinery in underground coal mines on the job. The two McDowell County underground mines, Pay Car 57 and Pay Car 58, missed the deadline to install proximity detection systems, which shut down underground mining machines before they get too close to workers, according to violation reports obtained by the Gazette-Mail. The systems would save miners from one of the most common causes of injury and death: being crushed by machinery. Across the country, 35 miners died by being pinned, crushed or struck by continuous mining machines in underground coal mines between 1984 and 2015, according to the U.S. Mine Safety and Health Administration. Proximity detection systems, which include a machine-mounted component and wearable tag, could prevent 50 injuries and 10 deaths nationwide over the next decade, according to MSHA.

          Fresh cracks found in Hunterston B nuclear reactor -- New cracks have been discovered in the Hunterston B nuclear reactor in North Ayrshire raising concerns that it may not be safe to restart. Operator EDF Energy said that it still intends to reopen the Hunterston B reactor despite calls for its shutdown. A Government’s Office for Nuclear Regulation (ONR) spokesman said: “We are currently assessing the safety case submitted by EDF after a planned outage identified a number of cracks in the graphite blocks that make up reactor three’s core. Before we grant permission to EDF to restart reactor three we will require that an adequate safety case justifying further operation has been made. ONR has to formally permission the restart of the reactor.”

          US coal bailout review slows after Trump faces pushback -A bankrupt power generator’s plea for President Donald Trump to help saving money-losing power plants has drawn opposition from key administration officials, slowing action on the proposal, according to two people familiar with the deliberations. FirstEnergy Solutions Corp. asked the Trump administration last month to immediately declare a grid emergency and guarantee profits for money-losing coal and nuclear power plants -- a move the government has generally reserved for times of war and potentially widespread blackouts. The Energy Department has yet to decide on the request, and instead opened a public comment period on the underlying authority. Some members of Trump’s administration see the FirstEnergy Corp. subsidiary’s plea as premature, lacking evidence that the situation is dire and requires urgency, said the officials, who asked not to be identified because the deliberations aren’t public. The company has said some of the plants in question won’t shut until 2020 at the earliest. "It’s a break-glass-in-case-of-emergency deal," said Republican energy strategist Mike McKenna, arguing that FirstEnergy Solutions’ economic woes shouldn’t qualify. "A business deficiency is not a circumstance for panic." The pushback from Trump’s own administration underscores the challenge the president faces in making good on his pledge to help save coal and nuclear industries that are struggling in the face of competition from cheap natural gas. Trump is encouraging Energy Secretary Rick Perry to find some way to solve the problem, two people familiar with the discussions said, and other administration officials concerned about the resiliency of the electric grid want to keep coal and nuclear power plants online.

          FirstEnergy Strikes Creditor Deal in Subsidiary Bankruptcies - FirstEnergy Corp. has reached a settlement with creditors of its bankrupt power-generation businesses that would simplify their restructuring while extricating the parent company from the chapter 11 case. The proposed deal with the nonbankrupt parent company requires approval from subsidiary FirstEnergy Solutions, or FES, and its affiliates and from the Ohio chapter 11 judge overseeing their restructuring. If approved, the agreement covers potential claims surrounding FirstEnergy’s obligations toward unprofitable coal and nuclear power plants in Ohio and Pennsylvania that are under bankruptcy protection. Research firm CreditSights said the settlement provides 15 cents on the dollar for holders of unsecured FES debt, some of which rallied nearly 20% Monday, according to FactSet. The two largest bondholder groups in the bankruptcy support the agreement, according to a securities filing. FirstEnergy said it would try to bring the court-appointed committee of unsecured FES creditors on board with the terms. Recoveries for creditors also depend on whether the Trump administration intercedes to keep the FES plants open. FES has sought an emergency lifeline from the U.S. Department of Energy to prop up those facilities, which have been unable to compete in unregulated markets with plentiful natural gas and state-subsidized renewables. The settlement provides a combination of cash payments and tax notes from the parent designed to deliver $628 million in value to creditors, according to a securities filing. FirstEnergy agreed to take on pension payments, deferred compensation and retiree life insurance and medical claims arising from FES. In return FirstEnergy would share in any bondholder recoveries above 60 cents on the dollar. FES and its affiliates are negotiating a restructuring of three nuclear plants while putting four fossil fuel operations and a retail power business on the block. CreditSights analysts said the potential upside for FirstEnergy would incentivize the parent to continue pressing federal and state regulators for a bailout of FES facilities. The potential closure of FES facilities is testing the Trump administration’s commitment to coal and nuclear as it weighs compelling the nation’s largest grid operator to favor those fuel sources over alternatives. 

           FirstEnergy is shielded from generating unit's bankruptcy - In another step to distance FirstEnergy Corp. from the financial woes of its bankrupt generating unit, the Ohio utility announced an agreement with creditors that would free it from future claims in the Chapter 11 proceeding. But FirstEnergy CEO Chuck Jones also said during an earnings call with analysts and investors that while the agreement would mean a clean break from the cash-strapped subsidiary, FirstEnergy Solutions Corp. (FES), he'll continue to personally lobby to keep the unit's coal and nuclear plants running. Jones also said that under the announced agreement with creditors, the utility could benefit financially from any government-mandated payments to support the money-losing power plants.  Under the agreement with creditors, if the amount of any coal or nuclear subsidies exceeds a certain threshold, "then, yeah, we would share some of that. But that's not why we're doing it," Jones said. FES filed for Chapter 11 bankruptcy protection in the northern district of Ohio on March 31, listing $560 million of cash on hand and total debts of about $3.8 billion (Energywire, April 2). The bankruptcy filing came just days after the subsidiary announced the planned closure of its three nuclear plants and, separately, asked the Department of Energy to subsidize its coal and nuclear plants under seldom-used Section 202(c) of the Federal Power Act (Greenwire, March 29).

          Across the US, Courts are Keeping Voter Initiatives Off Local Ballots - - Hattie Wilkins, a retired union president at a Youngstown pillow factory, is part of a group of residents who have, since 2013, placed six initiatives on the city’s ballot to protect city water and assert municipal control over frack-waste injection wells. The one in November 2016 failed 10,164 to 12,443 votes. Undaunted, the group, Frackfree Mahoning Valley, gathered enough signatures to get two initiatives on the November 2017 ballot.That year, the group proposed a ban on fracking and underground frack waste injection wells that would have allowed private citizens to take legal action against violators and another to regulate political campaign contributions, restricting the right to donate to city residents.But in 2017, for the first time, the Ohio Supreme Court effectively removed their initiatives from the ballot—no votes were cast.This year, for the May 2018 ballot, Frackfree Mahoning Valley again took to the streets to qualify yet another initiative. The group proposed a “Youngstown Drinking Water Protection Bill of Rights” that would ban oil and gas wells and waste injection, allow the city to prosecute violations, and mandate that surplus water revenue be spent on improving the city’s water and sewer infrastructure. (In March, the city of Youngstown was forced to repay water customers $4 million, $28 each, after it was found the city had illegally spent surplus water funds.) Shortly after Wilkens and her fellow petitioners submitted signatures for the Drinking Water Protection Bill of Rights, the Mahoning Valley Board of Elections refused to place it on the May 2018 ballot.“We had enough ballot signatures and the board of elections decided not to put it on, and that’s not right,” says Wilkens. As it did last year, the board referred to a 2016 law (HB463) that allows it to remove a initiative deemed beyond the city’s “scope of authority.” It argued that proposed language to hold violators liable and a provision to grant ecosystems new legal protections are outside the city’s power. The initiative is also a direct challenge to the Ohio Assembly’s claim of total control over oil and gas.

          High court rules fracking ban proposal must be on primary ballot - The Ohio Supreme Court ruled today in a 5-2 decision that the Mahoning County Board of Elections overstepped its authority by rejecting an initiative to ban fracking in Youngstown. The court ruled that the board must place the proposal back on the primary election ballot.

          MarkWest Agrees to Pay Millions in Federal Settlement Over 'Pig' Emissions - A natural gas energy processor has agreed to pay a $610,000 civil penalty and install millions of dollars worth of equipment to reduce harmful emissions at hundreds of facilities across western Pennsylvania and eastern Ohio.  In a federal settlement filed this week in the U.S. District Court for the Western District of Pennsylvania, Ohio-based MarkWest agreed to pay the civil penalty and install $2.6 million worth of equipment at more than 300 compressor stations, pig launchers and pig receivers.In addition, the company will install and operate ambient air monitoring systems near compressor stations in Ohio and Pennsylvania and participate in other supplemental environmental projects, totaling $2.4 million.  The federal settlement is the first to acknowledge that the use of a maintenance technique called “pigging,” is a major source of harmful emissions in wet gas shale plays like the Marcellus and Utica.Devices called “pigs” are used to remove debris and liquids inside pipelines. Often, before the pigs are inserted, pipelines are depressurized, which releases gas into the atmosphere The settlement between the U.S. Department of Justice, Environmental Protection Agency and Pennsylvania Department of Environmental Protection and two MarkWest subsidiaries -- MarkWest Liberty Midstream Resources, LLC and Ohio Gathering Company, LLC -- alleges the company failed to apply for or comply with air pollution permits. As a result, the company unlawfully vented hundreds of tons of natural gas and volatile organic compounds, or VOCs.    VOCs include chemicals that cause smog, or ozone pollution, and can cause serious health impacts, including headaches, nausea and damage to internal organs. MarkWest is the largest processor and separator of natural gas in the Appalachian Basin and has operations across the northeast and near the Gulf of Mexico. The company operates two processing facilities in West Virginia, one in Kenova and the Cobb Processing Facility in Clendenin. A spokesman for MarkWest said the settlement will only apply to the operations outlined in the documents. EPA says the technology installed under the settlement will prevent more than 700 tons of VOC emissions from being released annually.

          Blue Racer keeps growing in the heart of Utica Shale -- Blue Racer Midstream is not often in the news. The privately held company quietly goes about its business in the Appalachian Basin. The company operates the largest network of gathering pipelines in the Utica Shale with more than 700 miles of pipelines, its so-called “super system,” said spokesman Cory Gerken, at a recent Utica Midstream conference in North Canton, Ohio.That includes 531 miles of rich gas lines, 39 miles of lean gas lines, 101 miles of liquids and 50 miles of condensate lines, he said. Its processing has grown from about 200 million cubic feet per day (MMcf/d) in March 2014, to 400 MMcf/d in March 2015, to 700 MMcf/d today, according to a Kallanish Energy review of company data.It serves 20 customers in the Utica Shale in eastern Ohio and the nearby Marcellus Shale in West Virginia and western Pennsylvania.Blue Racer must remove the heavy hydrocarbons from the wet or rich natural gas to create the most value for its producers, and those natural gas liquid volumes are increasing. The system serves the lean Utica and the rich Utica and nearby rich Marcellus areas. The company’s flagship Natrium processing plant on the Ohio River at Natrium, W. Va., can handle 450 MMcf/d of natural gas processing, and 123,000 barrels per day (BPD) of fractionation, he said. It also features 2,500 BPD of onsite condensate stabilization, he said.

          Seneca Nation takes on Pittsburgh startup to defend the Allegheny River - Environmental Health News - Last month more than 100 Seneca Nation tribal members showed up at the monthly meeting of the local municipal authority in the small town of Coudersport, Pennsylvania, carrying protest signs and ceremonial drums. They couldn't all fit inside the sewer plant building, so many stood outside, where they sang and chanted in the Seneca language. Their signs bore messages like, "Water is sacred," and "Keep your fracking in Pennsylvania."  They were protesting a proposed fracking wastewater treatment plant adjacent to the Coudersport Area Municipal Authority's sewage treatment facility. If approved, the facility would take up to 42,000 gallons of fracking wastewater per day from Marcellus shale gas drillers to be treated and discharged into the Allegheny River—which flows from Coudersport in north central Pennsylvania's Potter County up into Western New York and through the Seneca Nation's territory.   No one consulted tribal members about the plan. They read about it in the news. "Our name for the Allegheny is Ohi'yo, which means 'beautiful water,'" said Seneca Nation president Todd Gates. "We're determined to keep it that way. We can't do anything without water. It's the basis of all life. It's a sacred resource." After flowing from Coudersport into New York and through the Seneca Nation's land, the river turns back into Pennsylvania and meanders down into Pittsburgh, where it converges with the Monongahela River to form the Ohio River. In other words, every community on the Allegheny River between New York and Pittsburgh is downstream of the proposed wastewater treatment plant.  "It's not a question of would something go wrong," John Stolz, director of the Center for Environmental Research and Education at Duquesne University in Pittsburgh, said. "The question is if there are still even small amounts of dangerous constituents in the discharge, especially radioactive ones, then there's the possibility of buildup in the river over time."

          The Connection Between Russia and 2 Green Groups Fighting Fracking in US - Daily Signal -- New Yorkers who are missing out on the natural gas revolution could be victims of Russian spy operations that fund popular environmental groups, current and former U.S. government officials and experts on Russia worry.Natural gas development of the celebrated Marcellus Shale deposits has spurred jobs and other economic growth in neighboring Pennsylvania. But not in New York, which nearly 10 years ago banned the process of hydraulic fracturing, also known as fracking, to produce natural gas.Two environmental advocacy groups that successfully lobbied against fracking in New York each received more than $10 million in grants from a foundation in California that got financial support from a Bermuda company congressional investigators linked to the Russians, public documents show.The environmental groups Natural Resources Defense Council and the Sierra Club Foundation received millions of dollars in grants from the San Francisco-based Sea Change Foundation.“Follow the money trail, and this [New York] ban on fracking could be viewed as an example of successful Russian espionage,” Ken Stiles, a CIA veteran of 29 years who now teaches at Virginia Tech, told The Daily Signal.To Stiles and other knowledgeable observers, this looks like an actual case of knowing or unknowing collusion with Russia.Both Natural Resources Defense Council and Sierra Club Foundation also accepted tens of millions from the Energy Foundation, the top recipient of grants from Sea Change, according to foundation and tax records.When New York Gov. Andrew Cuomo, a Democrat, renewed his state’s ban on fracking three years ago, the Natural Resources Defense Council issued a statement supporting the ban. So did the Sierra Club, the primary recipient of grants from its sister organization, the Sierra Club Foundation.Environmental activists associated with the groups receiving Sea Change Foundation grants continued to pressure Cuomo and other public officials to maintain and expand New York’s fracking ban.Most recently, the two environmental groups scored another victory when the Delaware River Basin Commission, an interstate regulatory agency that includes the governors of New York, New Jersey, Pennsylvania, and Delaware, proposed a ban on fracking within the Delaware River Basin cutting across all four states. The Sierra Club and the Natural Resource Defense Council have pressed the regional commission to impose the ban, issuing statements (here and here) calling for  restrictions that are tighter than what the commission proposed.

          Pennsylvania’s natural gas production continues to increase -- Pennsylvania’s marketed natural gas production averaged a record 15 billion cubic feet per day (Bcf/d) in 2017, 3% higher than the 2016 level. This production is largely from shale plays in the Appalachian Basin. Pennsylvania accounted for 19% of total U.S. marketed natural gas production in 2017 and produced more natural gas than any other state except Texas. Pennsylvania has experienced an increase in permitting and drilling activity with the expansion of regional pipeline capacity capable of moving natural gas to market centers outside of production areas. According to the Pennsylvania Department of Environmental Protection, the state issued 1,352 natural gas drilling permits in 2016 and another 2,038 in 2017. The drilling rig count in the state has also increased, averaging 20 rigs in 2016 and 33 in 2017, based on data from Baker Hughes.  Recent permitting and drilling activity in Pennsylvania is concentrated in opposite corners of the state. Washington and Greene counties in southwestern Pennsylvania and Susquehanna County in northeastern Pennsylvania have the highest number of permits and rigs.  Natural gas produced in Washington and Greene counties has a high natural gas plant liquid (NGPL) content, enhancing the value of gas extracted from these counties and helping drive production. NGPLs have tended to sell at a higher price than the natural gas. By comparison, natural gas production in Susquehanna County is relatively dry, meaning the natural gas has less NGPL content.  In Susquehanna County, the estimated ultimate recovery of wells—a measure of gas productivity—has increased over the past five years, spurring further drilling activity. In 2016 and 2017, these three counties combined accounted for slightly more than half of the total permits and two-thirds of the active rigs in Pennsylvania.  EIA forecasts natural gas production to continue to increase in the Appalachian basin, which would indicate a need for additional pipeline capacity. Current pipeline projects include the 3.25 Bcf/d Rover Pipeline Project and the 1.5 Bcf/d NEXUS Gas Transmission Project, both slated to begin operations during the next few months.

          Group urges Gov. Wolf to take action against Mariner East 2 pipeline - About 30 speakers pleaded with Gov. Tom Wolf to change his ways and put a stop to the Sunoco Mariner East 2 pipeline, during a Del-Chesco United for Pipeline Safety citizen’s public hearing, at the township building on Thursday. The venue was changed to accommodate what was a standing-room only audience of more than 150 concerned citizens from all over the state. The event highlighted what many said was Wolf’s lack of respect for the health, safety and welfare of Pennsylvania residents during pipeline construction, and when and if, highly volatile fuels are pumped through the pipeline stretching 350 miles from Ohio, West Virginia and western Pennsylvania to the former Marcus Hook Refinery in Delaware County. Speakers presented testimony as part of an “investigation” concerning whether or not Wolf has violated his oath of office by pushing through Sunoco Pipeline’s “dangerous” pipeline project. A panel of representatives from several counties listened intently and will make a decision at a future date. Rebecca Britton lives in Uwchlan and said she thought she was living the American Dream. “Put people over partisan politics and the big money,” Britton said. “Gov. Wolf, look deep within yourself.” Susan Britton-Seyler said that the governor, the Department of Environmental Protection and the Public Utilities Commission are violating the state Constitution. “They’ve decided that a blast zone in Exton, Pennsylvania is acceptable,” she said. She then asked public officials to embrace clean, renewable energy. “Fracking and pipelines are a threat to the health, safety, air and soil,” Britton- Seyler said. “Empty promises are not acceptable.” Ann Pinca, of North Lebanon Township, said, “our government has failed us.” 

          Gov. Justice order to expedite permit process could benefit business, oil gas industries — Gov. Jim Justice signed an executive order Monday intended to streamline the permitting process for business and industry seeking to set up shop in the Mountain State. “West Virginia has consistently been ranked at or near the bottom amongst all states for our regulatory environment by publications such as Forbes and CNBC,” Justice said in a press release. “This is an area where we need to improve. “Like our President, Donald J. Trump, I have been very focused on regulatory reform and will aggressively continue those efforts in our state,” Justice said in the release. According to the governor’s staff, the executive order would require expedited permitting for all projects, as well as prioritization of permits for projects of critical economic concern. The order also would require executive state agencies to file written reports to the permit applicant, executive director of the state Development Office and governor that explain inaction on completed permit applications for projects of critical economic concern. And the order would establish an annual reporting requirement from the Development Office to the governor and Legislature explaining whether the program is operating successfully. “The purpose of this action is to provide an expedited permitting process for business and industry to secure all necessary permits,” the order reads. “Executive state agencies shall immediately review all completed grant applications upon receipt,” the order says. “Executive state agencies shall grant or reject all permits in an expeditious manner without compromising the integrity of a thorough analysis or statutory requirements.”

          West Virginia executive order expected to smooth permitting for downstream projects -An executive order issued by West Virginia Governor Jim Justice to expedite the permitting of "projects of critical economic concern" is expected to speed permitting of intrastate pipelines and other large energy projects, an official representing independent oil and gas producers said Tuesday. The order, which Justice signed on Monday, calls for faster permitting of all projects but prioritizes those that have "the ability to stimulate economic development and job creation in West Virginia."The biggest effects from the executive order are likely to be felt "downstream from the drilling," Charlie Burd, executive director of the Independent Oil and Gas Association of West Virginia, said in an interview Tuesday.Burd cited proposed intrastate pipeline projects as the most likely beneficiaries of the order, as well as any industrial and chemical manufacturing plants built as an outgrowth of the expansion of the shale gas industry. In addition, he pointed to any projects that might be launched as a result of the $83.7 billion that China Energy Investment, the world's largest power company, had committed to invest in shale gas, power and chemical projects in West Virginia last November; as well as the much-discussed proposed creation of a petrochemical storage and trading hub in the southwest Appalachian region.However, the order is less likely to shorten the time it takes to secure a permit to drill an oil or gas well, a process that is already fairly streamlined, Burd said. He estimated the average time to secure a drilling permit at 75 days."Those permits are routinely done in a relatively efficient manner if all the components of the permits are included at the time of the initial submittal," he said. "Permits sometimes get held up if there's a portion of the permit mistakenly not included."

          Study: Songbird that needs clean streams threatened by fracking -- Mack Frantz is a Ph.D. candidate at West Virginia University and part of the USGS Cooperative Fish & Wildlife Research Unit. He recently published a journal article about the measurable effect of shale gas development on the bird.“The Louisiana waterthrush is the proverbial canary in the coal mine,” Frantz says.   Frantz and his colleagues studied habitat in West Virginia where there has been increasing activity from the gas industry. It’s a heavily forested area but there’s also forest fragmentation.  “It’s not really so much the placement of a well pad, but all of the infrastructure it takes in order to access that well pad and to transfer the gas — access road, pipelines, compressor stations,” Frantz explains. “So in areas where you used to have contiguous forested habitat, which is important to have for certain kinds of wildlife, that might be broken up.” Frantz and the research team looked at aerial and satellite images of gas development, and spent hours in the field from 2009 to 2011 when unconventional drilling began and was peaking, and then again from 2013 to 2015. They also monitored waterthrush nests and territories. They found that nest survival decreased. “So the probability that a nest is going to be successful over its 29 day nesting period, that was lower due to shale gas development,” Frantz says. “We also saw that shale gas-disturbed areas were producing less fledglings.”Frantz says the riparian habitat quality also declined in areas where there was gas development. That means water quality in the streams, but also erosion of stream banks, and a loss of native plants. The study also suggests that Louisiana waterthrush have had to increase their range. “If you start to remove some of that forest cover, that’s going to affect their food resources. And so I think in part that’s what we’re seeing here: that the waterthrush are having to have larger territory to support their foraging needs, not only for themselves but for their nestlings.”

          Perched on a platform high in a tree, a 61-year-old woman fights a gas pipeline — When the trees started coming down, Theresa “Red” Terry went up.Now, the 61-year-old mother of three is perched on a platform 32 feet in the air between two oak trees, trying to stop a natural gas pipeline from coming through land granted to her husband’s family by the king of England in Colonial times.For three weeks, she has endured rain, snow, hail, nighttime temperatures in the 20s and high winds. Her body is stiff and sore. When she huddles under a tarp to stay warm, it’s usually too dark to read. She’s bored.Ten days ago, police said family and friends could no longer bring her food and water. Officers are waiting at the base of the trees, around the clock, to arrest her when she finally comes down. Her 30-year-old daughter is in another tree, too far through the family’s woods to see, also defying police.They’re trespassing on their own property.As the stalemate drags on, “I stand with Red” has become a rallying cry for opponents of the Mountain Valley Pipeline, a 300-mile, $3.5 billion project being built by a coalition of companies led by EQT Midstream Partners. It’s the further along of two gas pipelines planned in Virginia. An even bigger project, the Atlantic Coast Pipeline, is being built through the central part of the state by a coalition led by Dominion Energy, the state’s largest utility. The two pipelines have thrown together environmentalists; although property rights advocates have tried to block them, the projects have won political and regulatory support at every turn. With tree-clearing finally underway, an air of desperation is gripping opponents. A handful of other tree-sitters have blocked part of the Mountain Valley Pipeline’s route in the Jefferson National Forest in West Virginia since February. A few more sitters went up trees in Virginia’s Franklin County last week.Last Wednesday, a group of Democratic state lawmakers from Northern Virginia and Richmond joined with others from the southwestern part of the state to call on Gov. Ralph Northam (D) to slow both projects, a sign that the issue is expanding beyond a regional concern. Though Northam’s office said there is nothing the governor can do, because the project has won federal approval, the State Water Control Board has approved a new 30-day comment period for the public to weigh in on whether waterway protections are adequate.

          With Treetop Protest, 61-Year-Old Red Terry Leads Fight Against Mountain Valley Pipeline - (video) In Virginia and West Virginia, residents and activists are battling natural gas companies over a natural gas pipeline currently being constructed.  The Mountain Valley Pipeline will extend 303 miles from northwestern West Virginia to southern Virginia, with a recently proposed 70 mile extension into North Carolina. The project is being funded and operated by Mountain Valley Pipeline LLC, owned by EQT Midstream Partners, LP; NextEra US Gas Assets, LLC; Con Edison Transmission, Inc.; WGL Midstream; and RGC Midstream, LLC.  The pipeline will transport up to 2 billion cubic feet of fracked natural gas daily from the Marcellus and Utica shale basins , "to supply the growing need for natural gas in the mid-Atlantic and southeastern regions of the United States," according to a EQT Midstream Partners spokesperson.  The Federal Energy Reserve Commission approved the pipeline in October 2017 with a 2-1 vote, with two seats on the commission vacant. The only dissenting vote was cast by Cheryl LaFleur, who cited environmental concerns and skepticism over the pipeline's necessity as influential factors on her vote against its approval. In February, a federal court denied a request to delay the pipeline's construction filed by Appalachian Voices and five other conservation organizations. Mountain Valley Pipeline LLC is currently clearing forest along the Appalachian Trail and in Jefferson National Forest for the pipeline construction. According to FERC , Mountain Valley Pipeline has until May 31 to complete tree cutting.  Pipeline opponents claim the pipeline's construction will negatively impact the scenery and pose various environmental risks in the Appalachian region. "We are concerned about the Appalachian Trail and the devastation that's going to occur to the views from Peters Mountain and all along this region," said Maury Johnson, a resident and property owner in West Virginia opposing the pipeline, in an interview. Johnson noted that pipeline surveyors visited the property on his family farm, and he has dealt with them since surveying began in early 2015. He claimed the surveyors rushed the job, often missing details that he had to frequently point out for them to record. "Some of the work that has been done has been very flawed," he said. On his Facebook account, Johnson has posted several photos of sediment barriers set up by Mountain Valley Pipeline being breached to prevent erosion, just one of the several risks to water quality in the area posed by the pipeline.

           Tree-sit protests of the Mountain Valley Pipeline pose a new challenge for police - Since tree-cutting began for the Mountain Valley Pipeline, local police have been faced with a new question: What to do when a protester climbs up a tree destined for a chainsaw and refuses to come down?There seems to be no established protocol for such a situation in Southwest Virginia, where the closest thing has been the occasional call for a cat up a tree.But according to law enforcement officials involved in similar standoffs elsewhere, the best response is the one being used here: avoid the use of force and wait the tree-sitters out. In the Kalmath National Forest of Northern California in the late 1990s, several people opposed to logging and timber sales on public land camped out in tree stands for weeks in an effort to block tree-cutting. Jay Power, a now-retired Forest Service law enforcement officer who was involved in the standoff, said authorities cut off the supply of food and water the tree-sitters were receiving from supporters on the ground. Then they shone bright lights at them all night long while cranking up country music on loudspeakers. “We did everything we could to make them uncomfortable and make them want to come down out of the trees,” Power said.In such cases, when determined but peaceful activists are high above the ground in tight quarters, trying to remove them forcefully can carry more risks than police are willing to take.“I think we were meeting non-violent tactics with non-violent police work, with no intention of hurting anybody,” Power said.Deb Strickland, a retired Forest Service officer in Montana, said similar tactics paid off when dealing with tree-sitters in the Bitterroot National Forest. “Sooner or later, each one of them crawled down on their own,” Strickland said. “But it was a waiting game.”

          Roanoke County police deliver pizza, sandwiches to pipeline protesters in tree stands -  After provisions ran low in two tree stands occupied by pipeline protesters, Roanoke County police used plastic buckets on a rope to send up pizza and bologna sandwiches to the two women. The police officers, who have been keeping a close watch on the mother-and-daughter team of tree-sitters, were told for the first time Sunday that they needed food. “Their requests were accommodated immediately,” county spokeswoman Amy Whittaker said. As the anti-Mountain Valley Pipeline stands of Theresa “Red” Terry and her daughter, Theresa Minor Terry, drew national attention, some observers accused police of treating the women inhumanely by denying them food and water. In fact, Whittaker said, intelligence gathered by police officers camped out below the tree stands indicated that the Terrys only recently depleted a stockpile of necessities during their three weeks aloft. “As has been repeatedly stated, Roanoke County will provide protesters with what is needed to ensure their physical needs are met,” Whittaker said in a news release Monday. While Minor Terry ate pizza, her mother dined on bologna sandwiches that were hoisted up to her wooden tree stand in the woods off Poor Mountain Road. The Terrys say they plan to sit tight for as long as it takes to block Mountain Valley from cutting trees for a natural gas pipeline slated to pass through land that has been in their family for seven generations.

          Appalachians Against Pipelines: “One of the Two Tree Sits…Has Been Taken Down by [MVP] Security” - Up on the mountain ridge — on the West Virginia side of Peters Mountain, at the original tree sit site — the past couple days have brought some changes.First, one of the two tree sits here has been taken down by Mountain Valley Pipeline security. No one was harmed or arrested in its removal.Just a couple hundred feet away, the second sit is occupied & holding strong! The sitter in that tree writes, “I feel together with everyone working to resist this pipeline. While the other tree sit here on Hellbender is no more, I’m continually inspired by its courageous stand for over 50 days. I am not intimidated by the now 24-hour surveillance of both MVP’s security and the Forest Service, whose tents you can see on the ridge above me. I remain. Stay strong.”A few miles down the mountain, the record-breaking monopod also remains standing. Today is Day 28. In addition to this (and perhaps in response), MVP filed for a variance request that would allow them to cut trees in the Jefferson National Forest after their March 31st deadline — specifically, they asked for permission to cut the trees protected by the Peters Mountain Stand. FERC granted that request almost immediately. We don’t know if or when they plan to come cut the trees left standing on the easement, protected now by one remaining tree sit. But we’ll be here. Come join us. In spite of these recent developments, we are continually inspired and encouraged by the support we’ve received from near and far. Local supporter Nancy Hadden sent us this beautiful note yesterday: “The tree sitters are doing more than just climbing onto a high platform in protest of corporate greed, stolen property rights, and environmental injustice. They are helping all of us to find our own strength, our own voice. Because of them, I check myself each day; I ask how much I am willing to sacrifice for what I know to be true and just. For every day they are there, I become more involved, more courageous. They are helping the people find their power.”

          Mountain Valley Pipeline gets OK to cut trees in small area past deadlineThe Federal Energy Regulatory Commission has granted permission for Mountain Valley Pipeline to cut trees in a small but contentious area of the Jefferson National Forest, beyond what had been a March 31 deadline. The area of the national forest — along the West Virginia/Virginia line — has been the location of protests by those who oppose construction of the 303-mile pipeline.Protesters have spent months on treetop platforms in the national forest, blocking the tree cutting.The deadline to cut trees was March 31 for areas considered sensitive as bat and migratory bird habitats.The variance granted Monday by FERC was also approved by the Bureau of Land Management, the U.S. Department of Agriculture Forest Service and the Fish and Wildlife Service.Protesters started blocking the tree cutting in late February by sitting on platforms in an area along the Appalachian Scenic Trail on Peters Mountain in Monroe County.The protest continued on past the March 31 deadline.The treetop protests still continue now, although one of two platforms in Monroe County was disassembled a few days ago after a protester left it.  Mountain Valley Pipeline would extend 42-inch diameter natural gas pipeline over 303 miles to transport West Virginia natural gas into southern Virginia.

          Attorneys warn that Giles pipeline protester could die if denied sustenance -   A protester could die if authorities continue to deny her food and water as she nears one month atop a pole blocking construction of a natural gas pipeline, two attorneys say in a letter to the U.S. Forest Service. Since March 28, the woman has been living on a small platform suspended from a 50-foot pole. The barricade was erected in the middle of an access road needed to build a segment of the Mountain Valley Pipeline through the Jefferson National Forest in Giles County. Forest Service law enforcement officers have cordoned off the so-called monopod sitter and are preventing supporters in a nearby camp from supplying her with food and water, according to court documents. “The Forest Service’s actions in continuing to starve her out are tantamount to torture and contrary to human rights and international law,” Floyd County attorneys Alan Graf and Tammy Belinsky wrote in a letter faxed Wednesday to Roanoke-based Forest Supervisor Joby Timm. “Mr. Timm, you have a duty to protect the health and welfare of a United States citizen,” the letter stated. “The death or significant injury to the pod-sitter will be on your shoulders should that transpire.” In an April 6 email through a spokeswoman, Timm said the woman was not being denied food or water and is free to leave her monopod, which sits in a portion of the national forest that has been closed for pipeline construction..“Quite a while,” the woman said when asked how long she might last.  “She has held her ground through snow, sleet, hail, heavy winds, driving rain, freezing nights, and (a few) scorching afternoons,” Appalachians Against Pipelines, a group that has been documenting the protests, said on its Facebook page Thursday. 

          Climate change looms large as FERC reviews pipeline policy -- The Federal Energy Regulatory Commission's comprehensive review of natural gas policy will likely open a new chapter in a long debate over how the agency weighs the environmental impacts of pipeline projects.FERC officially kicked off its first review of guidelines for pipeline applications since 1999 last week with a notice requesting feedback on four broad categories (Energywire, April 20). One of them: How should FERC consider environmental impacts?Another question raised is whether FERC should calculate potential greenhouse gas emissions from upstream activities, like the drilling of natural gas wells, and downstream gas consumption. The review also asks if FERC should use the "social cost of carbon" tool in its consideration of environmental impacts.Those are familiar questions to anyone who has followed FERC's shifting policies and legal strategies. FERC's review is also expected to delve into issues that have dogged the agency in recent court fights — notably battles over FERC's 2016 approvals of the Sabal Trail pipeline and the broader Southeast Market Pipelines Project without analyzing the planet-warming emissions anticipated from Florida power plants that would burn gas transported by the pipeline.Last August, the U.S. Court of Appeals for the District of Columbia Circuit rebuffed the agency and ordered it to conduct additional analysis of the project's downstream climate impacts (Energywire, Aug. 23, 2017). That decision triggered a high-stakes supplemental review process and an urgent — and successful — effort by FERC and developers to keep Sabal Trail from being shut down. Amid the legal drama, environmental lawyers and outside experts set to work making recommendations for how FERC should conduct its climate analysis. In the end, many advocates were dissatisfied with the commission's approach. They're likely to raise the issues again during the pipeline policy review.

          Anti-fracking documentary wins top prize at EarthxFilm - This weekend, the EarthxFilm festival awarded its top prize to Unfractured about a New York-based biologist turned fractivist. The film, directed by Chanda Chevannes, screened three times at the Dallas-based environmental film festival.  “This remarkable documentary does more than help us comprehend the fracking industry and its immediate impact on our environment. Unfractured is also a deeply moving and revealing portrait of the human cost of uncompromised activism and the anatomy of personal sacrifice. Ultimately, Unfractured carries with it a hopeful message about how advocacy, protest, and demonstration can—and must—truly change the world.” The award comes with a $5,000 prize. Inspired by the growing opposition she has witnessed, including recently in Texas, filmmaker Chanda Chevannes said she will use the funds to bolster the grassroots movement, by offering the rights to screen Unfractured free of charge to 50 grassroots organizations. Chevannes intends to work closely with those on the frontlines of the battle against the fossil fuel industry, in the hopes of inspiring more women and men to join the fight. A triumphant documentary about fighting with your whole heart, Unfractured follows biologist and mother Sandra Steingraber as she reinvents herself as an outspoken activist and throws herself into the fight against fracking in New York State.

           Why increasing pipeline capacity will reduce eastern gas price volatility - This past winter’s gas price spikes shined a bright light on the changing dynamics driving Eastern U.S. natural gas markets, especially the growth in gas-fired generation that is contributing to more frequent — and more severe — spikes in gas prices in the region on very cold days. There are other changes too. For one, gas is increasingly flowing from the Northeast to the Southeast as prodigious Marcellus/Utica production growth is pulled into higher-priced, higher-demand growth markets. In today’s blog, we conclude our series on ever-morphing gas markets on the U.S.’s “Right Coast” by examining how gas pipeline flows back East have changed on days besides the winter peaks, how much demand could be unlocked by forthcoming pipeline projects, and what that new demand will mean for flow and price patterns. In Part 1 of this series, we considered what was behind the sky-high Eastern natural gas prices we saw from time to time during the winter of 2017-18. We found that regional gas demand for power generation has been strengthening, although volatile weather and gas prices can sometimes obscure this trend. And we noted that while the Marcellus and Utica production areas are proximate to the biggest East Coast demand markets, limited pipeline capacity exists between these supply and demand locations.  In Part 2, we disentangled competing forces in Eastern power generation and determined that, after you strip out the impact of fuel switching and gas-price volatility, (1) gas demand in the Eastern Transco Corridor has increased structurally by about 400 MMcf/d since the 2013-14 Polar Vortex winter and (2) about 120 MMcf/d of that delta is due to coal-plant retirements. Now, in the final part of this blog series, we explore how growth in Northeast supply and Southeast generation has changed flow and price patterns on Transco, and how new pipeline projects now under construction will increase gas demand and change flows and prices next winter.

          Supersized Natural-Gas Power Plant Would Supply Energy to New York - Does New Jersey need a huge new natural-gas power plant? Probably not, but New York certainly does.That kind of explains why developers of a new 1,200-megawatt natural-gas power plant held a press conference yesterday in an industrial part of North Bergen to tout the benefits of locating a $1.8 billion generating unit a few miles away from Manhattan. The (1,200MW) project would sit on a 15-acre site in a heavy industrial section of the township at 94th Street near existing energy and utility infrastructure. The North Bergen Liberty Generating plant would use natural gas and the latest combustion turbine technology to produce enough electricity to power approximately 1.2 million homes in New York City. “Our facility would be among the cleanest, most efficient power plants in the region,’’ said David Deutsch, vice president of development for North Bergen Liberty Generating. Critics may offer a different view. The project also seems to be out of step with policies being proposed by New Jersey Gov. Phil Murphy and New York Gov. Andrew Cuomo, both of whom have endorsed having 50 percent of their state’s electricity produced by renewable sources by 2030.

          New Jersey Passes Nation's Toughest Ban on Offshore Oil Drilling -  New Jersey has passed a law prohibiting offshore oil and gas exploration, development and production in state waters—the nation's toughest response yet to the Trump administration's plans to vastly expand offshore drilling in nearly all U.S. coastal waters.Gov. Phil Murphy signed into law on Friday the bipartisan bill called the "Shore Tourism and Ocean Protection from Offshore Oil and Gas Act" or "STOP Offshore Oil and Gas Act." The Democratic governor noted that signing occurred on the anniversary of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. The state's 130-mile coastline is home to beaches, fisheries and marine life. It also supports a $44 billion tourism industry that attracts millions of visitors each year. Even though New Jersey has no control over drilling in federal waters, they do have jurisdiction over three nautical miles extending off the coast. By banning drilling in those waters, the state has effectively blocked the construction of any infrastructure such as pipelines or docks that could transfer the oil. While companies can get offshore oil without this equipment—they can instead use floating oil rigs and transfer the oil onto ships—that method is much more difficult and expensive. According to the governor's office, the bill also prohibits the Department of Environmental Protection (DEP) from issuing any permits and approvals for the development of any facility or infrastructure related to offshore drilling within or outside of New Jersey waters. Additionally, the DEP must review any proposed oil or natural gas development in the Atlantic region of the U.S. exclusive economic zone to determine if the proposal can reasonably be expected to affect New Jersey waters.

          Anchor’s Away: Marcellus Shale Leaves Cove Point, Future Arrives - Finally!!! The very first cargo of Marcellus Shale gas has been liquefied, loaded and as of Sunday night, set sail from Dominion’s Cove Point LNG plant, heading for we’re not sure where yet. We’ve waited YEARS for this day! Let’s pop the cork on a bottle of the bubbly and celebrate.  Last week MDN told you that a ship called the Patris was due to dock at Cove Point and load the first shipment of Marcellus molecules. It appears that information was incorrect. It was correct at the time! Either the Patris was redirected somewhere else, or we’re not sure what happened.   But, news has just broken that late Sunday night, close to midnight, a ship by the name of Adam departed Cove Point loaded with the very first Marcellus shipment. Several more ships are said to be headed for Cove Point now. International shipping isn’t our specialty, so we won’t quote chapter and verse for which ships and when. This first shipment that left Sunday belongs to Japan, but there’s no indication it will actually go to Japan.  As we’ve noticed and have been reporting, both Japan and India (which will take all of the LNG Cove Point can produce) are in the game of swapping cargoes they own, sending Cove Point cargoes to customers closer to the point of origin in return for receiving cargoes that originate closer to their own shores. When we hear where the first Marcellus cargo lands, we’ll let you know. In the meantime, here’s the information we can find about the very first load of Marcellus Shale gas to get exported from Cove Point. From Reuters:The first contractual liquefied natural gas (LNG) cargo from Dominion Energy Inc’s newly constructed Cove Point LNG export plant in Maryland in the United States left the facility on Monday, Thomson Reuters Eikon ship tracking data showed.The cargo is expected to act as a drag on spot LNG prices as it coincides with the resumption of exports of the fuel from the Papua New Guinea LNG plant, which had been shut following a powerful earthquake.The 160,000-cubic meter LNG tanker Adam LNG left Cove Point on Monday with a draft of 91 percent, suggesting it was full, according to the data. Its destination was not immediately clear.The facility has exported two commissioning or test cargoes already, which were sold to Royal Dutch Shell. The first cargo from the facility left the terminal in early March heading for Britain’s Dragon LNG terminal.

          New Louisiana Gas Pipeline Capacity Needed From North To Feed Gulf Coast LNG Exports -  Over the next two years, increasing natural gas demand for Gulf Coast LNG exports will reverse flow patterns across the Southeast/Gulf region, resulting in supply/demand imbalances, pipeline capacity constraints and regional price aberrations. The most significant of these developments will occur in the backyard of Henry Hub, Louisiana, where growing supplies in the north of the state will compete for pipeline capacity to get down to coastal export facilities. More Louisiana north-to-south pipeline capacity is needed. The only questions are where the capacity is needed most, and who will build it? Today, we continue our review of Louisiana gas supply, demand and transportation capacity. This is Part 6 of a blog series that we started about six weeks ago, in which we’ve been analyzing the effects of the major changes taking place in the Louisiana gas market — the decline in offshore gas production, the emerging demand from LNG exports, the influx of gas supply from the Marcellus/Utica and the rebound in local gas supply from the Haynesville and other regional gas supplies. These market developments will drive the overall U.S. gas supply-demand balance over the next several years, which makes understanding the Louisiana gas market a critical piece of the puzzle. Yet that is no small undertaking given that the Bayou State has the most dense, tangled network of natural gas pipes in the U.S.

          Gas pipelines facing $18.5-billion threat from Trump tax revamp - Pipeline owners led by Enbridge Inc. and Williams Cos. could be forced to refund as much as $18.5 billion to drillers, utilities and even United Airlines Inc. for upfront payments they charged customers before new U.S. tax rules cut the corporate rate. Natural gas conduits include the cost of future tax payments in customer fees. Because the Trump administration lowered the tax rate 21% from 35% earlier this year, pipelines have effectively been overcharging customers, according to East Daley Capital Management Inc. The sides now await a U.S. ruling on whether refunds must be made, and how quickly. The outcome could be particularly damaging to master limited partnerships aligned with pipeline companies. In March, MLPs -- whose shares are down 21% from a year ago --lost the ability to collect any taxes, after regulators issued a ruling following a federal court decision involving United Airlines. Now, they face the prospect of paying back funds charged in the past.

          Fracking boom drives Taiwan company's plan for $9 billion petrochemical plant in Louisiana - A company based in Taiwan plans to build a $9.4 billion chemical manufacturing complex on a 2,400-acre site in Louisiana, officials announced Monday.Gov. John Bel Edwards and Formosa Petrochemical Corp . Executive Vice President Keh-Yen Lin announced plans for the plant in St. James Parish, between Baton Rouge and New Orleans.The project is expected to provide 1,200 permanent jobs with average salaries of $84,500 and up to 8,000 construction jobs, according to a state news release.The plant will be the parish's largest industry, Parish President Timmy Roussel said.It will add about $28 million a year in property taxes once the exemption offered as an industrial incentive expires, Roussel told The Advocate. The parish now gets about $60 million a year in various taxes, he said.Part of Louisiana's standard incentive package is, with local approval, a full property tax exemption for five years, followed by an 80-percent exemption for three years. That alone would add up to about $207 million in tax breaks over eight years. Gary Perilloux, spokesman for Louisiana Economic Development, said he was working to get dollar figures for the exemptions.  Construction is expected to take 10 years, possibly beginning as soon as 2019 if all permits are approved. The work would be in two phases, with the first permanent jobs expected to be filled in 2021. That hiring would trigger the first of four $3 million installments of a performance-based grant to offset infrastructure costs. The complex downriver from Donaldsonville would take natural gas and make ethylene, propylene, ethylene glycol and associated polymers used in many plastic products. It's the latest big petrochemical expansion in Louisiana motivated by cheap natural gas produced by the American fracking boom.

          Gas Dominates, Again, in FERC State of the Markets Report - By now, it sounds like a broken record.As they have in the past four years, the trends in natural gas dominated the discussion of FERC’s annual State of the Markets report at the commission’s open meeting on Thursday. The report found that average U.S. natural gas spot prices rose 21% in 2017 from 2016, while average day-ahead on-peak LMPs increased 3 to 13% at pricing nodes in RTO/ISO markets.  While the previous two years were marked by cheap prices driven by warm winters, last year saw cold weather at both its beginning and end, with an especially severe cold snap at the end of December and into January 2018 leading to a sharp spike in prices, especially in ISO-NE. (See FERC, RTOs: Grid Performed Better in Jan. Cold Snap vs. 2014.)Last year also marked the first since 1958 that the U.S. was a net exporter in gas, propelled by increased LNG export capacity. “The largest increase in demand for natural gas came from LNG exports, which rose from 0.63 Bcfd to 2.19 Bcfd, a 248% increase,” according to the report. Total exports to Mexico, the U.S.’ biggest LNG customer, increased by 0.5 Bcfd to an average 4.2 Bcfd for the year, aided by several new cross-border pipelines.  Gas producers also found new markets within the U.S. About 12 billion Bcfd and 773 miles of new pipeline capacity went into service last year, most of it in the Marcellus and Utica shales. “New pipeline capacity out of the Marcellus and Utica shale plays allowed producers to meet demand in previously inaccessible markets,” the report says. “These shale plays demonstrated the largest U.S. natural gas production growth in 2017, with a 10.3% year-over-year increase for a total production of 22.1 Bcfd by the end of 2017.” Total U.S. gas production rose 1.0%, averaging 73.6 Bcfd. One of the only metrics to fall significantly was storage inventory. 2017 saw the third lowest weekly storage injection rate since 2010, while the end-of-year cold snap led to the largest withdrawal in history, 359 Bcf. The large winter withdrawals also led to the lowest end-of-winter storage level since 2014: 1.35 Tcf on April 5, 2018.

          NYMEX May gas little changed at $2.736/MMBtu as stocks offset weather - NYMEX May natural gas futures were little changed in overnight US trading as the bullish influence of depleted inventories offset the prospect of a fall on weather-related demand. At 6:40 am EDT (1040 GMT) the contract was 0.3 cents lower at $2.736/MMBtu. Natural gas inventories fell in the week ended April 13, for which the US Energy Information Administration reported a 36 Bcf withdrawal compared with the 47 Bcf injection a year earlier and the 38 Bcf five-year average build. Working gas stocks were 1.299 Tcf, or 808 Bcf lower on the year and 449 Bcf below the five-year average. Lingering cold weather in major heat-consuming regions kept demand supported in the storage review week, but recent and forecast mild to warm weather indicates diminished demand for heating likely to encourage the changeover from weekly storage withdrawals to injections. 

          May NYMEX gas ticks up marginally to $2.747/MMBtu with warming weather - NYMEX May gas futures tiptoed higher overnight in the US ahead of Tuesday's open, with changing fundamentals and ahead of options expiry at the close of Thursday's trade and the contract's roll off the board Friday. At 6:50 am ET (1050 GMT) the contract was 0.7 cent higher at $2.747/MMBtu, trading between $2.728/MMBtu and $2.754/MMBtu. Revised weather forecasts show above-average temperatures over the Northeast, much of the mid-Atlantic, nearly all the Midwest, the upper tier of the Gulf Coast and parts of the Rockies in the 6-10 day period. This shifts south and expands west to cover most of the country's eastern two-thirds, the Southwest and fringes of the Northwest in the 8-14 day period. Lingering below-average temperatures shrink in scope to Montana, parts of the west-north-central US and a bit of Florida. Longer-range projections call for warmer-than-normal weather over a large part of the US from April through June, encouraging the switch from the extended withdrawal season to the already-delayed injection season that typically runs from April 1 through October 31.

          NYMEX May natural gas futures down to $2.771/MMBtu ahead of options expiry - After rising 4.1 cents to $2.781/MMBtu Tuesday, NYMEX May natural gas futures fell on fundamental pressure overnight ahead of Wednesday's opening and options expiration at the close of business. At 7:10 am ET (1110 GMT) the contract was 1.0 cent lower at $2.771/MMBtu. Despite a prolonged withdrawal season, natural gas inventories are expected to end the injection season that typically runs from April 1 to Oct 31 with the second largest volume of refill season net injections on record at 2,416 Bcf, or 11.3 Bcf/d, according to preliminary EIA estimates. The agency anticipates an end-of-October inventory of 3,767 Bcf. Total working gas stocks are currently 1,299 Bcf, or 808 Bcf below the year-ago level and 449 Bcf below the five-year average of 1,748 Bcf, after the EIA outlined a large and atypical 36 Bcf withdrawal for the week to April 13. Estimates for the forthcoming storage report due Thursday that will cover the week ended April 20, call for a draw from stocks in the low to mid-teens. Moderate to warmer weather in store for the bulk of the country that should dampen heating demand ahead of the onset of substantial cooling load will combine with robust production implied by a rising rig count to encourage the onset of the injection season and promote a healthy pace of storage rebuilding going forward. 

          US heating season looks to continue its record-long stretch -- The natural gas withdrawal season is poised to stretch two weeks longer than ever reported as stocks must currently replace 2.549 Tcf of gas to reach the five-year average by the start of the next heating season. The US Energy Information Administration on Thursday is expected to report a 12 Bcf withdrawal for the week that ended April 20, according to a survey of analysts by S&P Global Platts. Responses to the survey were tight and ranged from a withdrawal of 7 Bcf to 17 Bcf. The EIA plans to release its weekly storage report at 10:30 am EDT on Thursday. A 12 Bcf draw would be very bullish compared to the corresponding week last year, which featured a 71 Bcf injection, and the five-year average build of 60 Bcf. It would also be the latest net withdrawal on record for the heating season. A withdrawal within analysts' expectations of 12 Bcf would deplete stocks to 1.287 Tcf. The deficit versus the five-year average would grow to 521 Bcf and the deficit versus the corresponding week last year would expand to 891 Bcf. The EIA reported a 36 Bcf net withdrawal for the week ended April 13. It dropped inventories to 1.299 Tcf, which was 38.3% less than the year-ago inventory of 2.107 Tcf, and 25.7% less than the five-year average of 1.748 Tcf. During the injection season, stocks currently need to replace 2.549 Tcf to reach the five-year average of 3.848 Tcf for the start of the next heating season. Last year, storage added 1.737 Tcf during injection season. Over the past five injection seasons stocks have increased by an average of 2.147 Tcf. Over the past decade, stocks only registered lower once to start the injection season. In March 2014, the injection season began with 824 Bcf in storage following the polar vortex. By November, producers had added 2.787 Tcf to reach 3.611 by the start of the 2014-15 heating season. S&P Global Platts Analytics has October ending inventories on pace to finish at 3.4 Tcf despite 7.5 Bcf/d of production growth summer over summer, of which 3.5 Bcf/d is forecast to come from the Northeast. Population-weighted temperatures across the US increased 1.5 degrees week over week. Although the East, Midwest and South Central storage regions experienced slight warming, temperatures there remained 6 or 7 degrees below normal, pushing withdrawal season for the US two weeks further than has historically occurred.

          Weekly Natural Gas Storage Report - One More Bullish Report In The Making Followed By 3 Bears -- The EIA reported a -18 Bcf change in storage for the week ended April 20. This brought storage to 1.281 Tcf. This compares to the +74 Bcf change last year and +60 Bcf change for the five-year average. Going into this storage report, a Reuters survey of traders and analysts pegged the average at -12 Bcf with a range of +9 Bcf to -22 Bcf. We expected -17 Bcf and were 5 Bcf above the consensus. We were off by 1 Bcf on this storage report.This week's report was clearly bullish from the standpoint that a -18 Bcf storage draw was 92 Bcf lower than last year and 78 Bcf lower than the 5-year average.And following this bullish storage report, we estimate next week's storage report will also be a relatively bullish one. We currently have an estimate of +45 Bcf versus last year's +67 Bcf and +69 Bcf 5-year average.  But it's not good news for the natural gas bulls following next week's report. Our estimates for 5/4, 5/11, and 5/18 week all show higher than average injections. On a relative basis, the first three weeks of May will show storage injections to be:

          • Higher than 5-year average by 29 Bcf.
          • Higher than last year by 92 Bcf.

          Throughout the injection season and at least for May, injections should continue to be higher than the 5-year average. This is the result of fundamental balances now shifting negative despite storage being materially lower y-o-y. Yes, we do realize that storage is now almost 900 Bcf below last year's, but keep in mind that the natural gas market is forward-looking and with supplies showing a max capacity limit of ~81.5 Bcf/d today, this could bode bearishly for fundamentals during cooling demand season.

          June NYMEX gas slips to $2.797/MMBtu on healthy outlook for storage rebuilding - NYMEX June natural gas futures had a weak showing in the US overnight ahead of Friday's open, as the market looked beyond significantly depleted inventories toward what is expected to be a healthy pace of storage rebuilding going forward. At 6:29 am ET (1029 GMT) in its first day as the new lead month, the June contract was 4.2 cents lower at $2.797/MMBtu. Natural gas inventories continued to draw lower three weeks beyond the typical start of injection season, with the latest storage data from the US Energy Information Administration outlining an 18 Bcf withdrawal for the week ended April 20. That bested the full range of estimates coming into the day, and defied both the 71 Bcf prior-year injection and the 60 Bcf five-year average build. Total working gas stocks were left at 1,281 Bcf, or 897 Bcf below the year-ago level and 527 Bcf below the five-year average of 1,808 Bcf. Increased heating demand relative to historical averages is seen to have allowed for the continued storage erosion in the recent inventory report week, but milder to warmer weather of late and in store associated with subdued demand suggests the possibility of the changeover from weekly stock draws to injections. Deflated demand combined with elevated production should allow for natural gas to flow more freely into underground storage facilities. Growing production implied by a rising rig count is expected to help natural gas inventories build by what is expected by the EIA to be the second largest volume of refill season net stock additions on record totaling about 2,416 Bcf, or 11.3 Bcf/d, by the traditional end of the injection season October 31. The agency anticipates an end-of-October storage of 3,767 Bcf. 

          Natural Gas Storage Forecast For Next Week - The EIA reported a -18 Bcf change yesterday. This was 1 Bcf higher than our forecast of -17 Bcf. Be sure to read our week of April 20 storage report here. For the week of April 27, we expect a storage build of 45 Bcf.  On a fundamental supply and demand basis, below is how each fundamental factor fared vs. the prior week:  On the supply side, Lower 48 production averaged at the all-time high of ~80.1 Bcf/d this week. Canadian gas net imports also rose w-o-w. Canada's gas storage situation has also shifted into a deficit to the 5-year average. Total gas supplies, as a result, were higher this week. On the demand side, big demand decrease from heating demand resulted in a drop of 5.6 Bcf/d w-o-w. Power burn and industrial demand also pulled back this week due to seasonal demand decrease. But on a relative basis, demand variables were higher versus norm given the bullish total degree day backdrop.  As we wrote in our NGD on Tuesday, natural gas fundamentals are starting to turn bearish. Storage injections for the first 3 weeks of May are expected to be higher than the seasonal average. In our last week's market balance, we had -4.4 Bcf/d for 2018. This week? It's -3.47 Bcf/d. But for the time being, end of storage is expected to still come in below the 5-year average with our latest estimate pegged at 3.561 Tcf. May is expected to show bearish storage builds, and the latest long-range weather outlook didn't help the bulls' cause either. For now, our trading position is that we are still long DGAZ as we told readers yesterday.

          First exported VLCC from LOOP arrives in China: In the LOOP -- The first VLCC to directly load a cargo at the Louisiana Offshore Oil Port arrived at the port of Huizhou, China, on Sunday. The Shaden departed LOOP on February 18 after a loading time of about five days. The Saudi Arabian-flagged VLCC is owned by Bahri and took approximately two months to reach its final destination on the east coast of China, according to Platts vessel-tracking software cFlow. Prior to arriving at Huizhou, the Shaden had previously stopped at Rizhao, China, on April 17. Shell loaded Mars onto the Shaden, with Unipec reportedly taking the crude to ports in China. As the only US Gulf Coast export facility that does not require Aframax or Suezmax vessels for reverse lightering on to a VLCC, LOOP is poised to become a major export hub in coming years. Month on month, the Dubai/WTI swap spread has widened 97 cents, putting second-month Dubai at a $1.43/b premium over front-month WTI. As the spread widens, WTI-based sour grades produced in the US Gulf become more competitive with Dubai-based Middle Eastern sour grades in export markets, including those in Asia. The assessed value of Mars reached a 10-month low February 6, when it was assessed at WTI cash minus $1.65/b. Since then, the grade has increased $1.55 its current assessed value of WTI cash minus 10 cents/b. Strong export demand from Asia has helped boost the price of Mars in recent weeks, with that demand expected to continue, according to market sources.  

          U.S., Cheniere rewrite safety order after LNG leak - Cheniere Energy Inc. has finalized an agreement with U.S. regulators that eliminates some deadlines for the company to complete an investigation into the causes of a ruptured storage tank at its Sabine Pass liquefied natural gas export facility in Louisiana.In a "consent agreement and order" dated Friday and published yesterday, Cheniere and the Pipeline and Hazardous Materials Safety Administration (PHMSA) agreed that the company would continue to investigate the cause of an LNG release from a storage tank at Sabine Pass, which in 2016 was the first of a handful of LNG plants to begin shipping U.S. gas overseas.The leak on Jan. 22 was not publicly reported until Feb. 9, when PHMSA issued a corrective action order requiring Cheniere to shut down two of the five LNG storage tanks in use at the facility (Energywire, Feb. 12).Natural gas is highly flammable and, under certain conditions, explosive. LNG is natural gas that is cooled to a liquid at minus 260 degrees Fahrenheit. Its volume is then reduced six-hundredfold. When supercooled LNG encounters ambient air temperatures, it quickly expands and turns back into a gas. Each of Cheniere's tanks can store up to 3.4 billion cubic feet of natural gas.At a hearing last month in Houston, Cheniere said PHMSA had overstated the danger posed to the public by the leak and described the agency's order as "not warranted." PHMSA responded that the safety order was necessary to protect the safety of the hundreds of workers at the Sabine Pass site, as well as the public (Energywire, March 22). The hearing was initially scheduled as closed to the public but was made open under legal pressure by E&E News with the help of lawyers for the Reporters Committee for Freedom of the Press.

          Oil/gas drilling activity, interest growing in area -- ConocoPhillips is making a play in Louisiana’s portion of the Austin Chalk formation, raising the prospect of a resurgence of onshore drilling activity in the state. Some reports claim the the Houston-based oil company’s effort could be focused in the Simmesport area. In the Bunkie area, people are watching an oil well being drilled in nearby south Rapides Parish, where the BlackBrush oil company has started “fracking” in a well it has drilled there. If the production from the well is good, it could open the Bunkie area up for more drilling. In addition to ConocoPhillips’ interest in what lies beneath Avoyelles’ fertile soil, EOG Resources has drilled a test well in the formation. A handful of other companies have established positions in Louisiana going from the Texas line eastward through Avoyelles, the Felicianas and beyond Baton Rouge. The Austin Chalk formation stretches from Texas through the middle of Louisiana, including Avoyelles Parish. “The excitement surrounding it is definitely there and measurable,” Louisiana Oil & Gas Association President Gifford Briggs said. He said the “jury is still out” as to whether the activity will turn into a full-blown resurgence of drilling in this area. There are several variables, including difficulty to drill, costs and production potential, that will be determined with exploratory wells. EOG Resources, which has leased about 130,000 acres, has drilled a test well in Avoyelles Parish in the Goudeau area. The firm will not comment on exploration work unless it moves into active development. 

          Permian Basin Is Growing Into the Largest Oil Patch in the World - The Permian shale play is all about setting records. Now, the region may even become the world’s largest oil patch over the next decade.  Output in the basin is forecast to reach 3.18 million barrels a day in May, according to the Energy Information Administration. That’s the highest since the agency began compiling records in 2007. By 2023, the basin may produce 4 million barrels a day, according to the International Energy Agency. The Ghawar field in Saudi Arabia is currently the world’s biggest oil field, with capacity of 5.8 million barrels a day, according to a 2017 EIA report.This is all thanks to the size of the oil deposits, coupled with increased technology and efficiencies. “The technology is the biggest driver,” said Rob Thummel, managing director at Tortoise, which handles $16 billion in energy-related assets. “The basin in and of itself could end up being the largest oil field in the world, even bigger than Ghawar in Saudi Arabia." By contrast, top-producing members of OPEC such as Iran and Iraq pump less than 5 million barrels a day. Iran produced about 3.81 million barrels day in March, according to data compiled by Bloomberg.“If the Permian was part of OPEC, it would be the fourth-largest OPEC member, right behind Saudi Arabia, Iran and Iraq,” Thummel said. “By the end of the year, the Permian probably overtakes Iran.”The rampant production growth has already strained available pipeline capacity to transport the oil to market, pressuring prices. West Texas Intermediate oil in Midland, Texas, the heart of the Permian, sank Tuesday to $8 a barrel below U.S. benchmark prices in Cushing, Oklahoma, the biggest discount in more than three years, according to data compiled by Bloomberg. Companies are planning more lines to ease the bottleneck. Phillips 66 Partners LP and Andeavor announced Tuesday a joint venture to build a pipeline from the Permian to Corpus Christi and the Sweeny-Freeport area that may carry as much as 700,000 barrels a day when it starts at the end of 2019.

             Permian crude differential hits lowest since Aug 2014 as output tops expectations - Permian Basin light sweet crude WTI Midland fell to its lowest level in more than three and a half years Tuesday, with rising production and limited takeaway capacity pushing down the grade's differential. On Tuesday, S&P Global Platts assessed WTI Midland at WTI cash minus $8.35/b on trade data heard, down $2.25/b compared with Monday's assessment. Tuesday's differential is the lowest assessment for WTI Midland since August 26, 2014, when the differential dropped to minus $9/b. Earlier in the day, the grade had traded as low as minus $11/b before slightly recovering by the early afternoon to its assessed value. Permian sour grade WTS Midland also fell to a multi-year low, dropping $2.80/b day on day to be Tuesday assessed at WTI cash minus $9/b, its lowest differential since January 25, 2013's minus $17.50/b. Permian Basin oil production is forecast to increase 1.2 million b/d in 2018, compared with last year, or 100,000 b/d each month, and is expected to reach 3.9 million b/d by December, according to data from S&P Global Platts Analytics. May output is expected to average 3.18 million b/d, according to data from the US Energy Information Administration, although the production estimate is slightly lower than total Permian pipeline takeaway capacity of 3.3 million b/d. This surge in regional crude production, facilitated by generally higher global oil prices, has tightened takeaway capacity from the Permian. With 3.3 million b/d of Permian takeaway capacity, April 15 pipeline allocations reduced the remaining spot capacity available for the month,

            Costly logistical headaches for Permian crude E&Ps, part 4 - Large-scale and well-funded producers in the Permian have built dedicated gathering systems and signed up for pipeline-takeaway options to keep their barrels moving to markets at the Gulf Coast and Cushing. For the most part, smaller producers don’t have the same options, for a variety of reasons. More and more, barrels from outside the core areas of the Permian are competing for the last bits of pipeline space and producers are being forced to rely more heavily on Permian trucking companies to help keep their crude flowing. Truckers are being asked to make less desirable, less economical and longer hauls, and are passing those costs back to the producer. With pipeline takeaway capacity maxed out, trucking capacity is being pushed to the limit too, with several potential upstream impacts. Today, we look at trucking options for smaller producers in second-tier production areas, the impact of boom-bust cycles on trucking companies and what tight trucking capacity means for the basin as a whole. In Part 1 of this series, we discussed the recent blowout in differentials between crude oil at Midland and crude in Cushing and the Gulf Coast widening spreads that were a result of massive and sustained production growth in the Permian and a lack of significant new takeaway capacity until 2019. In Part 2, we looked at smaller exploration and production companies (E&Ps), which are taking a more active approach in developing and thereby proving the value of more economically challenging “Tier 2” acreage. These new Tier 2 production trends are adding incremental production to the glut of crude in the basin and forcing producers to compete even harder for any and all available takeaway capacity. In Part 3, we discussed the challenges these smaller producers face without dedicated gathering systems or firm space on takeaway pipes. Today, we’ll get even closer to ground level and explore the potential impacts of Permian producers relying heavily on trucking operations to move their crude.

            Refinery explosions rock Texas and Wisconsin - On Thursday, a tank containing asphalt exploded at the Husky Energy oil refinery in Superior, Wisconsin, a city of about 27,000 that borders Minnesota and the westernmost tip of Lake Superior. According to authorities, 11 people were injured by the blast but only one sustained serious injuries. The fire sent huge, toxic plumes of smoke into the air, posing a serious health risk to those living downwind. The noxious fumes prompted an evacuation order covering a three-mile radius around the refinery as well as a 10-mile corridor south of the blast where the smoke was heading. It is unclear how many people were evacuated. The refinery is in an industrial area, but there is a residential neighborhood a mile to the northeast. After the fire was put out, residents were told they could return to their homes. But authorities later announced the evacuation order would remain and be re-evaluated throughout the night. The Wisconsin explosion and fire followed an April 19 blast and fire at a Valero refinery in Texas City, Texas. According to authorities, the fire was quickly contained and no injuries were reported.The Texas City explosion was heard five miles from the source. It shook buildings within a mile of the refinery. Workers at the Texas City Valero and Marathon refineries, which are adjacent to one another, were given orders to shelter-in-placeSmoke from the explosion forced vessels in the industrial canal to leave, and the Coast Guard asked that no ships sail out of the port. No residents were asked to evacuate, but emergency responders escorted bystanders away from the area.Smoke from the explosion was visible miles away. According to ABC 13, Valero estimated its Texas City refinery emitted more than 5,000 pounds of alkylates, 13,700 pounds of carbon monoxide, 970 pounds of hydrogen fluoride and 12,000 pounds of particulate matter. The refinery also released oxides of nitrogen and sulfur dioxide at rates exceeding amounts considered safe. The Texas Commission on Environmental Quality is investigating the fire and its potential impact. Both the Valero refinery in Texas and the Husky Energy refinery in Wisconsin have a history of safety violations.

             Oklahoma -- processing plants, pipelines planned to keep pace with gas growth, part 2 -- Increasing production of NGL-packed associated gas in the adjoining SCOOP, STACK and Merge plays in central Oklahoma and rising interest in the Arkoma Woodford play in the southeastern part of the state are spurring a bevy of natural gas-related infrastructure projects. New gas-gathering systems are being developed, new gas processing capacity has come online, and at least another 1.1 Bcf/d of processing capacity is under construction or will be soon. To help bring all the resulting gas and NGLs to market, new takeaway pipeline capacity out of Oklahoma is being planned too. Today, we continue our review of ongoing efforts to add gas-processing and takeaway capacity in the hottest parts of the Sooner State. As we said in Part 1, crude oil and natural gas production in Oklahoma have fully rebounded from the declines that followed the 2014-15 collapse in oil prices and stand at 21st-century highs. The center of most drilling activity in the state has been in the Cana-Woodford region, which includes SCOOP, STACK and Merge plays. SCOOP/STACK/Merge primarily targets crude oil, natural gas liquids (NGLs) and condensates in the Woodford and Meramec formations of the Anadarko Basin, but with them come significant volumes of associated natural gas. Since the start of 2017, crude production in the Cana-Woodford has increased 27% and gas production is up 24% — to 280 Mb/d and 3.7 Bcf/d, respectively, in March 2018, according to our friends at PointLogic. More recently, a few producers (many of them backed by private equity) have been talking up the gas-focused Arkoma Woodford — sometimes referred to as Arkoma STACK. Arkoma Woodford gas production in the first three months of 2018 averaged 1.5 Bcf/d — up 250 MMcf/d from the same period in 2017 and the highest output for the play in more than five years.

            GOP Tax Law Bails Out Fracking Companies Buried in Debt -- EOG Resources is one of the top companies in the fracking industry, and thanks to the new tax bill passed by Republicans and President Donald Trump at the end of last year, EOG had an exceptionally strong year compared to 2016.In 2017, the company reported a net income of $2.6 billion. The previous year? A loss of $1.1 billion. That financial turnaround seems very impressive until you realize that $2.2 billion, or about 85 percent, of its 2017 income was the result of the new tax law. Without that gift from the GOP and Trump, EOG would have lost approximately $700 million between those two years. Instead they are $1.5 billion ahead of the game. With numbers like these, it is easy to see how the Tax Cuts and Jobs Act of 2017 was a much-needed lifeline for the money-losing fracking industry. EOG is routinely touted as one of the best shale oil and gas companies. Yet the company still lost $700 million in the past two years. Or at least it would have if not for the tax bill.This is the same company that an analyst at the investment advice website Seeking Alpha says is “generally considered one of the best unconventional upstream oil and gas players in the business, and its financials back it up.” If those are the best financials in your industry, your industry has a big problem. An interesting side note is that EOG stands for Enron Oil and Gas, which was spun off as its own company from Enron — the company notorious for one of the great energy Ponzi schemes of the 20th century.

             US shale groups reach self-financing milestone as oil price rises - The US shale oil revolution has reached a landmark moment, with the sector’s top companies for the first time earning enough cash to cover the cost of new wells.Since the shale oil boom began a decade ago, exploration and production companies have needed a steady inflow of capital to pay for drilling and completing new wells but thanks to the rise in crude prices, many can now finance themselves.The leading producers, which were just about covering their capital spending from their operating cash flows in the final quarter of last year, are now generating significant free cash, according to Wood Mackenzie, the research company.“It’s quite a windfall for a lot of these companies,” said Andrew McConn, of Wood Mackenzie, who noted that the larger US shale oil companies needed a crude price of about $53 a barrel to generate free cash. Benchmark US crude was $68 a barrel on Friday.The shift to self-sustainability is removing one of the key concerns for investors. As crude prices have climbed since June last year, US exploration and companies’ shares, which typically follow the commodity, have lagged behind.  This month, however, they have started to rise. Since the start of April, shares in EOG Resources and Continental Resources are up 11 per cent, and for Pioneer Natural Resources they are up 17 per cent. From the time the first shale oil test wells were drilled in the US in 2008-09, the industry’s capital expenditure has exceeded its cash from operations, with producers only able to stay in business by attracting hundreds of billions of dollars in financing from bond and share sales and bank loans. From 2008 to 2017, US exploration and production companies raised $293bn from bond sales, according to Dealogic.

             Will U.S. Shale Offset Soaring Global Oil Demand? - Oil has rallied sharply in recent days to see West Texas Intermediate (WTI) trading at just under $70 per barrel and Brent breaking through the $70 per barrel mark, with crude trading at its highest price since 2014. The surge in oil can be directly attributed to a wide variety of geopolitical risks which are sparking considerable fears that global oil supplies could be sharply constrained in coming months.  This has triggered considerable speculation that $100 per barrel is on its way.According to some pundits, the bearish factors which have weighed on oil prices for some time have been priced in by the market.Nonetheless, the perception of geopolitical risk and how it is driving oil higher appears to be overbaked and there are a range of threats to the $100 per barrel oil narrative. Key is that U.S. oil production is expanding at a rapid clip. The U.S. EIA recently estimated that domestic production had hit 10,500 barrels daily, its highest level since starting to provide this data in the early 80s. The International Energy Agency (IEA) believes that the U.S. will overtake Russia to become the world’s largest oil producer by 2019.The big question is whether this along with a marked expansion in the volume of U.S. drilled but uncompleted wells (DUCs) and rig count, which in early April 2018 reached its highest point in three years, is enough to suppress prices. The answer could surprise investors because fundamentals indicate that higher oil is here to stay, for as long as Saudi Arabia and Russia don’t aggressively unwind the production caps established in November 2016. This is contrary to the thoughts of some analysts including those at Barclays who believe that oil will weaken once again to $51 per barrel during the second-half of 2018. What many analysts who are betting on lower oil are discounting is the effect of stronger global economic growth on the demand for energy. World gross domestic product (GDP) has been forecast by the International Monetary Fund (IMF) for 2018 to expand at 3.9 percent which is 10 basis points higher than the 3.8 percent projected for 2017. Already, the IEA has revised its 2018 estimates many times. At its last revision in mid-March 2018, the IEA estimated that demand growth would top 1.5 million barrels daily for the year, which is 200,000 barrels higher than its earlier forecast. There is every sign that the global economic upswing which is underway will boost demand even higher.

            TransCanada acquiring land in Nebraska for Keystone XL oil pipeline: spokesman TransCanada is now acquiring land in Nebraska for its planned Keystone XL oil pipeline, aimed at shipping incremental volumes of Western Canadian barrels to the US Gulf Coast for local refining and also providing options for exports, spokesman Terry Cunha said Wednesday. "The process [of land acquisition] just started last week," Cunha said in an email, adding that it's still early stages but "overall those discussions with landowners are going well." The need to acquire new "easements" -- handing over long-term access to land without transfer of ownership -- came after the Nebraska Public Service Commission decision, which approved an alternate route, he said. In November, the NPSC upheld its decision to allow TransCanada to build the 830,000 b/d Keystone XL pipeline system on an alternate route. The Nebraska regulators approved the 'mainline alternative,' which heads east sooner towards the existing Keystone pipeline and parallels it for 96 miles. A final investment decision is widely due for the Keystone XL system that will ship crude from Hardisty, Alberta, to Steele City, Nebraska, and link up with the Keystone pipeline that runs through Cushing, Oklahoma, to the USGC.

            Wisconsin DNR gives OK for Jackson County frac facility - State environmental officials have given a Colorado logistics company the green light to build a Jackson County frac sand rail terminal that neighbors have sued to block.The Wisconsin Department of Natural Resources issued a permit Monday allowing OmniTRAX Logistics Services to fill just over 4 acres of wetlands in order to install nearly 10 miles of track in a loop along the banks of Halls Creek, a Class II trout stream that feeds into the Black River.OmniTRAX says it will use the terminal to fill more than 80 rail cars per day with sand from a nearby mine. Sand will be processed near the mine and brought to the rail terminal by a nearly 2-mile-long conveyor that will pass under two public roads. The company says it intends to ship about 3 million tons of sand each year to Montana and Texas, where it will be used to extract oil in a process known as hydraulic fracturing. According to the permit, the wetlands are “generally high quality with few invasive species and historic human influence” and are “exceptional” wildlife habitat. The project will have a high impact on the wetland’s functional value and will result in habitat fragmentation, although the overall environmental impact will be “neutral” considering the company’s plans for mitigation and tunnels to allow wildlife to cross under the rails.

            Explosion at Wisconsin oil refinery injures at least 11, forces evacuation -  Authorities said a fire at a northwestern Wisconsin refinery where an explosion injured at least 11 people was out and people were being allowed back in their homes Thursday night after most of the city of Superior was forced to evacuate. Douglas County officials posted an update saying the fire was extinguished but asking residents in the evacuation area to stay away from their homes for at least another two hours. The fire had poured thick clouds of noxious black smoke into the air after the explosion rocked the refinery. Schools and a hospital also were evacuated. Authorities said a tank of crude oil or asphalt exploded about 10 a.m. at the Husky Energy oil refinery in Superior, a city of about 27,000 that shares a Lake Superior shipping port with nearby Duluth, Minnesota. That prompted them to order the evacuation of a three-mile (five-kilometer) radius around the refinery, as well as a 10-mile (16 kilometer) corridor south of it where the smoke was heading. It was unclear how many people were being evacuated, but Mayor Jim Paine said most of the city was being evacuated. The refinery is in an industrial area, but there's a residential neighborhood within a mile to the northeast. The corridor downwind to the south of the refinery is sparsely populated. Schools in Superior and nearby Maple, Wisconsin, canceled classes Friday as a precaution. Hospital officials said only one of the injured was seriously hurt, with what was described as a blast injury. No deaths were reported, and officials said all workers had been accounted for. Thick, black smoke poured from the refinery hours after the explosion. Refinery manager Kollin Schade said the smoke was from burning asphalt that was so hot that firefighters were unable to attack the fire to try to put it out. Emergency officials later said another tank had caught fire, too, though they didn't specify what was in it. 

            Wisconsin Oil Refinery Explosion Injures at Least 15 People -- A powerful explosion at Husky Energy 's oil refinery in Superior, Wisconsin sparked a massive fire and injured multiple people on Thursday.The blast sent thick, dark smoke across the city and prompted the evacuation of thousands of residents 10 miles downwind of the refinery, 2 miles to the north, and 3 miles east and west. All Superior schools closed Friday due to the fire.Roughly 15 people were injured, Reuters reported.Husky Energy, a Canadian company based in Alberta, said all the refinery's workers have been accounted for and no fatalities have been reported. Several people have been hospitalized and are reported to be in stable condition, the company said. MPR reported that the refinery gets heavy crude from Alberta's tar sands and lighter crude from North Dakota's Bakken region. It processes around 50,000 barrels per day and has a storage capacity of 3.6 million barrels. It produces asphalt, gasoline, diesel and heavy fuel oils. According to the Associated Press , a tank of crude oil or asphalt exploded about 10 a.m. Thursday at the refinery. The fire was put out about 11:20 a.m., but it reignited. Firefighters successfully extinguished the fires around 6:45 p.m., after burning for about eight hours.

            US judge gives conditional approval for Enbridge crude oil pipeline expansion - Enbridge's plans to proceed with its Line 3 replacement project delivering an additional 380,000 b/d of Canadian crude to refineries in the US Midwest, was boosted Monday when an administrative law judge in Minnesota gave a conditional approval for the planned expansion. Judge Ann O'Reilly has recommended to the Minnesota Public Utilities Commission that an approval be granted for the project as long as the pipeline expansion is carried out along the current corridor rather than an alternate route for which Enbridge is seeking regulatory approval. Adhering to the existing pipeline route would isolate the risk of a spill in an environmentally sensitive part of the state and also prevent the abandonment of nearly 300 miles of steel pipeline, the judge said. "We will be taking time to review in more detail the recommendation that we use the existing right-of-way, and will have additional comments to follow," Enbridge said, adding Monday's recommendation on the Line 3 replacement project is an important step in the regulatory process. Line 3 currently ships 390,000 b/d of Western Canadian crude from Hardisty, Alberta to Superior, Wisconsin, with the pipeline passing through Minnesota. Enbridge is planning to replace the existing pipeline that was built in the 1960s with 1,031 miles of new pipeline and related facilities on either side of the Canada-US international border, besides nearly doubling its total capacity to 760,000 b/d. The Minnesota Public Utilities Commission is due to issue a final judgment in June, according to information on its website. Enbridge has already received Canadian government approval for the project in 2016 and is now targeting to complete the facility in 2019, the company said in its last earnings call in February, noting work is already underway on the Canadian side to replace the pipeline.

            Environmental Groups Oppose Enbridge Ruling - Environmental and tribal groups are criticizing an administrative law judge's recommendation that Minnesota regulators should approve Enbridge Energy's proposal for replacing its aging Line 3 crude oil pipeline if it follows the existing route rather than the company's preferred route.They oppose Enbridge building the project, regardless of what route it takes.The director of the Sierra Club's Minnesota chapter, Margaret Levin, says the Public Utilities Commission should listen to thousands of Minnesota residents who have marched, submitted comments and testified against Line 3, and reject it once and for all.Tara Houska, national campaigns director of Honor the Earth, says tribes have made it "crystal clear" that a new line is not acceptable.Greenpeace USA campaigner Rachel Rye Butler says tar sands pipelines carry too much environmental and economic risk. Administrative Law Judge Ann O'Reilly recommended Monday that the Public Utilities Commission choose the existing route, which avoids sensitive areas in the Mississippi River headwaters region where American Indians harvest wild rice and hold treaty rights. The proposal has drawn opposition because the line would carry Canadian tar sands crude.The commission is expected to make its final decision in June. Line 3 was built in the 1960s. Alberta-based Enbridge says a replacement is needed to ensure reliable deliveries of crude to Midwestern refineries. It has said proposed route alternatives are unworkable.

             Leech Lake Band criticizes judge's recommendations on Enbridge's proposed pipeline - The Leech Lake Band of Ojibwe on Tuesday slammed a judge's recommendation that Enbridge's proposed new Line 3 oil pipeline should follow the current Line 3's route, which crosses the band's reservation. Administrative Law Judge Ann O'Reilly issued a report Monday saying that Enbridge should be allowed to build the controversial new Line 3, but not on the company's proposed new route. Rather, O'Reilly recommended that the new Line 3 be built along the same corridor that hosts six Enbridge pipelines running across northern Minnesota. She also recommended that Enbridge remove the aging and corroding old Line 3 and essentially drop a new pipeline in its place. The Leech Lake band has been adamantly against a new Line 3 on its land. "The judge has made this horrific recommendation without even holding a single hearing on the Leech Lake Reservation and gave a recommendation on a route that has not had the same environmental review [as Enbridge's preferred route]," the band said in a statement. O'Reilly's recommendation, the band added, "further drives the message that it is OK to put pipelines on reservations and that risk is acceptable." The Public Utilities Commission (PUC) is scheduled in late June to decide the fate of the $2.6 billion new Line 3 project, as well as its route. However, pipeline right-of-way issues on Indian reservations are governed by federal law, so it's unlikely the PUC could force an on-reservation solution. Calgary, Alberta-based Enbridge has declined to comment on O'Reilly's routing recommendation, but it's likely not happy, either. First, the company has rejected the notion of extracting the old Line 3, an expensive proposition. And second, Enbridge chose its new route partly because it doesn't cross any Indian reservations. 

            Minn. court sides with climate change activists in pipeline case - The Minnesota Court of Appeals ruled on the side of climate change activists Monday in a case over an oil pipeline protest. The four activists — one from New York and three from Washington — admit they broke into Enbridge Energy property in northwestern Minnesota in an effort to stop oil from flowing through a pipeline. The activists' case is headed to trial in Clearwater County later this year. They've asked the court if they can use what's known as a "necessity defense" to argue they needed to shut off the flow of oil in order to address climate change. The judge on their case granted the request. But state prosecutors challenged the decision and the Minnesota Court of Appeals heard oral arguments in Feburary. The Minnesota Chamber of Commerce, which represents business interests in the state, filed a friend-of-the-court brief supporting the prosecutors' argument. But the state appeals court dismissed the challenge in their ruling Monday, making way for the activists to call experts on global warming to testify during their trial. The activists argue they have exhausted other methods to get their elected officials to adequately address the problem. "We are left with no other recourse at this point," Annette Klapstein, one of the activists charged, said in an interview Monday after she heard about the ruling. "I hope it does mean more civil disobedience, because that's the only thing we have left as ordinary citizens when our political system will not respond to a crisis that is actually threatening the very existence of our grandchildren," she said. 

            Activists May Argue Pipeline Shutdown Was Necessary Due to Climate Change, Court Rules - The Minnesota Court of Appeals ruled Monday that four climate activists facing criminal charges may use an unusual "necessity defense" over their efforts to shut down a pair of tar sands pipelines owned by Enbridge Energy . "Valve turners" Emily Johnston and Annette Klapstein were charged after shutting off the emergency valves on the two pipelines in October 2016. Johnston and Klapstein, and the two defendants who filmed them, argue their actions to stop the flow of the polluting bitumen were justified due to the threat of climate change.  The action was part of Climate Direct Action 's plan to shut down five pipelines across the U.S. that deliver tar sands oil from Alberta, Canada. The pipelines targeted were Enbridge line 4 and 67 in Leonard, Minnesota; TransCanada's Keystone pipeline in Walhalla, North Dakota; Spectra Energy's Express pipeline at Coal Banks Landing, Montana; and Kinder Morgan's Trans-Mountain pipeline in Anacortes, Washington. The case now heads to trial in Clearwater County later this year. This court's decision allows the defense to call on climate scientists and other experts to explain the threat of climate change during the trial. "The Minnesota Court of Appeals has upheld our right to present the facts on the ongoing climate catastrophe, caused largely by the fossil fuel industry, to a Minnesota jury," Klapstein told the Associated Press in a statement. "As a retired attorney, I am encouraged to see that courts across the country seem increasingly willing to allow the necessity defense in climate cases."  The activists face felony charges of criminal damage to property and other counts.

             Russia’s ‘keep it in the ground’ ploy to stifle American oil | TheHill: Just 1 percent — that’s the share of all-electric vehicles to total new U.S. car sales today. You don’t have to be an auto retailer to know that electric vehicles are not pushing gasoline-powered cars and light trucks off the showroom floor. Virtually all of the 17 million vehicles sold in the U.S. last year were gas burners.More to the point, even allowing for a hypothetical spike in EV sales, the global gasoline demand for light vehicles is expected to roughly triple by the mid-2030s. Meanwhile, levying special taxes on electic vehicles — or switching from motor fuel taxes to a tax per mile driven — will be required so that EV owners help pay for building and maintaining roads and bridges.    But a threat is hanging over oil. What is most ominous is the spread of the destructive idea that, because of climate change, all fossil fuels, including oil, must be kept in the ground. Russia bears some of the blame for that underhanded campaign, using social media to twist American public opinion against oil production to achieve its own devious goal: push up world oil prices. With Russia’s help, the keep-it-in-the-ground movement threatens to impede the production of oil offshore and stifle hydraulic fracturing in shale formations. At the same time, Russia is spearheading opposition to the construction of new oil and natural gas pipelines. Because of the Depression-era Jones Act, which requires shipments between U.S. ports to be carried on American-flagged and -crewed vessels, additional pipeline capacity is essential for delivering heating oil to markets in the Northeast where it’s needed the most.If the keep-it-in-the-ground crowd is successful, domestic oil supplies will drop and prices will rise, harming oil-using industries and consumers. Every $10 per barrel hike in crude prices is like a $70 billion tax increase on Americans. The recent spurt in gasoline prices was a taste of what will happen if the keep-it-in-the-ground movement takes hold..     Given that Russia’s involvement in U.S. domestic affairs is likely to be a major political issue over the next few years, groups engaged in the keep-it-in-the-ground movement ought to rethink the economic and geopolitical consequences of their actions.

            Fracking in Colorado: Lawsuit Targets Federal Shell Game Hiding Harm to Communities and Wildlife - Conservation groups on Thursday sued Interior Secretary Ryan Zinke and the Bureau of Land Management for approving new leases to allow fracking on more than 45,000 acres in western Colorado, including within communities and within a half-mile of a K-12 public school , without analyzing or disclosing environmental and public health threats as required by federal law."Fracking is a filthy, dangerous business, and dodging environmental analysis puts people and public lands at risk," said Diana Dascalu-Joffe, a senior attorney at the Center for Biological Diversity. "The Trumpadministration is trying to ignore science , public health and climate change threats to enrich corporate polluters, but it can't shrug off the law."The lawsuit, filed in U.S. District Court in Denver, challenges leases in and around the towns of De Beque, Molina and Mesa on the western slope of the Rocky Mountains. Fracking would be allowed near three state parks—James M. Robb-Colorado River, Vega and Highline, a migratory bird hot spot and the site of the "18 Hours of Fruita" mountain bike race. Leases also have been offered within a half-mile of a K-12 public school in De Beque and beneath Vega Reservoir, important for wildlife , recreation, irrigation and hydroelectric power."Not only did the Bureau of Land Management move forward with these lease sales without looking at the climate effects of fracking, the agency also failed to examine its likely public health risks," said Kyle Tisdel with the Western Environmental Law Center . "In addition, the agency failed to analyze or acknowledge the enormous water depletion drilling will impose on the Colorado River, already in low-flow conditions. BLM is simply drilling in the dark on these lease sales."

            US delays oil, gas sales in Montana after climate ruling (AP) — U.S. officials delayed lease sales on federal oil and gas reserves beneath more than 160 square miles (414 square kilometers) of public and private lands in eastern Montana in response to a recent court ruling on climate change, a U.S. Bureau of Land Management spokesman said Wednesday. The 223 lease parcels had been slated for sale on June 12, but instead will undergo additional environmental analysis, Jon Raby said, the bureau's acting state director for Montana, in a letter announcing the delay. Agency officials could not provide a timeline for the new analysis or say when the parcels would be available for sale. U.S. District Judge Brian Morris in March ruled that government officials failed to fully consider the climate impacts of burning coal, oil and gas extracted from the Powder River Basin of Montana and Wyoming. The basin has the largest coal reserves in the U.S. and lesser quantities of oil and gas. Morris said any new or pending lease sales in the area must be subjected to a detailed environmental review. That ruling came in a lawsuit from environmental groups including the Western Organization of Resource Councils and Sierra Club. The groups argued that when federal officials drew up land management plans for the Powder River Basin they failed to acknowledge the large volumes of greenhouse gases that would be generated from burning the region's fossil fuels. "One thing the court was clear about is the BLM cannot continue to ignore the real and significant impacts of fossil fuel development in the Powder River Basin," 

            Trump just took the first step of an aggressive effort to drill in the Arctic - The Trump administration took the first step Thursday toward an aggressive effort to drill for oil in the Arctic National Wildlife Refuge, one of the country’s most pristine and environmentally sensitive areas. The Bureau of Land Management, a division of the Interior Department, issued a notice of intent to begin an environmental impact analysis of how oil exploration and the heavy infrastructure required to support it would alter a landscape where plants and animals thrive. The BLM said an official notice of the analysis, known as scoping, will be published Friday in the Federal Register, kicking off a 60-day comment period set to end in mid-June. In addition to allowing comments to be submitted online, five locations have been selected to engage Alaskans directly in Anchorage, Arctic Village, Fairbanks, Kaktovik and Utqiagvik. The administration wants to issue leases to the oil and gas industry as soon as next year. It is the first time an administration has initiated an oil and gas leasing program in the refuge since 1980, when Congress identified the region’s Coastal Plain section as an important area for energy resources.  “Developing our resources on the Coastal Plain is an important facet for meeting our nation’s energy demands and achieving energy dominance,” said Joe Balash, assistant secretary for Land and Minerals Management at Interior, echoing part of President Trump’s campaign message. “This scoping process begins the first step in developing a responsible path forward. I look forward to personally visiting the communities most affected by this process and hearing their concerns.”

            The New Alaskan Oil Rush - ConocoPhillips is coming off of an incredible exploration season, reportedly the best they’ve had in over a decade, and they have Alaskan oil to thank for it. The company stuck big in the National Petroleum Reserve-Alaska (NPR-A) this winter, successfully finding oil at all six of their test wells (three exploration and three appraisal), which means chances are good that the trans-Alaska pipeline system could soon be seeing a lot more (much-needed) action.  The Houston-based supermajor has estimated that there are at least 300 million barrels of recoverable oil in its  "Willow Discovery" along Alaska's Western North Slope, and these appraisal wells seem to strongly support that projection. More importantly, this discovery could represent just a fraction of the available reserves along the North Slope, and ConocoPhillips plans to keep exploring the area over another busy exploration season next year, starting with a recent $400 million deal to buy all of Anadarko Petroleum Corp.’s North Slope assets.Over the next five years, it is projected that ConocoPhillips will be adding 100,000 barrels a day to the trans-Alaska pipeline for a total 650,000 barrels a day, an 18 percent increase. This is great news after years of dwindling volumes--to put today’s 550,000 barrels per day in perspective, when the pipeline peaked in 1988 it was funneling  2.1 million barrels of oil per day through Alaska, an economy that relies heavily on oil revenues but has been seeing volatile returns in the past years. ConocoPhillips’ “Willow Discovery” is also a glimmer of hope for Alaska’s long-suffering North Slope. Once the powerhouse of the country, many of its once-abundant fields have been sucked dry. Onetime major fields like Prudhoe Bay, the Kuparuk River and the Alpine are now nearly tapped. Now companies like ConocoPhillips are breathing new life into the region, picking up speed since several major oil fields were discovered there over the past few years. Now, the Trump administration is pushing ahead with legislation that will allow drilling in the vast Arctic National Wildlife Refuge, with a 60-day review to sell oil and gas leases in the pristine 19.6-million acre region. A divisive issue to say the least, the fate of the region has been bounced back and forth between political platforms since the Clinton administration, and critics point out the delicacy of the region and the threat drilling would pose to its population of migratory birds and the caribou on which the indigenous Gwich’in people depend.

             ConocoPhillips claims North American record for horizontal drilling - ConocoPhillips Alaska has announced a North American drilling landmark as North Slope producers push efforts to tap oil as efficiently as possible after years of low oil prices. The company set the continent's land-based record with a four-mile "horizontal lateral," an extension branching off a vertical well, the ConocoPhillips said in a statement. The record, at 21,478 feet, beat a 19,500-foot horizontal lateral in Ohio announced in 2017 by Eclipse Resources, said Amy Burnett, a spokeswoman with the company.The record came at a well at the company's CD5 field, the first commercially producing field within the National Petroleum Reserve-Alaska.Oil companies today are able to drill "extraordinary kickout lengths," opening huge areas of a reservoir with a small footprint, said Mark Wiggin, deputy commissioner for the Alaska Department of Natural Resources.That saves money on the tons of gravel needed for well-pad foundations and roads, and reduces environmental impact, said Wiggin, a former engineer with Arco Alaska, a ConocoPhillips Alaska predecessor. Advances in drilling systems helped boost the distances, said Chip Alvord, Alaska drilling manager for ConocoPhillips.

            Russia Bets Big On Arctic Oil - Gazprom Neft, Russia’s fourth largest oil producer, has big plans for its Arctic oil operations, and it seems that neither sanctions nor production cuts can force it to quit its presence there. In fact, the oil division of Gazprom will try to turn itself into what its head of strategy and innovations called “a benchmark,” but not in terms of production. Gazprom Neft wants to become a benchmark in areas such as safety and efficiency, and most notably technology.Arctic drilling was one of the top targets of U.S. sanctions that banned U.S. oil companies—and their European peers—from sharing technological know-how with Russian producers. This may have slowed down the progress of Gazprom Neft and others in the Arctic, but it did not put an end to it. Not that it could: Russia’s energy industry has been working on Arctic exploration for much longer than the four years since the annexation of Crimea, which became the grounds for the sanctions.Gazprom Neft launched its first Arctic field, Prirazlomnoye, at the end of 2013, and first oil, and the new blend, ARCO, from Arctic Oil, reached markets the following year. Since then, more than 10 million barrels have been shipped from the field. Recoverable reserves at Prirazlomnoye are estimated at 540 million barrels of crude, and the peak of production is set to be reached in 2020, at 110,000 barrels per day. The Arctic as a whole is top priority for Gazprom Neft: in 2016, two new projects got the go-ahead there. Messoyakha, which is the northernmost onshore oil field in Russia to date, is estimated to hold 470 million tons of oil and condensate. Novoportovskoye, or Novy Port, field holds an estimated 250 million tons of oil and condensate.

            First Nations court challenges continue to hang over $7.4-billion Trans Mountain pipeline expansion- First Nations court challenges that allege inadequate consultation and seek to overturn federal and B.C. approval of the $7.4-billion Trans Mountain oil pipeline expansion have been overshadowed by recent debate on federal and provincial powers to regulate oil transport. But legal experts say the First Nations cases have real implications that should not be overlooked or forgotten. When the Federal Court of Appeal in 2016 overturned approval of Enbridge’s $7.9-billion Northern Gateway oil pipeline, finding Ottawa had failed to properly consult First Nations, it all but signalled the end for the project. “A lot of the focus in the last week and a half has come to be about the federal/provincial issue and that’s obviously a major issue. But the Indigenous rights issue is a major legal issue as well,” said University of Saskatchewan law professor Dwight Newman. University of B.C. law professor Margot Young said the Indigenous rights’ question — and the ruling from the courts — is a critical question that has yet to be answered. There is little chance that question is going to be resolved by a Kinder Morgan-imposed May 31 deadline for the federal government to assure them the project will go ahead. “Unlike this battle over jurisdiction … Indigenous rights stop both levels of government,” said Young. Jack Woodward, a B.C. lawyer who is the author of Native Law, said the constitutionally protected rights and title of First Nations is a completely separate hurdle for the project to overcome. “These cases are potential show stoppers,” he said.

            Justin Trudeau is under scrutiny over allegations that the Kinder Morgan pipeline approval was ‘rigged' - An investigation by the Canadian media outlet National Observer found that a high-ranking federal official directed staff across five different departments to “give cabinet a legally-sound basis to say ‘yes’” to the Trans Mountain pipeline expansion.Blowback was swift. On Wednesday, Trudeau faced blunt criticism in the House of Commons. “The whole fiasco of an approval process is looking more rigged than a Russian election,” said Nathan Cullen, member of Parliament from British Columbia — where opposition in the courts and in demonstrations have led to Kinder Morgan halting all non-essential spending on the flailing project.Canada’s constitution stipulates that the government consult with First Nations on projects like Trans Mountain that would impact their land and water. If the allegations are true, the government may have merely paid lip service.Trudeau is keeping his game face on, denying allegations of any wrongdoing in the pipeline process. “We actually added additional steps to make the process more rigorous,” he said in response.New Democratic Party leaders Jagmeet Singh and Guy Caron issued a letter to Trudeau on Wednesday calling for the prime minister to release all documents connected to its review of the pipeline expansion. “These revelations throw into question the legitimacy of the government’s entire review,” Singh and Caron assert. In an apparent attempt to make peace, Federal Environment Minister Catherine McKenna today proposed a joint scientific expert advisory panel and partnership with the B.C. government and indigenous peoples to address the risk of pipeline spills.

            Alberta moves toward limiting energy to British Columbia -- The government of Alberta is moving toward restriction of energy movement to British Columbia in an escalating interprovincial conflict over expansion of the Trans Mountain pipeline system. The expansion would nearly triple the system’s capacity to carry oil to Burnaby, BC, to 890,000 b/d and relieve a transport bottleneck costly to Alberta. Although the expansion has approval of the federal government, BC Premier John Horgan, the New Democrat leader governing in coalition with the Green Party, has pledged to block it. Alberta Premier Rachel Notley, also a New Democrat, has intensified her opposition to Horgan’s position and appealed to the federal government to intervene.“The powers in this legislation are not powers that Alberta wants to use, but we will do so if it means long-term benefit for the industry, for Alberta, and for Canada,” said Alberta Energy Minister Marg McCuaig-Boyd, according to press reports.

            The growing and possibly enduring role of LNG imports in Mexico's gas market - Imported liquefied natural gas from the U.S. is helping Mexico address major challenges facing its gas sector. For one, LNG shipments from the Sabine Pass export terminal in Louisiana to Mexico’s three LNG import facilities have been filling a gas-supply gap created by delays in the country’s build-out of new pipelines to receive gas from the Permian, the Eagle Ford and other U.S. sources. Imported LNG also is playing — and will continue to play — a key role in balancing daily gas needs within Mexico, which has virtually no gas storage capacity but is planning to develop some. Today, we consider recent developments in gas pipeline capacity, gas supply, LNG imports and gas storage south of the border.   For a few years now, we have been writing regularly about Mexico’s efforts to shift from oil-fired power generation to natural gas (and renewables), as well as the country’s development of vast networks of gas pipelines to help deliver U.S.-sourced gas from Texas and other U.S. border states to new gas-fired combined-cycle plants and industrial and other users in northern, central and even southern Mexico. In our With a Little Help from My Friends Drill Down Report, we explained that Mexico has been opening up its energy markets to competition and — with its own production on the decline — has been becoming increasingly dependent on imports of natural gas, liquefied petroleum gasses (LPG) and refined products from the U.S. Most important to our discussion today is that Mexico’s state-owned Comisión Federal de Electricidad (CFE) has been investing heavily in expanding and modernizing its power generation fleet with thousands of megawatts of new, natural gas-fired power plants, and the country has been developing new, high-capacity pipelines to supply growing gas-fired generation demand (see our It Takes Two blog series). As Figure 1 shows, the power-plant/pipeline build-out resulted in a sharp rise in U.S. gas exports to Mexico via pipeline (blue shaded area) in 2015, when pipeline gas exports increased 44%, and 2016, when they rose 23%, according to the U.S. Energy Information Administration.

            UK needs 6,000 shale gas wells to fill 50% of imports, study says - More than 6,000 shale gas wells would be needed to replace half the UK’s gas imports over a 15-year period, according to a new report.The nascent UK fracking industry has argued that growing reliance on gas from Norway and Qatar necessitates developing home-produced supplies in addition to North Sea output.Recent arrivals of Russian gas by ship have prompted shale advocates to repeat the argument.However, analysis for Friends of the Earth by the Cardiff Business School found that at least one well would need to be drilled and fracked daily between 2021 and 2035 to replace 50% of gas imports.Rose Dickinson, at Friends of the Earth, said: “This would mean an industrialisation of our countryside at a rate that nobody has yet fully appreciated and would put many more communities in the firing line of this dirty and unwanted industry.”Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDeskThe FoE research found 6,100 wells on 1,000 well pads would take up around 3,560 hectares of land (around 13 square miles), based on analysis of government figures, National Grid forecasts and other data.But no one expects there to be that many wells. The most bullish estimate came in a 2013 report by the Institute of Directors, forecasting 4,000 wells by 2032. The government admits its most recent estimate of 155 wells by 2025, produced last year, is already out of date.

             Report warns countryside could be 'littered' with fracking wells -- The countryside would have to be “littered” with fracking wells before the technology could significantly reduce Britain’s reliance on gas imports, a new report warns today. Research for Friends of the Earth suggests that one well would have to be drilled and fracked every day for 15 years to produce enough gas to replace just half of future imports. Drilling on such a scale would have “potentially terrible consequences” for the rural landscape, the report warns. Seven gas firms have licences to explore whether fracking is feasible across vast swathes of Yorkshire, with the Prime Minister saying in February that the process of extracting shale gas from rocks deep underground could reduce the nation’s reliance on imported energy. But last month the Government refused to publish a confidential Cabinet Office report on the subject, arguing that doing so “could call into question the industry’s viability”. Today’s research, conducted by Prof Calvin Jones of Cardiff Business School, finds that at least 6,100 wells would be required to replace just half of the UK’s estimated gas imports. If the new wells produced gas at the lower end of expectations, the figure could rise to 16,500, Prof Jones said. Rose Dickinson, of Friends of the Earth, said a widespread roll-out of fracking would mean “an industrialisation of our countryside at a rate that nobody has yet fully appreciated”. Ms Dickinson said: “One well would have to be drilled and fracked every day for 15 years to replace just half of our gas imports. “This would and would put many more communities in the firing line of this dirty and unwanted industry.

            Fracking can cause social stress in nearby areas according to research - The question of opening the Northern Territory and South Australia to fracking has re-ignited concerns about environmental and health impacts. Receiving less attention are the social and economic changes affecting nearby rural communities from this natural gas development and the social stress that can result. From 2012, I led a team analysing trends in key social and economic indicators over the past 15 years in Queensland's largely agricultural Darling Downs, where over A$20 billion has been invested in coal seam gas (CSG) development since 2011. We also interviewed and talked with over 200 residents and business owners. Social stress emerged as the most visible health impact of this coal seam gas development.  Staff in both government and the gas industry agree that stress is an important impact. Our findings are reinforced by studies in the Darling Downs by numerous researchers and research students as well as extensive work in North America on resource boomtowns.  Residents in community meetings expressed concern about potential effects of coal seam gas development on the amount and quality of groundwater and about possible health impacts.  Their concerns were compounded by low levels of trust in the oil and gas industry and a mix of distrust and trust in the government regulator's ability to manage the industry. This lack of confidence can contribute to psycho-social stress.

            Trump's revenge: US oil floods Europe, hurting OPEC and Russia -- As OPEC’s efforts to balance the oil market bear fruit, U.S. producers are reaping the benefits – and flooding Europe with a record amount of crude. Russia paired with the Organization of the Petroleum Exporting Countries last year in cutting oil output jointly by 1.8 million barrels per day (bpd), a deal they say has largely rebalanced the market and one that has helped elevate benchmark Brent prices LCOc1 close to four-year highs. Now, the relatively high prices brought about by that pact, coupled with surging U.S. output, are making it harder to sell Russian, Nigerian and other oil grades in Europe, traders said. “U.S. oil is on offer everywhere,” said a trader with a Mediterranean refiner, who regularly buys Russian and Caspian Sea crude and has recently started purchasing U.S. oil. “It puts local grades under a lot of pressure.” U.S. oil output is expected to hit 10.7 million bpd this year, rivaling that of top producers Russia and Saudi Arabia. In April, U.S. supplies to Europe are set to reach an all-time high of roughly 550,000 bpd (around 2.2 million tonnes), according to the Thomson Reuters Eikon trade flows monitor. In January-April, U.S. supplies jumped four-fold year-on-year to 6.8 million tonnes, or 68 large Aframax tankers, according to the same data. Trade sources said U.S. flows to Europe would keep rising, with U.S. barrels increasingly finding homes in foreign refineries, often at the expense of oil from OPEC or Russia. In 2017, Europe took roughly 7 percent of U.S. crude exports, Reuters data showed, but the proportion has already risen to roughly 12 percent this year. Top destinations include Britain, Italy and the Netherlands, with traders pointing to large imports by BP, Exxon Mobil and Valero.

            Gazprom pumping gas to Europe like it’s already winter -- After the coldest winter since 2012, storage sites from Austria to the Netherlands are depleted and levels on the continent are at their lowest in at least a decade. That has Russia’s Gazprom PJSC smelling an opportunity. The Moscow-based company is shipping as much as 580 MMcmd — volumes comparable with winter supplies when heating demand soars, its Deputy CEO Alexander Medvedev said in an interview in Berlin. Increased gas-fired generation and economic growth in Europe also support a strong appetite for Russian gas, he said. “Minimal historical gas storage levels will mean that summer demand will match winter demand of the not so distant past, given the need to refill the stores,” Medvedev said. “In addition, our gas remains the most cost-competitive.”

             Falcon expects serious drilling in 12 months as Australia fracking ban lifted -- Falcon Oil & Gas expects serious drilling activity to begin in 12 months' time at its major prospect, where a government ban on fracking has been lifted, enabling the project to proceed. The prospect, in Australia's Northern Territory, had been put into abeyance after the moratorium was established. The ban was lifted last week, but Falcon boss Philip O'Quigley said a new permitting process put in place will take three to six months to complete. In addition, monsoon-like weather will also delay the process, pushing a planned five-well programme back into 2019. The programme will be carried out in conjunction with Falcon's partner in the project, Australian business Origin. Well tests carried out prior to the moratorium indicated what Falcon called "a very promising material gas resource". The company is now free to seek to exploit the gas on a commercial basis. Northern Territory Chief Minister Michael Gunner, who lifted the fracking ban, admitted he could face a backlash from voters. Fracking is controversial because opponents say there is a risk of groundwater contamination. It works by drilling into the ground and shooting rocks with a high-pressure mixture of water, sand and chemicals to release the resources inside. A report commissioned by the Australian authorities found that "the challenges and risks associated with any onshore shale gas industry in the NT (Northern Territory) are manageable". "The panel is of the opinion that with enactment of robust and rigorously enforced safeguards, the waters shall continue to flow "clear and cold out of the hills'."

            South Korea's Most Damaging Earthquake Linked to Geothermal Fracking -- One of South Korea's largest earthquakes was likely triggered by hydraulic fracturing associated withgeothermal energy production, according to two studies published Thursday in the journal Science.   The 5.5-magnitude temblor that struck the city of Pohang on Nov. 15, 2017 was the second most powerful on record and its most damaging, leaving the infrastructure in ruins, injuring dozens of people and leaving about 1,500 homeless. Hydraulic fracturing, aka fracking, works by injecting high-pressure fluid underground to fracture rock in order to achieve increased rates of flow. Fracking is often associated with unlocking oil and natural gas deposits,but in this case , the intention was to enable circulation to produce geothermal energy. Using geological and geophysical data, South Korean researchers from one of the studies suggested that the Pohang earthquake was induced by fluid from an enhanced geothermal system site that was injected directly into a near-critically-stressed subsurface fault zone.  Kwanghee Kim, a seismologist at Pusan National University and lead author of the study, explained that the well's high-pressure water lubricated an unknown fault in the rock, causing it to slip and trigger the quake. In the second study , researchers from the University of Glasgow, ETH-Zurich in Switzerland, and GFZ-Potsdam in Germany found that the mainshock and its largest aftershocks occurred within 2 kilometers or less of the geothermal site, where many thousands of cubic meters of water were injected under pressure into boreholes.

            Arrested Chevron workers could face treason charge in Venezuela (Reuters) - Two Chevron Corp. employees detained in Venezuela last week could be charged with treason for refusing to sign a parts contract for a joint venture with state-owned oil company PDVSA, according to two sources familiar with draft charges against the U.S. firm’s executives. The arrests, by national intelligence agents, marked the first at a Western oil firm in Venezuela and represent a dramatic escalation of growing tensions between PDVSA and foreign companies over control of supply contracts, the sources told Reuters. The widening dispute could worsen operational chaos that has caused the OPEC nation’s oil output to plunge by 23 percent, or 450,000 barrels per day, since October. “These detentions are going to accelerate the operational crisis,” another source with knowledge of Chevron’s operations told Reuters. “Procurement could end up in paralysis if nobody wants to take the risk of signing or authorizing anything.” The draft treason charges - seen by Chevron lawyers last week, the two sources said - raised concern that the oil major could get caught in the crossfire between Washington and Venezuelan President Nicolas Maduro, who accuses the U.S. government of sabotaging the economy to topple his administration. The United States has imposed sanctions on senior members of Maduro’s government and PDVSA. The two Chevron employees were jailed when they refused to sign a supply contract written by PDVSA executives under an emergency decree - which skips the competitive bidding process, according to a half dozen sources close to the case. Such decrees have been cited by Venezuela prosecutors as a means of extracting bribes in some recent PDVSA corruption cases. The Chevron employees balked when the parts were listed at more than double their market price in a contract worth several million dollars, one of the sources told Reuters.

            Chevron evacuates Venezuela executives following staff arrests (Reuters) - U.S. oil major Chevron Corp has evacuated executives from Venezuela after two of its workers were imprisoned over a contract dispute with state-owned oil company PDVSA, according to four sources familiar with the matter.  Chevron asked other employees to avoid the facilities of its joint venture with the OPEC nation’s oil firm, the sources said. The arrests, in a raid by national intelligence officers, were the first at a foreign oil firm since Venezuela’s government launched a purge last fall that has resulted in detentions of more than 80 executives at PDVSA and business partners accused of corruption. The Chevron workers may face charges of treason for refusing to sign a supply contract for furnace parts drawn up by PDVSA executives, Reuters reported earlier this week. The workers balked at the high costs of the parts and a lack of competitive bids.  Venezuela’s foreign minister, Jorge Arreaza, linked the Chevron arrests to the government anti-corruption probe for the first time on Wednesday. “The decisions of the prosecutor’s office are based on serious investigations to fight corruption ... These two people involved have the right to defense and due process.”  Chevron spokeswoman Isabel Ordonez responded to the minister’s comments with a written statement that the firm “abides by a code of business ethics, under which we comply with all applicable U.S. and Venezuelan laws.”  Chevron’s move to evacuate its expatriate workforce underscores the how arduous it has become for foreign oil firms and their workers to sustain operations through Venezuela’s accelerating political and economic meltdown. The affected staff numbers about 30 people in the coastal city of Puerto la Cruz.  Chevron’s Ordonez said the company had an executive team overseeing operations in Venezuela but declined to provide details on the leadership there or the number and type of workers the company had withdrawn.  Chevron has no plans to exit the country, according to a person familiar with the thinking of its board of directors. The oil company has not pulled out of other tough environments in the past, the person said - citing the jailing of employees in Indonesia in 2013 - and the firm believes Venezuela will eventually stabilize.

            Halliburton Writes Off Remaining $312 Million Invested in Venezuela — Halliburton, the global oil service company, announced on Monday that it had written off its remaining investment of $312 million in Venezuela, as oil production in the politically polarized and virtually bankrupt country continues to plummet.The move had long been expected because the state-owned oil company, Petróleos de Venezuela, known as Pdvsa, had for years been falling behind on paying its bills from companies that maintain and operate its oil and gas wells.“This is one step further into the collapse of the Venezuelan oil industry,” said Francisco J. Monaldi, a Venezuelan energy expert at Rice University, “because it means oil service contractors, which are absolutely essential to operations, are slowly giving up on the country.’’Daily oil production in Venezuela, the country with the world’s largest reserves, has plummeted by 200,000 barrels since late last year, to its lowest level in 30 years. That drop has helped raise global oil prices in recent weeks to more than $70 a barrel, and has pushed gasoline prices in the United States to their highest level for this time of the year in three years. Pdvsa has been purged of more than 80 executives in recent months, and its operations have been put under the command of a major general in Venezuela’s National Guard with no experience in the oil business. Tensions between the national company and foreign companies that operate in the country have increased as military officers have taken over more oil supervisory positions.

            China Sets Its Sights On First South American Refinery - China could be on the brink entering the refining industry in the Americas if it inks a deal with Brazil’s Petrobras that will see it invest in the Comperj refinery in exchange for local crude oil, two sources close to the negotiations told Reuters. The Comperj refinery needs an injection of around US$3 billion, other sources said, in order to reach its initial processing capacity of 165,000 barrels per day and Petrobras has not made a commitment to fund the facility. China’s CNPC, however, could do that, the sources said, and in exchange receive stakes in some of the fields the Brazilian major operates in the Campos Basin as well as the right to use the Comperj refinery. China has been investing heavily in South America with the energy sector a priority. Brazil in particular has been in the focus of Chinese investment attention but if completed, the current deal between CNPC and Petrobras would be the first in which the Brazilian company offers oil in exchange for investments. The two, however, are already partners in the Libra field, in another prolific basin, Santos. Last year, Chinese investment in Brazil hit the highest since 2010, at US$20.9 billion, with oil and gas, logistics, and agriculture the top three destinations for Chinese money. Construction of the Comperj refinery started a decade ago but has run into problems as it got caught up in the political corruption scandal that cost ex-president Dilma Rousseff her office and saw almost 100 business executives end up with jail sentences. Petrobras, which poured US$13.5 billion into the refinery, had to take write-downs of almost US$2 billion on the project because of overpriced services related to its construction and equipment, Reuters said. Still, Petrobras wants to finish the construction as the country needs more locally produced fuels to reduce its dependence on imports.

            Schlumberger warns of oil supply gaps unless E&P raise capex -- Oil services giant Schlumberger on Friday warned of an increasing likelihood the world will face growing oil supply challenges as cautious upstream producers show capital budget restraint even at current robust oil prices, while the impacts from spending cut during the recent industry downturn accelerate. Notable year-over-year declines in Mexico, Angola, China, Malaysia, and Indonesia, coupled with Venezuela's production "freefall" and potential new sanctions against Iran have left Saudi Arabia, the UAE, and US shale oil as the only major feasible sources of short-term supply growth to remedy global production declines, Schlumberger CEO Paal Kibsgaard said during the company's first quarter earnings conference call. The company, which provides equipment and services to the upstream industry, is typically the first to hold its quarterly call and provides an early glimpse at the rest of the year's likely outlook for the sector. Despite "clear signs of a tightening oil market," no upward revision to 2018 upstream budgets has taken place so far, with North America and the rest of the world still expected to spend just 20% and 5% higher, respectively, over last year's levels, Kibsgaard said. "Based on these investment's increasingly likely industry will face growing supply challenges in the coming years and that a significant increase in global E&P [capex] will be required to minimize an impending production deficit," Kibsgaard said. Unless triggered by a clear crisis or other event, oil companies typically review their capital spending plans at mid-year and announce changes in their second-quarter financial reports. As for the US, where oil production recently surpassed 10 million b/d and is projected to exceed 11 million b/d by year-end, questions have arisen over whether that bullish outlook is achievable given growing midstream infrastructure constraints, well interferences from more infill drilling, and lower per-well outputs as the most productive acreage wanes and operators are left with less prolific areas, Kibsgaard added. 

            Footing Bill for Environmental Damage from Pertamina Oil Spill - Greenomics Indonesia, a social institution which focuses on environmental economics, had put a number on the amount of losses which resulted from the crude oil spill from a Pertamina pipeline which passes along the bottom of Balikpapan Bay, East Kalimantan, on Saturday three weeks ago.A Director-General of Law Enforcement of the Environment and Forestry Ministry Royas Rasio Ridho Sani is known was angry because Greenomics had come up with the figure prematurely. He was concerned that this would make things more difficult for the Environment Ministry, which was in the process of calculating the damage to the environment which had resulted from the Pertamina oil spill. "If our demands are lower than the figure from Greenomics, there will be an uproar," said Roy in his office at the Environment Ministry in Jakarta. On the other hand, if the figure reached by the Ministry is higher, Roy is concerned that the difference could be exploited to reduce the credibility of their calculation. In their release on Wednesday last week, Greenomics stated that the Pertamina oil spill in the waters of Balikpapan Bay was equivalent to an area 20,000 times larger than Gelora Bung Karno Stadium in Jakarta. The minimum amount of ecological damage was said to be US$8.27 billion, or about Rp110.428 trillion at a US dollar exchange rate of Rp13,700. Their calculation used a benefit transfer approach which referred to the monetary value of several of the main components of the maritime and mangrove ecosystem. "This calculation used an international standard of methodology to quickly provide an initial estimate," said Vanda Mutia Dewi, Executive Director of Greenomics Indonesia. How much will Pertamina have to pay due to this disaster? Pertamina Company Secretary Adiatma Sardjito said that the company is still focusing on cleaning up the oil spill. Pertamina, according to him, has not yet calculated the potential losses resulting from the oil spill and other burdens. "We are still focusing on social and environmental recovery," said Adiatma, on Friday last week.

            Caspian games: Central Asian ‘stans’ vie for connectivity market Asia Times - Pepe Escobar - Azerbaijan held a presidential election this month. Predictably, incumbent leader Ilham Aliyev won his fourth consecutive term with a Kim dynasty-esque 86% of the votes.  International monitors for the Organization for Security and Cooperation in Europe (OSCE) Office for Democratic Institutions and Human Rights (ODIHR) stressed “widespread disregard for mandatory procedures, numerous instances of serious irregularities and lack of transparency”; the Azeri electoral commission replied that such observations were “unfounded”. Then the whole issue simply vanished. Why? Because, from a Western strategic perspective, Azerbaijan’s post-Soviet petro-autocracy is simply untouchable. Much has to do with the Baku-Tblisi-Ceyhan (BTC) pipeline, facilitated by the late Zbigniew “Grand Chessboard” Brzezinski during the first Bill Clinton administration to bypass Iran. The BTC de facto unleashed the energy chapter of the New Great Game that I have called Pipelineistan.Now, Baku is harboring great hopes for its new port at the desert wasteland of Alat (“Your hub in Eurasia!”), simultaneously connected to the West (Turkey and the European Union), the South (Iran and India) and the North (Russia). Alat is also designed as a top logistics/manufacturing/connectivity hub of the New Silk Roads, aka Belt and Road Initiative. Its top strategic location straddles the BRI’s central connectivity corridor; links to the newly opened Baku-Tblisi-Kars railway, connecting the Caucasus with Central Asia; and also links with the International North-South Transport Corridor that connects Russia to India via Iran. Transportation corridors are all the rage. For Azerbaijan, oil and gas may only last up to 2050. So the priority from now on is to engineer the transition toward becoming a logistics hub; actually, the premier Caspian Sea hub.

            Can China Combat Its Natural Gas Crisis? -- Last December, LNG imports into China hit a record high amid natural gas shortages due to the government moving too fast with its shift from coal to gas as well as gas transport infrastructure construction falling behind. But this year things will be different, according to the head of Sinopec’s trading division, Unipec. Last year, China became the world’s second-largest LNG importer, taking in some 38 million tons of the fuel, a 46-percent increase on 2016. Even so, some parts of the country suffered shortages because the gas could not reach them fast enough. As a result, China is now actively working on expanding its LNG storage capacity and pipeline network.Earlier this month Sinopec said it had plans to boost its LNG import capacity to 26 million tons annually over the next six years from the current 9 million tons. China’s total of LNG import capacity is 17 million tons. State energy companies have also begun turning depleted gas fields into gas storage facilities to avoid a repeat of this winter’s supply crunch.Plans are to have all 25 underground gas storage sites before winter, and to increase LNG imports: according to Wood Mac, China’s LNG imports are set for a 25-percent increase this year, to 48-49 million tons. Fresh customs figures for March, meanwhile, revealed a 64.2-percent increase in LNG shipments to 3.25 million tons, Xinhua reported. Over the first quarter of the year, China imported 12.38 million tons of LNG, up 59.1 percent on Q1 2017. Chances are that imports will continue to increase: the available storage capacity is only enough to cover 5 percent of the country’s gas consumption. That’s twice as low as the international average, which stands at 10-12 percent, but Beijing has launched a storage-building strategy that will see the current capacity doubled over the next five to eight years.

            One of the world’s longest gas pipelines from Russia to China almost complete --The construction of the 3,000km Power of Siberia gas pipeline or the eastern route, which is aimed to deliver Russian gas to China, will be completed by the end of the year. The announcement was made by Deputy Chairman of Gazprom Management Committee Vitaly Markelov, who said: “By 2019, we plan to eliminate technical gaps after testing.”The Power of Siberia pipeline is one of the biggest projects between Russia and China. Analysts say it could help Russia become one of China’s main providers of natural gas as demand in the country increases. At 3,000km, the pipeline is one of the longest in the world, longer than the distance between Moscow and London. The deal on the eastern route took more than a decade to negotiate. Last July, Gazprom and the China National Petroleum Corporation (CNPC) inked an agreement to start gas deliveries via the route.

            Sinopec plans to extend cuts in Saudi crude oil imports to June, July: officials (Reuters) - China’s Sinopec, Asia’s largest refiner, plans to continue to cut their Saudi Arabian crude oil purchases for June and July loadings, after slashing May shipments by 40 percent, two senior executives from the company’s trading arm Unipec said on Tuesday. The Unipec executives, who declined to be identified as they are not authorized to speak to the media, said the reductions in May followed state oil company Saudi Aramco’s decision to raise its official selling prices (OSP) for Arab Light crude which made the grade uncompetitive against other crudes. The unexpected price increase prompted some Asian refiners to trim imports and seek substitutes in the spot market. “Arab Light’s economics are not as good as oil from other Middle East producers. So our refineries have reduced their consumption and we will continue to cut,” one of the Unipec executives said. “We have cut imports in May and we plan to reduce (Saudi oil supply) in June and July,” he said, without indicating how much supplies will be cut. “There’s no reason to use the oil if the (Saudi) OSPs are high and economics do not improve.” Saudi Aramco did not respond to an e-mail from Reuters seeking comment on Sinopec’s cuts. Sinopec’s request for a 40 percent cut in their May Saudi crude imports also coincides with scheduled maintenance at its largest refinery. Still, the big supply cut raised eyebrows as Saudi Arabia only sells its oil through long-term contracts where the permitted change in the monthly contract volume is plus or minus 10 percent. This clause, known as operational tolerance, is to allow both parties to adjust volumes based on shipping conditions. 

             China's top refiners plan Q2 maintenance, cast doubts on global oil optimism (Reuters) - Some of China’s top refineries will shut in May and June for maintenance, cutting nationwide throughput by some 10 percent and dampening oil demand in the world’s largest crude importer after record run levels in March, according to a Reuters survey. At least six state-owned and private refiners are planning a full annual maintenance shutdown in the second quarter for 30 days or more, including China’s largest refiner Sinopec’s Zhenhai unit, a Reuters survey of 11 plants showed. A slowdown in China’s refining activity could result in lower Chinese imports of crude oil, which in turn could undercut a two-month price rally that has lifted crude to more than $75 a barrel for the first time in over three years. Analysts and traders say imports may also be disrupted by a shutdown of major oil import hub Huangdao, part of Qingdao port in northern Shandong province, further crimping consumption. “If Shandong prepares to shut down the Huangdao port, crude arrivals could start dropping starting in late May,” said Emma Li, senior analyst at Thomson Reuters Oil Research. Port authorities declined to comment on what measures they might take ahead the Shanghai Cooperation Organization Summit in Qingdao in June. Qingdao is a major commodities port, and Beijing usually adopts tighter pollution controls and curbs shipping traffic for big events to ensure blue skies. In total, the six plants to be fully shutdown process around 1.09 million barrels per day (bpd), accounting for 10 percent of China’s average monthly crude runs, Reuters calculations based on refinery rates from China’s statistics bureau showed. The pace of outages due to maintenance is down from 1.26 million bpd in the same period last year, Reuters calculations also showed. But the actual volume of outages could grow as a flurry of independent refineries are considering undertaking maintenance in June and early July to avoid the potential pollution curbs. 

            Analysis: Asian oil importers ready to sail through Iran sanctions storm -- Asian oil importers were well placed to weather the storm of a possible US re-imposition of sanctions on Tehran,and any subsequent blockage to the country's crude exports, due to their supply diversification efforts that had led to a drop in their Iranian purchases. Various sources with East Asian refiners said they were waiting for clarity on Washington's intention to bring back the sanctions. Major oil consumers in Asia had, however, already factored this in and the companies were well-positioned to seek alternatives in the event that they faced difficulties accessing Iranian crude, industry sources and analysts said. "Iranian crude oil imports have already been declining so it would not create a headache [for us] even without it," a northeast Asian refiner source said. "We [still] hope to have clarity [on the sanctions] because it could be troublesome for shipping arrangements." South Korea's crude and condensate imports from Iran dropped 37.4% year on year to 374,097b/d in March, marking the fifth consecutive year on year decline since November 2017, Korea National Oil Corp's latest data showed. Japan's 2017 imports from Iran fell 24.2% to 172,216 b/d, from 227,142 b/d in 2016, S&P Global Platts calculations based on the Ministry of Economy, Trade and Industry data showed. In the first two months of 2018, imports had fallen 12.3% year on year to 192,289 b/d. 

            Kuwait Plans Massive Oil Tanker Expansion - Despite the ongoing oil production cuts across OPEC, Kuwait has announced plans to expand its oil and oil product tanker fleet twofold over the next 20 years to 60 vessels, the chief executive of Kuwait Petroleum Corp, Nizar al-Adsani said as quoted by S&P Platts today.The move is the latest indication that in spite of hints, the production cuts may not be in the long-term plans of all members. Several OPEC producers have production expansion plans on their agendas, most notably Iraq, OPEC’s number-two, and now Kuwait.Currently, Kuwait has 28 tankers at its disposal, of which 12 are for crude oil, 10 are for oil products, and four are LPG carriers. The remaining four are bunkering tankers. Yet, "To service KPC's international marketing trade requirements, we will expand our fleet, especially for product carriers," al-Adsani said at the Middle East Petroleum and Gas event in Abu Dhabi.KPC will buy two more oil tankers in the next three years and another four by 2040, the CEO said, along with 11 more oil product vessels and one more LPG carrier. By the same year, Kuwait plans to expand its oil production capacity to 4.75 million bpd from the current 3.2 million bpd, which will take some US$400 billion in new investment. Before that, however, by 2020, Kuwait plans to ramp up its production capacity to 4 million bpd. Refining capacity will also grow, from 936,000 bpd at the moment to 2 million bpd by 2035. At the same time, the Kuwaiti energy minister earlier this month signaled an extension of the production cuts might be what the future holds, which could interfere with the country’s expansion plans unless it is counting on troubled Venezuela’s fast-falling output.

            Down In Saudi Arabia, They're Partying Like It's 2008 –  Is this really 2018? It started to sound a lot like 2008 in Saudi Arabia on Friday, as the kingdom's oil minister argued that the world could tolerate a higher crude price.  "I haven't seen any impact on demand with current prices," Khalid Al-Falih told reporters at the meeting of OPEC and non-OPEC producers in Jeddah. Arguing that the energy intensity of global economic growth hadn't declined, he offered the view that "there is the capacity for higher prices." President Trump certainly didn't appreciate the sentiment, firing off a tweet that accused OPEC of promoting "artificially high prices" which "will not be accepted."Yet setting aside Trump's unique approach to geopolitics, the Saudi comments are indeed troubling. They are an eerie echo of comments made almost exactly a decade earlier by a former OPEC grandee: Libya's Shukri Ghanem. The world economy "has not reached the tipping point where it can't accept higher prices," Ghanem said back in April 2008. Little did he realize just how close that tipping point was. West Texas Intermediate crude, which had touched a record $116.97 a barrel the previous day, continued to climb for another 3 months as OPEC insisted it didn't need to raise production. But then the collapse came, and it was quite a crash. After trading above $145 a barrel in the first half of July, WTI was below $40 by the end of the year.Of course, oil prices are nowhere near as high as a decade ago. But it's startling how quickly the lessons of 2008, or indeed the last price crash of 2014, are being ignored -- even if they're unlikely to have been forgotten.

            Kemp: Mission Accomplished for OPEC as Oil Moves from Slump to Boom (Reuters) - The slump that characterised the oil market between the middle of 2014 and the middle of 2016 has been replaced by what looks like the beginning of a boom. Benchmark Brent prices have already risen by more than $45 per barrel or 170 percent from their cyclical trough in early 2016. Front-month futures prices, at almost $75 per barrel, are now trading close to the inflation-adjusted average for the last price cycle, which started in 1998 and finished in 2016. So far this year, futures prices have averaged nearly $68 per barrel, which is well above the post-1973 real average price of $50-$55. Futures prices have shifted from a big contango during the slump into an increasingly wide backwardation since the middle of 2017, which is consistent with a shift from over-supply to under-supply ( ). Global oil consumption is predicted to increase by more than 1.5 million barrels per day (bpd) in 2018, the fourth consecutive year of very strong growth. Non-OPEC oil production is forecast to increase by 2.0 million bpd or more this year, mostly as a result of a large increase in U.S. shale plus other output increases from Canada, Brazil and Norway. But with steep declines in output from OPEC member Venezuela as a result of unrest and mismanagement, and continued curbs on production by other OPEC and non-OPEC members, global production is failing to keep pace with consumption. OECD inventories have dropped sharply and are now in line with the five-year average, eliminating the surplus of over 300 million barrels inherited from the slump. If inventories are adjusted for the rise in consumption, which gives a more accurate picture of the market balance, stocks are now well below the five-year average and continue to tighten. So on every indicator, from spot prices and spreads to consumption, production and inventories, the oil market is now well into the boom phase of the cycle. But booms are always followed by slumps. If OPEC allows the oil market to tighten too much in 2018/19, it will create the conditions for the next downturn a few years later.

            Opec’s grand bargain on output is at risk of becoming a victim of its own success - There are three problems with the Opec/non-Opec coalition’s current approach. Compliance is too high, and is not adjusted for some members’ inability to maintain production. The group’s metrics for assessing their deal, and hence their future guidance on policy, have become blurred. And current prices threaten demand growth, and hence risk a renewed slump. The committee reported that Opec and its non-Opec partners had achieved record compliance to their planned cuts of 149 per cent – ie, cutting 50 per cent more than they had planned. But this is not a sign of success. The group should be aiming to hit, not exceed, its target. The over-tightening is mainly due to the continuing collapse in Venezuela, whose output is down from 1.9 million barrels per day in 2017 to less than 1.5 million bpd in March. Angola has lost another 150,000 bpd over its target because of ageing fields. Meanwhile Saudi Arabia is also producing less than its target – when it should be slightly over-producing to compensate for others’ losses. Having declared that they have pretty much achieved their goal of bringing down Organisation for Economic Co-operation and Development oil stocks to the five-year average level, Opec has now begun casting around for a different metric to justify continuing cuts. This is not price: the Saudi Arabia and UAE energy ministers, Khalid Al Falih and Suhail Al Mazrouei, have resolutely refused to talk in terms of a specific price. Conversely, Iranian oil minister Bijan Zanganeh and Russia’s Alexander Novak, respectively, named $60 and $64 per barrel as “acceptable”. Instead, Mr Al Falih has echoed the oil consumers’ organisation, the International Energy Agency (IEA), in pointing to the danger of a lack of investment. But this is not a guide to Opec policy: what is the right level of investment? And with investments taking several years to come to fruition, this would not be helpful for making month-by-month production decisions. 

            Saudi Arabia’s $100 Oil Dilemma - Saudi Arabia is rumored to want oil prices at $100 per barrel, but if prices rise that high, it could sow the seeds of the next downturn. Saudi officials want more revenues for their budget and a higher oil price to bolster the valuation of the Aramco IPO. But that short-term thinking could spell trouble not just for them, but also for oil prices, and ultimately for longevity of oil demand.As Liam Denning of Bloomberg Gadfly points out, in the past decade, while oil prices have surpassed $100 per barrel for periods of time, they didn’t stay there for very long. In 2008, when oil nearly hit $150 per barrel, it was quickly followed by the financial crisis and a deep U.S. recession. Then, the period between 2011 and 2014, when oil was north of $100 per barrel, U.S. shale crashed the market with a wave of fresh supply.If Saudi Arabia aims to drive up prices to triple-digit territory once again – and to be sure, that is only a rumor at this point – there are plenty of ways that could merely create the conditions for another bust. First, oil prices are rising, in part, because demand is so strong, not just because OPEC is keeping barrels off the market. Oil at $100 would essentially amount to a doubling of the price from the past few years, which would quickly put an end to high demand growth rates. A corollary to this is that $100 oil would likely impact economic growth. The economic recovery from the financial crisis in 2008 is almost a decade old at this point, much longer than the average upswing. History suggests that we are due for a recession at some point in the not-so-distant future. A spike in fuel prices around the world could help bring that on.  Taking too much oil off to the market for too long could send prices “artificially” high he said. "That is a big concern…Because oil prices don't generate crises; the abrupt and unexpected rise of oil prices creates crises," Second, $100 oil would set off yet another round of frenzied drilling, likely resulting in an even stronger wave of new shale supply. Several years of triple-digit oil prices led to a near doubling of shale production in the U.S., a volume that helped crash the market in 2014. A spike in oil prices could result in history repeating itself.

            Saudi Aramco to Lift Oil-Trading Volume to 6 Million Barrels/Day -- Saudi Aramco, the world's biggest oil exporter, plans to trade as much as 6 million barrels a day, a jump in volume that would put it in the top tier of companies that buy and sell crude and refined products.The trading arm of the state-run giant known officially as Saudi Arabian Oil Co. currently handles between 3.3 million and 3.6 million barrels a day, Ibrahim Al-Buainain, the unit's chief executive officer, said in an interview in Abu Dhabi. Aramco Trading, as the business is known, targets 5.5 million to 6 million barrels a day by 2020 as its parent opens new refineries in Malaysia and Saudi Arabia, he said.Saudi Arabia is counting on Aramco to anchor an economic transformation that the kingdom's Crown Prince is promoting to create industries and jobs. The government plans to sell shares in Saudi Aramco as early as this year in what could be the largest initial public offering. While Aramco is extremely profitable, the government has yet to choose an international exchange on which to sell the shares and could push the IPO into 2019.If it reaches its target, Aramco Trading would rival Vitol Group, the world's largest independent trader, which trades about 7 million barrels a day of crude and products. Royal Dutch Shell Plc buys and sells about 12 million barrels a day, and BP Plc deals in about 8 million. Shell and BP, like Aramco, are integrated oil companies engaged in production, refining and trading. Middle Eastern oil producers are adding refining capacity through joint ventures and will need to find new buyers for their larger product volumes, according to Chris Bake, Vitol's head of origination. Bake and Al-Buainain both spoke on Monday at the Middle East Petroleum and Gas Conference in Abu Dhabi.

            Hedge fund oil bulls on the rampage as bears vanish: Kemp (Reuters) - Hedge fund managers have never seemed so convinced that oil prices are set to rise rather than fall in the near term, according to the latest positioning data published by regulators and exchanges. Fund managers remain super-bullish even though benchmark Brent prices have almost tripled over the last two years and are now trading at the highest level since November 2014. Hedge funds and other money managers raised their net bullish position in the six most important futures and options contracts linked to the price of crude and fuels by 45 million barrels in the week to April 20. The net bullish position was equivalent to 1.411 billion barrels of crude and fuels - enough to satisfy global oil consumption for more than two weeks. The net long position was still below the record 1.484 billion barrels set back on Jan. 23 ( ). But hedge fund managers have never been so overwhelmingly convinced prices are set to rise further rather than fall back. Across the six major contracts, portfolio managers hold almost 14 long positions for every short one, compared with a ratio of less than 12:1 back on Jan. 23. In total, funds hold 1.520 billion barrels of long positions across Brent, NYMEX and ICE WTI, U.S. gasoline, U.S. heating oil and European gasoil. The number of short positions has fallen to just 109 million barrels, down from 141 million in January, and the lowest number for at least five years. There are plenty of reasons to be bullish about oil, including rapid growth in global oil consumption, continued supply restraint by OPEC, falling output in Venezuela and the possible re-imposition of sanctions on Iran. OECD oil inventories have fallen back in line with the five-year average and are now below the average if adjusted for increased consumption. Senior OPEC leaders have indicated they see room for prices to rise further and have no intention of boosting output before the end of 2018. Nonetheless, the hedge fund community's positioning has become exceptionally lopsided, which could herald a sharp correction in prices if and when fund managers try to close some of their open positions. 

            Oil pivots higher, settles with a gain as tensions in the Middle East heat up again -  Oil prices gave up earlier declines Monday to settle higher, as reports that a Saudi-led air strike killed the head of the Houthi rebels in Yemen raised the potential for disruptions to the flow of crude in the Middle East. “The fear of geopolitical risk, and the reality that supply will tighten again this week, brought the market back,” said Phil Flynn, senior market analyst at Price Futures Group. Saleh al-Sammad, political leader of the Houthi rebels in Yemen, was killed in Saudi-led air strikes, Al Jazeera reported, citing the Houthi-run Al-Masirah TV network. U.S. benchmark oil prices had turned higher around the last hour of trading on the New York Mercantile Exchange. Earlier losses were fed by strength in the U.S. dollar and news of a higher U.S. rig count late last week, which pointed to further growth in domestic crude production. June West Texas Intermediate crude ose 24 cents, or nearly 0.4%, to settle at $68.64 a barrel on Nymex, after trading as low as $67.14. The expired May contract logged a 1.5% gain last week. June Brent crude on Monday tacked on 65 cents, or 0.9%, to $74.71 a barrel on ICE Futures Europe, reversing course after touching a low of $73.13.

            Deutsche: Another $5 Rise In Oil Would Unleash Market Turmoil -  Recall, it is the ongoing move higher in crude prices that has sent 10Y breakevens surging to 4 year highs, while expectations of rising inflation have in turn boosted nominal yields as well as sent odds for 4 rate hikes to cycle highs... ... translating into a relentless dollar bid, which is creating a feedback loop forcing the record number of dollar shorts to aggressively cover their positions. So how much higher can oil prices rise, before there the adverse feedback loops and unintended consequences swamp out the risk-on sentiment? According to Deutsche Bank's chief Macro Strategist, another $5/barrel increase in oil would be enough for US 10y yields to threaten 3%, which also suggests that "oil is now at the cusp of levels where higher prices will spark greater FX and broader asset market volatility." As Ruskin notes, "oil is working its wonders on inflation expectations. Figure 1 shows 10y breakevens again slavishly following oil around" and calculates that according to market beta regressions, "a $5/b increase in oil is worth at least 10bps on 10y breakevens. Assuming that real yields and breakevens if anything remain positively correlated (see figure 2) a WTI near $75/b could precipitate US 10y pushing through 3%." As shown in the next chart, breakevens have been following real yields higher. Real yields, meanwhile, have been benefiting from some impact from fiscal policy; positive productivity/ growth expectations; and, most recently, a better risk environment as it relates to a range of political issues, inclusive of trade protectionism, N.Korea and perhaps Syria. Further, as discussed previously, the Syria story with its associated Russian sanctions angle, has awakened dormant commodity price pressures, with the CRB now finally threatening levels last seen in 2015, although some of these have eased in the past 24 hours following suggestions from the US Treasury the Trump admin may be willing to ease back some of its Russian sanctions, unlocking Rusal aluminum supply-chains. Meanwhile, higher commodity prices are falling on a market that should be receptive to some broader increase in inflation in the US.

            Oil Prices Tumble After Brent Breaks $75 -  Brent prices hit $75 per barrel in early morning trading on Tuesday, the highest price in more than three years. While prices quickly fell back again, bullish sentiment remains strong. The reasons are familiar – geopolitical events are flaring up at a time when the oil market is tightening. The Trump administration is less than three weeks away from a key decision on whether or not to withdraw from the Iran nuclear deal. “Let’s assume he will withdraw from the deal on May 12, we don’t know how much volume will be lost, we might see the $80 level for Brent,”   Halliburton reported a 34 percent increase in first quarter revenue largely due to higher drilling activity in North America. The oilfield services giant did take a revenue hit in the first quarter due to winter weather, but that was offset by the uptick in demand for its services from the shale industry. Halliburton’s CEO said that margins of 20 percent should return later this year as the fracking market tightens. “We believe the pressure pumping market is undersupplied and will remain tight,” CEO Jeff Miller saidHalliburton took impairment charges on its entire operation in Venezuela, citing lack of reimbursement from PDVSA, currency turmoil, U.S. sanctions and political uncertainty.  PDVSA only produces about half of Venezuela’s oil production on its own, and joint ventures with private companies represent the other half. Even as oil prices hit multi-year highs, demand in Asia is set to rise to a record high in April. That is helping drive oil prices higher.  Reuters estimates that China’s oil imports will hit 9 million barrels per day in April, a monthly record high. China’s overall oil demand is expected to jump some 370,000 bpd in 2018.As Bloomberg notes, cash flow for the oil majors is set to be the highest in 12 years, yet they have fallen out of favor with investors. Fears of abundant supply in the next few years, combined with fears that demand will peak in the long run has pushed down the stock prices of the majors.

            Oil prices finish lower after tapping highest levels in more than 3 years - Oil settled lower on Tuesday, finding little support from uncertainty surrounding Iran’s nuclear deal, as a diminished appetite for risk weighed on the U.S. stock market.Colin Cieszynski, chief market strategist at SIA Wealth Management Inc., cited a “general lack of enthusiasm toward risk markets” for oil’s retreat, with the U.S. stock market taking an even bigger hit Tuesday than oil.“Swirling geopolitical tensions around Iran may come and go in terms of importance in the coming days,” he said, noting that comments from U.S. President Donald Trump appear to be mixed Tuesday in relation to Iran. “U.S. [updates on crude] inventories and other indications of energy demand, like U.S. GDP on Friday, may also have a significant impact on energy prices.”June West Texas Intermediate crude lost 94 cents, or 1.4%, to settle at $67.70 a barrel on the New York Mercantile Exchange, the lowest finish since April 17. It fell from an intraday high of $69.38, which would have marked its highest settlement since November 2014. Global benchmark June Brent settled at $73.86 a barrel on ICE Futures Europe, down 85 cents, or 1.1%. It had touched a high of $75.47, the highest level since November 2014.The two contracts settled higher Monday, after reports that a Saudi-led airstrike killedthe leader of Houthi rebels in Yemen. That was seen as raising the potential for disruptions to crude supply in the Middle East, which is a major oil-producing region. Separately, the possibility that the U.S. will reimpose sanctions on Iran has been a key concern.. Reinstating the sanctions would likely lead to tighter global oil supplies.

            Oil Tumbles After Macron Proposes New Iran Deal - With crude oil surging in recent weeks as a result of geopolitical tensions, including Trump's tariffs on Russia but mostly due to concerns the US president will terminate the Iran nuclear deal in two and a half weeks, eliminating roughly 1 million barrels in Iranian output from the market, it was to be expected that the mere suggestion that the Iranian deal could be salvaged - as virtually all of Europe has insisted and pleaded with Trump - would send oil tumbling. That's precisely what happened moments ago, when during his press conference with Donald Trump, French President Emmanuel Macron proposed a new Iran deal, noting that a "new deal" would block nuclear activity to 2025. Here's a breakdown of Macron's "Plan B" for the Iran, per CBS."I always said there is the JCPOA but we needed to add three pillars post 2025. I don't know what President Trump will decide on the JCPOA and it is his responsibility," said Macron when asked again on the Iran deal."I'm not saying we're moving from one deal to another, I'm saying its one aspect of the problem," Macron said. He added, "I've never been critical [of the JCPOA] because I think we can usefully add to it."Macron again urged adding limitations on Iran's ballistic missile program and limiting Iran's regional influence to a potential new deal."It's about respecting the sovereignty of the states in the region," added Macron. "It's not about tearing apart an agreement but building something new that will cover all of our concerns." In a kneejerk response, oil tumbled by nearly one dollar, sliding below the $69 level it reached earlier today for the first time since 2014, and dropping briefly below $68, in the process slamming Inflation breakevens, and the broader market, as suddenly inflation is not looking all that certain.

            WTI/RBOB Extend Losses After Surprise Crude Build - WTI/RBOB sank on the day as Macron suggested a new Iran Deal that may work for President Trump, but after API reported a surprise crude build (+1.099mm vs -2.25mm exp), energy prices kneejerked lower.Macron “has quickly switched to ‘let’s negotiate a new deal.’ It was a bit of a surprise,” said Bob Yawger, director of futures at Mizuho Securities USA Inc. in New York.“It would be a deal that would get everyone involved and try to avoid a confrontational situation. It does seem to be a situation that would hopefully not involve taking barrels off the market.”API;

            • Crude +1.099mm (-2.25mm exp)
            • Cushing -930k (-150k exp)
            • Gasoline -2.724mm
            • Distillates -1.911mm

            Investor expected a follow up to last week's surprise crude draw but were surprised by a crude build. Cushing along with products all saw inventory draws again...

            WTI/RBOB Slide After Surprise Crude, Gasoline Builds; Record Production - WTI/RBOB prices have gone nowhere since API reported a surprise crude build, but after last week's across the board inventory draws, DOE reported surprise builds in crude and gasoline inventories and production hit a new record high, sending prices lower. Bloomberg Intelligence's Senior Energy Analyst Vince Piazza noted before the data hit that, propelled by WTI discounts to Brent of greater than $6 a barrel, domestic refinery throughout is expected to push higher. Strength in crude exports, relative to last year, should persist.  DOE:

            • Crude +2.17mm (-2.25mm exp)
            • Cushing +459k (-150k exp)
            • Gasoline +840k
            • Distillates -2.611mm

            After last week's across the board inventory draws, Crude and Gasoline saw notable surprise builds this week... Inventories are just 3% below the five-year norm. Crude exports hit a new record high... Production rose 46k b/d to 10.586mm b/d - a new record high... In the Permian basin, output is forecast to reach 3.18 million barrels a day in May, the highest since the Energy Information Administration began compiling records in 2007. Amid all the chaos in stocks, WTI/RBOB went nowhere since the API data with no follow-through from Trump or Macron regarding Iran.

            Oil prices rise on geopolitical worries, shrugs off U.S. build (Reuters) - Oil prices rose on Wednesday despite data showing rising U.S. inventories, holding within sight of three-year highs reached the previous day on geopolitical tensions including the prospect of fresh sanctions on Iran. Trump will decide by May 12 whether to restore U.S. sanctions on Tehran, which could be a first step to ending the deal. The market was also supported by concerns around oil output from Venezuela. U.S. oil major Chevron Corp has evacuated executives from Venezuela after two of its workers were imprisoned over a contract dispute with state-owned oil company PDVSA, according to four sources familiar with the matter. “The geopolitical risk in the market has a pretty high premium,” . “Even with this week’s Department of Energy numbers it hasn’t shaken any of the confidence that the global supply and demand balance continue to tighten.” Brent crude LCOc1 settled 14 cents higher at $74.00 a barrel, below the November 2014 intraday high of $75.47 reached on Tuesday. U.S. crude futures CLc1 ended up 35 cents at $68.05 a barrel. The market rebounded quickly from a dip after bearish U.S. inventory data because the build was not as large as it could have been, given the jump in exports, McGillian said. Crude inventories USOILC=ECI rose 2.2 million barrels last week, compared with expectations for a 2 million-barrel draw. Crude stocks at the Cushing, Oklahoma, delivery hub USOICC=ECI rose 459,000 barrels, EIA said. A rise in U.S. government borrowing costs to their highest since 2013 this week has tempered some investor appetite for risk, but analysts said Brent crude futures, the global benchmark, may yet rise toward new 2018 peaks above $75 a barrel. Supplier cutbacks, steady demand growth, geopolitical tensions and a favorable structure in the futures market have attracted record investment in oil this year. 

             Oil prices rise on Iran sanctions worries, falling Venezuelan output - Oil prices rose on Thursday,supported by expectations the United States will re-impose sanctions against Iran, a decline in output in Venezuela and ongoing strong demand. Brent crude oil futures were at 74.27 per barrel at0643 GMT, up 27 cents, or 0.4 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were up 14cents, or 0.2 percent, at $68.19 per barrel. Traders said markets climbed on expectations that the UnitedStates will in May re-impose sanctions against Iran, a major oil producer and member of the Organization of the Petroleum Exporting Countries (OPEC). French President Emmanuel Macron said on Wednesday that he expected U.S. President Donald Trump to pull out of a deal withIran reached in 2015, in which Iran suspended its nuclear programme in return for western powers lifting crippling sanctions. Trump will decide by May 12 whether to restore U.S.sanctions on Tehran, which would likely result in a reduction ofits oil exports. Further pushing oil prices has been declining output in Venezuela, OPEC's biggest producer in Latin America. Venezuela's crude production has fallen from almost 2.5 million barrels per day (bpd) in early 2016 to around1.5 million bpd due to political and economic turmoil. U.S. oil major Chevron CorpCVX.N has evacuated executives from Venezuela after two of its workers were imprisoned over contract dispute with state-owned oil company PDVSA. u= However, not all market indicators point towards tighter supplies. U.S. crude oil inventories rose by 2.2 million barrels in the week to April 20, to 429.74 million barrels.That's almost 10 million barrels above the five-year average.  U.S. crude production climbed by 46,000barrels per day (bpd) on the previous week, to 10.59 bpd. That'san increase of more than a quarter since mid-2016. American crude oil output has overtaken that of top exporter Saudi Arabia. Only Russia currently produces more, at around 11million bpd. 

            Expect Much Tighter Oil Markets - As oil prices hover close to multi-year highs, Saudi's Oil Minister has hit the wires saying that OPEC 'shouldn't be complacent and listen to some of the noise such as mission accomplished' . Just as we learned earlier in this economic cycle via 'don't fight the Fed', we too should take heed: 'Don't fight the Falih'.Year-to-date, U.S. crude inventories have risen by 3 million barrels, compared to 53 million barrels for the same period last year. Our seasonal Q1 build has been distinctly errant.While a number of factors can be assigned for such a lack of upward trajectory (higher exports, stronger refinery runs, lower waterborne imports), the slashing of crude flows to the U.S. from Saudi Arabia has also played a part. Saudi crude deliveries were down over 50 million barrels year-on-year in Q1, a third consecutive quarter of considerably lower year-on-year imports.The aforementioned combo of higher exports, stronger refinery runs and lower waterborne imports have colluded to leave Q1 U.S. crude inventories 110 million barrels lower than end-March last year. (Granted, this is from a high-water mark indeed - the absolute record of U.S. crude inventories at 535.54 million barrels, but hey). In 2017, Saudi crude deliveries to the U.S. dropped by 160,000 bpd versus the prior year. Meanwhile, total OPEC deliveries to U.S. shores in both 2016 and 2017 averaged ~3.2 million barrels per day, with imports last year really strong in the first half of the year, before taking a dive in the second half (hark, below). In Q1 of this year, OPEC deliveries averaged close to 2.7 million bpd, down nearly 20 percent on year-ago levels and the lowest quarter since Q3 2015. This is both a combination of OPEC reining in supplies, and a lesser need from U.S. refiners for OPEC barrels, as they lean as heavy as they can on soaking up rising domestic production.

            Oil's big backwardation spells trouble ahead: Kemp (Reuters) - The oil market is becoming extremely tight as consumption outstrips production, and traders expect it to tighten even further over the next six months. The balance between production, consumption and inventories is intimately connected with the shape of the oil futures curve ( ). If consumption is expected to exceed production, and inventories are already low and falling, spot prices tend to trade at a premium to forward prices. The premium for spot prices over forward prices, known as backwardation, acts as a signal to conserve remaining stocks as much as possible. The premium for spot prices is intended to boost supply in the short term while encouraging consumers to defer purchases. Backwardation is the most important and reliable signal of a tight and tightening oil market. Front-month Brent futures have recently been trading in a backwardation of more than $3.40 per barrel over the seventh-month contract. The current backwardation in Brent is among the most extreme in the last quarter of a century and in the 91st percentile of all trading days since 1992. If the backwardation was confined mostly to one or two months, it could be dismissed as an aberration or a sign of market manipulation. But big backwardations are evident for all months through 2018 and 2019. The increasing backwardation is consistent with statistics from the physical market showing oil inventories are becoming increasingly tight. Stocks of crude oil and refined products in the OECD industrialised countries have fallen to just 43 million barrels above the five-year average, from a surplus of 340 million barrels at the start of 2017. If OECD stocks are adjusted for the rise in consumption, current inventories are now below the five-year average. The oil market is currently on an unsustainable trajectory, with global demand growth systematically outrunning supply. Logically, there are five ways in which the oil market can be moved off its currently unsustainable course and brought back towards balance:

            • (1) Slower consumption growth (in response to higher prices, an economic slowdown, or a combination of both)
            • (2) OPEC and its allies lift their output
            • (3) Supply disruptions (existing and threatened) ease
            • (4) U.S. shale output increases even faster than expected
            • (5) Non-OPEC non-shale output increases faster than predicted.

            Trump, Merkel Confirm That Iran Deal Talks Continue; Oil Drops -  German Chancellor Angela Merkel and Trump had what was by all accounts a productive meeting on Friday. And if the press conference that followed their three-hour summit had a key takeaway, it would be that, despite Trump's aggressive rhetoric, the Iran deal remains alive - for now, at least. This realization sent the price of WTI sinking in afternoon trade as oil bulls worried about Iranian supply, though WTI climbed 4.5% in April. Trump addressed the Iran deal in general terms, saying that the West must "ensure that this murderous regime does not even get close to a nuclear weapon." Reiterating remarks from earlier this week, Trump said Iran would not be restarting its nuclear program, "you can bank on it." Merkel said that while the deal "isn't perfect", she said it's "part of a bigger Middle Eastern picture" and added that the signatories would continue to be involved in "very close talks" to try and preserve the deal. Merkel said the JCPOA was discussed, and that the two sides were working on forging a deal that would assuage US concerns. Turning to the subject of North Korea, Trump reiterated remarks from a press conference earlier in the day, saying that while he's looking forward to talks with North Korea, the US would not let the North "play" the Trump administration like the Kims have played previous administrations. "I will be meeting with Kim Jong Un in the coming weeks, we look forward to that," he said, thanking Merkel for her help in the "maximum pressure" campaign on North Korea. Trump also touched on the need for NATO nations to pay their fair share for national security costs born by the bloc, and also commented on Germany's trade surplus with the US. Crucially, Merkel didn't give a direct answer about whether the US would extend an exemption for aluminum and steel tariffs for the European Union, which is set to expire early next month.

            Geopolitical Breakthroughs Calm The Oil Market - The diplomatic breakthrough on the Korean Peninsula is taking away one source of geopolitical risk, at least for now, with oil prices dipping in early trading on Friday. After a brief outage, Libya’s Es Sider export terminal resumed shipments. A pipeline suffered damage from an explosion last Saturday, leading to a temporary outage of 80,000 bpd, but the pipeline has since been repaired. Separately, Libya’s eastern military leader, Khalifa Haftar, returned to the country after a hiatus in France for medical treatment. His absence fueled speculation about a return to instability, which threatened new oil supply disruptions.   At least six state-owned and private oil refineries will shut down in May and June for maintenance. The pause could result in a 10 percent decline in refinery runs, or about 1.09 million barrels per day, which could temporarily hit China’s demand for crude oil imports.   First quarter earnings began coming out this week from the oil majors, most of whom are posting the largest profits in years. . All are making more money with oil at $65 to $70 today than they were in the pre-2014 environment in which oil topped $100 per barrel. Royal Dutch Shell announced the final investment decision for the Vito project, a deep-water offshore development in the Gulf of Mexico. The Anglo-Dutch oil major said the project has a breakeven price of about $35 per barrel and will produce 100,000 bpd at its peak. The project is expected to begin producing in 2021. The Trump administration has repeatedly found itself caught in the fight between the oil refining and the corn ethanol industries, industries that are battling over the renewable fuels standard (RFS) and how much ethanol refiners are required to blend into their fuel mixes. Refiners are demanding changes to the rule that requires 10 percent ethanol, asking for a rollback. The ethanol industry is digging in its heels. The EPA has granted exemptions to a growing number of refiners, which is giving more urgency to the debate because it is undermining the ethanol market. Trump is caught between the two sides and has tried to avoid making a decision over fears of alienating one of these constituencies.

            Oil inches down but Brent ends week firmer on Iran concerns (Reuters) - Oil prices edged lower on Friday, although Brent still gained for a third straight week amid supply concerns should the United States reimpose sanctions on Iran. Brent crude futures fell 10 cents, or 0.1 percent, to settle at $74.64 a barrel. This month, the global benchmark hit highs above $75, a level last seen in late 2014. U.S. West Texas Intermediate (WTI) crude futures fell 9 cents to settle at $68.10 a barrel, also a 0.1 percent loss. Brent gained about 0.5 percent this week - its third consecutive weekly gain - while WTI posted a weekly loss of about 0.5 percent. Hedge funds and other money managers cut their combined futures and options position in U.S. crude in New York and London by 17,021 contracts to 455,885 during the week to April 24, the U.S. Commodity Futures Trading Commission (CFTC). U.S. President Donald Trump will decide by May 12 whether to reimpose sanctions on Iran that were lifted as part of an agreement with six other world powers over Tehran’s nuclear program. The renewed sanctions would likely dampen Iranian oil exports, disrupting global oil supply. “That’s the biggest factor right now that’s driving the market. And that’s why you’re seeing low volatility today and for the most part during the week,” Rob Thummel, portfolio manager at energy investment manager Tortoise Capital in Leawood, Kansas. “The market is just kind of waiting on that.” Brent has risen by around 6 percent so far this month, while WTI was on track for a gain of nearly 5 percent. The gains came despite a higher dollar .DXY, which hit its strongest since Jan. 11 against a basket of currencies. A stronger dollar makes greenback-denominated commodities more expensive for holders of other currencies. Concerns about market tightness have also been fueled by the deteriorating political and economic situation in Venezuela that has led to a 40 percent decline in crude output in the past two years. 

            Baker Hughes reports U.S. rig count up 8 to 1,021 rigs BHGE - Baker Hughes reports that the U.S. rig count is up 8 rigs from last week to 1,021, with oil rigs up 5 to 825, gas rigs up 3 to 195, and miscellaneous rigs unchanged at 1. The U.S. Rig Count is up 151 rigs from last year's count of 870, with oil rigs up 128, gas rigs up 24, and miscellaneous rigs down 1 to 1. The U.S. Offshore Rig Count is unchanged at 18 and up 1 rig from last year's count of 17. The Canada Rig Count is down 8 rigs from last week to 85, with oil rigs down 5 to 33 and gas rigs down 3 to 52. The Canada Rig Count is unchanged from last year's count of 85, with oil rigs up 9 and gas rigs down 9.

            Tehran Threatens To Leave Nuclear Nonproliferation Treaty If Trump Kills Iran Deal - While the UN, EU, International Atomic Energy Agency and a host of others implored President Trump late Monday to preserve the landmark Iran nuclear deal - even if the US couldn't achieve concessions on Iran's ballistic missiles program that it has been aggressively pushing - Iranian officials have been cranking their rhetoric up to "11", with Ali Shamkhani, the Secretary of Iran's Supreme National Security Council, acknowledging during a news broadcast on state television that the Iranian leadership had discussed leaving the Nuclear Nonproliferation Treaty as "one of three options that we are considering" in response to the US potentially scrapping the deal. While this isn't the first time Iran has threatened to leave the NPT - the cornerstone of the international nonproliferation order - it's the first time the leadership has threatened to leave as a tit-for-tat response to the US leaving the Iran deal. While Iran committed to not pursuing a nuclear weapon when it joined the NPT in 1970, the Iran deal imposed tighter restrictions on the regime, per Reuters. Of course, by leaving both agreements, Iran would only fuel its enemies' claims that the Islamic Republic is explicitly seeking to build a nuclear weapon. Per the Jerusalem Post, Shamkhani, who spoke with reporters shortly before departing for Russia, said the Atomic Energy Organization of Iran was ready for some "surprising actions" if the nuclear deal is scrapped.  Meanwhile, over the weekend (and again on Monday), Iranian Foreign Minister Javad Zarif warned that Tehran would reactivate its centrifuges should the US drop out of the deal and reimpose economic sanctions. On Tuesday, the war of words ratcheted higher when Iranian President Hassan Rouhani warned that Trump should keep the deal in its current format or face "severe consequences.""I am telling those in the White House that if they do not live up to their commitments...the Iranian government will firmly react," Rouhani said in a speech."If anyone betrays the deal, they should know that they would face severe consequences," Rouhani told a cheering crowd of thousands gathered in the city of Tabriz. "Iran is prepared for all possible situations," he added.

            A Saudi-Iranian Dialogue on Regional Security - With tensions between regional rivals Iran and Saudi Arabia at the brink, a rare dialogue recently took place between two former senior Saudi and Iranian officials. Hosted by the Center for Strategic Studies at the Joint Special Operations University in Tampa, Florida, former Saudi Ambassador to the United States and Director General of Saudi Arabia’s intelligence agency Prince Turki al Faisal debated Ambassador Hossein Mousavian, a former spokesman for Iran’s nuclear negotiators and chairman of the foreign policy committee of Iran’s National Security Council. The lively discussion touched on each country’s view of its security environment and the broader issues affecting the Iran-Saudi relationship. LobeLog has obtained the full transcript of the conversation, and the following is an abbreviated excerpt covering the key points.

            Saudi airstrike kills 33 at wedding in northern Yemen - An airstrike by Saudi-led coalition jet fighters on a wedding in northern Yemen killed at least 33 people and wounded 55 others Sunday night.The bombs, supplied by the United States, rained down on a tent in the northwestern province of Hajjah where women and children had gathered, killing dozens, including the bride. Most of those injured in the attack were children, many of whom were sent to hospital with grievous shrapnel wounds and severed limbs.Abdel-Hakim al-Kahlan, a Health Ministry spokesman, reported that ambulances were delayed from reaching the injured and dying out of fear of a repeated attack as Saudi jets continued to fly overhead following the attack. Such so-called “double tap” strikes have been used repeatedly in Yemen by the Saudi coalition.Video from the scene depict scattered limbs and a young boy clinging to a man’s corpse as he is removed from the rubble.The bloody attack was one of three Saudi airstrikes over the weekend which claimed mass civilian casualties in Yemen. A separate airstrike Sunday night on a home in Hajjam killed five members of a single family. The previous day 20 civilians were killed outside the city of Taiz when Saudi planes bombed a commuter bus. Saudi Arabia has been waging an unrelenting war against Yemen for more than three years, with the full support of the United States and its allies. Utilizing American-made jet fighters armed with US-supplied bombs and refueled by the US Air Force, the Saudis have pushed the poorest country in the Arab world to the brink of famine and sparked the worst cholera outbreak in modern history. The US Navy has provided ships to enforce a blockade of the country, which has cut off critical supplies of food and medicine. Saudi coalition jets have attacked residential neighborhoods, schools, markets, factories and hospitals, as well as water and electrical systems. No civilian target is apparently off limits for Saudi bombs. Earlier in April Saudi warplanes struck a housing complex for displaced people in port city of Hodeida. Once the attack ended at least 14 had been killed and nine wounded, the victims were predominantly women and children. More than 13,000 civilians have been killed in the course of the three-year war, with Saudi Arabia responsible for the majority of all casualties.

            Saudi Media Claims Houthis Are Holding 19 Oil Tankers Hostage Off Yemeni Coast - The Yemeni Houthis have captured 19 oil tankers and are keeping them from entering the Hodeidah port, according to reports from Saudi media quoting the Kingdom’s ambassador in Yemen. The ambassador suggested three possible reasons for the detention, including an attempt to extract money from the owners of the vessels, “the continued starvation of the Yemeni people”, and a plan to destroy the tankers, causing major environmental damage to the Red Sea.However, the only media sources reporting the tanker seizure are Saudi sources and there has been no confirmation from an external source that the Houthis have indeed seized any tankers yet. No details have been disclosed as to the origin of the vessels, either. According to Saudi Arabia, the Houthis - a Shiite militia backed by Iran - are holding the port of Hodeidah as “a tool of war”. The port is one of the largest in the war-torn country, and it is the destination for many oil tankers and humanitarian aid. It is also controlled by the Houthis unlike other large ports, which the Saudi-led coalition closed earlier, worsening the plight of starving Yemenis.At the end of last year, the Houthis threatened that they would start attacking oil tankers and warships sailing under enemy flags if the Gulf coalition fighting it in the country does not reopen its ports. Since then, there have been multiple reports of Houthis strikes against Saudi targets, including civilian targets, but no real damage has been done.Even so, following the latest missile strike report, Human Rights Watch said that “Houthi forces in Yemen violated the laws of war by launching ballistic missiles indiscriminately at populated areas in Saudi Arabia on March 25, 2018.” “But just as unlawful coalition airstrikes don’t justify the Houthi’s indiscriminate attacks, the Saudis can’t use Houthi rockets to justify impeding life-saving goods for Yemen’s civilian population,” Sarah Leah Whitson, Middle East director at Human Rights Watch, said.Yemen lies along one of the main global oil chokepoints in the Red Sea. Millions of barrels of crude oil pass Yemeni shores from the Suez Canal en route to Europe every day.

            Saudis say 19 oil ships are held hostage off Yemen. Not true, say maritime experts. -- A Saudi Arabian diplomat said last weekend that 19 oil tankers were seized by rebel forces off the coast of Yemen. Then, the Saudi Embassy in Washington, DC, repeated the story. But based on interviews and research conducted by PRI, there is no hostage situation at all.  The first report appeared Saturday, April 21 in a tweet from a Saudi Arabian diplomat, Mohammad Al-Jabir, which showed a list of ships which the ambassador said were being detained outside Yemen's deepwater port of Hodeidah.   "A list of detained ships by the Iranian-backed Houthi militia in the anchoring zone, which they control," the tweet reads. "These ships have been detained for more than 26 days."  The Saudi Embassy in Washington, DC, amplified Jabir's claims two days later in a press release.A hostage crisis. Hijackings at sea. Commercial ships to be destroyed. An environmental disaster to follow. The Saudi press release indicated a crisis was surely brewing.  But shipping companies and industry analysts tell a different story., a maritime transparency project based in Sweden, spotted the tankers listed by the Saudis within hours of the ambassador's tweet. Through satellite imagery and data transmissions, the group identified the vessels anchored off Hodeidah and began watching their movements.  On Tuesday, a spokesperson for a Greek shipping company whose tankers are on the Saudi list expressed surprise about the Saudi accusations. "Up to now there is not any issue reported by vessels," wrote Capt. Minas Papadakis of the Athens-based company, Eurotank, which manages four of the ships. "There is congestion at port, but waiting time is normal for Hodeidah." Papadakis said the Delia I had successfully offloaded its cargo of fuel at Hodeidah and that Eurotank's other ships were in line to do the same."Ariana, Selene and Liana are at [Hodeidah] anchorage waiting orders by port control for discharging their cargo," he said. "We confirm that all are in order." "Given everything that we've seen from satellite imagery, we have not seen any vessels that were surrounded or physically blocked from entering port," he said. "They've been sitting idle in anchorage. And now we see a lot of traffic: vessels that move from anchorage into port to deliver the cargo, and then they leave the port." In short, it's been business as usual at Hodeidah.

            Yemenis resort to burning firewood and rubbish to cook food - Since November, millions of Yemenis have been affected by a chronic shortage of fuel after Saudi Arabia tightened its blockade on Houthi-controlled ports and airports.Attempting to force the Houthis, a group of Shia rebels who control large parts of the north, into relinquishing their grip on power, a major gas firm in Marib, a gas-rich region controlled by the Saudi-backed Yemeni government, slashed deliveries to rebel-held areas. The blockade, which has only been partially lifted, had a devastating impact on the civilian population, with only a sliver of goods entering the capital of 4 million people.The shortage of fuel forced factories to lay off their staff, taxi prices to increase astronomically and hospitals, which rely on diesel to power their generators, to start closing wards. Fuel imports in March were less than one-third, 30 percent, of the national requirement, according to the UN's Office for the Coordination of Humanitarian Affairs (OCHA). Power shortages have caused a burgeoning rise in demand for diesel and gasoline on the black market, and young men and boys have begun lining major thoroughfares, selling plastic water bottles filled with bright red or deep yellow fuel - at up to five times the normal price.

            A US Ally Is Literally Beheading People Over Nonviolent Drug Charges - Saudi Arabia, the United States’ main ally in the Middle East, has executed 48 people so far this year, half of them over nonviolent drug charges, Human Rights Watch reported this week.“Many more people convicted of drug crimes remain on death row following convictions by Saudi Arabia’s notoriously unfair criminal justice system,” the advocacy organization said in a release.Though Human Rights Watch did not specify the method of execution, the Guardian classified the 48 killings as beheadings, and the Saudi government has a reputation for this type of sentence.“Saudi Arabia has carried out nearly 600 executions since the beginning of 2014, over 200 of them in drug cases. The vast majority of the remainder were for murder, but other offenses included rape, incest, terrorism, and ‘sorcery,’” HRW noted.As far back as 2004, CBS reported that “[t]he Saudi government beheaded 52 men and one woman last year for crimes including murder, homosexuality, armed robbery and drug trafficking,” adding that the Kingdom argues the practice is acceptable under Islamic law, which governs the country. At the same time, they condemned beheadings by militant groups. CBS noted that while Islam allows for the death penalty “few mainstream Muslim scholars and observers believe beheadings are sanctioned by Sharia, or Islamic law.”Nevertheless, the Saudi government has continued the practice, beheading 157 people in 2015, the highest since 1995, when 192 were executed. Nonviolent drug offenders were among those killed that year, as well. “Human Rights Watch (HRW) found that of the first 100 prisoners executed in 2015, 56 had been based on judicial discretion and not for crimes for which Islamic law mandates a specific death penalty punishment,” the Guardian noted at the time. The Kingdom also criminalizes protest and received widespread condemnation in 2017 for its efforts to execute 14 Shia minority demonstrators who protested during the Arab Spring. One of those protesters was a Saudi student who was arrested on his way to study abroad in the United States, and an advocacy groups’ appeals to President Trump to intervene on his behalf, the White House offered no indication it intended to help him.

            UK refuses to back UN inquiry into Saudi 'war crimes' amid fears it will damage trade -  Britain vowed not to back a proposed UN investigation into possible war crimes by Saudi Arabia in Yemen after the Kingdom threatened to review its trade with nations who backed the move. A Saudi-led coalition has been waging war in northern Yemen for more than two years against Houthi rebel forces who are opposed to the country’s leader, President Abdrabbuh Mansour.  More than 10,000 have been killed – many of whom are said to be civilians – and some 50,000 injured, figures show, after mostly air strike attacks by fighter jets dispatched by Riyadh.It comes after figures from charity War Child UK claimed that British arms companies have earned more than £6bn from trade with Saudi Arabia since the conflict erupted.UN members Holland and Canada have called for an inquiry into alleged war crimes by the Saudis in its campaigns against the Houthi forces over its border with Yemen.  But the Kingdom said it “will not accept” any outside investigation into the allegations and warned countries that supported the move could see their trade with the Saudis suffer. A letter distributed by the kingdom read: "Adopting The Netherlands/Canadian draft resolution in the Human Rights Council may negatively affect the bilateral political economic relations with Saudi Arabia”, according to the news agency.

            Iran Officially Switches From Dollar To Euro - Middle East Monitor reports that Iran’s feud with the US is set to get worse after Tehran announced this week that it will start reporting foreign currency amounts in euros rather than US dollars, as part of the country’s effort to reduce its reliance on the American currency due to political tension with Washington. Central bank governor Valiollah Seif said last week that Supreme Leader Ayatollah Ali Khamenei had welcomed his suggestion of replacing the dollar with the euro in foreign trade, as the “dollar has no place in our transactions today”.Iran does hardly any trade with the US due to decades of economic sanctions. It’s most important trading partner is the UAE, which accounts for around 24 per cent of all Iranian imports and exports. China is not far behind with 22 per cent, followed by Turkey, India and the EU, all of which account for around six per cent of Iran’s trade.Iran’s leaders have been threatening for some time to ditch the dollar for a different currency. The shift towards euro took on added urgency after the appointment of Donald Trump and his decision to include Iran on a list of mainly Muslim majority countries banned from entering the US. Trump has also threatened to exit a 2015 nuclear deal Iran made with world powers. The next major test for the deal is 12 May when Trump will be required to re-endorse the deal, which he has derided as “the worst deal ever”. The move is seen by Iranian officials as a logical and necessary step. The threat of further US sanctions has destabilised Iran’s foreign exchange market in recent months. Bank transactions involving the dollar are already difficult for Iran; sanctions have made US banks unwilling to do business with Tehran; foreign firms can be exposed to sanctions if they do Iranian deals in dollars, even if the operations involve non-US branches.

            The growing threat of an Israeli war against Iran --With the world media focused on the discussions in Washington between US President Donald Trump and his French counterpart Emmanuel Macron concerning the Iranian nuclear agreement, the Israeli government has adopted an increasingly provocative posture toward Iran while carrying out a buildup on its northern border in preparation for a military confrontation. Macron bowed to Trump’s demand for an aggressive policy toward Iran aimed at further curtailing not only the country’s nuclear program, but also its conventional weapons, and rolling back its influence throughout the Middle East. Nevertheless, the reaction in Tel Aviv to the Franco-American summit was largely negative. The Israeli perception is that Macron might succeed in brokering a deal that would deter the American president from the outright repudiation of the JCPOA (Joint Comprehensive Plan of Action), the nuclear deal reached between Iran and six major powers—the US, Russia, China, Britain, France and Germany—in 2015. Trump faces a May 12 deadline for deciding whether to scrap the agreement and reimpose unilateral US sanctions against Iran. This would place Washington on a direct trajectory toward war with Iran, the preferred outcome of the Israeli government. Israeli Intelligence Minister Israel Katz said in a radio interview Wednesday that the Iranian nuclear deal had to be “fundamentally amended, and if not, cancelled.” He warned that Macron and other European leaders had to understand that “putting pressure on Iran today can prevent violence and perhaps war tomorrow.” The warning of a potential war made by the Israeli minister was by no means hypothetical. Israel has sharply escalated the danger of an all-out military confrontation with Iran. The April 8 strike, a direct violation of international law and a violation of the sovereignty of two countries, was launched by US-supplied F-15 fighter jets flying over Lebanon against Syria’s T4 Air Base in the central province of Homs. The victims of the Israeli missiles included over a dozen military personnel, including seven Iranian military advisers, apparently the intended targets.

            Snipers ordered to shoot children, Israeli general confirms – w/ transcript - An Israeli general has confirmed that when snipers stationed along Israel’s boundary with Gaza shoot at children, they are doing so deliberately, under clear and specific orders.In a radio interview, Brigadier-General (Reserve) Zvika Fogel describes how a sniper identifies the “small body” of a child and is given authorization to shoot.  Fogel’s statements could be used as evidence of intent if Israeli leaders are ever tried for war crimes at the International Criminal Court.On Friday, an Israeli sniper shot dead 14-year-old Muhammad Ibrahim Ayyoub. The boy, shot in the head east of Jabaliya, was the fourth child among the more than 30 Palestinians killed during the Great March of Return rallies that began in Gaza on 30 March. More than 1,600 other Palestinians have been shot with live ammunition that has caused what doctors are calling “horrific injuries” likely to leave many of them with permanent disabilities. As eyewitnesses and video confirmed, the child Muhammad Ayyoub posed no conceivable danger to heavily armed Israeli occupation forces stationed dozens of meters away behind fences and earthen fortifications on the other side of the Gaza boundary when he was killed. Even the usually timid United Nations peace process envoy Nickolay Mladenov publicly declared that the slaying was “outrageous.”   A recording of the interview is online (it begins at 6:52). The interview was translated for The Electronic Intifada by Dena Shunra and a full transcript follows this article.

            Palestinian-Israeli conflict: UN envoy warns 'Gaza about to explode'  -- “Gaza is about to explode” as the Palestinian-Israeli conflict is continuing with no prospects for a political resolution, Nikolay Mladenov, UN Special Coordinator for the Middle East Peace Process has warned. Mladenov told the Security Council during an open debate on the crises affecting the region, urging both sides to avoid further clashes along the enclave’s border. “Old wounds continue to bleed and deepen as we speak, risking the outbreak of another war,”, the UN special envoy warned. While his briefing covered the situations in Syria, Yemen and Lebanon, it was largely focused on the unfolding crisis along the Gaza fence, which is at the tiny enclave’s border with Israel. For the last four weeks, tens of thousands of Palestinians in Gaza have converged on the fence to protest the long-standing blockade of the enclave. The so-called ‘Great March of Return’ demonstrations were expected to continue and culminate around May 15, and could spread to the West Bank and beyond, Mladenov said. Since March 30, during these demonstrations, 35 Palestinians have been killed and large numbers have been injured by Israeli security forces but no Israeli casualties have been reported, he added. Israel had accused Hamas, Islamic Jihad and other militants of using the protests, women, children and the elderly, as a cover to infiltrate Israel and commit terrorist attacks. The UN envoy urged Israel to calibrate its use of force and minimise the use of live fire. He also called on Hamas – a Palestinian faction governing the enclave – and the leaders of the demonstrations to keep protestors away from the Gaza fence. Mladenov said the combination of the security, development and humanitarian deterioration, coupled with the political impasse, was making Gaza “a powder keg" 

            Germany's Largest Public TV News Broadcaster: Syria Chemical Attack "Most Likely Staged" - A senior correspondent for German state media broadcast ZDF heute stunned his European audience during a report from on the ground in Syria when he gave a straightforward and honest account of his findings while investigating what happened in Douma. The veteran reporter, Uli Gack, interviewed multiple eyewitnesses of the April 7 alleged chemical attack and concluded of the testimonials, "the Douma chemical attack is most likely staged, a great many people here seem very convinced." It appears that all local Syrians encountered by the German public broadcast reporter were immediately dismissive of the widespread allegation that the Syrian government gassed civilians, which the US, UK, France, and Israel used a pretext for launching missile strikes on Damascus. ZDF heute: The world continues to puzzle over whether the banned chemical weapons were used in Douma. ZDF correspondent Uli Gack is in Syria for us: "you were in a large refugee camp today and talked to a lot of people - what did you hear about the attack there?" Gack responded, "the Douma chemical attack is most likely staged, a great many people here seem very convinced." The German ZDF report is consistent with veteran British journalist Robert Fisk's investigation upon being the first Western journalist to gain access to the site in Douma. Fisk reported early this week, "There are the many people I talked to amid the ruins of the town who said they had 'never believed in' gas stories–which were usually put about, they claimed, by the armed Islamist groups.

            Beware Of White Helmets Bearing News - The celebrated White Helmets of Oscar fame appeared to have made their own feature film in Duma on the night of the alleged chemical attack... At the center of the controversy over an alleged chemical attack in the Damascus suburb of Duma on April 7 are the White Helmets, a self-described rescue operation about whom an Oscar-winning documentary was made.  Reporter and author Max Blumenthal has tracked the role of the White Helmets in the Syrian conflict. He reported that the White Helmets were created in Turkey by James Le Mesurier, a former British MI5 agent. The group has received at least $55 million from the British Foreign Office and $23 million from the U.S. Agency for International Development as well as millions from the Kingdom of Qatar, which has backed a variety of extremist groups in Syria including Al Qaeda.  Blumenthal writes, “When Defense Secretary James Mattis cited ‘social media’ in place of scientific evidence of a chemical attack in Duma, he was referring to video shot by members of the White Helmets. Similarly, when State Department spokesperson Heather Nauert sought to explain why the US bombed Syria before inspectors from the OPCW could produce a report from the ground, she claimed, ‘We have our own intelligence.’ With little else to offer, she was likely referring to social media material published by members of the White Helmets.” The reference to social media as evidence in the most serious decision a leader can make—to engage in an act of war—is part of a disturbing trend. Then Secretary of State John Kerry pointed to “social media” as evidence of the Syrian government’s guilt in a 2013 chemical attack in the same Damascus suburb. But as Robert Parry, the late founder and editor of this site, pointed out in numerous reports, Syrian government guilt was far from a sure thing. Rather than wait for the arrival of a team of experts from the Organization for the Prohibition of Chemical Weapons to assess whether chemicals had even used in this latest incident, Trump gave the order to bomb.

            OPCW Investigators Reportedly Found "No Evidence" Of Chemical Weapons At Syrian Facilities Bombed By US - While it will likely take the Organization for the Prohibition of Chemical Weapons weeks or even months to issue their final report on the alleged gas attack in Douma (an attack for which journalists and other independent parties have failed to find any evidence), the organization's investigators have apparently spoken with Russian military officials after visiting the site of the Barzeh research center in Damascus - one of the three facilities targeted by the strikes. The Barzah Research and Development Center in Damascus, Syria, before it was struck by coalition forces on Saturday. This satellite image, taken Monday morning, shows the Barzah Research and Development Center in Damascus after it was struck by coalition forces. At the time we noted Paul Craig Roberts' 'awkward question' to Washington's warmongers:If this were true, would not a lethal cloud have been released that would have taken the lives of far more people than claimed in the alleged Syrian chemical attack on Douma?Would not the US missile attack be identical to a chemical weapons attack and thus place the US and its vassals in the same category as Washington is attempting to place Assad and Putin?And now, according to Sputnik, the investigators, who spoke with Russian General Staff Col. Gen. Sergey Rudskoy, revealed that they had found no evidence of chemical weapons in the remains of research facilities that were supposedly integral to the Syrian Army's chemical weapons program. Of course, this shouldn't come as a surprise: After all, if the US, France and the UK really did bomb a building filled with chemical weapons, there would've been thousands - possibly tens of thousands - of bodies to show for it.  "Immediately after the attacks, many people who worked at these destroyed facilities and just bystanders without any protective equipment visited them. None of them got poisoned with toxic agents," Rudskoy said.

            Did You Really Drop Bombs On A Chemical Weapons Facility Mrs May? On April 14th, shortly after the United Kingdom, United States and France bombed the sovereign country of Syria, on the basis of unproven allegations of the use of chemical weapons in Douma on 7th April, the British Prime Minister, Theresa May made the following comment in her official statement: “Together we have hit a specific and limited set of targets. They were a chemical weapons storage and production facility, a key chemical weapons research centre and a military bunker involved in chemical weapons attacks. Hitting these targets with the force that we have deployed will significantly degrade the Syrian Regime’s ability to research, develop and deploy chemical weapons” [my emphasis].It seemed to me when I heard these words – and the passage of time has not altered this impression – that Mrs May was admitting to one of two actions, either of which ought to see her removed from office. If we take her statement at face value, then it appears that she authorized a cruise missile strike on a number of depots that she believed contained chemical weapons, thus risking the dispersion of toxic chemicals into the atmosphere. It hardly needs to be spelled out what this could have led to, especially as some of these sites were close to residential areas. On the other hand, if she authorised the bombing of these facilities knowing full well that they did not contain chemical weapons, then her public statement made after the bombing was false. There really are no other options. Either she believed that these facilities contained chemical weapons, in which case her authorisation of the bombing of them was a deeply reckless and irresponsible act, which could have had horrendous consequences for the people near those locations. Or she knew that they did not in fact contain chemical weapons, in which case her statement was deliberately misleading.

            Russia Claims It Captured Trump's "Nice And New And Smart" Missiles After Syrian Strike - Two of President Trump’s “nice and new and smart” cruise missiles were recovered non-detonated by the Syrian Armed Forces on April 14, one day after the US, the UK and France fired more than 100 rockets into Syria according to the Russian TASS new agency. The U.S.-led missile strike targeted what they assumed were Syrian chemical weapon facilities in response to the April 07 gas attack in the Syrian city of Douma.  And now the reverse engineering of America's "new and smart" technology can begin: an unnamed source within the Syrian military confirmed to TASS that the cruise missiles were sent to Russia on April 18.“Two cruise missiles that were not exploded during the US missile strike in Syria on the night of April 14 were discovered by the Syrian military, both missiles in good enough condition the day before yesterday [April 17] were transferred to the Russian military,” the source said.As the source adds “these missiles were sent yesterday [April 18] by plane to Russia” for further examination.Alleged images of American and French cruise missiles shot down by Syria forces have recently surfaced on Twitter:“Syrian soldier stands beside downed US Tomahawk missile,” said Partisangirl.#Syrian soldier stands beside downed #US tomahawk missile. #Syria #SyriaStrike  — Partisangirl (@Partisangirl) April 14, 2018

            We will deliver S300 to Syria. Russian Army answers to threats by Lieberman - Russia plans to deliver new air defense systems to Syria in the near future, RIA news agency cited Russia’s Defense Ministry as saying on Wednesday.The ministry added it plans to study a U.S. Tomahawk cruise missile captured by Syrian forces in a recent attack, in order to improve Russia’s own missiles, RIA reported.The announcement comes a day after Defense Minister Avigdor Lieberman said that Israel may strike the Russian-made S-300 anti-aircraft defense systems in Syria if they are used against Israel. “One thing should be clear – if someone fires on our planes, we will destroy them,” Lieberman said in an interview with the Israeli website Ynet. “What’s important to us is that the weapons defense systems that the Russians transfer to Syria are not used against us. If they are used against us, we will act against them.”

            Russia presents alleged Syrian witnesses in The Hague to disprove chemical attack claims - Russia has presented more than a dozen alleged witnesses from Ghouta in Syria at The Hague to support its claim that the chemical attack this month was "staged". Britain dismissed the move as a theatrical "stunt", and said allied powers including France and the United States had boycotted the closed-door briefing."The OPCW [Organisation for the Prohibition for Chemical Weapons] is not a theatre," Britain's envoy to the agency, Peter Wilson, said in a statement."Russia's decision to misuse it is yet another Russian attempt to undermine the OPCW's work, and in particular the work of its fact-finding mission investigating chemical weapons use in Syria." The OPCW is investigating the deaths of dozens of people in Douma, an enclave in Ghouta, on April 7 which the United States and its allies said was caused by chemical weapons, possibly a nerve agent, used by forces of the Russian-backed Government of President Bashar al-Assad.The suspected attacks led to air strikes by the United States, France and Britain against sites in Syria.Both Syria and Russia have denied the accusation and said rebel forces staged the attacks. Russia and Syria brought 15 Syrians to a news conference in The Hague on Thursday (local time), and they said they had not seen any evidence of chemical weapons being used in Ghouta.

            "No Attacks, No Victims": Syria Chemical Attack Video Participants Speak At OPCW Briefing - Russian officials brought fifteen people to The Hague from the city of Douma, Syria, said to have been present during the alleged April 7 chemical attack - including  11-year-old Hassan Diab, who was seen in a widely-distributed video taken by the controversian NGO organization known as the "White Helmets," who filmed themselves giving Diab "emergency treatment" after the alleged incident. “We were at the basement and we heard people shouting that we needed to go to a hospital. We went through a tunnel. At the hospital they started pouring cold water on me,” said Diab, who was featured in the video which Russia's ambassador to the Netherlands says was staged.The boy and his family have spoken to various media outlets, who say there was no attack. Others present during the filming of Diab's hospital "cleanup" by the White Helmets include hospital administrator Ahmad Kashoi, who runs the emergency ward. “There were people unknown to us who were filming the emergency care, they were filming the chaos taking place inside, and were filming people being doused with water. The instruments they used to douse them with water were originally used to clean the floors actually,” Ahmad Kashoi, an administrator of the emergency ward, recalled. “That happened for about an hour, we provided help to them and sent them home. No one has died. No one suffered from chemical exposure.” –RT Also speaking at The Hague was Halil al-Jaish, an emergency worker who treated people at the Douma hospital the day of the attack - who said that while some patients did come in for respiratory problems, they were attributed to heavy dust, present in the air after recent airstrikes, but that nobody showed signs of chemical warfare poisoning.The hospital received people who suffered from smoke and dust asphyxiation on the day of the alleged attack, Muwaffak Nasrim, a paramedic who was working in emergency care, said. The panic seen in footage provided by the White Helmets was caused mainly by people shouting about the alleged use of chemical weapons, Nasrim, who witnessed the chaotic scenes, added. No patients, however, displayed symptoms of chemical weapons exposure, he said. –RT  Emergency paramedic Ahmad Saur who is with the Syrian Red Crescent, said that his hospital ward did not receive any patients exposed to chemical weapons the day of the alleged incident, and that all the patients either needed general medical care or help with injuries.

            Thousands of Syrians buried in the rubble six months after US destruction of Raqqa -- Six months after what the Pentagon proclaimed as its “liberation” of the Syrian city of Raqqa from ISIS militants, reports are emerging about the devastation caused by the relentless US siege of airstrikes and artillery bombardments against the city.The population of approximately 100,000 people, roughly a quarter the number living in the city prior to the US attack, is still without running water and electricity. Between 70 and 80 percent of the city was reduced to rubble by the US assault, with 11,000 buildings either damaged or destroyed. Six months on, an unknown number of thousands of civilians, men, women and children, remain buried beneath the rubble, filling the city’s neighborhoods with the stench of decomposing corpses.   An April 19 on-the-spot report by Tamer El-Ghobashy for the Washington Post —a supporter of US military intervention in Syria—detailed the efforts by 37 emergency services personnel to recover the remains of those killed. Since October, they have recovered more than 300 bodies. There are another 6,000 reports of human remains throughout the city that are yet to be responded to. Many of those discovered are so badly decomposed that they are unidentifiable, or can only be identified by family members based on pieces of clothing.  “People want to settle back into their neighborhoods and begin to rebuild. But everywhere we go, people are reporting more and more bodies.” This has given rise to a new threat to the city’s population: the spread of leishmaniasis, a parasitic skin disease spread by sand flies attracted to rotting corpses. Khanis noted that “The danger alarms are beginning to sound in this area, diseases and epidemics are starting to spread.” Omar Khalf, a member of the US-backed forces, told Syria Direct that the emergency teams are seeking to “extract the bodies before summer comes” to limit the spread of disease. The Post article quotes a 66-year-old Raqqa resident who lost seven family members to the airstrikes. “We suffered under [the Islamic State], but we’re suffering more from this American liberation.”

            The United States Used Depleted Uranium in Syria - Officials have confirmed that the U.S. military, despite vowing not to use depleted uranium weapons on the battlefield in Iraq and Syria, fired thousands of rounds of the munitions during two high-profile raids on oil trucks in Islamic State-controlled Syria in late 2015. The air assaults mark the first confirmed use of this armament since the 2003 Iraq invasion, when it was used hundreds of thousands of times, setting off outrage among local communities, which alleged that its toxic material caused cancer and birth defects.U.S. Central Command (Centcom) spokesman Maj. Josh Jacques told Airwars and Foreign Policy that 5,265 armor-piercing 30 mm rounds containing depleted uranium (DU) were shot from Air Force A-10 fixed-wing aircraft on Nov. 16 and Nov. 22, 2015, destroying about 350 vehicles* in the country’s eastern desert.Earlier in the campaign, both coalition and U.S. officials said the ammunition had not and would not be used in anti-Islamic State operations. In March 2015, coalition spokesman John Moore said, “U.S. and coalition aircraft have not been and will not be using depleted uranium munitions in Iraq or Syria during Operation Inherent Resolve.” Later that month, a Pentagon representative told War is Boring that A-10s deployed in the region would not have access to armor-piercing ammunition containing DU because the Islamic State didn’t possess the tanks it is designed to penetrate. It remains unclear if the November 2015 strikes occurred near populated areas. In 2003, hundreds of thousands of rounds were shot in densely settled areas during the American invasion, leading to deep resentment and fear among Iraqi civilians and anger at the highest levels of government in Baghdad. In 2014, in a U.N. report on DU, the Iraqi government expressed “its deep concern over the harmful effects” of the material. DU weapons, it said, “constitute a danger to human beings and the environment” and urged the United Nations to conduct in-depth studies on their effects. Such studies of DU have not yet been completed, and scientists and doctors say as a result there is still very limited credible “direct epidemiological evidence” connecting DU to negative health effects.

            How the US Occupied the 30% of Syria Containing Most of its Oil, Water and Gas –  After the U.S. launched “limited” airstrikes on Friday against Syria, U.S. Ambassador to the United Nations Nikki Haley announced that the U.S. will maintain its illegal presence in Syria until U.S. goals in the area are fulfilled, opening the door for the U.S. occupation to continue indefinitely. While the U.S. military presence in Syria has been ongoing since 2015 – justified as a means of countering Daesh (ISIS) — U.S. troops have since turned into an occupying force with their failure to pull out following Daesh’s defeat in northeastern Syria. Currently, the U.S. occupies nearly a third of Syrian territory — around 30 percent — including much of the area east of the Euphrates River, encompassing large swaths of the Deir Ezzor, Al-Hasakah and Raqqa regions.  As is often the case in U.S. occupations, both historical and present, it is an effort born out of two goals: resource acquisition for U.S. corporations and the destabilization of a government targeted for U.S.-backed regime change. Northeastern Syria is an important region owing to its rich natural resources, particularly fossil fuels in the form of natural gas and oil. Indeed, this area contains 95 percent of all Syrian oil and gas potential — including al-Omar, the country’s largest oil field. Prior to the war, these resources produced some 387,000 barrels of oil per day and 7.8 billion cubic meters of natural gas annually, and were of great economic importance to the Syrian government. However, more significantly, nearly all the existing Syrian oil reserves – estimated at around 2.5 billion barrels – are located in the area currently occupied by the U.S. government.

            Turkish President Erdogan Blasts The US For "Sending 5,000 Trucks Loaded With Weapons To Northern Syria" -  On Saturday, Turkish President Recep Tayyip Erdoğan sharply criticized the United States Armed Forces and its N.A.T.O. (North Atlantic Treaty Organization) allies for supplying weapons to Kurdish militias in Syria for free, while refusing to sell defense hardware to Turkey. “We cannot buy weapons from the US with our money, but unfortunately, the US and coalition forces give these weapons, this ammunition, to terrorist organizations for free,” Erdoğan stated in an interview on Turkish NTV news channel.“So where does the threat come from? It comes primarily from strategic partners,” he said, warning that Washington continues to pump in truckloads of weapons into northern Syria. During the interview, the Turkish president unloaded a bombshell that most Americans are entirely oblivious to — Washington and the Trump administration are deploying thousands of trucks jammed packed with guns and ammunition to Syrian terrorist.The United States has recently “sent 5,000 trucks loaded with weapons to northern Syria,” he said.Meanwhile, Trump took to Twitter on April 14 with a triumphant message in less than 280 characters after the US-led precision strikes in Syria hit alleged chemical weapons manufacturing sites earlier this month. “A perfectly executed strike,” he bragged, ending the tweet with a foolish phrase: “Mission accomplished!”The tweet eerily echoed that famous phrase of a former p resident, George W. Bush, who announced “mission accomplished” in 2003 to mark the start of the Iraq War, also called Second Persian Gulf War, that would continue for another 8-years until 2011. Even though Trump could have been using the phrase in a different context — the recent delivery of 5,000 trucks packed with military weapons and ammunition via Washington to terrorist organizations in Syria, indicates that fight in Syria is far from over.

            Qatar govt. must send troops to Syria or lose US support and be toppled – Saudi FM - Riyadh appears to be trying to bully regional rival and fellow US ally Qatar into going to war in Syria, with the Saudi foreign minister citing the US leader's call for "wealthy" nations to stump up and send boots to the ground. In his interpretation of US President Donald Trump's appeal to the affluent states in the region, Saudi Foreign Minister Adel Jubeir issued a thinly veiled threat to Doha, arguing the Qatari government will not last a week after the US cuts off its military support.Qatar must "send its military forces (to Syria), before the US president cancels US protection of Qatar, which consists of the presence of a US military base on its territory," Jubeir said on Wednesday, as cited by the ministry's media center.Should the US withdraw some 10,000 servicemen currently stationed at Al-Udeid air base near Doha, the government "would fall there in less than a week," Jubeir argued. The Saudi top diplomat was referring to the remark Trump made during a joint press conference with French President Emmanuel Macron on Tuesday.Reiterating his pledge to pull US forces out of Syria "as soon as possible," Trump pointed to "countries that are in the area, some of which are immensely wealthy" that should pick up the baton in Syria after the US withdraws. "They wouldn't last a week. We're protecting them," the US leader said, urging for those who enjoy America's goodwill to "step up and pay for what's happening."

            Mossad Accused Of Assassinating Hamas-linked Professor In Malaysia, Israel Denies -After the mysterious assassination of a well-known Palestinian engineer and academic in Malaysia over the weekend, Israel's defense minister issued a statement denying accusations that the Israeli spy agency Mossad was behind the killing. Dr Fadi Mohammed al-Batash, 35, had been living with his family in Malaysia for the past ten years and was a university professor in the field of electrical engineering. Batash was further recently employed by the Energy Authority in the Gaza Strip and had long held a position as lecturer at the British-Malaysian Institute at the University of Kuala Lumpur, according to Israel's YNet news. Israeli officials have recently accused him of being a rocket expert and downplayed his advisory work connected to Gaza's civilian infrastructure. Multiple international reports indicate that as Batash made his way from his home in Kuala Lumpur to a nearby neighborhood mosque for dawn prayers sometime around 6am, a motorcycle drove by and two unidentified men unleashed a volley of ten shots, at least four of which hit Batash in the head and body, killing him on the spot. Witnesses say the killers had European features.

            China’s Car Revolution Is Going Global --We’ve seen this movie before from China—in the smartphone industry. The nation used the shift in technology from basic flip phones to hand-sized computers to dominate the manufacturing industry, trouncing then-dominant makers from Finland, Sweden, the U.S., Japan and Germany. Last year, three of the top five smartphone handset makers in the world were Chinese, according to Gartner Inc.Yet the sequel may take longer to become a hit, given the brand loyalty that has existed since Henry Ford debuted the Model T in 1908. How will Chinese automakers convince Midwesterners to give up their Ford F-150 pickups or Tokyo residents to switch from their Toyotas? “Chinese carmakers intend to come over, but what need will they fill?” said Doug Betts, senior vice president of global automotive practice at J.D. Power. “What is the reason to buy their cars?”Chinese cars probably would compete more directly with Japanese and Korean models, said Bob Lutz, the retired vice chairman of GM. American consumers mostly cross-shop Asian brands. “If they start coming in, they won’t be any more competent than Korean and Japanese cars,” Lutz said. “They would probably take share from other Asian brands because the vehicles will be more Asian in character. They’re not going to get much market share.”

            Trade war with US could be the tipping point for China’s $14 trillion debt-ridden economy - While some of the rhetoric around trade tariffs on China has died down over the last couple of weeks, the prospect of a trade war has not. On April 18, China imposed preliminary antidumping tariffs of 178.6 percent on sorghum, a crop used to make alcohol and biofuels, while President Donald Trump's threat to impose tariffs on $150 billion worth of goods on everything from solar panels to aircraft to cars remains on the table. If an actual U.S. trade war ensues, then China's economic growth prospects could be negatively impacted in a significant way. While the country's economy has shifted inward over the last few years, relying on its own citizens to fuel growth, it still exports billions of dollars in goods and services every year. Last year it sold $506 billion in exports to the United States — nearly 20 percent of its exports go to America — while the United States sold just $130 billion to the Chinese. In January the International Monetary Fund said China's economic growth would top 6.6 percent in 2018, but it could now drop by as much as 0.5 percent if these tariffs are imposed — and it could slow even further if a global trade war truly heats up. China's economy can likely weather a small decline in growth, in part because of its increased reliance on domestic spending, but this isn't the only potentially GDP-destroying situation it's dealing with. Over the last few years, China's debt-to-GDP has ballooned to more than 300 percent from 160 percent a decade ago, causing many people, including Chinese officials, to warn of a financial-sector debt bubble that's waiting to burst.  How did it get so bad? After the recession, the country spent trillions on infrastructure projects, with many banks, including unregulated or "shadow" banks, loaning money to companies that have been unable to pay back their debts. According to a Chinese news outlet, total volume of nonperforming loans could hit a record $476 billion by 2020. Many of these loans were made to finance infrastructure projects, which did help the economy. China's GDP growth hovered between 9.5 percent and 10.5 percent between 2008 and 2011, but it's become clear that the spending was done at a cost.

            Chinese navy drills rattle Taiwan - Chinese naval forces have passed through waters south of Taiwan and carried out military exercises in the western Pacific, the latest in a series of military drills that Taiwan has called "intimidation". J-15 fighters took off from China's sole operational aircraft carrier, the Liaoning, on Friday for training in the area to the east of the Bashi Channel, which runs between Taiwan and the Philippines, the official newspaper of the People's Liberation Army reported on Saturday. Chinese destroyers carried out offensive and defensive drills to test their capabilities, the PLA Daily said. The Ministry of Defence also carried pictures of the exercises on its website on Saturday. China has been ramping up military displays in the area over the last week. On Wednesday, the navy carried out live-fire drills in the Taiwan Strait in what state media said was a direct response to "provocations" by Taiwan. Taiwan, which is claimed by Beijing as Chinese territory, accused China of "sabre rattling", and carried out its own live-fire exercises on Tuesday on two Taiwan islands close to China. On Thursday, Chinese bombers flew around Taiwan in what the air force called a "sacred mission". Taiwan's Mainland Affairs Council, which oversees China policy, said the exercises, including the flight by the bombers, amounted to "military intimidation".

            70% Of Taiwanese "Willing To Fight" China | Zero Hedge - Just days after China launched its "largest naval drill in 600 years"  in the Taiwan Strait, The Taipei Times reports that 67.7 percent of respondents said they were willing to go to war to defend Taiwan if China launched an armed assault on the nation to force unification. The survey, released by the Taiwan Foundation for Democracy last week, also showed the number of people willing to fight to prevent unification with China rose to 70.3 percent among respondents aged 20 to 39, the survey showed. The foundation president Hsu Szu-chien told a news conference in Taipei that it considers it a fitting time to pose the question as the Chinese military has over the past few years been increasing activity near Taiwan.94 percent of people said that living in a democratic society is “important,” of which 65.8 percent said it is “very important.” In addition, 76.4 percent of people agreed with the statement: “Democracy, despite its flaws, is still the best system,” the poll showed.“If we factor in questions about whether young people support democracy, we discover that the more people support democracy, the more willing they are to defend Taiwan in the event of an invasion by China,” Hsu said.“I think it is our democratic lifestyle and values that people want to protect.”

            Australian and Chinese navy ships reportedly face off in the South China Sea - As tensions heighten between the US and China, an encounter between Australian and Chinese naval vessels reportedly occurred on April 15. Though both sides disputed the facts of the event, international media outlets gave it prominent coverage, depicting it as a “Chinese challenge” to Australian warships.From the limited details provided in media and government statements, it appears that Chinese naval forces approached three Australian warships as they transited from the Philippines to Vietnam to participate in joint training exercises with Vietnamese forces. The encounter occurred when the Chinese People’s Liberation Army Navy (PLAN) was conducting large military exercises in the South China Sea.The precise course of the Australian ships remains unclear, and whether this would have brought them near Chinese exercises or military facilities, prompting the PLAN to engage them, is unknown.No information has been provided on the actual interaction between the ships. The Australian Defence Department refused to answer any questions, saying only that communication between the ships was “polite but robust.” However, the Australian Defence Force did confirm the identities of the ships involved—the frigates HMAS Anzac and HMAS Toowoomba, and the resupply ship HMAS Success.Australian government officials have been similarly tight-lipped. Prime Minister Malcolm Turnbull refused to confirm any details of the incident while insisting that Australia had every right to conduct “freedom of navigation operations and overflight operations”—a phrase used by the US to refer to challenges to Chinese territorial claims in the South China Sea.

            Top US Admiral Warns China Now Controls The South China Sea -- An unclassified 50-page transcript on Advance Policy Questions for Admiral Philip Davidson, USN Expected Nominee for Commander, U.S. Pacific Command, just confirmed the collapse of American exceptionalism in the South China Sea. Adm. Davidson, the likely nominee to replace departing U.S. Pacific Command Chief Admiral Harry Harris, warned that Beijing has the capability and capacity to control the South China Sea “in all scenarios short of war with the United States.”  In written testimony to the US Senate Armed Services Committee released last Tuesday, Adm. Davidson said China is seeking “a long-term strategy to reduce the U.S. access and influence in the region,” which he claims the U.S. must maintain its critical military assets in the area. He views China as “no longer a rising power,” but rather a “great power and peer competitor to the United States in the region.” Adm. Davidson agreed with President Trump’s recent assessment on China, calling the country a “rival.” Adm. Davidson warns, that it is Beijing’s clear intent to disintegrate the seventy years of U.S. alliances and partnerships in the region. “I am also concerned about Beijing’s clear intent to erode U.S. alliances and partnerships in the region. Beijing calls them a relic of the Cold War. In fact, our alliances and partnerships have been the bedrock of stability in the Indo-Pacific region for the past seventy years, and they remain a core element of our defense strategy.”

            The DPRK declares itself a nuclear power - Note by the Saker: please read carefully what this official statement says.  There are two key elements here, first, the DPRK has successfully completed its program of nuclear tests and ballistic missiles test and, second, the DPRK will now act as a responsible nuclear power and never use its nuclear power unless she is attacked.  In plain English this simply means: we made it, you could not stop us, now we are a nuclear power on par with all the rest of them and there is nothing you can do about it.  No doubt, the Hegemony’s propaganda machine will present that as a huge, immense, victory for Trump.  In reality, it is anything but.  Truth be told, I personally doubt that the DPRK has a real nuclear warhead or anything beyond an intermediate-range missile.  But that is neither here nor there because whatever the facts of the matter really are, the fact that they themselves declare that they have real nuclear warheads and ICBMs and that nobody can do anything about it means that they have won.  Besides,  you can’t prove a negative anyway.  So whether these capabilities are real or not, the status of nuclear power claimed by the DPRK will have to be granted to them.  Thus, “Rocket Man” wins!  The Donald lost this one. 

            North Korean Nuclear Test Site Has Collapsed, Explaining Kim's "Suspension" Of Further Tests -  It finally happened. Six months after a group of Chinese scientists warned that the North Korean Punggye-ri nuclear test site was on the verge of collapse, and following reports from Japan's Asahi TV that more than 200 North Koreans had died when a tunnel collapsed at the test site, the South China Morning Post reported today that North Korea’s mountain nuclear test site has completely collapsed, putting China and other nearby nations at unprecedented risk of radioactive exposure, two separate groups of Chinese scientists studying the issue have confirmed. The collapse also likely explains the sudden willingness of North Korean leader Kim Jong-un to declare last Friday that he would freeze the state’s nuclear and missile tests and shut down the site, a researcher cited by the SCMP said.  At least five of North Korea's last six nuclear tests all took place under Mount Mantap at the Punggye-ri nuclear test site in North Korea’s northwest; in the process they unleashed artificial earthquakes and destabilized the mountain to the point of no return.According to the SCMP report, a group of researchers found that the most recent blast tore open a hole in the mountain, which then collapsed upon itself. A second group concluded that the breakdown created a “chimney” that could allow radioactive fallout from the blast zone below to rise into the air.

            From DMZ to Seoul, hope and concern as summit approaches | Asia Times: “End of separation, beginning of unification” reads a slogan on a camouflaged observation post south of the DMZ. A sign beside an army position guarding the Han River bank some 20 miles north of Seoul – wired off to prevent North Korean amphibious infiltration – reads “Gyeonggi Province, toward reunification.” And the slogan on an arch over the checkpoint that leads into the DMZ reads, “Reunification-preparing Paju County.” Many are excited. “I think South Koreans will be able to visit Pyongyang very soon!” a Seoul citizen, vacationing in Europe, texted a foreign reporter. Currently, South Korean tourism to North Korea is illegal. Much of this is coming from the top. One of Moon’s key pre-election promises was upgrading relations with the North, but even he must be elated at developments since January. Even seasoned Korea watchers are surprised by the speed at which events are moving. Kim has promised a missile and testing moratorium; said he will discuss denuclearization; agreed to hold Friday’s inter-Korean summit, and – critically – offered to meet US President Donald Trump. North Korea attended the Winter Olympics in the South, and high-level envoys crisscrossed the DMZ.Inter-Korea telecommunications, severed in 2016 amid high tensions, have been reconnected. A first-ever direct hotline between the leaders of the two Koreas was connected last week. Also last week, a plenary meeting of the North Korean Worker’s Party Central Committee heard of plans to cease missile and nuclear tests and shutter the nation’s underground nuclear test site. In a televised announcement, Moon hailed the moves. Yesterday, the Koreas agreed to halt propaganda cross-border broadcasts.

            North And South Korea Declare End To War, Proclaim "New Era of Peace” - North Korean leader Kim Jong Un and South Korean PresidentMoon Jae-in agreed Friday to finally end a seven-decade war this year, and signed a declaration to pursue the “complete denuclearization” of the Korean Peninsula, although they did not announce any concrete steps to dismantle the North’s nuclear programs.. The two leaders embraced after signing the deal during a historic meeting on their shared border, the first time a North Korean leader has set foot on the southern side. They announced plans to formally declare a resolution to the war and replace 1953 armistice that ended open hostilities into a peace treaty by year’s end. “We solemnly declare to our 80m Koreans and the world that there will no more war on the Korean peninsula and a new era of peace has begun,” North Korean leader Kim Jong Un and South Korean president Moon Jae-in said in a joint statement. “It is our urgent historic assignment to put an end to this current abnormal state of ceasefire and establish a peace regime.”“We have agreed to share a firm determination to open a new era in which all Korean people enjoy prosperity and happiness on a peaceful land without wars,” Kim said, in his first remarks in front of the global press since taking power in 2011.The two sides “confirmed the common goal of realizing, through complete denuclearization, a nuclear-free Korean Peninsula.” The two agreed to work towards advancing the reunification of the divided nations and further improving inter-Korean relations. In order to reduce tension, the two sides agreed to hold military talks in May and set up a joint liaison office in Kaesong, the border town in the North.“South and North Korea agreed to actively seek the support and cooperation of the international community for the denuclearization of the Korean Peninsula,” according to the statement. It didn’t elaborate on what that would entail. “The commitment to ‘complete denuclearization’ is ambiguous, and subject to different interpretations,” said Youngshik Bong, a researcher at Yonsei University’s Institute for North Korean Studies in Seoul. “It can be interpreted as North Korea getting rid of all warheads, or North Korean demands on the U.S. military in South Korea.”

            Korean leaders pledge denuclearization, but avoid specifics — The leaders of North and South Korea played it safe Friday, repeating a previous vow to rid the Korean Peninsula of nuclear weapons but failing to provide any specific new measures or forge a potential breakthrough on an issue that has captivated and terrified many since the rivals seemed on the verge of war last year. In a sense, the vague joint statement produced by North Korean leader Kim Jong Un and South Korean President Moon Jae-in to achieve “a nuclear-free Korean Peninsula through complete denuclearization” kicks one of the world’s most pressing issues down the road to a much-anticipated summit between Kim and U.S. President Donald Trump in coming weeks. Even so, the Koreas’ historic summit Friday might be remembered as much for the sight of two men from nations with a deep and bitter history of acrimony holding each other’s hands and grinning from ear to ear after Kim walked over the border to greet Moon, and then both briefly stepped together into the North and back to the South. Standing at a podium next to Moon after the talks ended, Kim faced a wall of cameras beaming his image live to the world and declared that the Koreas are “linked by blood as a family and compatriots who cannot live separately.” What happened Friday should be seen in the context of the last year — when the United States, its ally South Korea and the North threatened and raged as the North unleashed a torrent of weapons tests — but also in light of the long, destructive history of the rival Koreas, who fought one of the 20th century’s bloodiest conflicts and even today occupy a divided peninsula that’s still technically in a state of war. Kim’s single step across the cracked, weathered concrete marking the Koreas’ border made him the first ruler of North Korea to step on South Korean soil since the war. It marks a surreal, whiplash swing in relations for the countries, from nuclear threats and missile tests to intimations of peace and cooperation.

             India's Modi visits China's Xi to talk 'cooperation' -  Chinese President Xi Jinping called for stepped-up cooperation with India during an informal summit with Prime Minister Narendra Modi amidborder tensions and a rivalry for influence with smaller neighbours that could determine dominance in Asia. Xi greeted Modi at the provincial museum in the city of Wuhan on Friday at the start of two days of talks between the heads of the world's two most populous nations. "Conducting great cooperation by our two great countries can generate worldwide influence," Xi was quoted as saying by state broadcaster CCTV. Xi said he hoped the meeting would "usher in a new chapter of China-India relations".Indian Ministry of External Affairs spokesman Raveesh Kumar tweeted the leaders would "review the developments in our bilateral relations from a strategic and long-term perspective". China-India relations date back centuries, but in recent decades have been characterised by competition for leadership in Asia.The countries fought a border war in 1962 and last year engaged in a 10-week standoff in the neighbouring state of Bhutan. New Delhi has also been alarmed by China's moves to build strategic and economic ties with Indian Ocean nations including Sri Lanka, the Maldives and India's longtime rival Pakistan.  China resents India's hosting of the exiled Tibetan spiritual leader the Dalai Lama, and its control of territory Beijing says belongs to it. China claims some 90,000sq km of territory in India's northeast, while India says China occupies 38,000sq km of its territory on the Aksai Chin Plateau in the western Himalayas.

            India to seize property of super-rich fugitives: document  (Reuters) - Indian authorities will be empowered to seize properties of super-rich fugitives whose economic offences or crimes involve sums over 1 billion rupees ($15 million), according to a government document seen by Reuters on Saturday. The move comes as the country reels from a series of banking scandals, including a $2 billion fraud at state-run Punjab National Bank (PNBK.NS) that was uncovered in February. Mumbai jewelers Nirav Modi and his uncle Mehul Choksi are prime suspects in the case and a special court of India’s Central Bureau of Investigations (CBI) this month issued non-bailable warrants against them. But authorities say the two men left the country before the fraud was uncovered. Modi and Choksi have denied the allegations against them. Following an executive order, or ordinance, issued by the cabinet, investigating agencies will be able to confiscate the properties of fugitives in such cases. “The ordinance is expected to re-establish the rule of law with respect to the fugitive economic offenders as they would be forced to return to India to face trial for scheduled offences,” the government document said. According to the ordinance, a special court set up under anti-money laundering laws will have to declare a suspect fugitive before authorities can seize property. India is seeking the extradition of Indian liquor and aviation tycoon Vijay Mallya over unpaid loans to his defunct Kingfisher Airlines after the businessman, co-owner of the Formula One Force India team, moved to Britain in March 2017. Mallya’s lawyers argue that he is being used as a scapegoat by Indian politicians of all stripes to deflect public anger at the accumulation of bad debts by state-owned banks.  

            What caused the sudden cash crunch, and what are the lessons for policymakers  - Memories of the days of demonetisation, through which the government in November 2016 declared Rs 500 and Rs 1,000 notes invalid, have not faded away. Though the situation has improved since then, empty automatic teller machines (ATMs) have returned to haunt the average Indian in several parts of the country. To add to the confusion, there is no consensus on the reasons for the problem. How long will it take to resolve the problem that has gripped Andhra Pradesh, Telangana, Karnataka, northern Bihar, parts of Uttar Pradesh, parts of Punjab, the border areas of Gujarat and Madhya Pradesh and some parts of interior Maharashtra? Chairman of State Bank of India Rajnish Kumar said normalcy would return in a week. Finance Minister Arun Jaitley said the problem was temporary. How big is the problem? Educated guesses put it between Rs 70,000 crore and Rs 1,50,000 crore. What caused it? Answers are diverse — from hoarding to election-related demand to festival and agrarian expenses.  Many claim they saw it coming. The head of a prominent cash management agency, who does not want to be named, says he has been raising the issue of shortage of cash since December 2017 with various authorities. But they chose not to address it. “They felt pushing more cash in the region will only lead to more cash being sucked out.” A more public signal was seen in mid-February, when the government of Andhra Pradesh wrote to the Reserve Bank of India (RBI), seeking an infusion of Rs 5,000 crore into the region. Accord-ing to a government reply tabled in Parliament on March 16, the money was provided. It also noted that since demonetisation, the Hyderabad office of the RBI has been the highest recipient of currency notes — Rs 82,168 crore up to March 2017, and Rs 51,523 crore between April 2017 and February 2018.

            Indonesian ISIS Recruits Threaten "Satanic" CNN, Universal Studios In New Propaganda Poster - ISIS recruits in Indonesia (famously the country with the largest Muslim population) have released a series of propaganda posters that are circulating on the Internet that exhort their followers to commit acts of violence against the US financial system, as well as media organizations like CNN.The release comes as Indonesia has increasingly become a hotbed of Islamic terror and haven for extremists."Indonesia increasingly has become a haven for Islamist extremists. And we've seen it not just in the society at large, but also in the government," Mark Mitchell, acting assistant secretary for special operations and low-intensity conflict at the Defense Department.As PJ media pointed out, the first poster shows a devil-like figure looming over several icons that are ringed in flames. They include: the United Nations, the Federal Reserve, Universal Studios Hollywood, CNN, NATO and NASA, along with the seal on the US dollar bill.An image of an ISIS soldier firing a machine gun at logos can be seen in the bottom left corner. The poster goes on to pan "modern philosophy," "modern science," "modern state," and "modern era" as "mankind is kept away from the path of his God."It also claims that Dajjal, the antichrist in Islamic theology, is "behind the modern name whether you can or not see it," essentially condemning all the organizations listed in the poster as "satanic." The second poster features the Eye of Providence and stacks of burning American money, with an admonishment to "read carefully and choose the verdict."

            How The Globalism Con Game Leads To A 'New World Order' - When globalists speak publicly about a “new world order” they are speaking about something very specific and rather sacred in their little cult of elitism. It is not simply the notion that civilization shifts or changes abruptly on its own; rather, it is their name for a directed and engineered vision — a world built according to their rules, not a world that evolved naturally according to necessity.There are other names for this engineered vision, including the “global economic reset,” or the more general and innocuous term “globalism,” but the intention is the same. The ultimate goal of the new world order as an ideology is total centralization of economic and governmental power into the hands of a select and unaccountable bureaucracy made up of international financiers. This is governance according the the dictates of Plato’s Republic; a delusional fantasy world in which benevolent philosopher kings, supposedly smarter and more objective than the rest of us, rule from on high with scientific precision and wisdom. It is a world where administrators become gods.Such precision and objectivity within human systems is not possible, of course. Human beings are far too susceptible to their own biases and personal desires to be given totalitarian power over others. The results will always be destruction and disaster. Then, add to this the fact that the kinds of people who often pursue such power are predominantly narcissistic sociopaths and psychopaths. If a governmental structure of high level centralization is allowed to form, it opens a door for these mentally and spiritually broken people to play out their twisted motives on a global stage.It is important to remember that sociopaths are prone to fabricating all kinds of high minded ideals to provide cover for their actions. That is to say, they will adopt a host of seemingly noble causes to rationalize their scramble for power, but in the end these “humanitarians” only care about imposing their will on as many people as possible while feeding off them for as long as time allows.

            IMF Blasts New Zealand's "Discriminatory" Ban On Home Sales To Foreigners - Amid reports that 40,000 kiwis were living on the streets or in emergency shelters thanks to an acute housing crisis in the nation of nearly 5 million, New Zealand's Labour-led government knew it needed to take drastic action to cool the country's white hot housing market - or at least convince the public that it was doing something. So late last year, lawmakers proposed a bill that would limit home purchases to people who carry residential visas. It is called the Overseas Investment Act.As we've pointed out, home prices in New Zealand have risen dramatically since the financial crisis. Over the past ten years, New Zealand home prices have risen by roughly 60% due to a combination of factors, including limited supply, low interest rates fueling a boom in borrowing, and - of course - foreign speculation. And on Sunday, the chorus of critics against the measure - which hasn't been passed into law - gained another voice: That of the International Monetary Fund. In its annual report on the New Zealand economy, the IMF said the measure would be "unlikely to have a significant impact on housing affordability," and that the rest of the government's "ambitious policy agenda" would likely be more than enough to help make homes more affordable.

            Peru: 89-Year-Old 'Wise Woman' Indigenous Leader Murdered - Olivia Arevalo Lomas, an 89-year-old leader of the Shipibo Konibo Indigenous group in the Peruvian Amazon, was assassinated on Thursday afternoon. Witnesses said they saw a man approach Arevalo Lomas' house and shoot her several times in the chest before fleeing on a motorcycle.  The murder occurred in the intercultural community of Victoria Gracia, 20 minutes from the town of Yarinacocha in Coronel Portillo province, Ucayali. The Federation of Native Communities of Ucayalo and Tributaries (Feconau) released a statement on Facebook condemning the killing: "We call on national and international opinion for the Peruvian state to provide guarantees for the lives of other indigenous leaders of the Shipibo Konibo people who today face death threats and harassment," the statement said. Peru's Ministry of Culture described Arevalo Lomas as a wise woman who retained "traditional knowledge of the Shipibo-Konibo people," expressing condolensces and solidarity with her relatives and the Victoria Gracia community. The Ombudsman's Office also condemned the assassination: "We are immediately following up with the police and the prosecutor's office in order to conduct a thorough investigation. We ask the authorities for protection for the affected family." Arevalo Lomas was a staunch defender of Indigenous people's rights in the region. She also served as an ikaro ('singer'), a traditional form of singing-medicine that removes negative energies from the individual and collective. Their songs, known as Onyanya ('plant songs'), are taught to healers through a specific dietary regime lasting roughly four years. It's intended to immerse the singer in the healing powers of plants and help them inherit the songs.

            Demonstrations grow in Nicaragua after Ortega suspends pension cuts - Mass demonstrations took place across Nicaragua yesterday against an executive decree that drastically cuts pensions and requires workers and employers to contribute more to the near-bankrupt Nicaraguan Social Security Institute (INSS). The protests grew even after president Daniel Ortega, the former commander of the Sandinista Front for National Liberation (FSLN), canceled the proposed pension reform that was demanded by the International Monetary Fund (IMF). After nearly a week of protests, the Red Cross reports 428 injured and anti-government NGOs say 27 were dead by Sunday.The demonstrations began last Wednesday with marches by pensioners and public university students in Managua and León. Over the next few days, the protests spread to other major cities and towns across the country and have increased in size and militancy in response to deadly repression by the state forces. Sandinista youth groups have also functioned as pro-government shock groups, inflicting violence on demonstrators.After criminalizing protests and threatening to step up the repression on Saturday, Ortega retreated Sunday, calling for negotiations with business organizations, trade unions and the Catholic Church. The right wing is intervening in the demonstrations to calm social tensions and block the growth of opposition to Ortega’s capitalist government. Although the IMF reform was intended to make Nicaragua a more attractive investment for Wall Street and foreign capital—a prospect which the top business organization, Cosep, welcomes—big business has disagreements with the way the plan was implemented.

            "This Is Mushrooming" - Nicaragua Teeters On The Brink Of Revolution As US Pulls Diplomats -- For the first time since the late 1970s, Nicaragua is on the brink of a revolution as tens of thousands of protesters throng the streets of the capitol Managua and a host of other towns to demand the resignation of President Daniel Ortega, a former left-wing dictator-turned-democrat who led the Sandinistas to during the Nicaraguan Revolution.Ortega, who gave up power after losing an election in 1990 but remained a popular opposition figure and was elected president in 2006, has been criticized for his autocratic rule, political repressions and - most recently - for proposing social security reforms that would involve Nicaraguans paying more into the system while reducing payouts by 5%, according to Al Jazeera.Ortega has aligned his government with the governments of Cuba and Venezuela, though Nicaragua's economy achieved 5% GDP growth last year. Still, it remains the poorest country in Central America.The country's Social Security Institute's deficit has tripled in three years to $77 million as of 2017, prompting the push by Ortega for reform.The protests are the biggest to sweep the country since Ortega returned to power. While Monday's protest was organized by business groups and was markedly less violent than the previous five days of demonstrations - which resulted in the deaths of 25 protesters at the hands of Nicaraguan security forces - Ortega's decision to abandon the controversial social security reform has done little to blunt the opposition's anger. Local journalist Tim Rogers tweeted a picture of molotov cocktails stowed behind a barricade. The situation has grown so dire that the US has withdrawn its diplomats from the capitol, as the Financial Times reported. In addition to the killings, hundreds of people have been injured as police have used live ammunition. Dozens of shops in Managua have been looted.

            Narco-Politics: 7,667 Mexicans Killed In 3 Months As Drug Cartels Unleash Hell Before Elections - According to official Mexican government data, released on Sunday, more than 7,667 people were killed in Mexico during the first quarter of 2018, that is almost a 20 percent increase year over year, “making it the most violent year in two decades,” said AFP. This time last year, the figure stood at 6,406 murders, according to the Mexican government. AFP’s explanation for the explosive killings across Mexico is primarily due to the drug cartel wars. The government’s statistics behind the violent crime is mind-boggling, with total 2017 deaths hitting a staggering 25,339 — which makes last year the most dangerous year ever.“The worst month was March, when 2,729 people were killed, most of them shot dead. January’s figure stood at 2,549 murders, with another 2,389 in February. The bloodshed follows a proliferation of gangs involved in drug trafficking, as well as stealing fuel, kidnappings, extortion and other criminal activities. In 2017, a total of 25,339 people were killed in Mexico, the highest number since monitoring began 10 years earlier.”To make matters worse, drug cartels have started targeting politicians, as the Mexican general election is expected to be held on July 01. In recent months, eighty candidates have been “shot, knifed, beaten or burned to death; some have even been dismembered,” said Deutsche Welle.One thing is for sure: Drug cartels have thinned out the voting selection for early July when Mexicans choose a president and legislators.Jose Reveles, a journalist, and writer concentrating in drug trafficking said the motives behind drug cartels murdering politicians could include, “voter intimidation and revenge on leaders who ally with rival criminal organizations or even stand up to cartels.” Though, Reveles said, “the killings of politicians in such large numbers is a relatively new phenomenon, journalists, activists and other noncombatants have long been targeted by cartels.”

            Nova Scotia Arrests Teen Who Discovered Massive Government Data Breach - A Nova Scotia teenager woke up to 15 police officers raiding his home last Wednesday, after the 19-year-old discovered that the government had uploaded confidential documents to a publicly available database and then took measures to download them.   "They read us our rights and told us not to talk," said his mother.  The teen, whose name has been withheld prior to arraignment, was unsatisfied with an answer he received after filling a Freedom of Information request related to a provincial teachers' dispute. He noticed, however, that the URL for the response ended in a long string of digits - and that by simply changing the number (adding or subtracting from it), he had access to other documents provided through similar FoI requests. "I decided these are all transparency documents that the government is displaying. I decided to download all of them just to save," the teen told CBC News. "I didn't do anything to try to hide myself. I didn't think any of this would be wrong if it's all public information. Since it was public, I thought it was free to just download, to save," he added.In response, he wrote a one-line program which grabbed approximately 7,000 public records in order to check them out - which led to the police raid in which authorities seized all the family's electronics - including the phone and computer his father uses for income. "They rifled through everything. They turned over mattresses, they took drawers and emptied out drawers, they went through personal papers, pictures," said the teen's mother. "It was totally devastating and traumatic."   The police also arrested one of the teen's younger brothers as he was walking home from school. Officers also took his 13-year-old sister to question her in a police car.   "Our daughter, she was really traumatized, really bad ó brought her to tears, the way they conducted this," said the father. "They rifled through everything. They turned over mattresses, they took drawers and emptied out drawers, they went through personal papers, pictures ... It was totally devastating and traumatic." The 19-year-old faces criminal charges and a possible 10-year prison sentence.

             Data Privacy Is a Human Right. Europe Is Moving Toward Recognizing That. - While “privacy” may sound like a fuzzy concept, it’s not at all a new idea in either human rights law or the rules that apply to Facebook in some of its largest markets. The company has also had to defend its practices before courts and regulatory bodies that have examined the issue — which makes Zuckerberg’s answer unsettling. And since Facebook obtains data even about people who don’t use the social network, this is an issue for all of us.  The UN’s top human rights office concluded years ago that in order to respect the right to privacy, governments should regulate how private companies — not just police and spy agencies — treat personal data. Although the human rights treaties only strictly apply to governments, there is a long-established norm that >businesses should respect rights even if a government doesn’t force them to do so — and that’s as true for Facebook as for more usual suspects such as the diamond, oil, and tobacco industries. The same UN body has specifically urged web-based companies to make sure their practices don’t facilitate inappropriate government surveillance or otherwise harm human rights.  To achieve this, companies should first recognize that simply because a user has “shared” a piece of information with a platform or others doesn’t mean he or she has lost any privacy interest in it. If one looks closely at Facebook executives’ responses to the scandal surrounding data analysis firm Cambridge Analytica’s access to users’ data, one will find repeated mentions of the idea that this was data the users themselves had shared or made public.  However, as the European Court of Human Rights has recognized, data about us can still raise privacy concerns >even if it isn’t something we’ve kept secret. And European Union law acknowledges even more explicitly that personal information we can’t — or shouldn’t have to — keep to ourselves, such as our race and religious beliefs, can still be sensitive and need protection by both governments and companies.

             Pope Fransziskus to award the Russian President Putin with Peace Award „Golden Palm“ for his peace efforts in the Middle East. -- According to reports in the Polish newspaper „Wyborcza“ and in the italian „La Stampa“, the Russian head of state agreed to travel to Italy to receive the prize. He will probably meet Pope Francis, and will be accompanied by a high representative of the Russian Church.  The „Golden Palm“ award has been awarded since the 1980s by the association Assisi Pax International, an ecclesiastical association inspired by St. Francis. The award refers to the meeting of John Paul II, in which representatives of different religions prayed together in Assisi in 1986 for peace.

            Was Finland’s Universal Basic Income Program A Failure? -- While it lasted, Finland’s social experiment that gave 2,000 unemployed people nearly $700 a month with zero strings attached was a decent take home for those who enjoyed its benefits over the 15 months—but the authorities say it’s not working and are moving to wind it down by 2019. In January 2017, Finland became first country in Europe to launch a universal basic income program, randomly choosing 2,000 individuals without jobs, aged 25 to 58, and giving them a fixed monthly income of $685 without the usual condition that they actively seek employment. It was a unique social experiment that its advocates hoped would help reduce poverty, boost employment and cut down on crime. One year and one quarter later, the government is scrapping the program though the country’s social benefits agency, KELA, has requested an extension. The government holds that the program, experimental in nature, was only intended to run for an initial two years. As of last November, Finland had 213,000 unemployed people—largely unchanged since from the year before. Panic set in in 2015 when unemployment rates hit a 17-year high of 10 percent, prompting calls for welfare reform. Since then, it’s hovered around 8.4-8.8 percent, none of which can directly be attributed to the latest social experiment, however, as the unemployment rate lowered before the launch of the program.Its advocates argue that not enough time has passed to call the experiment a success, or failure.“Two years is too short a period to be able to draw extensive conclusions from such a big experiment. We should have had extra time and more money to achieve reliable results,” one expert involved in the project told media. Indeed, 15 months into it and it’s not possible to get a handle on whether crime has been reduced as a result, or whether getting a stable monthly income incentives anyone to seek gainful employment.

            ECB Capitulates On Defusing Eurozone's "$1 Trillion Ticking Time Bomb" - In late 2017, the ECB surprised central bank watchers, briefly spooked markets, and angered many Italians, with its plan to eradicate what many have dubbed the "ticking time-bomb" at the heart of the Eurozone, namely the roughly $1 trillion in non-performing loans across European banks (a number which is materially higher in reality as Euro banks were recently caught misrepresenting it). The ECB then quickly came under fire - mostly from Italy whose banks have the biggest notional amount of bad loans - for demanding that banks set aside far more capital as loss buffer for when the €900 billion in bad loans are ultimately discharged. Fast forward six months when it now appears that the European central bank came, saw... and ran away when faced with what now appears to be an certifiably insurmountable problem: as Reuters reported this morning, the ECB "is considering shelving planned rules that would have forced banks to set aside more money against their stock of unpaid loans, after suffering a political backlash." The NPL guidelines, which were already delayed by a month, and were expected by March, were pitched as a key anchor of the ECB’s plan to bring down the $930 billion pile of non-performing credit that has crippled eurozone banks for the past decade, particularly those in Greece, Cyprus, Portugal and Italy. Instead, the ECB is now planning to tactically surrender as there NPL problem has proven too massive for banks to be able to officially address it, or as Reuters put its far more politically, "the ECB was now considering whether further policies on legacy non-performing loans were necessary depending on the progress made by individual banks." Of course, since there has barely been any progress in resolving this issue, the conclusion is simple: the ECB is no longer pushing for an NPL resolution, as there simply isn't a viable one.So what will the ECB do instead to perpetuate the illusion of solvency? According to Reuters sources, if the proposed rules are scrapped - as now appears likely - supervisors will instead "continue putting pressure on problem banks using existing powers."In other words, the ECB will do nothing as matters revert to the state they were before the ECB pretended it could resolve the elephant in the European bank vault.

            ECB's government debt pile shrinks for first time as debt matures - (Reuters) - The European Central Bank’s 2 trillion-euro pile of government debt, the centerpiece of its stimulus policy, shrank for the first time last week as the ECB failed to roll over the bonds that matured, data showed on Monday. It was the first time the ECB was unable to keep pace with the redemptions of its government bonds, in a new sign of its struggle in finding enough paper to buy to keep the 2.55 trillion euro ($3.11 trillion) program running. This was launched in 2015 to stave off the threat of deflation and bring price growth in the euro zone to the ECB’s target of just under 2 percent. The ECB aims to buy 30 billion euros worth of bonds per month and, having bought some 22 billion euros worth so far in April, it could still comfortably hit its monthly target. But worries about scarcity were set to be at the back of policy-makers’ minds as they debated when and how to wind down the quantitative easing program, widely expected to end at the end of this year. Inflation in the euro zone has stabilized at just over 1 percent.

            Italy Rapidly Running Out of Options to Form a New Government —President Sergio Mattarella kicked off a fourth round of consultations among Italy’s political parties in an attempt to form a new government, as the likelihood of brokering a deal fades nearly two months after national elections. If the current round fails, the only remaining option could be a broad-based coalition government led by a neutral figure whose mandate and duration could be limited. On Monday, Mr. Mattarella asked a senior parliamentary figure, Roberto Fico, the speaker of the lower house, to hold talks with party chiefs of the 5 Star Movement and the incumbent Democratic Party to see if they can form a government together. Mr. Fico must report back to the president by Thursday.Mr. Mattarella has gone through each possible combination of parties to ascertain if they could come together in a coalition government. The March 4 elections produced a parliament divided roughly into three blocs, with no single group having won enough votes to govern alone. A center-right coalition, led by the anti-immigration party League and including Silvio Berlusconi’s Forza Italia party, emerged as the largest coalition with around 37% of the popular vote. The 5 Star Movement followed with 32%, making it the party with the largest share, while the center-left Democratic Party trailed both. In principle, 5 Star and the Democratic Party would together have enough votes in parliament to command a simple majority. But the two parties are opponents and the Democratic Party has repeatedly said it plans to retreat to the opposition after suffering a drubbing in last month’s polls. Some expected the League, a nativist party that won 18% of the popular vote on an anti-immigrant platform, to join forces with 5 Star to form an alliance of two, large antiestablishment groups. But the League has refused to drop out of its center-right alliance with Mr. Berlusconi and strike out on its own. If Mr. Fico’s attempt is unsuccessful, Mr. Mattarella’s only remaining option appears to be to try to form a broad coalition government. Under that scenario, the president would seek to appoint a high-profile figure who had the support of most political parties, but who would be asked to tackle only a specific set of legislation. Such a government would also likely be limited in how long it remains in power. If that fails, Mr. Mattarella will call new elections. Meanwhile, Italy’s current prime minister, Paolo Gentiloni, will continue to lead a caretaker government.

            British Politicians Declare War On Knives  -- For proof of the expression that "guns don’t kill people, people kill people" look no further than Britain, where families may have to start practicing cutting their dinner with a spoon. This is because Britain's politicians have now made the absurdly ridiculous move to call for the banning of what Reason magazine called "the most useful tool ever invented" - the knife. According to Reason, British politicians have "declared war on knives" and are swiftly moving with an attempt to ban them, as gun bans have amazingly failed to stop crime altogether:Having failed to disarm criminals with gun controls that they defy, British politicians are now turning their attention to implementing something new and different: knife control. Because criminals will be much more respectful of knife laws than of those targeted at firearms, I guess."No excuses: there is never a reason to carry a knife. Anyone who does will be caught, and they will feel the full force of the law," London's Mayor Sadiq Khan tweeted on April 8.Not to be outdone, his predecessor, Boris Johnson, currently Foreign Secretary, called for increased use of stop-and-search powers by police. "You have got to stop them, you have got to search them and you have got to take the knives out of their possession." Poundland (the British equivalent of a dollar store) announced last week that it will no longer sell kitchen knives in any of its 850 stores. Similar stores are being slapped with fines for selling knives to minors.

            ‘Hostile environment’ prevents migrants accessing NHS and delays detection of infectious diseases, experts warn -- The government’s immigration strategy is a risk to public health as the "hostile environment" it has created makes migrants less likely to get treatment for infectious diseases, experts have warned. Migrants living here legally are also affected by a raft of policies which work to deter them from seeking early testing or care for complications, the National Aids Trust (NAT) has told The Independent.  “Migration is the major issue for anyone working on HIV and sexual health,” the charity's director of strategy, Yusef Azad said. “One cannot underestimate the degree to which the hostile environment creates an atmosphere of fear and suspicion and distance for many migrant communities from health care.”  The result of these barriers “is that we fail to diagnose people with infectious diseases early and it spreads to the general population”, he said, adding that with HIV "the key problem is getting people diagnosed".

            Hoisted from E-Mail: Brexit, Security, and the UK’s Coming Poodledom --  Yves Smith - In yet another “the Brexit situation has developed not necessarily to UK’s advantage” sighting, the Financial Times reported on Saturday that Britain threatens to quit Galileo satellite project, which we strongly urge you to read in full. The short version is the UK’s ultimatum looks like an effort to rebrand an inevitable loss as some sort of British success. Expect this to become a heavily-worn playbook. From the pink paper: Britain has threatened to walk out of Europe’s €10bn Galileo satellite project… Greg Clark, business secretary, is also calling for an immediate three-month freeze of the procurement process… Bidders are due to put in their best and final offers for the ground control segment of Galileo next week, while a second, bigger tender for back-up satellites, worth hundreds of millions of euros, is expected to be launched within weeks…. In a blunt letter dated April 19, also sent to EU industry commissioner Elzbieta Bienkowska, Mr Clark said that unless Britain had access to secure parts of the Galileo project it could simply walk away. Since the project’s launch in 2003, the UK has funded roughly 12 per cent of Galileo’s annual budget…. The EU has threatened to exclude the UK from Galileo’s sensitive “public regulated service”, an encrypted navigation system for government users. It said that sharing sensitive information with a third country — Britain — would “irretrievably compromise” the service. Britain’s armed forces were also keen to access PRS, a rival to the US’s GPS which is designed to continue working when all other navigation services are jammed. However, the Brussels move would make that impossible as under EU rules PRS can be accessed only by member states…. A senior industry executive said recently to the Financial Times that excluding British companies from secure parts of Galileo would mean that they could no longer bid for the software and ground links that control the 30 orbiting satellites. Airbus manages the ground control system out of Portsmouth…. “The UK is the incumbent,” the source said. “If the tendering rules are not changed within weeks then Airbus would be forced to move work out of the UK. The work would go to France because they have the most relevant expertise.”

            Brexit: from muddle to Pulitzer-level stupidity - Last week, peers voted for us to explore "a customs union" with the EU, writes Booker in this week's column, and this week they want a vote on us staying in "the customs union". Meanwhile, he adds, the EU says that none of our "customs options" for the Irish border will work.  Wearily, he then asks, "Is there, in fact, a single UK politician who could properly distinguish between the customs union, a customs union and access to the single market?"  Although Theresa May used to say she wanted us to remain "within" the market, with "frictionless borders", she and the rest of them seem to have got into a total muddle. You can only belong to the customs union, of course, if you are a member of the EU. On the other hand, a customs union, like that between the EU and Turkey, is a very much lesser thing, creating a far from "frictionless border", with checks and long delays.   And there's the muddle. Booker picks up the thread from the blog and tells his audience what we have been saying so often and what so few of our politicians understand; a customs union as such is concerned only with tariffs, which can be dealt with quite easily by electronics.  What these dumb creatures seem incapable of understanding is that the real problem lies with the system of "customs co-operation", a quite different matter. This, for the education of politicians and other ignoramuses, this concerns "non-tariff barriers", such as the need for checking goods like all food and plant-related products, and a great deal more.  Thus, says Booker, the only way to retain virtually "frictionless borders" with the single market from outside the EU, as some of us have long been trying to explain, would be to join Norway in the European Free Trade Association and thus remain in the wider European Economic Area.

            More Brexit defeats for No 10 in Lords amid reports of cabinet split - The government has suffered more significant defeats to its Brexit legislation in the House of Lords as the row over membership of the customs union threatened to split the cabinet. Peers voted by a majority of 77 to keep the fundamental charter of EU rights in force after Britain leaves the EU with 10 Conservative voting with the opposition. It raised the prospect of the government being defeated in the Commons on the amendment when the EU withdrawal bill returns for final consideration by MPs in May. Ministers only averted a defeat on the issue in January by offering to review the protections given by the charter. The former Tory attorney general Dominic Grieve has indicated that he might vote against the government when the bill returns, saying he was waiting to hear if there would be any concessions. Paul Blomfield, Labour’s Brexit spokesman, welcomed the vote. “The future of human rights protections is not a party political issue. It is about the type of country we want to be and the values that we want to champion,” he said. Opening the debate, the cross-bencher Lord Pannick, who is a practising lawyer, argued that it was “unprincipled and unjustified” to remove the protection of rights from children, older people and disabled people that are covered by the charter. The government lost a series of other votes that could have given ministers the power to restrict when citizens could use principles of EU law to challenge the government. However, it avoided defeat on another measure relating to public health protection by pledging to allow EU obligations to continue after the UK left the EU. Peers have been reluctant to challenge the Commons on Brexit itself, but many of them regard protecting the detail of legal and constitutional principle as one of their core functions. On Wednesday, the government is expected to table amendments relating to devolved powers, which could provoke a significant revolt in early May when it is due to come to a vote. The defeats came as Downing Street played down reports that senior cabinet ministers continue to be split over the customs union, with key Brexiters wanting to drop one of the two options put forward by the government. Theresa May could face calls from ministers including David Davis, Liam Fox and Boris Johnson to abandon the so-called customs partnership, which is generally regarded as her preferred option. 

            Brexit: Government insists UK will leave customs union - BBC News: The government has restated its commitment to leaving the EU's custom union - ahead of a symbolic vote on the issue this week. Last Wednesday, the government suffered defeat on the EU Withdrawal Bill in the House of Lords on the issue of staying in a UK-EU customs union after Brexit. And MPs will get their own chance to debate the issue on Thursday. But a senior Downing Street source told the BBC the government's position would not change. "We will not be staying in the customs union or joining a customs union," the source said. BBC assistant political editor Norman Smith said Downing Street's move was an attempt to reassure Brexiteers worried about a U-turn following the Lords defeat and pressure from the EU. A customs union is when countries agree to apply the same taxes on imports to goods from outside the union. This means when goods have cleared customs in one country, they can be shipped to others in the union without further tariffs being imposed. If the UK remains part of the customs union, it would be unable to strike trade deals with countries around the world. But supporters say it would help to keep an open border between Ireland and Northern Ireland.

             UK: May government declares against customs union as Brexit crisis intensifies --The Conservative government is wracked by divisions over Brexit, with Downing Street insisting that a parliamentary vote tomorrow is not a vote of confidence in Theresa May’s premiership.May suffered more blows last week, after the House of Lords voted to amend the European Union Withdrawal Bill to require the government to try to stay in the EU’s customs union. In a vote with a much larger than expected majority, the government was defeated by 348 to 225. The motion was put forward by a cross-party section of the Lords, with the amendment jointly authored by John Kerr, a former civil servant, and pro-EU crossbencher, former Conservative cabinet minister Chris Patten, backed by Labour and Liberal Democrats shadow ministers.The amendment won the support of 24 Conservative rebels. Supporting the government were just 26 crossbenchers, one Labour and two Liberal Democrats.The Lords also defeated the government in another amendment tabled by the Labour frontbench, with backing from the Lib Dems and Tory backbencher Lord Kirkhope of Harrogate. The amendment was passed by a majority of 97 and would mean “retained EU law” relating to rights in the fields of employment, equality, health and safety, consumer standards and environmental standards, can only be amended or revoked post-Brexit via primary legislation. On Monday evening, the government lost a further two votes over Brexit in the upper house. These set off a firestorm within the hard Brexit faction of the Tories, led by Brexit Secretary David Davis, Foreign Secretary Boris Johnson and Environment Secretary Michael Gove. Thursday’s debate is non-binding, but next month MPs are set to take part in a number of key votes on a customs union, with the Sunday Times reporting that the hard Brexiteers are demanding May face down around ten Tory MPs who may back opposition MPs on remaining in the customs union. That number of rebels would imperil May’s position, as she leads a minority government relying on the support of ten Democratic Unionist Party MPs for a majority. According to reports, leaders of the hard Brexit wing—that she is in thrall to—warned May they would resign if she backed any form of a customs union. In response, a Downing Street spokesman said Monday that no soft Brexit would be considered as, “We are leaving the customs union, we will have an independent trade policy and we will strike trade deals around the world.”

             DUP threatens to bring down Theresa May’s Government if it crosses Customs Union red line - The DUP has warned it will bring down Theresa May's Government if Northern Ireland is forced to stay in the Single Market or Customs Union after Brexit. Nigel Dodds, the leader of the Democratic Unionist Party at Westminster, said his party would vote against the Government if any of its "red lines" on Brexit are crossed. It comes as Britain and the EU are deadlocked over how to ensure that there is no hard border between Ireland and Northern Ireland after Brexit. Mr Dodds told the Conservativehome website: “If, as a result of the Brexit negotiations for instance, there was to be any suggestion that Northern Ireland would be treated differently in a way, for instance that we were part of a customs union and a single market and the rest of the UK wasn’t ... for us that would be a red line, which we would vote against the Government. © Reuters Britain's Prime Minister Theresa May leaves 10 Downing Street, London, January 24, 2018. REUTERS/Toby Melville “You might as well have a Corbyn government pursuing openly its anti-Unionist policies as have a Conservative Government doing it by a different means.” It comes as Tory MPs will on Thursday hold a symbolic vote on keeping Britain in a customs union. Bob Neill, Nicky Morgan and Sarah Wollaston are among Tory MPs backing the motion, which urges the Government to “include as an objective in negotiations ... the establishment of an effective customs union”. Ministers have said that the vote is "meaningless" because it is not binding. As a result Tory MPs will not be whipped into attending the vote. David Davis, the Brexit Secretary, said he would have personally "failed" if the UK has to stay in a customs union after Brexit.

            Is New EU “Travel Authorisation” Another Brexit-Induced Ireland Headache? - Yves Smith -  This week, there’s a lot of noise on the Brexit front, and I feel a big remiss in not writing it up. But I am not sure how consequential much of it will prove to be. For instance, the House of Lords has delivered Theresa May a series of embarrassing defeats, ranging on demanding that she report to them down the road on the efforts she had made to keep the UK in the customs union (when May is committed to leaving) to voting to limit the so-called Henry VIII powers, which is the authority the Government sought to do mass rewrites of existing legislation, allegedly merely minor edits so it will all work post Brexit. But the problem is in most cases it is nowhere near this tidy, and the legislature sensibly doesn’t want to give the executive a blank check to rejigger huge swathes of law. But this flip side is that the having both Houses review the huge volume of laws that need to be revised is a mammoth task that no one seems the foggiest idea how to get done. The reason I have not taken these votes as seriously as perhaps I should is they seem more important as a barometer of rising public doubt about Brexit and the diminishing of the sense of inevitability of May pushing through her idea of Brexit, despite the EU having already said no to lots of parts, like being super nice to British banks or indulging Ireland techno border fantasies, and other bits not even being doable, like having any new trade deals in place by the end of 2020.1 I don’t pretend to understand UK legislative procedure, but the commentary I’ve seen suggested that the risk to May was that the House of Commons might affirm some of these votes, meaning that by themselves, they aren’t dispositive. Nevertheless, this rebellion of sorts has led to lots of pontificating by officials and pundits on the issue of whether the UK should stay in the customs union. Poor Richard North has been tearing his hair on his website, since the focus on this question demonstrates how badly informed the UK officialdom is. What all the soft Brexit advocates want is to have a frictionless border, as in no customs checks. A customs union does not achieve that. It simply means “no tariffs”. The EU and Turkey have a customs union, but there is a hard border between Turkey and the EU.   North has been posting almost obsessively on this topic for the last week, since the press and MPs have been getting this issue wrong in just about as many was as one possibly could.

            Irish prime minister: Progress on border needed by June EU summit — Dublin won’t allow progress on a Brexit withdrawal agreement if a deal on the border with Northern Ireland is not firmed up by the European Council summit in June, Irish Prime Minister Leo Varadkar said Thursday. “Without the Irish border [issue resolved] there can be no withdrawal agreement,” Varadkar said in a lecture in the Belgian city of Leuven. “Let there be no doubt about that.” The U.K.’s “hard red lines” are holding back a deal on Brexit, he said, and the June summit is the hard deadline for progress. The red lines include a commitment by London to leave the EU’s single market and customs union, key for trade across the Irish border, while rejecting oversight from the European Court of Justice. Talks over a legal text on the U.K.’s departure from the EU in the meantime are proving “difficult” ahead of June, according to Varadkar. The June summit was described by Britain’s chief Brexit negotiator David Davis as an “artificial deadline” this week. Varadkar also called for more ambition in talks over free trade deals between the EU and third parties, welcoming progress on deals with Japan and Mexico, while insisting that the bloc’s next budget should continue to “support programs that work” like the Common Agricultural policy and Erasmus student exchange scheme. Populists like those who backed the Brexit vote offer a “dark and dangerous future” with the EU providing a “light to their darkness” and an “antidote to their poison,” the Irish leader said. 

            EU doesn’t need the City of London, says chief Brexit negotiator - The EU does not need the City of London, and Theresa May’s “pleading” for a special deal for the UK’s financial services sector will not be rewarded, the EU’s chief negotiator, Michel Barnier, has said. In his toughest rebuff yet to the demands made by the British prime ministerin her landmark Mansion House speech, Barnier suggested the City would be granted nothing more generous than that enjoyed by Wall Street. “Some argue that the EU desperately needs the City of London, and that access to financing for EU27 business would be hampered – and economic growth undermined – without giving UK operators the same market access as today,” Barnier said at a meeting of finance ministers in Sofia, Bulgaria. “This is not what we hear from market participants, and it is not the analysis that we have made ourselves.” May had argued in March, in a keynote speech spelling out her vision of a future UK-EU trading relationship, that failing to construct a special deal for the City would hurt economies on both sides. The City provided more than £1.1tn of cross-border lending to the rest of the EU in 2015 alone. May conceded in her speech that the current “passporting” regime, under which UK-based financial services would automatically have the right to operate across the EU, would not survive Brexit. However, she went on to suggest that a mutually agreed system would be necessary that would give the UK’s financial services sector greater assurances over future rules than the current “equivalence regime”. 

            Brexit: unravelling - Richard North -  I think it's reasonable to say that Thursday's debate in the Commons on the customs union did not enhance our understanding of what is necessary to ensure a smooth Brexit process, with a minimum of economic damage. The best thing that could be said of it, in my view, is that it was an unwelcome distraction. At this stage of the proceedings, we should already have decided on the shape of our post-exit settlement and the focus now should be on practical needs. Businesses and individuals should, at the moment, be flooded with information and advice from government, telling them what to expect, and what they need to do to prepare for Brexit day and beyond. It is this, it seems, that is the missing element. And in its absence, there is nothing to focus on – hence the fragmentation of the debate. We see different factions with their own preoccupations, at one extreme to plotters who would block Brexit altogether and, at the other, the "ultras" who would be happy to see us ejected without further ado. As for the middle – there is precious little there, and no voice represented in the media or politics, that seeks a pragmatic, long-term solution and attempts to deal with the present issues, such as the Irish question, which must be resolved if we are to make a success of leaving. For many months, though, there have been those of us who have patiently sought to engineer a way through the morass, initially hoping that there were those in government and parliament who would appreciate and benefit from good advice. Virtually, the only substantive thing parliament as an institution has been able to offer since the referendum is Thursday's debate, where MP after MP paraded their ignorance of the issues and an almost total inability to engage with the real world. In so doing, the institution simply confirmed something which we have known for some time – that it is no longer fit for purpose.

            Resistance to joint proposal to WTO leaves UK and EU divided --Resistance to a joint UK-EU proposal to the World Trade Organization on trade after Brexit – which was once celebrated by the trade secretary, Liam Fox, as “real progress” – has triggered a break down in unity, with London and Brussels divided on a way forward. Fox had described the plan on how much meat, butter and wheat the rest of the world could export to the UK and the 27 member states on low or zero tariffs as a sign of the country “forging ahead”, and boasted: “It’s a sign we can make progress when both sides choose to do so.” Yet, in recent months the united EU and UK front has splintered in the face of a strident rejection of their proposals from the US, Australia and New Zealand, among others, the Guardian understands. Brussels has proposed another way forward. But London has yet to agree and has left open the prospect that the UK could go its own way in talks with the world’s biggest trading powers. To add to the tensions, the UK is also seeking to speak during the 21-month transition period after Brexit with an independent voice at the WTO, where large multilateral trade deals are negotiated, something the European commission is resisting. Until Brexit, the EU has a schedule spelling out how much of each agricultural product from each country that can be imported into the bloc without attracting high tariffs. After Brexit, the plan had been for the UK and EU, as independent WTO members, to divide the current quotas between the two according to historical flows of trade in each product. This plan was described as a “technical rectification”. However, EU sources said an initial objection from the US, Argentina, Brazil and New Zealand over the joint plan, hammered home in a fiery letter last October, had not gone away, proving Brussels’ initial belief that the plan would “not fly”. 

            Pound Crashes After UK Reports Worst GDP Since 2012, Rate Hike Odds Tumble -  The British pound tumbled, 10Y gilt yields slumped and odds of a May BOE rate hike vaporized after the UK reported the weakest GDP print since 2012. This morning, the UK's Office for National Statistics reported that Q1 GDP rose just 0.1% Q/Q, badly missing expectations of a 0.3% increase, and the lowest quarterly increase since Q4 2012. On an anual basis, the increase was just 1.2%, also missing expectations of a 1.4% rise. While analysts had had expected a modest slow down in growth to drop from the 0.4% growth in Q4 2017, the slowdown was far bigger than expected as snow hit retail sales and disrupted building work, and raises further questions over whether the Bank of England will raise interest rates in May. According to the FT, a sharp fall in construction output was responsible for most of the slowdown. "The sector contracted by 3.3 per cent compared to the previous quarter. Analysts had expected the industry to bear the brunt of the poor weather." Following the news, UK money markets slashed their bets in half for a rate hike in May to 27% from 56% on Thursday. They now see the first rate increase this year in December, from November earlier. Immediately following the data, which put the likelihood of a widely priced-in May rate hike by the BOE in doubt, the pound was hammered on the news, tumbling by 150 pips or 0.9% to 1.3791. Cable was already under pressure as U.K. Prime Minister Theresa May’s struggle to keep control of a Cabinet divided over Brexit doesn’t go unnoticed amid broad dollar strength

            TSB Train Wreck: Massive Bank IT Failure Going into Fifth Day; Customers Locked Out of Accounts, Getting Into Other People’s Accounts, Getting Bogus Data by Yves Smith -   From time to time, we’ve written about how bank IT is a systemic risk waiting to happen. Major financial firms have legacy code at the core of their systems that they can’t migrate off at acceptable costs and risk (numerous banks have had a go at this issue, and projects wind up being shelved; at best, they can port only some products or customers off the aging systems). Readers, even ones who are in IT but not in banking, sometimes scoff at what we have said.The disaster at TSB should serve as a big wake up call. The very short version is that a UK bank, TSB, which had been merged into and then many years later was spun out of Lloyds Bank, was bought by the Spanish bank Banco Sabadell in 2015. Lloyds had continued to run the TSB systems and was to transfer them over to Sabadell over the weekend. It’s turned out to be an epic failure, and it’s not clear if and when this can be straightened out.It is bad enough that bank IT problem had been so severe and protracted a major newspaper, The Guardian,created a live blog for it that has now been running for two days.The more serious issue is the fact that customers still can’t access online accounts and even more disconcerting, are sometimes being allowed into other people’s accounts, says there are massive problems with data integrity. That’s a nightmare to sort out.Even worse, the fact that this situation has persisted strongly suggests that Lloyds went ahead with the migration without allowing for a rollback. If true, this is a colossal failure, particularly in combination with the other probable planning failure, that of not remotely adequate debugging (while there was a pilot, it is inconceivable that it could have been deemed to be a success if the testing had been adequate). Let’s turn the mike over to the Telegraph:

            TSB’s IT Fiasco and Some Implications for Banks’ Legacy Systems -- Yves Smith - We’re turning again to TSB’s botched effort to transfer all of its users to a new computer system over the past weekend, where the bank is still bleeding from a major artery. In yet another effort at porcine maquillage, the CEO today tried claiming everything was fine.Our mobile banking app and online banking are now up and running. Thank you for your patience and for bearing with us. — Paul Pester (@PaulPester) April 25, 2018 That didn’t last long. Again from Paul PesterThe challenge we are facing at the moment is that while we know everything is working, one of the main ways that our customers see everything is working – through our internet banking and mobile app – isn’t functioning as well as it should be, and for this I’m truly sorry. I can appreciate how frustrating this must be for our customers.  As Financial Times reader Paper Chase remarked: “The level of contradiction in this statement is beyond my comprehension.”  The bank later stated that only about half the online customers could access their accounts, as if the only problem was now capacity. Per the GuardianTSB said internet banking was operating at 50% of capacity, which means that for every 10 customers only five will be able to access this service. Mobile banking was operating at around 90% of capacity, the bank said in a statement issued at about 4pm. It appears the bank has a different idea of what “operating” means than customers do. Twitter was rife with complaints from users that while they could finally get into their accounts, they saw alarming errors and/or had difficulty performing transactions. These tweets are from the late afternoon and early evening UK time: [series of tweets] Needless to say, the potential damage goes beyond late bill payments and inability to access funds, which bites for stay-at-homes who can’t go to a bank branch and people with large expenses in coming days, such as for a wedding.  Given that the top management of TSB was high-fiving a successful launch over the weekend, its ability to make accurate self-assessments seems pretty impaired.

            TSB Are Using Their Own Customers to Alpha Test Their New IT Platform - naked capitalism by Clive - Yves here. Based simply on Clive carefully drawing out the implications of public information and a wee bit of testing on his own TSB account, it is becoming more and more apparent that the IT disaster at TSB is not only vastly worse than the bank maintains, but was completely self-inflicted. It’s as if they decided to play Russian roulette with a gun with a bullet in every chamber. Clive’s forensics demonstrate:Basic customer information is not mapping to his account. TSB does recognize that he had a credit card and apparently has its credit line correct as well. But it has no transaction history, sees it as a new card when it isn’t.New transactions are not being associated with his account either.The systems problems aren’t simply an “online banking problem” and go well beyond that. TSB and its parent Sabadell have been telling customers that the “engine” is fine, they just can’t get those pesky, flaky apps to connect to that humming engine properly. Clive went to the branch and they couldn’t find his new transaction either.Twitter complaints indicate that some (many?) customers who have mortgages similarly have the TSB system, when they finally get in, showing a zero balance. That says the problems with finding historical data are affecting a yet undetermined number of customers for at least two major products, and the ones that almost certainly account for most of TSBs credit risk and profits.In a best case scenario, TSB has a data mapping problem that it presumably can eventually sort out, but the cost and time involved could be very high. In a worst case, the data is corrupted or lost. And if that has happened on anything more than a trivial scale, I’m not sure how the bank recovers from that. Similarly, if the bank is making payments but they are floating in some sort of data purgatory not posted to account, what does it take to clean that up? Contrast that with the continued delusion back at Sabadell, courtesy the Guardian:

            Warning signs for TSB’s IT meltdown were clear a year ago – insider - The banking software at the heart of TSB’s troubles this week was doomed to failure from the start, an insider with extensive knowledge of the systems involved has said.With customers locked out of their bank accounts, mortgage accounts vanishing, small businesses reporting that they could not pay their staff and reports of debit cards ceasing to work, the TSB computer crisis has been one of the worst in recent memory. The bank, its chief executive, Paul Pester, admitted on Thursday, was “on its knees” and it faces a compensation bill likely to run to tens of millions of pounds. Just before the bank’s services crumpled, software engineers and Banco Sabadell, TSB’s Spanish owner, were toasting their own efforts with champagne and claiming a job well done. The comments posted below the photo read: “Hell of a team!” and “Champions!” However, the warning signs that a catastrophe of this magnitude might happen were apparent a full year earlier. When TSB split from Lloyds Banking Group (LBG), a move forced by the EU as a condition of its taxpayer bailout in 2008, a clone of the original group’s computer system was created and rented to TSB for £100m a year.  That banking system was a “bodge of many old systems for TSB, BOS, Halifax, Cheltenham and Gloucester and others” that had resulted from the “nightmare” integration of HBOS with Lloyds as a result of the banking crisis, according to one insider who had extensive access to and intimate knowledge of LBG and TSB’s internal systems over a prolonged period. “The idea with the IT was to create a mirror copy of the sprawling LBG merged systems and use this to service the much smaller TSB bank. It seemed a bad fit for a smaller bank to inherit all the problems of a bloated mess to service far fewer customers,” the insider said. When Sabadell bought TSB for £1.7bn in March 2015, it put into motion a plan it had successfully executed in the past for several other smaller banks it had acquired: merge the bank’s IT systems with its own Proteo banking software and, in doing so, save millions. By the summer of 2016, work on developing the new system was meant to be well under way and December 2017 was set as a hard-and-fast deadline for delivery.“The time period to develop the new system and migrate TSB over to it was just 18 months,” the insider said. “I thought this was ridiculous. TSB people were saying that Sabadell had done this many times in Spain. But tiny Spanish local banks are not sprawling LBG legacy systems.”

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