Harvard study: Exxon ‘misled the public’ on climate change for nearly 40 years

For nearly 40 years ExxonMobil publicly raised doubt about the dangers of climate change even as scientists and execs inside the oil giant acknowledged the growing threat internally, according to a Harvard University study.

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How Rand Paul Can Free Americans From The Fed

Authored by Tho Bishop via The Mises Institute,

Ever since entering the Senate, Rand Paul has continued his father’s work in advocating for an audit of the Federal Reserve. This week, writing for the Daily Caller, Senator Paul renewed his efforts, illustrating how the recent era of unconventional monetary policy has made an audit all the more important:

In 2009, then-Fed Chairman Ben Bernanke was able to refuse to tell Congress who received over two trillion in Fed loans, and it took congressional action and a Bloomberg lawsuit to force the Fed to reveal the details of what it did in more than 21,000 transactions involving trillions of dollars during the 2008 financial crisis.  A one-time audit of the Fed’s emergency lending mandated by Congress revealed even more about the extent to which the Fed put taxpayers on the hook.

When pushed to defend the lack of transparency for the Federal Reserve, officials like Janet Yellen and Treasury Secretary Steve Mnuchin point to the myth of the Fed independence – a position that requires outright ignorance of the history of America’s central bank and the executive branch. Of course it’s quite usual for the Senate to base the merits of legislation entirely off of fallacious arguments, so they have continued to be the legislative body holding up a Fed audit with little indication they are prepared to move.

Given that reality, it is time for Senator Rand Paul to change his approach and introduce another piece of legislation from his father’s archives: the Free Competition in Currency Act.

While not as catchy as “End the Fed”, this piece of legislation – inspired by the work of F.A. Hayek – was perhaps Ron Paul’s most radical pieces of legislation. The idea was quite simple: eliminate legal tender laws mandating the use of US Dollars and remove the taxes Federal and State governments place on alternative currencies – such as gold and silver. While the original legislation did apply to “tokens,” an updated version should explicitly include the growing market of cryptocurrencies as a good with monetary value that should not be taxed.

What this would do is create a more even playing field between the dollar and alternative currencies, allowing an easy way for Americans to safeguard their wealth if they ever have reason to doubt the wisdom of the Federal Reserve’s policies. Just as Senator Paul advocated for the ability of Americans to be able to opt-out of the failing Obamacare system, this bill would grant Americans a lifeboat should the weaknesses inherent with the Fed’s fiat money regime expose themselves.

Unlike most examples of monetary policy reforms, which tend to be the products of ivory tower echo chambers, competition in currency would reflect active political trends. In recent years, states like Texas, Utah, and – in 2017 – Arizona have passed laws allowing the use of silver and gold for use in transactions. Meanwhile, other countries have looked to embrace the potential of cryptocurrencies for their monetary regimes. This makes this not only an idea that is good on paper, but one whose time has come.

As alluded to before, simply because a policy makes sense does not mean the Senate will act on it. That doesn’t mean the conversation and debate isn’t worth having. While it may still be on the horizon, there has been a steady drumbeat in Washington for the Federal Reserve to face some sort of reform. For two Congressional sessions in a row, the House has passed legislation explicitly calling for the Fed to embrace a “rules-based monetary system.” While this approach may sound better than today’s PhD standard, it doesn’t solve the problems inherent with central banking and fiat money.

Monetary rules such as “NGD Targeting” – which has the support of a rare coalition including the Cato Institute, Mercatus Center, Christina Romer, and Paul Krugman — should never be seen as a “reasonable compromise” for those skeptical about the Fed. Instead it’s simply another way of disguising central planning in a way to make it more palpable to the public, and therefore more difficult to stop. By putting this bill out there, Rand Paul can help frame the debate and bring a real solution to the table. Something that wouldn’t force the Fed to change a single thing, only making them compete on the market like the producer of other good or service. 

After all, as is the case with healthcare, or shoes, the best sort of “monetary policy” is competition on the market. Not one dictated by government. 

 

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Compass Point: “Odds Of A Government Shutdown Are Now Dramatically Higher”

Over the weekend, Morgan Stanley reminded its clients that the biggest threat facing markets over the coming weeks is the “three-headed policy monster” inside Washington: raising the debt ceiling, passing a budget and embarking on tax reform. As MS cross-asset strategist Andrew Sheets noted, “none are easy, but we see the debt ceiling as the most immediate test.”

He then cautioned that while the most likely outcome is that, after some tension, the debt ceiling gets raised “we don’t think it will be easy, or smooth, and it may require some form of market pressure to get different sides to fall in line. I’ve spoken to investors who are comforted by FOMC transcripts from 2011 that discussed prioritization of debt payments in order to avoid default. I am not. First, I worry that this reduces the urgency of what remains a serious issue. Second, this prioritization would require delaying payments to programmes like Social Security and Medicare, with real human and economic cost. And third, while the mechanics of this prioritisation may work, it is untested in a live environment.”

As reported earlier, the market’s concerns about a potential debt ceiling crisis, so far mostly contained, have once again started to bubble to the surface, with the Oct. 5 T-Bill rate rising to the highest level since August 1st, suggesting that bond traders see rising odds of a “worst case outcome” and partially answering our question from Monday whether “Markets Are Sleepwalking Into A Debt Ceiling Crisis: Mnuchin Issues Another Warning.

Additionally, the yield spread between the Sept 28 and Oct 5 Bills is now the widest on record:

The blowout has come after the latest warning by Treasury Secretary Steven Mnuchin, who on Monday said that “we need to raise the debt limit and it’s my strong preference is that there’s a clean raise of the debt limit.”

However, as of this morning, it’s not just the debt ceiling that traders have to worry about, because as discussed overnight, a new potential problem emerged last night when Trump told a Phoenix rally that he is commited to securing funds for a border wall, even if it results in a government shutdown.

While last night’s rally audience loved the threat, Democrats promptly blasted it: on Wednesday, Chuck Schumer ripped Trump for threatening to shutdown the government: “If the President pursues this path, against the wishes of both Republicans and Democrats, as well as the majority of the American people, he will be heading towards a government shutdown which nobody will like and which won’t accomplish anything,” Schumer said on Wednesday. Including funding for a physical wall is considered a non-starter for Democrats, whose votes will be needed to get a government funding bill through the Senate.

We doubt a warning from the Senate Minority Leader, or any other Democrat or Republican for that matter, will have much of an impact on Trump’s decision-making if he has indeed set his mind on procuring border wall funding. Which is also why in a note from Compass Point released this morning, strategists Isaac Boltansky and Lukas Davaz warn that not only is the risk of a government shutdown bigger than the debt limit, but that Trump’s commitment to securing funds for a border wall, together with Trump’s “injurious relationship” with GOP leaders – best demonstrated by last night’s NYT bombshell article laying out the open war between Trump and Senate Majority Leader Mitch McConnell – “dramatically raises the spectre of a shutdown in October.” Here are the highlights of their note, courtesy of Bloomberg:

  • The prospect of a govt shutdown “still poses a potentially serious downside risk for investors,” even as “our firm belief that the debt ceiling will be lifted removes a profound political risk from the landscape”
  • Trump’s commitment to securing funds for a border wall “dramatically raises the spectre of a shutdown in October” and his “injurious relationship” with Congressional Republican leadership “further complicates the underlying calculus”

Compass Point adds that four factors increase the potential for an equity market sell-off as government shutdown risks intensify:

  • Further delays confirmations, which would affect Trump’s deregulatory agenda;
  • Delivers a “psychological blow” to markets, serving as a “concrete symbol” of Washington’s inability to govern;
  • Delays legislative progress on tax reform;
  • Alters Fed’s policy normalization trajectory

In summary, while Compass Point says that lawmakers will promptly raise the debt ceiling in mid-September, or less than a month from now – something which Morgan Stanley and others find hard to believe – a government shutdown in October suddenly all too likely.

Then, shortly after the note was released, rating agency Fitch also chimed in and warned that if the U.S. debt limit is not raised in a timely manner, it would review the U.S. sovereign rating, with potentially negative implications. In other words, Fitch is warning that a repeat of August 2011 – when S&P infamously downgraded the US to AA+ after the failure to raise the debt ceiling resulted in a brief technica default0 is now on the table. The silver lining: Fitch said that a government shutdown following a debt ceiling increase, such as the one envisioned by Compass Point, would not direct affect on U.S. AAA rating.

Finally, for those who are still on the fence about the likelihood of a shutdown and are otherwise unhedged, one month ago Bank of America put together a “costless” spread collar trade, should volatility surge in the coming weeks as a debt ceiling/government funding deal emerges as unlikely. Here again is how to make money should the US government shut down in just over a month.

Trade idea: VIX Oct 12/14/19 call spread collar for zero-cost upfront

 

We are comfortable selling VIX puts to leverage a likely floor in volatility, particularly ahead of the debt ceiling, and using the premium collected to the cheapen the cost of portfolio protection. For example, investors may consider selling the VIX Oct 12 put vs. the 14/19 call spread, indicatively zero-cost upfront with a net delta of +54 (Oct fut ref 13.35).

 

The trade leverages the facts that (i) VIX 3M ATMf implied volatility, while low, is not necessarily cheap compared to the level of the VIX 3M future (Chart 14), and (ii) VIX 3M call skew is currently very steep, in the 92nd percentile since Sep-09 (Chart 15).

 

More critically, while VIX call spread collars have been challenged by recent sub-11 VIX settlement values, they can be successful, low-cost hedges when there are defined macro catalysts on the calendar to provide support to volatility, as seen from the US election and more recently the first round of the French election.

 

Lastly, we are comfortable capping upside via the call spread as the VIX 1M and 2M futures have not closed above 20 since Brexit over one year ago.

 

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GBP/USD Sell-off Approaching Key Support Targets

The decline off the yearly / monthly high is nearing technical support just lower. Here are the updated targets & invalidation levels that matter ahead of Jackson Hole.The post GBP/USD Sell-off Approaching Key Support Targets appeared first on For…

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تقدم الأسهم العالمية يحرك الحركة التصاعدية

تقدم الأسهم العالمية الذي بدأ يوم الثلاثاء يمتد إلى صباح الأربعاء ولدى المحللين السبب للإعتقاد بأن الحركة التصاعدية قد لا تزال تمتلك بعض الطاقة.

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United Nations Issues Rare “Early Warning” – Signals Potential Civil Conflict In America

A United Nations Committee tasked with combating racism on a global scale has issued an ultra rare “early warning” for the United States citing “alarming racism” trends.

As StockBoardAsset.com notes, this rare signal often preludes the potential for civil conflict.

In the past 10-years, the early warning has been issued in Burundi, Iraq, Ivory Coast, Kyrgyzstan and Nigeria.

The United Nations Committee on the Eliminations of Racial Discrimination has called on high-level politicians and public officials of the United States to condemn “racist hate speech and crimes in Charlottesville and through the country”.

Anastasia Crickley, Chairperson of UN Committee on the Elimination of Racial Discrimination (CERD) said:

We are alarmed by the racist demonstrations, with overtly racist slogans, chants and salutes by white nationalists, neo-Nazis, and the Ku Klux Klan, promoting white supremacy and inciting racial discrimination and hatred

As per UN News Centre:

In a decision issued under its ‘early warning and urgent action’ procedure, the Committee, which monitors implementation of the International Convention on the Elimination of All Forms of Racial Discrimination, stated “there should be no place in the world for racist white supremacist ideas or any similar ideologies that reject the core human rights principles of human dignity and equality.”

 

In addition to the criminal investigation of the individual who ploughed his car into a crowd of peaceful protestors killing a woman, the UN experts asked the US authorities to undertake concrete measures “to address the root causes of the proliferation of such racist manifestations.”

Let’s take a moment to gain another perspective from Los Angeles Times writer Jesse Walker asks in an Op-EdAre we headed for a second civil war?

Not inconceivable? That’s a low bar. It’s certainly possible to imagine America returning to the violence of the 1960s and ’70s, and beneath the overwrought language, that’s what some – though not all – of these civil war prophets seem to have in mind. But a near-future war with two clear sides and Gettysburg-sized casualty counts is about as likely as a war with the moon.

 

These “new civil war” stories frequently take a bait-and-switch approach. They invoke the violence at demonstrations like the rally in Charlottesville, Va., last weekend, where a man reportedly sympathetic to Nazism drove his car into a crowd of counter-protesters, killing a woman. In the same breath, they discuss the broad divisions separating “red” America from “blue” America. If you flip quickly between small violent clashes and big political disagreements, those big disagreements will look bloodier.

Conclusion

It’s clear that the United States is being purposely divided. The United Nations is clearly playing into the hype of issuing an early warning that has only been issued for third world countries in the past 10-years. In our opinion, the continued division in America will only be achieved through more events such as Charlottesville that will polarize the sheep into the streets for slaughtering.

*  *  *

Finally we note that The United Nations dropped this little beauty in their progonstication…

CERD also called on the Government to ensure that the rights to freedom of expression, association and peaceful assembly are not exercised with the aim of destroying or denying the rights and freedoms of others, and also asked it to provide the necessary guarantees so that such rights are not misused to promote racist hate speech and racist crimes.

In other words – speech should be free… as long as it does not hurt my feelings.

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