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Turkey should not become EU member, Merkel tells TV debate

September 3, 2017 rbksa 0
Sun, 2017-09-03 22:28

BERLIN: German Chancellor Angela Merkel said Sunday that she would ask the European Union to call off membership talks with Turkey, amid escalating tensions between Berlin and Ankara.
“I don’t see them ever joining and I had never believed that it would happen,” she said during a televised debate with Martin Schulz, her Social Democratic rival in elections later this month.
She added that she would speak with her EU counterparts to see if “we can end these membership talks.”
Merkel’s tough stance came after Turkey arrested two more German citizens this past week “for political reasons,” infuriating Berlin.
The arrests brought the number of German political prisoners in Turkish custody to 12, at a time when ties between the two NATO allies were already at an all-time low.
The plunge in relations began after Berlin sharply criticized Ankara over the crackdown that followed last year’s failed coup attempt.
The arrest of several German nationals, including the Turkish-German journalist Deniz Yucel, the Istanbul correspondent for the Die Welt newspaper, further frayed ties.
Yucel has now spent 200 days in custody ahead of a trial on terror charges.
German journalist Mesale Tolu has been held on similar charges since May, while human rights activist Peter Steudtner was arrested in a July raid.
After Steudtner’s arrest, Germany vowed stinging measures impacting tourism and investment in Turkey and a full “overhaul” of their troubled relations.
Turkish President Recep Tayyip Erdogan, for his part, has also sparked outrage after charging that Germany is sheltering plotters of last year’s coup, as well as Kurdish militants and terrorists, and demanded their extradition.
Erdogan added to the tensions this month when he urged ethnic Turks in Germany to vote against Merkel’s conservatives and their coalition partners, the Social Democrats, in September 24 elections.
The escalating tensions have split the Turkish community in Europe’s top economy, the largest diaspora abroad, which is a legacy of Germany’s “guest worker” program of the 1960s and 70s.


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Turkey urges global action on Rohingya Muslims

September 3, 2017 rbksa 0
MENEKSE TOKYAY | Special to Arab News
Mon, 2017-09-04 01:35

ANKARA: Turkey has called on the international community to put pressure on Myanmar’s government to stop the killing and displacement of Rohingya Muslims in Rakhine state.

Foreign Minister Mevlut Cavusoglu on Saturday said Turkey has so far delivered more than $70 million in humanitarian aid to the Rohingya, but delivering aid is not enough.

“In two weeks, we need to hold a meeting in New York with the UN secretary-general, leaders of Muslim countries, international organizations, the head of the UN Advisory Commission on Rakhine State, Kofi Annan, and other leaders to solve this issue,” he said.

“We’ve called upon the Organization of Islamic Cooperation (OIC). We’ll organize a summit this year on the issue. We have to find a definitive solution to this problem.”

Cavusoglu also urged the Bangladeshi government to “open its doors” to Rohingya Muslims, and pledged to cover all costs to accommodate them.

Meanwhile, Turkish President Recep Tayyip Erdogan, who has accused Myanmar of “genocide” against the Rohingya, continued his telephone diplomacy with the leaders of Senegal, Nigeria and Kazakhstan, the state-run Anadolu Agency reported.

He is expected to discuss the crisis on the phone with the leaders of Pakistan, Iran, Mauritania, Qatar, Saudi Arabia, Kuwait, Azerbaijan and Bangladesh this week. Meanwhile, Cavusoglu spoke with former UN Secretary-General Annan.

Dr. Altay Atli, a research associate at Sabanci University’s Istanbul Policy Center, said Turkey can draw global attention to the tragedy and facilitate multilateral steps to resolve the issue.

“I see, however, two obstacles in this respect,” Atli told Arab News. “One is related to what I call ‘democracy illusion’ in Myanmar. There’s a democratic transition, the junta has left, there were elections, but democratization takes time.”

With the international community buying into this “democracy illusion,” it turned a blind eye to ongoing undemocratic practices, including the situation of ethnic minorities, he said.

Furthermore, Western countries want to access Myanmar’s natural resources and counterbalance China’s influence there, Atli added.

“The second problem relates to the OIC’s inability to act in unison, make binding decisions and enforce them,” he said.

Talip Kucukcan, a lawmaker from Turkey’s ruling Justice and Development Party, said Ankara has taken the lead in raising awareness about the plight of the Rohingya, and calls on the international community to take effective steps to prevent a humanitarian disaster.

“A humanitarian tragedy is unfolding, while the international community pays lip service to the slaughter and forced migration of Muslims,” he told Arab News.

“The lack of response around the world indicates that UN and other agencies are becoming useless entities,” he said.

“Ankara couldn’t remain silent over the plight of Rohingya Muslims, not because Turks belong to the same religion, but due to Turkey’s emphasis and investment in humanitarian assistance worldwide.”

Turkey hosts the largest number of refugees in the world, and provides humanitarian assistance in more than 100 countries regardless of religion or ethnicity, said Kucukcan.

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Texas Governor: “Harvey Could Cost Up To $180 Billion”

September 3, 2017 Tyler Durden 0

Texas Governor Greg Abbott said on Sunday that it could cost as much as $180 billion to rebuild Texas following Hurricane Harvey, more than four times what most experts expected ($40 billion). If accurate, Harvey would beat out Hurricane Katrina (total: $160 billion) for costliest storm in US history.

“Katrina caused if I recall more than $120 billion but when you look at the number of homes and business affected by this I think this will cost well over $120 billion, probably $150 to $180 billion,” Abbott told Fox News, adding, “this is far larger than Hurricane Sandy.”

Aside from a handful of meteorologists like Dr. Joel N. Myers, founder, president and chairman of AccuWeather, who predicted – apparently with a surprising degree of accuracy – that Harvey-related costs could pile as high as $190 billion, few anticipated the extensive flooding damage the storm would cause in Houston, the fourth-largest city in the US, which contributes some $500 billion to US GDP every year.

Abbott, who offered his assessment of the damages during an appearance on CNN’s “State of the Union,” said the devastation wrought by Harvey could be costlier than Hurricane Katrina and Superstorm Sandy combined.

But whatever the final total, Abbott said he’s confident the federal government will authorize the assistance that President Trump promised, adding that the $8 billion that the White House asked for is merely a “down payment.”

Texas is still in “phase one” of the cleanup effort – i.e. first responders are still rescuing people in Beaumont and other parts of Southeastern Texas, where the storm made its second landfall.

“The president has made it clear, Congress is making it clear, this is just a down payment. Let’s not compare this to Sandy let’s compare this to Katrina. The population size is larger and the geographic size is far bigger than Hurricane Katrina and Sandy combined. It’s going to require even more than what was funded for Katrina which was $120 billion dollars…In the overall equation, the cost of this, if I understand it correctly, to rebuild Katrina was over $120 billion and when you consider the magnitude of this storm, when you look at the number of homes that have been mowed down and damaged, this is a huge catastrophe that people are going to have to come to grips with. It’s going to take years for us to overcome this challenge.”


“When you look at the number of homes and businesses affected by this, I think this will cost well over $120 billion…probably $150 [billion] to $180 billion.”

Worse, according to preliminary estimates, less than 20% of Harris County homeowners are insured against flooding (some estimates have the number as low as 15%). So what will Texas do to aid these homeowners? Abbott said the state had established a fund to help ensure that all homeowners affected by the storm are “taken care of.”

“Waters are receding in Houston, but remember there are so many other parts of the state that are affected such as the Beaumont, where we’re still doing search and rescue missions. We are still in phase one of response. As it comes to the homeowners, we’re working on multiple levels to make sure that these homeowners will be taken care of. Trump has had all his cabinet members in Texas constantly.”

Meanwhile, Houston was still struggling to recover on Sunday, when the city forced the evacuation of thousands of people on the western side of town to accommodate the release of water from a pair of reservoirs that otherwise might sustain damage. The storm stalled over Houston, dumping more than 50 inches (127 cm) on the region in a matter of days. The city cut off power to homes on Sunday morning to encourage evacuations, but conflicting information about who must leave angered some residents.

The area was barricaded and military vehicles were stationed on the periphery to take people out. Some living near the reservoirs were told their homes were in danger of new flooding and would not be allowed to return if they left.

“It’s hard to get the real story. We’re having to make decisions on what we do day by day. Do we stay or go?” said Todd Kellenbenz, who lives in the affected area. 


About 37,000 refugees stayed overnight in 270 shelters in Texas plus another 2,000 in seven Louisiana shelters, the highest number reported so far by the American Red Cross. Some 84,700 homes and businesses were without power on Sunday, down from a peak of around 300,000, according to the region’s major electric companies.

Still, Houston Mayor Sylvester Turner said his city was making progress on several fronts, resuming city services and helping get people into housing and out of emergency shelters.

Trump visited Houston on Saturday to meet evacuees and rescue workers, an opportunity to show an empathetic side after some criticized him for staying clear of the disaster zone during a previous visit on Tuesday. Trump had said he did not want to hamper rescue efforts.

Trump and his wife Melania marked a national day of prayer for hurricane victims on Sunday by attending church services at St. John’s Episcopal Church near the White House.

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Philippine leader to meet Malaysian, Indonesian leaders over Daesh threat

September 3, 2017 rbksa 0
ELLIE ABEN | Special to Arab News
Mon, 2017-09-04 00:44

MANILA: Philippine President Rodrigo Duterte is set to meet with leaders of Malaysia and Indonesia to discuss closer counterterrorism efforts against Daesh.

“I have to talk to (Indonesian) President (Joko) Widodo. We’ve agreed that we’ll talk, the three of us, including (Prime Minister) Najib (Razak) of Malaysia. We’re just waiting for the timing,” said Duterte, raising the possibility of a joint task force to go after Daesh members.

He added that he will open his country’s borders to Malaysian and Indonesian authorities pursuing Islamist extremists.

Duterte said Daesh’s defeat in Syria will result in its members there trying to flee to places to which they have access, such as Marawi, the Muslim-majority city in the southern Philippines where government forces have been fighting members of the Daesh-inspired Maute group since May.

The crisis in Marawi have so far left more than 800 people dead and displaced thousands of residents.

Duterte said his meeting with Widodo and Razak is being worked out, with the venue either in Sabah, Malaysia, or Jakarta, Indonesia.

“To formalize an agreement, we have to meet face to face and agree on an agenda for the talks,” said Duterte. 

Meanwhile, his spokesman Ernesto Abella on Sunday said “it will only be a matter of time” before government forces “get” Isnilon Hapilon, the Abu Sayyaf Group (ASG) leader designated emir of Daesh in Southeast Asia and one of America’s most wanted terrorists.

There are reports that Hapilon has left Marawi and has been seen openly on Basilan Island. But Abella said such reports require “further validation by the military and various security agencies.”

If Hapilon is in Basilan, “it would mean that he chose to abandon his men as the battle of Marawi nears its final stretch,” said Abella, adding that according to recent military assessments, Hapilon is still in Marawi.

A botched joint military and police operation to serve an arrest warrant against Hapilon in May triggered the Marawi crisis.
Authorities said he was in the city to join forces with Maute, which has pledged allegiance to Daesh. The Marawi crisis prompted Duterte to place the entire island of Mindanao under martial law.

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How To Make The Financial System Radically Safer

September 3, 2017 Tyler Durden 0

Authored by EconomicPrism’s MN Gordon via,

Preventing the Last Crisis

Clear thinking and discerning rigor when it comes to the twisted state of present economic policy matters brings with it many physical ailments.  A permanent state of disbelief, for instance, manifests in dry eyes and droopy shoulders.  So, too, a curious skepticism produces etched forehead lines and nighttime bruxism.


The terrible scourge of bruxism and its potentially terrifying consequences. Curious skepticism can lead to the darnedest things, which is why Big Brother strongly recommends that citizens remain in a medication and cable TV-induced apathetic stupor. To make this happy outcome easier to achieve, stagnation in real wages was successfully introduced a number of moons ago; forced to work to exhaustion just to keep their heads above water, citizens tend to be more docile in their shrinking free time. [PT]


Nonetheless, these are small prices to pay for the simple delight that comes when a central planner opens their mouth and inserts their foot.  Last Friday, for example, Fed Chair Janet Yellen gave a speech to her friends and cohorts at the annual central banker’s powwow in Jackson Hole, Wyoming.  There she patted herself and the financial regulatory community on the back for what she believes has been a successful execution of financial regulations:

“The events of the [2008] crisis demanded action, needed reforms were implemented, and these reforms have made the system safer.”

How Yellen knows the reforms have made the system safer is unclear.  Like France’s impenetrable Maginot Line, the regulations Yellen lauds are backward looking.  They are suited to preventing the last crisis while ignoring new and greater threats amassing just beyond the horizon.


If mouse traps were designed like our nifty new financial regulations, this is what they would look like. Don’t you feel safer already?  [PT]


No doubt, the greatest of these mounting threats are of the Fed’s own making.  After adding $4 trillion to the Fed’s balance sheet and dropping the federal funds rate to near zero for many years they’re now in the early stages of their great endeavor to ‘normalize’ monetary policy.

But, alas, it’s no longer a normal world.  Years of abnormal monetary policy has fabricated an abnormal world.  Surely something will break before things are bent back into place, assuming they ever get there.


Dead Wrong

The reforms Yellen was referring to include the Dodd-Frank Act.  The Frank part of the regulation, if you recall, is former Congressman, and overall repulsive being, Barney Frank.  Despite being out of office for over four years, Frank’s grubby finger prints continue to besmirch the economy.

The Dodd-Frank Act, which was rolled out in response to the 2008 financial crisis, has turned out to be a classic case of knee-jerk regulatory overkill.  President Trump has promised relief to certain aspects of the Dodd-Frank Act’s suffocating regulatory regime, including stress test and capital requirements. These requirements force banks to keep more capital on their books as opposed to investing it in interest-earning assets.


Das abominable Frank, who lives on in the Act named after him. After aiding and abetting  the very lending practices that brought Fannie Mae and Freddie Mac to their knees, he was somehow held to be the go-to person to work out a new set of regulations for the financial industry. He and Dodd created a telephone book-sized monstrosity of regulatory guidelines, which via implementation of administrative law by the bureaucracy has by now grown into several hundred telephone books of rules. The main effect of this was that the banking industry has become even more concentrated and so-called too-big-to-fail banks have grown even larger. They certainly are not happy with numerous aspects of the new regulations, but on the other hand, they no longer need to fear competition from upstarts, as compliance with this jungle of laws has essentially become unaffordable for institutions below a certain size threshold. [PT]


The rules also dictate how banks allocate their assets between highly liquid securities and illiquid loans – with greater preference for the former. Rolling back capital and stress test requirements would directly reduce compliance costs for banks and financial institutions.  It would also give banks greater autonomy in how they manage their lending operations.

But Fed Chair Yellen, a dyed-in-the-wool central planner, has a very narrow focus.  In her world, more control via more regulations always provides for a more stable financial system.  Yet she’s dead wrong.


We were unable find more recent data than those depicted in the above chart, so we cannot comment on the current situation, but shortly after the GFC, business closing did begin to exceed the number of new start-ups. Note that this trend has been in place for a long time – and it goes hand in hand with the growth on regulations in the Federal Register. The longest interruption occurred during the Reagan administration, which is not a coincidence: it was the only time in the entire post-war era in which the number of regulations in the Federal Register actually declined. This is of course precisely what one should expect – it is not rocket science. Unfortunately the political and bureaucratic elites are so far removed from the real world in their echo chambers that they apparently don’t understand even the most simple cause-effect chains. We should add, Mr. Bernanke also echoed the false claim that the mortgage credit market – one of the most tightly regulated sectors of the economy –  somehow suffered from “too little regulation”. It should be obvious that his aim was to deflect blame from where it should have been rightfully placed: the loose monetary policy of the Federal Reserve and the system-immanent drawbacks of a fiat money-based fractional reserve banking system that can expand the supply of money and credit willy-nilly. [PT]


The new financial reforms that were instituted following the 2008 financial crisis have had the adverse effect of constraining economic growth.  U.S. gross domestic product growth has lagged behind asset price and debt growth.  Moreover, more businesses are vanishing than are being created. Barney Frank’s maze of regulations has made it harder for small businesses and entrepreneurs to access the capital needed to grow and create jobs.


How to Make the Financial System Radically Safer

At the same time, the new financial reforms haven’t minimized risk.  Moreover, they’ve set taxpayers – that’s you – up for a future fleecing.  Congressman Robert Pittenger elaborated this fact in a Forbes article last year:

“Even Dodd-Frank’s biggest selling point, that it would end “too big to fail,” has proven false.  Dodd-Frank actually created a new bailout fund for big banks–the Orderly Liquidation Authority–and the Systemically Important Financial Institution designation enshrines “too big to fail” by giving certain major financial institutions priority for future taxpayer-funded bailouts.”

What gives? Regulations, in short, attempt to control something by edict.  However, just because a law has been enacted doesn’t mean the world automatically bends to its will.  In practice, regulations generally do a poor job at attaining their objectives.  Yet, they often do a great job at making a mess of everything else.

Dictating how banks should allocate their loans, as Dodd-Frank does, results in preferential treatment of favored institutions and corporations.  This, in itself, equates to stratified price controls on borrowers.  And as elucidated by Senator Wallace Bennett over a half century ago, price controls are the equivalent of using adhesive tape to control diarrhea.


The dangerous conceit of the clueless… the house of cards they have built is anything but “safe” and they most certainly can not “fix anything”. Listening to their speeches that seems to be what they genuinely believe. A rude awakening is an apodictic certainty, but we wonder what or who will be blamed this time. Not enough regulations? The largely absent free market? As they say, “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” (this quote is often erroneously attributed to Mark Twain: we think it doesn’t matter whether he created it, it is often quite apposite and this is a situation that certainly qualifies).  [PT]


The point is that planning for future taxpayer-funded bailouts as part of compliance with destructive regulations is asinine.  In this respect, we offer an approach that goes counter to Fed Chair Janet Yellen and the modus operandi of all central planner control freaks.  It’s really simple, and really effective.

The best way to regulate banks, lending institutions, corporate finance and the like, is to turn over regulatory control to the very exacting, and unsympathetic, order of the market.  That is to have little to no regulations and one very specific and uncompromising provision:

There will be absolutely, unconditionally, categorically, no government funded bailouts.

Without question, the financial system will be radically safer.

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Russia’s Rosneft, China’s CEFC Shake Hands on Joint <b>Oil</b> Exploration in Siberia

September 3, 2017 0

Russian oil giant Rosneft said Sunday it had concluded a contract with CEFC China Energy conglomerate for the supply of Russian crude oil to China …

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Venezuelans Find A New Way To Fight Back

September 3, 2017 Tyler Durden 0

Authored by Rene Chun via The Atlantic,

Hyperinflation has driven thousands to seek out unorthodox currency.

In Venezuela, home to some of the worst hyperinflation since the Weimar Republic, a Big Mac costs about half a month’s wages. Or rather, it did, until a bread shortage forced the burger off the menu. The annual inflation rate is expected to hit 1,600 percent. Life resembles an old newsreel: long lines, empty shelves, cashiers weighing stacks of bills.

To survive, thousands of Venezuelans have taken to minería bitcoin – mining bitcoin, the cryptocurrency. Lend computer processing power to the blockchain (the bitcoin network’s immense, decentralized ledger) and you will be rewarded with bitcoin. To contribute more data-crunching power, and earn more bitcoin, people operate racks of specialized computers known as “miners.” Whether a mining operation is profitable hinges on two main factors: bitcoin’s market value—which has hit record highs this year—and the price of electricity, needed to run the powerful hardware.

Electricity, it so happens, is one thing most Venezuelans can afford: Under the socialist regime of President Nicolás Maduro, power is so heavily subsidized that it is practically free. A person running several bitcoin miners can clear $500 a month. That’s a small fortune in Venezuela today, enough to feed a family of four and purchase vital goods—baby diapers, say, or insulin—online. (Most web retailers don’t ship directly to Venezuela, but some Florida-based delivery services do.)

Under these circumstances, a miner starts to look a lot like an ATM. Professors and college students have mined bitcoin; so, rumor has it, have politicians and police officers. It has become a common currency even among non-miners: Peer-to-peer online exchanges (think Venmo, but with cryptocurrency) allow everyone from shopkeepers to a former Miss Venezuela to buy and sell with bitcoin.

But recently, Maduro has begun cracking down on mining operations, apparently finding in them a convenient political scapegoat—much as he calls those who seek to profit off inflation “capitalist parasites.” Yet trading bitcoin is still condoned. It’s as if Maduro realizes that cryptocurrency is one of the few things holding the country together.

Because Venezuela has no cryptocurrency laws, police have arrested mine operators on spurious charges. Their first target, Joel Padrón, who owns a courier service and started mining to supplement his income, was charged with energy theft and possession of contraband and detained for 14 weeks. Since then, other bitcoin rigs have been seized – and, in many cases, rebooted by corrupt police for personal profit. As a result, Padrón told me, many people have stopped mining. But Rodrigo Souza, the founder of BlinkTrade, which runs SurBitcoin, a Venezuelan bitcoin exchange based in Brooklyn, says that for others, the temptation is still too great to resist. “People haven’t stopped mining,” he told me. “They’ve just gone deeper underground.”

Venezuela’s most resourceful miners, in fact, are moving on to a new inflation-buster: the cryptocurrency ether (ETH). The profit margins are higher and, more important, the risk factor is much lower.

“Mining ETH or bitcoin is pretty much the same principle: using free electricity to generate cash,” one Venezuelan miner told me.


“But ETH mining is more affordable – all you need is free software and a PC with a video card. Any police officer is easily fooled into thinking your ETH miner is just a regular computer.

And so, as the presses churn out worthless bolivares, the miners carry on, tapping into the power grid, turning electrons into dollars.

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