from Press For Truth:
by Simon Black, Sovereign Man:
I’ve long held a working theory that US voters are completely predictable in Presidential elections.
The idea is that Americans almost invariably tend to swing wildly every few election cycles, voting for the candidate who is as close to the opposite of the current guy as possible.
Let’s go back a few decades to, say, Jimmy Carter.
In 1976, the country was sick and tired of the corruption, scandal, and disgrace of Richard Nixon’s administration (which at that point had been inherited by Gerald Ford).
Jimmy Carter was pretty much the opposite of Richard Nixon– a youthful outsider versus an aging crony.
After four years of economic disaster, Americans swung in the opposite direction from Carter, choosing an older, polished conservative in Ronald Reagan who represented strength and stability.
That trend lasted for twelve years– two terms with Reagan, and one term with his successor George HW Bush, after which the country swung in the other direction again– to Bill Clinton.
Clinton was another young, energetic liberal, pretty much the opposite of the elderly, curmudgeonly Bush.
After eight year of Clinton and his personal scandals, the country swung again to George W. Bush, a God-fearing, fundamental conservative who wouldn’t cheat on his wife. He represented Clinton’s opposite.
And after eight years of war and economic turmoil, the country swung once again to Bush’s opposite– a youthful, charismatic, black outsider.
Eight years later, the 2016 election was won by a man who is as far from Barack Obama as it gets.
Now, however you feel about the current guy, it’s safe to say that the country is probably going to wildly swing in the opposite direction in either 2020 or 2024.
Last night the world got a sneak peak at what that might look like– Congressman Joe Kennedy III, the 37-year old grandnephew of John F. Kennedy.
The young Congressman clearly represents Trump’s opposite and seems to embody so many of the gargantuan social movements that are coming to a head– the Dreamers, #metoo, BlackLivesMatter, etc.
Now, I typically hate talking about something as trite as politics and elections; elections merely change the players. It’s the game that’s rotten.
But in the Congressman’s rebuttal last night after the State of the Union address, he said something that I found quite alarming, almost inconceivable.
He lamented that the government has turned America into a “zero-sum game” where benefits received by one group must come at the expense of another– fund health insurance by cutting funding for education; build new highways by slashing teachers’ pensions.
He cited a number of examples, and then told his audience, “We choose both!”
Given the thunderous applause at that remark, everyone seemed to agree that the wealthiest, most prosperous nation in the world should never have to make a single tough financial decision.
Americans should have everything they want. And somehow, the money to pay for it all will just magically appear.
I found this astonishingly naive. He should have said, “We choose debt!” Because that’s the only way they’ll be able to pay for any of it.
Bear in mind the US government is already nearly $21 trillion in the hole and spending hundreds of billions of dollars each year just to pay interest on the debt.
In Fiscal Year 2017, in fact, the Treasury Department reports that interest payments on the debt hit a new high of $458,542,287,311.80.
Read More @ SovereignMan.com
by Jeff Brown, International Man:
That’s the estimate for how many “ghost accounts” were created by banking giant Wells Fargo.
That’s about 1% of the total U.S. population. It’s also roughly the population of the state of Connecticut.
You’ve likely heard the story already, so I won’t go into all the details. But here’s the gist…
Wells Fargo created millions of fake accounts for its customers… to charge them fees for services that they never requested.
It was later discovered that Wells Fargo was signing customers up for unwanted insurance policies as well – again, to charge customers for services that they never requested. This was outright fraud.
It’s for reasons like this that a new type of technology has burst onto the scene. It enables secure, reliable, and transparent transactions… without the potential for manipulation by big financial institutions.
As an investor, this technology needs to be on your radar.
Recently, I wrote to you to give you an “inside look” at the world of cryptocurrencies. I told you that the crypto market would experience some pullbacks and high volatility. We’re seeing that today. Bitcoin, the world’s first cryptocurrency, dropped about 30% earlier this month.
But despite these pullbacks, I’ve also told you that these new crypto assets still have a long way to run in the years ahead. And the reason why can be summed up in one word: blockchain.
You’ve likely heard the term “blockchain” associated with the popular cryptocurrency Bitcoin. You may even know it as the decentralized ledger technology underpinning cryptocurrencies.
But that’s only part of the story…
Blockchain technology is also known as distributed ledger technology. We can think of a distributed ledger in its simplest form as a distributed database – distributed in the sense that there are complete copies of this database (or ledger) scattered around the world.
Historically, companies, governments, and individuals all keep their records in one centralized database. Imagine a room with racks of computers that store information.
But centralized databases can be manipulated… Records can be changed, hard drives can fail, data can be lost, and the records represent only one party’s view of any given transaction.
In the world of blockchains and distributed ledger technology, the exact opposite is true. The transactions recorded on the ledger represent a transaction that takes place between the parties involved and is confirmed by the blockchain network via a consensus.
Once a transaction is written to the ledger, it is immutable. It cannot be changed.
The image below gives you an idea of the difference between these two network types.
The value and utility that a well-designed blockchain provides is remarkable. Immutability, secure transactions, privacy, transparency, the reduction or elimination of fraud…
That last part is key.
That’s because in a centralized system, we depend on “trusted” intermediaries (banks and other financial institutions) to conduct transactions.
But as we’ve learned time and time again, these “trusted” intermediaries are not at all trustworthy.
It wasn’t long ago when the LIBOR scandal uncovered that many of the most “trusted” financial institutions in the world were manipulating interest rates for their own benefit, and of course at the expense of others.
Banks like Barclays, Deutsche Bank, JPMorgan Chase, UBS, Citigroup, Bank of America, and the Royal Bank of Scotland were found to be right in the middle of these manipulations. And we’ve already discussed Wells Fargo…
The corruption is seemingly endless.
Read More @ InternationalMan.com
by David Stockman, David Stockman’s Contra Corner:
America’s economy is faltering not from too little infrastructure spending, but from too much debt—-$67 trillion of total public and private debt, to be exact. So it appears that the bond vigilantes are returning from 24 years of hibernation just in the nick of time to put the kibosh on the Trumpite/GOP’s latest hare-brained scheme to balloon the public debt.
As if the impending FY 2019 collision between $1.2 trillion of new Treasury borrowing and the Fed’s $600 billion bond-dumping campaign (QT) incepting this coming October were not enough, word now comes that Tuesday’s night’s State of the Union (SOTU) adress will feature a $1.7 trillioninfrastructure plan.
We’d say rechristen the Donald as “Boondoggle Don” and be done with it. On top of the $1 trillion + deficits already rumbling down the pike, the very idea of a massive debt-financed, pork-barrel driven borrow and spend spree 104 months into a business cycle expansion is sheer lunacy.
And don’t take our word for it—even if we have been smoked by the bond vigilantes up close and personal, and more than once. With this morning’s breakout to a 2.72% yield on the 10-year treasury note, it is more likely than not that the bond-selling stampede has commenced.
To wit, the greatest no-brainer trade ever invented has been front-running on repo (i.e. 95% borrowed money) the massive bond-buying campaigns of the central banks: The carry was free, the bond price was guaranteed to rise, the spread was fulsome, the central banks’ policy signals were well-telegraphed and transparent, and through it all bond traders slept like babies without risk of Ambien addiction.
That is to say, on top of the $20 trillion of bond supply that the central banks have taken out of the market with credits conjured from thin air since 1995, trillions more was absorbed by leveraged speculators who were buying today exactly what the central banks had pledged to be buying tomorrow—-right down to the cusip number.
Needless to say, that double whammy of bond price levitation is over and done. With central banks rapidly winding down their QE bond purchases, the smart money is about to make its own pivot.That is, toward selling what the Keynesian central banks will be selling as the latter desperately scramble to shrink their elephantine balance sheets, and reload the dry powder they believe will be needed to combat the next recession.
To that end, it is worth noting that the 10-year yield has now doubled from it’s all-time closing low of 1.36% recorded on July 5, 2016. Having gone eyeball-to-eyeball with a yield of 15.86% back in September 1981, we can say this: A 92% yield drop over 37 years defined an aberrational era that virtually destroyed all intellectual muscle memory in the bond pits.
Neither the trading algorithms nor the remaining carbon-based bond jockeys have ever known a sustained period of rising yields.
Likewise, they have operated for a lifetime in hot-house markets where massive, sustained central bank bond buying over-rode and deformed any ordinary dynamic of supply and demand fundamentals. Accordingly, the denizens of today’s electronic bond pits don’t know from “price discovery” and can’t imagine a scenario in which the central banks don’t have their backs.
But that’s precisely why a “yield shock” is imminent. In fact, now comes the black swan with an orange-colored hue; Trump’s SOTU boondoggle may well be the risk-off pin that the current manic financial bubble has been searching for since November 8, 2016.
Stated differently, Boondoggle Don may be commencing god’s work after all. In the current fraught environment, it will not take much to trigger a self-fueling bond market sell-off that will finally bring down the entire debt-enabled house of cards.
In this context, we’d also bet heavily on the proposition that the chart below has never been seen inside the White House. Unlike the warmed over supply-side fantasies being ponied-up by geriatric supply-siders like Steve Forbes and Stephen Moore, this chart is about the real economics of our time; it dwarfs into insignificance Art Laffer’s four-decades ago napkin scriblings.
To wit, as recently as January 2017, the major central banks were draining securities from the bond pits at a $2.1 trillion annual rate, thereby injecting a tsunami of newly minted cash into the casino where it found its way into corporates, junk bonds, ETFs, short vol trades and even more exotic “risk-on” speculations.
Read More @ DavidStockmansContraCorner.com
by Mark O’Byrne, Goldcore:
– ATMs in US hit by “jackpotting” attacks that empty ATMs in minutes
– FBI warns of attacks in US after similar crimes in Taiwan, Thailand and Europe
– Hackers have stolen c.$1 million from ATMs across the US warns U.S. Secret Service
– Target Diebold Nixdorf machines – #1 global ATM provider, 35% of ATMs worldwide
– Digital deposits increasingly vulnerable – Time to save in physical gold
$1 million has been stolen from ATMs across the United States by hackers in a new hacking approach known as ‘jackpotting’. Using malware and an endoscope hackers are able to force cash machines to spew out their entire holding of cash.
Once the machine has been emptied the malware, known as Plotus. D, has handed over complete control to the hackers and displays an ‘Out of Service’ message.
This week a memo was leaked from the US Secret Service regarding this discovery. It stated that it was only a matter of time that the US became a target for this type of hacking, given it has already been seen in both Europe and Asia.
According to Russian cybersecurity firm Group IB, dozens of remote attacks were reported in 2016 within Europe.
Plotus.D is not a new discovery for security services, background reading suggests that they have been aware of it for a while now. An alert issued by the US Secret Service, states:
“In previous Ploutus.D attacks, the ATM continuously dispensed at a rate of 40 bills every 23 seconds…Once the dispense cycle starts, the only way to stop it is to press cancel on the keypad. Otherwise, the machine is completely emptied of cash.”
In fact, it was first seen in Mexico in 2013, as described by security firm FireEye in 2017. They concluded that it was “one of the most advanced ATM malware families we’ve seen in the last few years…
“Once deployed to an ATM, Ploutus-D makes it possible for a money mule to obtain thousands of dollars in minutes,” They believe the malware can be modified to use against 40 different ATM vendors in 80 countries.
No longer need to ‘blow the bl**dy doors off’
As Wired magazine pointed out last year, it used to be that robbers needed to either blow up or physically steal an entire ATM in order to steal its contents. Now there are two, far more subtle routes. A simple physical hack or one which goes through the bank’s own software system.
Due to the nature of cybersecurity threats these days, it is getting harder for hackers to access a bank’s back-end network as it requires a far more sophisticated network intrusion skills. Conversely, hacking physically through the front of a machine does not trigger any alarms and can be done relatively cheaply and easily.
Even more convenient for the hackers, physical attacks on machines means the banks or ATM issuers cannot do a remote fix across all machines, each one has to be repaired individually. Giving the hackers more time to access as many ATMs as they can.
How can this be managed? Wired magazine believe this may be an unsolvable problem:
Physical attacks on ATMs are, in some sense, an unsolvable problem. Computer security experts have long warned that no computer should be considered secure if an attacker takes physical control of it. But weak encryption and a lack of authentication between components leaves ATMs particularly vulnerable to physical attacks—access to any part of the insecure machine Kaspersky describes means access to its most sensitive core. And for computers that are left standing unprotected on a dark street in the middle of the night, stuffed full of money, a little more thought to digital security might be a worthwhile investment.
ATMs are not alone
As we discussed last week, anything is hackable today. Very little with an internet connection is safe from the malicious intent of hackers.
Sadly we’re exposed on all sides to hacking. From the security of our cash machines to the heating in our homes right down to our iphones and the many sensitive apps and data on them.
Hackers are no longer just individuals who have progressed from gaming in their mothers’ basements to hacking for jokes. Nowadays many of the hacks that we see are backed by international crime syndicates who themselves are supported by foreign governments.
Whilst companies are distracted with laying down the best security money can buy, individuals are left somewhat in the dark wondering how best to protect themselves. The idea of ATM attacks is particularly concerning when one realises the ultimate impact on consumer and citizens.
ATM attacks are another excuse to go cashless
Ultimately we will end up paying, either for the privilege of withdrawing our own money or (worse) being forced to go to a bank (of which there are fewer physical branches).
The attack on ATMs will likely be used as an excuse to further outlaw cash in the ongoing war on cash, by both governments and banks.
We have written previously of both governments’ and banks’ missions to prevent us from using cash. Very often reasons for banning large bills or preventing the carrying of certain amounts across borders has been justified under money laundering prevention, terrorism and even for the efficiencies and profitability for banks.
In truth, we know that cash is disliked by less liberal governments. They can’t track it and it’s certainly of no use to them when bail-ins and negative interest rates are on the table. What is the incentive, therefore, for ATM hacking to be resolved?
As we wrote in a previous piece on the cashless society:
Going cashless will not rid us of people and organisations who wish to commit horrific and illegal acts. Instead it will encourage them to find additional ways to run their gangs and terrorist cells. For the rest of us it will remind us of the importance of liberty, safe-havens, security and the need to protect our wealth from negative interest rates, bail-ins and currency devaluations.
Read More @ Goldcore.com