#Obama

Pot calling the kettle black?

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Ukrainian MP Andriy Derkach revealed yesterday that former VP Joe Biden received $900,000 from Burisma Group (the one his son Hunter worked for) for lobbying activities.

Derkach publicized documents which explained the channel of getting those funds. He said,

This was the transfer of Burisma Group’s funds for lobbying activities, as investigators believe, personally to Joe Biden through a lobbying company. Funds in the amount of $900,000 were transferred to the U.S.-based company Rosemont Seneca Partners, which according to open sources, in particular, the New York Times, is affiliated with Biden. The payment reference was payment for consultative services…According to the documents, Burisma paid no less than $16.5 million to [former Polish President, who became an independent director at Burisma Holdings in 2014] Aleksander Kwasniewski, [chairman of the Burisma board of independent directors] Alan Apter, [Burisma independent director] Devon Archer and Hunter Biden [who joined the Burisma board of directors in 2014]“…

Using political and economic levellers of influencing Ukrainian authorities and manipulating the issue of providing financial aid to Ukraine, Joe Biden actively assisted closing criminal cases into the activity of former Ukrainian Ecology Minister Mykola Zlochevsky, who is the founder and owner of Burisma Group…Biden’s fifth visit to Kyiv on December 7-8, 2015 was devoted to making a decision on the resignation of [then Ukrainian Prosecutor General] Viktor Shokin over the case of Zlochevsky and Burisma. Loan guarantees worth $1 billion that the United States was to give to Ukraine was the point of pressure. Biden himself admitted exerting pressure in his speech at the Council of Foreign Relations in January 2018, calling Shokin ‘son of a bitch who was fired.”

Derkach added that international corruption of this magnitude couldn’t have taken place without the participation of then Ukranian President Petro Poroshenko.

International corruption of this magnitude, as well as interference in the U.S. presidential election, could not have occurred without Poroshenko’s participation

…We see the conflict in which the new government of Ukraine faces due to the activities of the previous president. I want to emphasize that I’m almost sure, and not only I, but many journalists, that Poroshenko personally bears responsibility for the situation in which Ukraine has ended up, for dragging Ukraine into interfering in the U.S. presidential election, for a huge number of corruption scandals and international corruption that could not have occurred without his control or participation.

Of course, all this must be proven in a court of law, but isn’t it ironic that Biden is demanding Trump is impeached when it would seem the VP (undoubtedly in the full knowledge of the President) might have been complicit in quid pro quos with Ukraine himself.

Do we believe Joe Biden? Biden claimed he had never spoken to Burisma until a picture came out showing him playing golf with Devon Archer and his son, Hunter Biden, both directors of Burisma. Archer and Hunter were managing partners at Rosemont Seneca Partners. Archer was also a co-founder of the private-equity firm Rosemont Capital with Christopher Heinz, his college roommate at Yale. Archer had served as a senior adviser to Heinz’s stepfather, Democratic Senator John Kerry Kerry, during his 2004 presidential bid. Surely Joe never heard a peep about Burisma? Almost as believable as Bill Clinton’s chance meeting with AG Loretta Lynch on a Phoenix Airport runway, a day before her testimony on Hillary’s emails. Nothing to see here.

Ford downgraded to junk

This week, Ford Motor Co’s credit rating was downgraded by Moody’s to junk. $84bn worth of debt now no longer investment grade. It will be the first of many Fortune 500s to fall foul to this reality. In 2008, there was around $800bn of BBB status credit. That number exceeds $3.186 trillion today.

CM has long argued that the credit cycle would be the undoing of the economy. For too long, corporates binged on easy money, caring little for credit ratings because the interest spreads between AAA and BBB were so negligible. The market ignored risk and companies went hell for leather issuing new debt to fu buybacks to artificially prop up weak earnings to give the illusion of growth.

Sadly this problem is likely to cause widespread sell offs by companies/investors which must stick to products (as woefully yielding as they may be) with an investment grade, exacerbating the problem of refinancing debt close to maturity. The thinking during easy credit times was simple – refinancing could be done with low interest rates because there was no alternative.

This is problematic for three reasons:

1) under the Obama era, much of the newly issued debt was short term meaning $8.4 trillion arrives for refinancing in the next 2.5 years, crowding out the corporate market.

2) more than 50% of US corporates are one notch above junk status. Refinancing will not be a simple affair.

3) more and more investment grade debt will be driven to zero or even negative yields as a result further exacerbating the problems for insurance companies and pension funds dealing with massive unfunded liabilities.

Last year, in relation to unfunded liabilities at US public pension funds, CM wrote,

California Public Employee Retirement System (CalPERS) lost around 2% of its funds in 2015/16. The fund assumed an aggressive 7.5% return. Dr. Joe Nation of Stanford Institute for Economic Policy Research thinks unfunded liabilities have surged to $150bn from $93bn in the last two years. He suggested the use of a more realistic 4% rate of return last year. At that rate, CalPERS had a market based unfunded liability of $412bn (or the equivalent of 2 years’ worth of California state revenue). At present Nation now thinks the number is just shy of $1 trillion using a 3.25% discount rate. He expects that the 2017 data for CalPERS will be out in a week or so which should give some interesting perspective as to how much deeper the pension hole is for Californian public servants.

N.B. California collects $232bn in state taxes annually in a $2.3 trillion economy (around the size of Italy).”

This is just California, which in the last 8 years has seen a 2.62-fold jump in the gap between liabilities and state total expenditures.

Unfunded liabilities per household. In California’s case, the 2017 figure is $122,121. In 2008 this figure was only $36,159. In 8 years the gap has ballooned 3.38x. Every single state in America with the exception of Arizona has seen a deterioration.

Switching to Illinois, we have a case study on what happens when pension funds go pear shaped.The Illinois Police Pension is rapidly approaching the point of being unable to service its pension members and a taxpayer bailout looks unlikely given the State of Illinois’ mulling bankruptcy.

Local Government Information Services (LGIS) writes, At the end of 2020, LGIS estimates that the Policemen’s Annuity and Benefit Fund of Chicago will have less than $150 million in assets to pay $928 million promised to 14,133 retirees the following yearFund assets will fall from $3.2 billion at the end of 2015 to $1.4 billion at the end of 2018, $751 million at the end of 2019, and $143 million at the end of 2020, according to LGIS…LGIS analyzed 12 years of the fund’s mandated financial filings with the Illinois Department of Insurance (DOI), which regulates public pension funds. It found that– without taxpayer subsidies and the ability to use active employee contributions to pay current retirees, a practice that is illegal in the private sector– the fund would have already run completely dry, in 2015…The Chicago police pension fund held $3.2 billion in assets in 2003. It shelled out $3.8 billion more in benefits to retired police officers than it generated in investment returns between 2003 and 2015…Over that span, the fund paid out $6.9 billion and earned $3.0 billion, paying an additional $134 million in fees to investment managers.”

Therefore Ford’s downgrade to junk will have the effect of repricing over a decade of misplaced central bank policy across all markets. The dominos are only beginning to fall. The market can absorb Ford’s downgrade but not if it has to deal with the panic of dozens like it.

CM has long been warning of GE. Despite being the world’s largest stock in 2000, it is 1/5 the size today, trades in negative equity, wasted $45bn on share buybacks in 2015/16 and were it be classified as junk would increase the pile of junk by 10% on its own. Broadcom and American Tower are other monsters ready to be hurled onto the ratings scrap heap.

Buy Gold. The US Fed will likely embark on QE. It requires an act of Congress to approve the purchase of equities but don’t be surprised if this becomes a reality when markets plunge.

This will be the reset of asset prices which has been long overdue thanks to almost two decades of manipulation by authorities. It has 1929 written all over it. Not 2008.

Obama treats Greta as a 16yo – Good

Congratulations to Obama for being one of the first world leaders to treat Greta Thunberg according to her age. Instead of fawning over her prophecies, he just resorted to vacuous chit-chat and a fist-bump. That’s about as far as anyone should take her seriously. Yet watch everyone else in the media treat her as a world expert whom we must pay eager attention to save us from ourselves.

As CM has always contended, if a teenager knows everything we should close our universities down immediately. There is simply no need for further education. It would save us billions in student debt too!

No Greta, Trump doesn’t have time for you

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As 16yo Swedish climate activist Greta Thunberg sets sail for America she claimed she doesn’t want to waste her time talking to President Trump. CM is pretty sure that Trump wouldn’t waste his time making time in his calendar to see the teenager. There is absolutely no way in the world that the lefty activists that guide her would pass up an opportunity to pillory Trump in person as she challenged him on the need to panic. The mainstream media would be gushing in its derangement on how the headlines would describe how she “owned him”.

Despite looking forward to pooping in a bucket on a carbon made boat that emits no carbon (hoping they don’t need to fire up the emergency fossil fuel engines), she was forced to admit that “people can’t just take a sailboat across the Atlantic Ocean.” Spot on, Greta. However, she should take more comfort to know that the 280 million commercial airline flights every year contribute only 1.47% of human-made CO2 according to some of her biggest supporters – the EU. So on a global basis, airlines make up a mind-bogglingly frightening 0.00001825% of global CO2 emissions. Time to panic? If we increase our air travel 50% we’ll only match Germany for emissions…

Who’d a thunk?

Dr. Rex Fleming, a former National Oceanic and Atmospheric Administration (NOAA) atmospheric scientist has broken his silence on the cabal running the show. He has left the administration citing,

– data was manipulated inside NOAA by numerous individuals under the Obama era. They changed ocean data, atmospheric data. They wouldn’t own up to weather stations which would give inflated data to support their warming.

– the American Meteorological Society (AMS), the American Geophysical Union (AGU), and the American Association for the Advancement of Science (AAAS) refuse to publish scientific papers from scientists (including Fleming) it considers “deniers“. Fleming was forced to go to Europe to have the 2018 paper peer-reviewed and published. So much for seeking balance.

– CO2 has risen because of warm temperatures. Not the other way around. 420,000 years of zero correlation of CO2 leading temperature. Can’t all of a sudden claim correlation of C02 leading temperature. Therefore it can’t be a cause.

– He said many scientists within NOAA agree that this is the truth yet are afraid to speak out. He said many scientists risked being fired for speaking out against the orthodoxy. This is why many are speaking out when they leave NOAA.

– more scientists are making no effort shifting away from anthropogenic global warming theory (AGW)because they are “in this groove of getting funds for huge, bigger computer systems to run these massive climate models. And they want their salaries to increase. They don’t want to change.”

Where have we seen this before? James Cook University bullying Professor Peter Ridd for not towing the party line? To have them lose a court case against him and to then double down by telling the judge he is wrong and spending another $600,000+ on a retrial.

The podcast can be found here.

Greta & Obama

A propaganda picture which would have had a place in Soviet times. A socialist leader Obama looking down on a brainwashed teenager, Great Thunberg, who is unbeknownst being exploited by the intelligentsia.

The picture, while excellent as a stand-alone photo, has a patronizing overtone. The disdain held against those wicked climate skeptics. Had NZ PM Jacinda Ardern been in it, the leftist dream team would have been fully assembled. Although her 2050 zero emissions plan has been independently costed and its outrageous.

Obama better not tell Greta Thunberg about the disastrous Solyndra scandal otherwise those crossed arms might end up being for him.

Solyndra was an Obama era solar darling that the Inspector General’s Office, after more than four years of investigation, concluded that company’s senior management used inaccurate information to mislead the Department of Energy (DoE) in its $535 million loan. Soon after the fees landed, Solyndra declared bankruptcy.

Perhaps Greta should be speaking to Bjorn Lomborg to get a proper education on the real price of costing her plans for climate change.

Children in cages and the hypocrisy of the left

Good to see the woke artists of NY protest kids in cages by using 24 mock ups complete with audio being blasted through speakers of crying and wailing kids. pluck at those heart strings.

Where were these same people in 2014 when the Obama administration had a policy of kids in cages? It is far from ideal but let’s explore the facts.

No one wants to see screaming kids locked in cages. Separated? Well there is good reason for that. When even the likes of left-leaning HuffPoadmitted in December 2014 that 80% of women and girls are sexually assaulted while trying to make it across the border there is a good reason to question the proof of identity of the supposed parents. Even if 90% of parent/children pairs are legit, what of the 10% that aren’t? Do ICE risk it?

Australia had an experience of a mother from Nepal (a democracy not at war) who deliberately poured boiling water on her infant to expedite processing on the mainland. Are these the values of people we should provide refuge to? We should not forget that many people make the journey knowing ALL the risks that confront them yet still attempt it despite the warnings.

To emphasize the danger of lax screening, multiple kids were found dead after being abandoned once across the border as their usefulness as a golden ticket on compassionate grounds was expended. If that isn’t some of the worst forms of child abuse then what is? Moreover these people are hardly the type that decent Americans would want to embrace with open arms!

In Jan 2016 WaPo noted, “The Office of Refugee Resettlement, an agency of the Department of Health and Human Services, failed to do proper background checks of adults who claimed the children…several Guatemalan teens were found in a dilapidated trailer park near Marion, Ohio, where they were being held captive in squalid conditions by traffickers and forced to work“. So slave labour to repay human traffickers? Let’s encourage more to attempt the crossing!

Then ICE has the trouble of finding the parents/guardians (sponsors) already living (often) illegally to collect their unaccompanied children at pre-arranged court hearings. The media went into a frenzy saying that ICE had lost the records. The truth came out in Feb 2016 that,

“The head of ICE’s removal operations, Thomas Homan, told members of the Senate Judiciary Committee that 7,643 immigrants who arrived as children were sent home between the 2012 and 2015 budget years…More than 171,000 children, mostly from Honduras, El Salvador and Guatemala, were arrested at the border during that same time…The number of children caught crossing the border illegally spiked in 2014 [see impacts in NY Times graphic below] and the Obama administration promised that those who were not eligible for protections in the United States would be swiftly sent home… And with an immigration court backlog of more than 474,000 pending cases some cases can take years to move through the court system…

…about 40% of immigrants are no shows at court…Finding immigrant children with outstanding deportation orders is also complicated by the fact that they often are no longer at the addresses provided to the government.”We are out looking,” Homan said. “But they are hard to find. A lot of these folks who don’t show up in court, we don’t know where they’re at.”

The pictures of kids in concentration camp style cages were from 2014. Yet don’t let that get put in the way of a narrative to show the nationalist tendencies of the current administration.

While we can express outrage at the treatment of illegal immigrants at the border, the tougher laws have started to resonate with Ana Garcia Carias, wife of Honduran President Juan Orlando Hernandez, who said, “Stay in the country and let’s look for solutions to support you.” She visited the border and said that she didn’t recommend her citizens go to the US undocumented. If a court system has nearly 500,000 backed up in the system, it seems reasonable to push for a zero tolerance policy to end.

So typical of the left – it’s not the principle but the side that counts. Of course Trump is a single handed villain using Gestapo tactics to jail kids despite Obama starting the practice of caging in the first place.

More stats on ICE can be found in CM’s report here.