Thursday, May 24, 2018

Turkey’s Currency Meltdown: Erdogan’s Screw-up


Turkey’s Currency Meltdown as investors flee the Turkish lira amid Erdogan’s political central banking.

Investing in emerging markets is like watching the tides without the moon as a guide. Capital flows in and out in surges, and woe to the country that gets caught with bad policies when the tide suddenly goes out. Argentina has been getting that re-education of late, and now Turkey is watching capital flee for safer climes.

Turkey’s lira fell as much as 5% on Wednesday, and it’s lost more than a fifth of its value this year, adding to a long decline that is forcing extreme monetary measures to compensate. Much of the blame lies with President Recep Tayyip Erdogan, as Turkey has been running a current-account deficit that is on trend to exceed 6% of GDP. Turkey has been growing rapidly but the growth has been heavily financed by dollar-denominated investment.

Meanwhile, Mr. Erdogan has been beating the central bank like it’s Syria’s Bashar Assad. In Ankara this month, he called high interest rates “both the mother and father of all evils.” Investors took this to mean he’s exerting political control over Turkey’s central bank even as inflation has reached nearly 11%.

Wednesday, May 23, 2018

Trump’s Ultimatum To Terror-Ayatolahs Of Iran


Our Trump will not allow Iran to keep on
terrorizing the people of Iran.
What’s in America’s New Tough Plan for Iran? Secretary of State Mike Pompeo laid out the U.S.’s new tough stance on Iran, emphasizing the Trump administration’s post-nuclear-deal approach to the Islamic Republic is nothing less than what the global consensus was before the deal was signed.

In 2012, then-president Obama said, “The deal we’ll accept is [that] they end their nuclear program.” In 2013, the French foreign minister said he was wary of being sucked into a “con game” re: Iranian uranium enrichment In 2015, then-secretary of state John Kerry said, “We don’t recognize the right [of Iran] to enrich [uranium].”

The deal has been exposed as a failure on these points (as well as many others) and the U.S. decided to pull out. So what in store for the mullahs now? Here’s the basis of the U.S. plan:

1. Sanctions are going back in full effect and new ones are coming.

Last week, the U.S.sanctioned the head of Iran’s central bank and other entities funneling money to the IRGC Quds Force, Hezbollah and other terrorist organizations. “This is just the beginning,” Pompeo said. “Iran will be forced to make a choice: Either fight to keep its economy off life support at home or keep squandering precious wealth on fights abroad. It will not have the resources to do both.”

Monday, May 21, 2018

God Help Turkey: Lira Crashes As US Yields Explode

 (Staff articles from The BLOOMBERG & DAILY RECKONING on May & February 2018.)

With Turkey’s central bank sitting on the sidelines observing a currency meltdown and double-digit inflation, one brokerage is looking for help from a higher power.

“God help Turkey,” Istanbul-based broker Alnus Yatirim said in the sign-off to its morning note to clients on Monday. “We’re faced with a central bank that is watching the market when it needs to lead and direct it.”

The brokerage predicted that the TRY could fall to 4.58 per dollar by the end of this week - or rather the start as it is already there now, give or take - and 4.75 next week.

The market is testing whether the central bank’s verbal interventions are a bluff or not, Alnus said. Without policy action, the damage is likely to spiral, it said, citing the $222 billion of net debt held by Turkish non-financial companies in overseas currencies. Each 1 cent depreciation in the currency adds about 5 billion liras to the cost of Turkey’s foreign borrowings, it said.

Sunday, May 20, 2018

Gaza Strip: The Hellhole Of Palestinian Arabs


As Gaza sinks into desperation, a new book makes the case against Israeli brutality.

ISRAEL CELEBRATES a double anniversary on May 15 this year, the founding of the state and the formal establishment of the Israeli Defense Forces, the name the state gave to its combined army, navy, and air force. Armed statehood fulfilled the political Zionists’ dream of gathering Jews from the ancient Diaspora under their own government in what they declared to be their “promised land.”

During the battle over the land between 1947 and 1949, the IDF expelled three-quarters of the indigenous population. Of the 750,000 Palestinian Arabs who fled, 250,000 took shelter in Gaza, a tiny pocket of southwest Palestine then occupied by the Egyptian army. The destitute and traumatized refugees were three times more numerous than the 80,000 Gazans who took them in.

The United Nations passed but did not enforce annual resolutions calling for the refugees’ return. Israel invaded the territory in 1956, withdrew under American pressure in 1957, and invaded again in 1967. As its population grew to nearly 2 million souls packed into a pocket five miles wide and 40 miles long, Gaza has become a byword for misery. Former British Prime Minister David Cameron, no advocate of the Palestinian cause, called it “an open-air prison.”

Wednesday, May 16, 2018

Families Of Indonesian-Muslim Suicide Bombers

(Staff articles from The CNN, STUFF NZ, & GUARDIAN on 14-15 May 2018.)

Innocent-looking family of Muslim suicide bombers.
Jakarta (CNN): A husband and wife used their four children in a string of deadly suicide attacks on three churches in the Indonesian city of Surabaya that left 12 people dead, according to the country's ranking police official.

The family included two daughters, aged 9 and 12 years old, said Head Gen. Tito Karnavian. The young girls were present when their mother detonated one of the bombs, and the couple's two teenage sons carried out a separate attack on another church.

Earlier reports indicated at least 10 people died in the Sunday morning attacks, but Karnavian said during a news conference that 12 victims were killed. Forty-one people, including two police officers, were hospitalized with injuries, police spokesman Frans Barung Mangera said previously.

Tuesday, May 15, 2018

Understanding Modern Map Of Jerusalem


US Embassy in Jerusalem has officially been opened.
The U.S. marks the opening of its embassy to Israel in Jerusalem with a large ceremony Monday. In physical terms, it's just a move of the ambassador and some staff from Tel Aviv to a large consular building that already exists.

But it carries political significance that's reverberating around an already-tense Middle East: After decades of U.S. policy saying the status of the disputed city should be settled in peace talks between Israelis and Palestinians, the Trump administration is now saying the city is Israel's capital.

It puts the U.S. in a distinct world minority. The U.N. General Assembly, by a vote of 128 to 9, condemned the move last December. Most of the world's governments do not recognize the city as either Israel's or as the Palestinians'.

Monday, May 14, 2018

The Return Of Horror Stagflation 1970s Style


One of the worst possible outcomes for the U.S. economy, and ultimately for investors, is stagflation. Of course, if you weren’t around in the 60-70’s, there is a reasonably high probability you are not even sure what “stagflation” is.

Here is the technical definition: “stagflation – persistent high inflation combined with high unemployment and stagnant demand in a country’s economy.” How can that happen? Exactly in the way you are witnessing now.

While the current Administration is keen on equalizing trade through tariffs, trade deals, and trade deficit reduction, they have also embarked on a deficit expanding spending spree which has deleterious long-term effects on economic growth. At the same time, the administration is attacking our major trading partners, particularly China, leading to a push to shift away from the U.S. dollar as a reserve currency.

Thursday, May 10, 2018

“Iranian Secret Nuke Program” By Benjamin Netanyahu

Good evening. Tonight, we’re going to show you something that the world has never seen before. Tonight, we are going to reveal new and conclusive proof of the secret nuclear weapons program that Iran has been hiding for years from the international community in its secret atomic archive.

We’re going to show you Iran’s secret nuclear files. You may well know that Iran’s leaders repeatedly deny ever pursuing nuclear weapons. You can listen to Iran’s Supreme Leader Ali Khamenei: “I stress that the Islamic Republic has never been after nuclear weapons.” 

You can listen to Iran’s president Hassan Rouhani: “Nuclear weapons and other weapons of mass destruction have no place in Iran’s security and defense doctrine, and contradict our fundamental religious and ethical convictions.”  This is repeated by Iran’s Foreign Minister Javad Zarif: “We didn’t have any program to develop nuclear weapons. Anyway, we consider nuclear weapons both irrational as well as immoral.”

Thursday, May 3, 2018

KiloPower Nuclear Reactors For Space Travellers


NASA and the U.S. Department of Energy say they have successfully tested a new type of nuclear reactor that could one day provide juice to colonies on other worlds. The reactor can power several homes and appears able to operate in harsh environments.

Getting electricity in space is always a problem. Close to Earth, satellites and astronauts can use solar panels. But farther out, the sun's light dims, making it exponentially harder to get the power needed to run communications, scientific instruments and, in the case of astronauts, life support.

The best solution is good old-fashioned nuclear power. Nukes have fueled everything from NASA's Pluto probe to the Curiosity rover on Mars. Nuclear power sources are durable, and they can last a long time. The two Voyager spacecraft, launched in 1977, are still phoning home using power from a a few pounds of plutonium they carry with them.