Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
The Year of the Autocrat (Handelsblatt) Autocracy is back in style thanks to the likes of Vladimir Putin, Recep Tayyip Erdogan and Donald Trump. And 2016 is just the beginning:
To deem 2016 an unpredictable year would be a grave understatement, especially if you’re a pollster or a political prognosticator.
Developments that once seemed impossible - or at least highly unlikely - suddenly became the status quo. The Brits, for one, voted to break away from Europe. Not to be outdone, the Americans elected a billionaire and former reality TV star to be their next president. And those are only two examples.
If there’s one thing these once unimaginable developments have made crystal clear, it’s that our expectations and understandings of how the world works are no longer relevant.
We’ve entered an era in which autocrats are no longer a phenomenon limited to far away countries with weak economies and no political clout.
This Startup Uses Night Lights to Forecast GDP (Bloomberg) Nowcast Inc., a Japanese financial research and technology startup, has developed a product that estimates economic growth in real time by using satellite images of night-time lights. Based on algorithms that examine changes in the intensity of illumination, as well as a range of published statistics including industrial production and trade, the Tokyo-based company can accurately forecast changes in gross domestic product, Chief Executive Officer Ryota Hayashi said in an interview.
NSA Inspector General Facing Termination For Whistleblower Retaliation (Mint Press News) Hat tip to Roger Erickson. The inspector general for the National Security Agency, George Ellard, received a termination notice for retaliating against a whistleblower. The outcome was the result of a process enabled by an executive order containing whistleblower protections issued in 2012 by President Barack Obama, according to a report from the Project on Government Oversight (POGO). Though unnamed, government officials confirmed Ellard was issued a “notice of proposed termination" in May from Admiral Mike Rogers, who is the NSA director. The notice came after “eight months of inquiry and deliberation" by an external review panel made up of the inspector generals from the Justice Department, Treasury Department, and Central Intelligence Agency. They overturned a finding from the Pentagon inspector general, which determined it could not confirm the retaliation claim against Ellard. Jesselyn Radack, a whistleblower attorney who has represented multiple NSA whistleblowers, including Snowden and Thomas Drake, told Shadowproof:
“Ellard’s proposed termination for whistleblower retaliation confirms what the whistleblowing community has long known: there were no safe and effective internal channels for NSA whistleblowers like Snowden to use. The case for pardoning Snowden is made stronger given Ellard’s now proven record of retaliation."
Goldman Sachs Steals $1.25 BILLION from Puerto Rico…and Uses Two “Governors" to Cover it Up (Resumen) Hat tip to Roger Erickson. (Econintersect: What is described below is only one of a number of hidden deals described in this article that may have seen as much as another 9 billion siphoned out of this island in just 4 years time.) Puerto Rico has become the Wild West of Wall Street fraud, with the island’s politicians guiding the robbers. The latest scam - netting more than one billion dollars - was engineered by Goldman Sachs and executed by two governors from BOTH political parties: Alejandro Garcia Padilla (PPD) and Luis Fortuño (PNP). They used the island’s most profitable highway, PR-22, in order to steal $1.25 billion dollars. Here is how…PR-22, aka José de Diego Expressway, is 51 miles long. It runs from Santurce to Hatillo, passes through San Juan, and is the island’s busiest highway. Every day, more vehicles pass through PR-22, than any other road in Puerto Rico:
The annual toll revenues from PR-22 are $85 million. In 2011, Luis Fortuño turned PR-22 into a “public private partnership" (aka “P3") with Goldman Sachs and a Spanish corporation named Abertis.
This P3 gave Goldman Sachs and Abertis a 40-year lease on PR-22 and PR-5, for which they would receive 50% of the toll revenues (roughly $1.8 billion) in exchange for a $1.4 billion investment, for a profit of approximately $400 million.
The ROI (return on investment) on this deal seemed reasonable…but now in 2016, the deal suddenly changed.
In the immortal words of Johnny Guitar Watson, “Somebody doing something slick…downtown." Five years into the deal, in April 2016, Gov. Garcia Padilla quietly altered the initial contract.
Under the new terms, in exchange for an additional investment of only $115 million, the governor decreased the island’s revenue share on PR-22 from 50% to 25%, and extended the lease term for an additional 10 years.
So for 35 years, Goldman/Abertis will receive an additional 25% annually…and…For 10 new additional years, they will receive 75% of 85 million.
The math works out like this: 25% additional of $85 million per year x 35 years = 21 x 35 = $735 million, plus…75% of 85 million x 10 years = 63 x 10 = $630 million
The total added revenue is thus $1,365,000,000 ($1.365 billion), on an investment of $115 million…for a new, additional profit of $1.25 BILLION
Goldman Sachs to settle U.S. rate-rigging lawsuit for $56.5 million (Reuters) Goldman Sachs Group Inc (GS.N) has agreed to pay $56.5 million to resolve a U.S. class action lawsuit accusing it and other banks of rigging an interest rate benchmark used in the $553 trillion derivatives market. The proposed settlement was disclosed in papers filed in federal court in Manhattan on Friday. It came after seven other banks agreed in May to pay a combined $324 million to resolve the litigation. As part of the deal, Goldman has also agreed to provide lawyers for the plaintiffs evidence including transaction data, documents and witness interviews, which could be used in litigations against the remaining banks, the court papers said.
Electors won’t get intelligence briefing: report (The Hill) Voters in the Electoral College will not receive an intelligence briefing about Russian meddling in the U.S. presidential election, according to a new report. Sources told NPR the electors would not receive any national intelligence before they cast ballots this Monday. Fifty-four of the 232 Democratic electors had signed a letter asking for a briefing before the Electoral College’s vote, according to reports. The letter asked Director of National Intelligence James Clapper for information on what role, if any, Russia had in helping elect Donald Trump.
Deep State at War with itself (The Duran) Hat tip to Roger Erickson. The America presidential election cycle has exposed a number of serious fractures undermining the stability of the United States and the west in general. The power elites and its pliant mass media are in state of shock and fury western electorates are rejecting the neo-liberal order in droves. This has rattled the confidence of the powers-that-be. As expected these elites are not taking this lightly - they are vigorously pushing back:
At the center of the Deep State are the intelligence agencies. They are the guardians of the status quo and hegemony. Largely apolitical (though intensely ideological), they usually do not express a political party preference. It is assumed the major parties and their leaders will be in sync with the interests and goals of the Deep State. It is also assumed the intelligence community sings - more or less - from the same hymn sheet. This does not appear to be case at the moment.
The unexpected election of Donald Trump as the 45th president of the United States is an unwelcome deviation from what western democracy is supposed to produce for the Deep State. Elections in the west are a ritual to validate and legitimize the status quo. The popular will is engineered, with the corporate mass media giving it a seal of approval. This time it didn’t work. The election of Trump is a major off script moment.
Deutsche Bank Said Last Lender to Stop Angola Dollar Clearing (Bloomberg) Deutsche Bank AG stopped providing dollar clearing in Angola, leaving one of Africa’s biggest oil-producing nations without a lender to supply the service, according to three people with knowledge of the matter. The company ceased dollar clearing for Angola in mid-November, said two of the people, who asked not to be identified because they’re not authorized to speak to the media. The Frankfurt-based lender was the only European bank providing clearing to banks in Angola, one person said. Angola is among the 20 most corrupt countries in the world as ranked by Transparency International, making it difficult for foreign lenders to comply with anti-money laundering and corruption rules.
How Russia's Edge in Electronic Warfare Could 'Ground' the U.S. Air Force (The National Interest) Russia is integrating electronic jamming technology with its military operations. The development is significant because U.S. air power is highly dependent upon networking. The Pentagon uses a host of networks including Link-16 to tie its forces together in real time. Moscow has watched American warfighting capabilities since the first Persian Gulf War and has learned lessons from those conflicts. Russia - which retains a very robust defense industry - has invested heavily in countering American advantages.
Gunmen kill five female Afghan airport staff in Kandahar (Reuters) Afghanistan Five female Afghan guards working in the airport in southern Kandahar were killed by unknown gunmen as they were on their way to work, security officials said on Saturday, the latest in a string of attacks against women in Afghanistan.
Cash crunch till January, says govt. (The Hindu) The cash crunch being faced by people due to the demonetisation of high-value currency notes could be resolved by the middle or end of January 2017, with about Rs. 12 lakh crore ($820 billion) in cash returning to the system by then, NITI Aayog CEO Amitabh Kant said on Friday.
April 2017 may be the earliest India can say goodbye to the demonetisation nightmare (The Economic Times) We are 15 days away from Prime Minister Narendra Modi's 50-day deadline to end the worst effects of the scrapping of 86%, by value, of currency. An extrapolation of 2016 Reserve Bank of India (RBI) data on the capacity of printing presses and currency distribution indicates that, at current rates, Modi's deadline will not be met. If the government wants to introduce Rs 9 lakh crore ($135 billion), or 35% less money than it pulled out, it will take up to May 2017, and if it wants to reintroduce the entire Rs 14 lakh crore ($180 billion) that it withdrew, that could take up to August 2017. The crux of the problem is change, specifically the Rs 500 note, which the country's presses cannot, currently, print in adequate numbers.
False rumours and fake news cloud India’s currency plan (BBC News) More than a month after India's demonetisation - the surprise announcement by Prime Minister Narendra Modi that 500 and 1,000 rupee notes would be withdrawn from circulation and replaced by new currency - the plan has been the subject of protests and false rumours. Online and on the streets, people have claimed that the ink will bleed from the new 2,000 rupee notes, that the ink is dangerously radioactive, and that the new money will soon be withdrawn as well. All the rumours are false. Rahul Roushan, a Modi supporter who runs the libertarian news site OpIndia, says some of the claims are being propagated by senior politicians and government opponents.
Seized U.S. drone issue to be resolved smoothly: China paper (Reuters) China expects a smooth resolution to the seizure by its navy of "unidentified" equipment found in the South China Sea, a state-run newspaper said on Saturday, after U.S. officials said a Chinese warship had taken a U.S. underwater drone.
Chinese Tourists Flaunt Their Cash While U.S. Cities Scramble for Scraps (Bloomberg) China is poised to become the world’s largest source of international travelers, sending as many as 200 million people abroad each year and becoming the tourism juggernaut to dwarf all others. Europe and Asia will claim a healthy share of these explorers, but the U.S. is among the top nations the Chinese want to see, from Niagara Falls to the Grand Canyon and all manner of towns in between.
Central American migrants await asylum in southern Mexico (Associated Press) The decision to settle in Mexico and not continue to the United States is tied to increased recognition of the risks of crossing Mexico and more recently the hostile rhetoric of U.S. President-elect Donald Trump, the immigrants and their advocates say. The number of those seeking asylum in Mexico this year is more than double the 3,423 applicants last year - itself a 65% increase from 2014. Applications have risen by about 9% each month this year, says the United Nations High Commission for Refugees, or UNHCR. According to the Mexican Commission for Refugee Aid, or COMAR, about 4,000 of the 6,898 applications it received through October this year made it to the end of the process and of those, 2,162 applicants got refugee status. Another 414 applicants who did not qualify as refugees received other kinds of government protection and escaped deportation.
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