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WSJ Confirms: Trump-Appointed Venezuela Coup Leader Plans Neoliberal Capitalist Shock Therapy

Juan Guaido

WSJ Confirms: Trump-Appointed Venezuela Coup Leader Plans Neoliberal Capitalist Shock Therapy

Venezuela’s US-appointed coup leader Juan Guaidó plans to privatize state assets and give foreign corporations access to oil, the Wall Street Journal admitted.

The Wall Street Journal reported that Venezuela’s US-appointed coup leader Juan Guaidó has already drafted plans for “opening up Venezuela’s vast oil sector to private investment” and “privatizing assets held by state enterprises.”

The report confirms what The Grayzone previously reported.

“Juan Guaidó, recognized by Washington as the rightful leader, said he would sell state assets and invite private investment in the energy industry,” read the  Wall Street Journal’s January 31 article.

The paper noted that Guaidó plans “to reverse President Nicolás Maduro’s economic polices,” explaining:

“Mr. Guaidó said his plan called for seeking financial aide from multilateral organizations, tapping bilateral loansrestructuring debtand opening up Venezuela’s vast oil sector to private investment. It includes privatizing assets held by state enterprises … He also said he’d end wasteful state subsidies and take steps to revive the private sector.”

In other words, Guaidó plans to implement the neoliberal capitalist shock therapy that Washington has imposed on the region for decades.

Using funding from US-dominated international financial institutions like the International Monetary Fund (IMF), the Venezuelan coup leader seeks to adopt an aggressive “structural adjustment” program, enacting the kinds of economic policies that have led to the preventable deaths of millions of people and an explosion of poverty and inequality in the years following capitalist restoration in the former Soviet Union.

In a speech, Juan Guaidó even echoed rhetoric that is popular among US conservatives: “Here, no one wants to be given anything.”

It is clear that the coup leader’s priorities reflect those of Venezuela’s capitalist oligarchs and right-wing politicians in the United States. Economic liberalization is the Venezuelan opposition’s first and most important goal; democracy is just a pretense.

 …click on the above link to read the rest of the article…

US Electric Grid Hacked: Perpetrators Could Have Shut Down the System

Hackers broke into the US electric grid with spearphishing techniques targeting contractors with system access.

The Wall Street Journal has a detailed report out today regarding a sophisticated, and successful attack by hackers into the US electric grid. The hackers could have temporarily shut off power.

The Journal claims Russia is responsible. I hate such assumptions. In the absence of hard proof, the hack could have come from China, North Korea, Israel, or even the US. Even if Russian hackers did this, there is a difference between “Russian” and “Russia”.

Early victims

In the summer of 2016, U.S. intelligence officials saw signs of a campaign to hack American utilities, says Jeanette Manfra, assistant secretary of Homeland Security’s cybersecurity and communications program. The tools and tactics suggested the perpetrators were Russian. Intelligence agencies notified Homeland Security, Ms. Manfra says.

Mr. Vitello of All-Ways Excavating has no idea how the hackers got into his email account. He doesn’t recall reading CFE’s websites or clicking on tainted email attachments. Nonetheless, the intrusion was part of the Russian campaign, according to the security companies that studied the hack.

On March 2, 2017, the attackers used Mr. Vitello’s account to send the mass email to customers, which was intended to herd recipients to a website secretly taken over by the hackers.

Once Mr. Vitello realized his email had been hijacked, he tried to warn his contacts not to open any email attachments from him. The hackers blocked the message.

Sneak Attack

Hackers sent bogus emails from the account of Oregon construction contractor Mike Vitello to herd recipients to a website they had secretly taken over, called imageliners.com. Hackers then used the site to seek access to contractors that do business with U.S. power utilities.

 …click on the above link to read the rest of the article…

Fracked Shale Oil Wells Drying Up Faster than Predicted, Wall Street Journal Finds

Fracked Shale Oil Wells Drying Up Faster than Predicted, Wall Street Journal Finds

Pumpjacks in Permian Basin outside Midland, Texas

In 2015, Pioneer Natural Resources filed a report with the federal Securities and Exchange Commission, in which the shale drilling and fracking company said that it was “drilling the most productive wells in the Eagle Ford Shale” in Texas.

That made the company a major player in what local trade papers were calling “arguably the largest single economic event in Texas history,” as drillers pumped more than a billion barrels of fossil fuels from the Eagle Ford.

Its Eagle Ford wells, Pioneer’s filing said, were massive finds, with each well able to deliver an average of roughly 1.3 million barrels of oil and other fossil fuels over their lifetimes.

Three years later, The Wall Street Journal checked the numbers, investigating how those massive wells are turning out for Pioneer.

Turns out, not so well. And Pioneer is not alone.

Those 1.3 million-barrel wells, the Journal reported, “now appear to be on a pace to produce about 482,000 barrels” apiece — a little over a third of what Pioneer told investors they could deliver.

In Texas’ famed Permian Basin, now the nation’s most productive shale oil field, where Pioneer predicted 960,000 barrels from each of its shale wells in 2015, the Journal concluded that those “wells are now on track to produce about 720,000 barrels” each.

Not only are the wells already drying up at a much faster rate than the company predicted, according to the Journal’s investigative report, but Pioneer’s projections require oil to flow for at least 50 years after the well was drilled and fracked — a projection experts told the Journal would be “extremely optimistic.”

Fracking every one of those wells required a vast amount of chemicals, sand, and water. In Karnes County, Texas, one of the two Eagle Ford counties where Pioneer concentrated its drilling in 2015, the average round of fracking that year drank uproughly 143,000 barrels of water per well.

…click on the above link to read the rest of the article…

How do you Stop the Arms Race? By Starting a New War, for Instance

How do you Stop the Arms Race? By Starting a New War, for Instance

Do you see a ghostly Seneca Cliff in this graph? (source)

There is a good rule that you should always be careful when extrapolating your data, especially over the long term. And there is an even better rule saying that you should never, never extrapolate an exponential growth. The uncertainty in the data of an exponentially growing curve increases exponentially, too, and that makes your extrapolation meaningless very soon.

But, in the figure above, they extrapolated an exponentially growing curve for the military expenses of the US and China over more than 30 years!  The origin of that curve above seems to be the RAND Corporation. I couldn’t find the original source, but it has been reproduced in the blog of the Wall Street Journal and on Zero Hedge

It looks like someone seriously proposed this extrapolation. But consider a few numbers: according to the chart, by 2050 the US would spend more than 20% of its present GdP for the military! (it is now about 3%). It might be possible if the US GdP were to increase in proportion. But, from the graph, they assume a growth of nearly a factor of 5 (from ca. 600 billion dollars, today, to 2.9 trillion in little more than 30 years. It means that the GdP should double at least twice in 30 years, that is, the US economy should grow at the rate of 6% (twice the current rate!) every year for the next 30 years. Otherwise, the US government would bankrupt itself even faster than it is doing now.

Now, you might want to dismiss this graph as one of the many silly forecasts that are part of the everyday chat on how this or that sector of the economy is going to grow — and therefore everyone should invest on it.
…click on the above link to read the rest of the article…

Retailers Rejecting Customers’ Cash As More Ban Paper Money

“Your cash is not wanted here”, a growing number of retailers and restaurants throughout the US and UK are telling customers. But are reasons being given by companies for the new “cashless” approach — speed, efficiency, and the safety of store employees — valid enough to require something as utterly and downright unAmerican as rejecting cash?

We think not, and unfortunately the trend of “cash not welcome here” establishments is growing, to the point that lawmakers are beginning to take note and could introduce legislation barring the practice, as Massachusetts has done already, and as the New Jersey State House could be set to do next. According to a Federal Reserve survey conducted in 2017 cited in The Wall Street Journal, cash represented 30% of all transactions in America, with 55% of those being under $10.

via the NY Times

Regardless of Americans’ longtime preference for plastic in most transactions, many of which take place online, research by the Federal Reserve found that cash is still king in terms of Americans’ daily lives and usage, and as the study concluded further, this remains true across all income levels:

Not only is cash used frequently for small value and in-person purchases, it is also used by a wide array of consumers. The data on cash use by household income provides two main insights. First, consumers make—on average—14 cash transactions per month, regardless of household income. It is also noteworthy that cash was the most, or second most, used payment instrument regardless of household income, indicating that its value to consumers as a payment instrument was not limited to lower income households that may be less likely to have access to an account at a financial institution.

…click on the above link to read the rest of the article…

Mother of All Sucker Rallies Sends Dow 1,000 Points Higher

Following a brutal four days in a brutal month, stocks staged a massive rally. Alas, it won’t last.

The Wall Street Journal reports Dow Industrials Leap More Than 1,000 Points.

The Dow Jones Industrial Average surged more than 1,000 points for the first time in a single session Wednesday, rebounding after a bruising four-session selloff put the blue-chip index and the S&P 500 on the brink of a bear market.

All 30 stocks in the Dow industrials notched gains, as did each of the 11 sectors in the broader S&P. Shares of Amazon.com , Facebook and Netflix climbed more than 8%, while retailers rallied as early data on the crucial holiday shopping season appeared robust. And a nearly 9% rise in oil prices offered a respite for shares of beaten-down energy companies.

Verge of Bear Market?

The WSJ says the S&P 500 was “on the verge of a bear market”.

I disagree. I claim the S&P 500 is in a bear market.

Who’s right?

Arguably, we both are. It depends on where you measure from.

The high of 2940.91 as shown in the above chart was an intraday high. The high the previous day was 2930.75. That was also the highest close ever. On a close-to-close basis the S&P only fell 19.78%

Is the WSJ ridiculously splitting hairs? Yes.

About Bear Market Rallies

Today was a typical bear market rally. I posted some charts on December 24: S&P 500 Slips into Bear Territory on Worst Christmas Eve Trading Ever

Yes Virginia, it’s a bear market. Expect a lot more days like today, with everyone caught believing “the bottom is in”, every step of the way.

The next real bottom will not be in until everyone is totally disgusted with the stocks and gives up. Demographically-speaking it will come at the worst time for boomers.

There was one and only one thing surprising about today: Trump did not yap about it.

“It Tells People: Don’t Worry” – Saudi Stock Market Plunge Protection Team Exposed

In politics, “when it gets serious, you have to lie.”

In the increasingly intermingled worlds of geopolitics and financials markets, when it get serious, you have to rescue your nation’s stocks…

America’s Plunge Protection Team has been a long-standing feature behind the scenes since Greenspan (some even think it has been around since 1944), ready as equity market buyer of last resort (and even getting subsidies for doing so from the exchanges).

See any number of magical and sudden reversals from 2008/9 and 2014USA Today finally realizes, fundamentals don’t matter anymore…

2015… The rescue bid arrives…

in dramatic size!!

But America’s lessons have spread.

China’s National Team is more erratic, sporadic, and definitely less successful.

But is nevertheless conspicuous in its sudden panic-buying sprees when Shanghai Composite nears critical levels (or economic strength needs to be projected domestically or otherwise).

For instance, this week…as China begins to fold on its strong-man trade war tactics…

And now, amid the current crisis of confidence in The Kingdom, The Wall Street Journal has exposed Saudi Arabia’s stock market rescue squad

The Journal pulls no punches in turning the conspiracy theory into conspiracy fact, noting that the government of Crown Prince Mohammed bin Salman has spent billions to counter selloffs in recent months.

According to a Wall Street Journal analysis of trading data and interviews with multiple people with direct knowledge of government intervention efforts, the Saudi government has placed huge buy orders, often in the closing minutes of negative trading days, to boost the market.

…click on the above link to read the rest of the article…

Yet Another Trillion-Dollar Unfunded Liability: WHY California Is Burning

Yet Another Trillion-Dollar Unfunded Liability: WHY California Is Burning

The apocalyptic fires that hit California last month have left observers scratching their heads and wondering how destruction on that scale could be possible – and how much it will cost in the future if the causes aren’t addressed immediately.

This morning’s Wall Street Journal concludes that 1) the problems aren’t being addressed and 2) this failure is going to cost a fortune that no government is prepared to cover (emphasis added below).

Why Californians Were Drawn Toward the Fire Zones

Building codes, state grants and low insurance rates have encouraged people to flee expensive cities for their dangerously fire-prone fringes.

California fires
A Nov. 15 view in Paradise, Calif., above, shows charred remains of houses among the trees after the Camp Fire burned down more than 11,000 homes. PHOTO: CAROLYN COLE/LOS ANGELES TIMES/GETTY IMAGES

The historically deadly wildfires that have roared through California this fall, and a string of similarly destructive ones over the past two years, are boosting calls to do more to slow climate change. But another underlying problem has contributed to the fires’ tragic damage: For decades, California, supposedly the greenest of states, has artificially lowered the cost of encroaching on nature by living in the woods.

Permissive building codes, low insurance rates and soaring taxpayer spending on firefighting and other services have provided an economic framework that has encouraged people to flee the state’s increasingly expensive cities for their leafy fringes. The forested exurbs, including places once thought too hilly or too dry to develop safely, have offered comparatively affordable living with jaw-dropping views.

The upshot: More houses have been packed into the fire-prone border between civilization and forest—known among planners as the “wildland-urban interface,” or WUI—in California than in any other state.

…click the above link to read the rest of the article…

U.S. Aircraft Carrier Heads To Persian Gulf In “Show Of Force” After Iran Ballistic Missile Test

Days after Iran unveiled its first stealth destroyer in a televised ceremony on Saturday which saw the warship launched into operation in the Persian Gulf, and after the US condemned Iran’s test firing a medium-range nuclear capable ballistic missile on Sunday, Pentagon officials have announced the U.S. is sending an aircraft carrier strike group to the Persian Gulf in a show of force against Iran.

US officials told the Wall Street Journal the USS John C. Stennis and support ships will arrive in the Middle East “within days” — which will bring a close what’s been described as the longest period in two decades that a carrier group was absent from the region. Specifically the unnamed officials identified the purpose as to “exhibit a show of force against Iran” at a moment tensions are soaring after Nov. 4 renewed sanctions targeting Iran’s energy sector. The White House has vowed that it will work with international allies to reduce Iran’s oil exports to zero in continuing economic warfare that could easily spark direct military confrontation.

USS John C. Stennis nuclear-powered aircraft carrier, via Defence Blog

The WSJ reports:

The Stennis is scheduled to remain in the region for about two months, the officials said, spending most of that time in the Persian Gulf. Its presence “certainly provides a deterrence” against any potentially hostile Iranian activity in the region’s waters, one of the officials said.

Responding to the unprecedented sanctions regimen after President Trump withdrew the US from the 2015 JCPOA, Iran’s military leadership has over the past months issued a counter threat of blockading the vital Strait of Hormuz in the Persian Gulf, which would strangle global oil shipping. The US carrier presence inches the world closer to witnessing a major flare up in the gulf which could send the price of oil soaring.

…click on the above link to read the rest of the article…

Pompeo: US/Saudi Partnership ‘Vital’ – American Taxpayers May Disagree!

Pompeo: US/Saudi Partnership ‘Vital’ – American Taxpayers May Disagree!

Secretary of State Mike Pompeo has published a bizarre op-ed in the Wall Street Journal claiming that Saudi Arabia has been a guarantor of stability in the Middle East and a bulwark against “expansionist” Iran. Perhaps he forgot about Saudi support for jihadists in Syria and the Saudi destruction of Yemen? Is carrying water for the murderous Saudi kingdom in the Middle East really the best way to demonstrate “American values,” as Pompeo claims? We break down Pompeo’s neocon screed in today’s Liberty Report:

Why I Think this Sell-Off is Just One Step in Methodical Unwind of Stock Prices

Why I Think this Sell-Off is Just One Step in Methodical Unwind of Stock Prices

One after the other, individual stocks are getting crushed.

It was an ugly Monday and Tuesday followed by a Wednesday that at first look like a real bounce but ended with the indices giving up their gains. This was followed, mercifully, by Thursday when markets were closed, which was followed unmercifully by Friday, during which the whole schmear came unglued again.

The S&P 500 index dropped 0.7% on Friday to 2,632 and 3.8% for Thanksgiving week, though this week is usually – by calendar black-magic – a good week, according to the Wall Street Journal: During Thanksgiving weeks going back a decade, the S&P 500 rose on average 1.3%.

This leaves the S&P 500 index 1.5% in the hole year-to-date. It’s now back where it had first been on November 30, 2017:

Clearly, when seen over the longer term, the sell-off for now still belongs to the small-fry among sell-offs, with S&P 500 down just 10.5% from its peak:

The Dow dropped 0.7% on Friday and 4.4% during Thanksgiving week, to 24,286. It’s 1.75% in the hole for the year. Technically speaking, it’s not even in a correction, being down only 9.9% from its peak.

And the Nasdaq, dropped 0.5% on Friday and 4.3% during Thanksgiving week. According to the Wall Street Journal, during Thanksgiving week over the past 20 years, the Nasdaq rose on average 1.3%. So this is no good for calendar-black-magic aficionados. Where’s the free-wheeling holiday spirit?

The Nasdaq is now down 14.7% from its peak at the end of August but remains up 0.5% year-to-date.

The Russell 2000 small-caps index edged down today and is down 14.5% from its peak on August 31. It’s 3% in the hole year-to-date and right back where it had first been on September 27, 2017:

…click on the above link to read the rest of the article…

The Empire Keeps Proving Assange Right About Everything

The Empire Keeps Proving Assange Right About Everything

WikiLeaks founder Julian Assange has been charged under seal by the Trump administration. This has been revealed by a purportedly accidental copy-paste error in an unrelated court document which used Assange’s name, interestingly not long after it was reported to the Wall Street Journal that federal prosecutors “have considered publicly indicting Mr. Assange to try to trigger his removal from the embassy because a detailed explanation of the evidence could give Ecuadorean authorities reason to turn Assange over.”

Insider sources have reportedly confirmed to the Washington Post that Assange has been charged. Because those charges are sealed, it’s impossible to know what they are or how they’re being justified. If you ask #Resistance Twitter, it’s because it’s #MuellerTime and Assange is about to be arrested under some mysterious charges involving WikiLeaks’ publication of non-government, non-classified emails in 2016. If you ask QAnon cultists, it’s because Donald Trump is planning to extradite Assange so as to rescue him and deal a fatal blow to the Deep State. If you ask people who actually know what they’re talking about, however, it’s most likely for WikiLeaks’ Afghanistan and Iraq war logs and/or last year’s CIA leak publications, and most likely using the Espionage Act. This would constitute a deadly blow to press freedoms, and arguably a greater leap in the direction of Orwellian dystopia than the Patriot Act.

It also proves once again that Julian Assange was completely right.


Indictment of Assange puts press freedom in peril (Letters) http://s.masslive.com/wMcGusY  Many thought Assange was unnecessarily paranoidthat the US intended to extradite him. He was right all along.

Indictment of Assange puts press freedom in peril (Letters)

Many thought Assange was unnecessarily paranoid that the US intended to extradite him. He was right all along.

masslive.com


…click on the above link to read the rest of the article…

Just in Time Stimulus: Fed Proposes Looser Rules for Large U.S. Banks

The Fed’s proposal marks one of the most significant rollbacks of bank regulations since Trump took office.

The Wall Street Journal reports Fed Proposes Looser Rules for Large U.S. Banks

The Federal Reserve announced one of the most significant rollbacks of bank rules since President Trump took office with a proposal for looser capital and liquidity requirements for large U.S. lenders.

The changes would affect large U.S. lenders including U.S. Bancorp , Capital One Financial Corp. , and more than a dozen others. The largest U.S. banks, including JPMorgan Chase & Co., wouldn’t see any significant rule changes, and some in the industry thought the proposal didn’t go far enough.

The draft proposal, approved by a 3-1 vote at a Wednesday meeting of the Fed’s governing board, would divide big banks into four categories based on their size and other risk factors. Regional lenders would be either entirely released from certain capital and liquidity requirements, or see those requirements reduced. They could also, in some cases, be subject to less frequent stress tests.

The proposals received a mixed reaction from banks. While some trade groups praised it, Greg Baer—president of the Bank Policy Institute, which represents large banks—said the proposal “does not do enough to tailor regulations.” He said, for instance, the plan doesn’t include changes to the Fed’s primary stress tests for big banks or to rules affecting foreign-owned banks with U.S. footprints. Fed officials said they were planning future proposal in those areas.

The plan divided the Fed, with Trump-appointed regulators and the Fed’s lone Obama-appointed official taking opposite sides. Fed Chairman Jerome Powell said the proposal would cut the regulatory burden “while maintaining the most stringent requirements for firms that pose the greatest risks.”

…click on the above link to read the rest of the article…

According to the Wall Street Journal, Inflation Is About to Increase the Prices of EVERYTHING

According to the Wall Street Journal, Inflation Is About to Increase the Prices of EVERYTHING

We’ve been pretty lucky over the last ten years in terms of inflation, which has remained at about 2%. However, if the Wall Street Journal is correct, our luck is about to run out.

The price of just about everything is set to increase in the coming months. Part of this is because manufacturers and suppliers are facing rising costs, just like the rest of us.

Airlines are paying about 40% more for jet fuel than they were a year ago. Trucking costs were up 7% annually in September, as trucking companies passed along their own higher labor costs. Private-sector wages and salaries in the September-ended quarter rose 3.1% from a year earlier, the strongest gain since 2008, the Labor Department said Wednesday.

Meanwhile, U.S. manufacturers are paying roughly 8% more for aluminum and 38% more for steel than a year ago as the industry adjusts to tariffs the Trump administration levied on imports of those metals. Also, a 10% tariff the administration imposed in September on $200 billion worth of various goods from China is weighing on businesses that buy those imports. (source)

With that being the case, it isn’t surprising that those costs will be passed on to consumers.

What is inflation?

Here are some basic facts about inflation from Investopedia.

  • Inflation is a sustained increase in the general level of prices for goods and services.
  • When inflation goes up, there is a decline in the value, or purchasing power of money.
  • Variations on inflation include disinflationdeflationhyperinflation and stagflation.
  • Theories as to the cause of inflation are up for debate. Some common theories include demand-pull inflationcost-push inflation, and monetary inflation.
  • When there is unanticipated inflation, creditors lose, people on a fixed-income lose, menu costs go up, uncertainty reduces spending and exporters aren’t as competitive.

…click on the above link to read the rest of the article…

Marty Feldstein Warns “Another Recession Looms…” And The Fed’s Out Of Ammo

Marty Feldstein Warns “Another Recession Looms…” And The Fed’s Out Of Ammo

Authored by Martin Feldstein, op-ed via The Wall Street Journal,

And unlike in the past, the Federal Reserve has little room to encourage growth by reducing rates…

Ten years after the Great Recession’s onset, another long, deep downturn may soon roil the U.S. economy. The high level of asset prices today mirrors the earlier trend in house prices that preceded the 2008 crash; both mispricings reflect long periods of very low real interest rates caused by Federal Reserve policy. Now that interest rates are rising, equity prices will fall, dragging down household wealth, consumer spending and economic activity.

During the five-year period before the last downturn, the Fed had decreased the federal-funds rate to as low as 1%. That drove down mortgage interest rates, causing home prices to rise faster than 10% a year. When the Fed raised rates after 2004, the housing-price bubble burst within two years.

As housing prices plummeted, homeowners with highly leveraged mortgages found themselves owing substantially more than their homes were worth. They defaulted in droves, causing lenders to foreclose on their properties. Sales of the foreclosed properties forced prices even lower, leading the national house-price index to decline 30% in three years.

Banks that held mortgages and mortgage-backed bonds saw their net worths decline sharply. A total of 140 U.S. banks failed in 2009, and those that survived were terrified by how much further the market might slide. To avoid risky bets, they shied away from lending to businesses and home buyers and refused to lend to other banks whose balance sheets were also declining.

The fall in home prices from 2006-09 cut household wealth by $6 trillion. Coinciding with a stock-market crash, the erased wealth caused consumer spending to drop sharply, pushing the economy into recession. The collapse of bank lending deepened the decline and slowed the recovery to a sluggish pace.

…click on the above link to read the rest of the article…

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