US Spent A Record $4 Trillion In Fiscal 2017, Pushing Deficit To $666 Billion

One year ago, the CBO forecasted that the  Fiscal 2017 US deficit (for the year ended September 30), would be in the mid-$500 billion range. It was not meant to be, however, and on Friday the Treasury reported that with outlays of $341 billion in the last month of the fiscal year, offset by $349 billion in receipts, the full year deficit grew to a nice, round and very memorable $666 billion in fiscal 2017, up $80 billion or 14% from fiscal 2016. The government ran an $8 billion surplus in September, much smaller than the $33 billion surplus in September 2016. Receipts fell 2% while outlays grew 5% last month compared with the same period a year earlier.

For the full year, federal tax receipts reached a record high $3.315 trillion, thanks to slightly faster growth, according to a Treasury official quoted by the WSJ. But government outlays also hit a record high last year at nearly $4 trillion ($3.981 trillion to be precise), 3% higher than they were in the previous fiscal year, thanks to increased spending on Social Security, Medicare and Medicaid, as well as higher interest payments on the public debt. And that's with interest rates that were near all time lows. We can't wait until the $20+ trillion in Federal debt starts really hitting the bottom budget line as the Fed starts pushing rates higher.

As a percentage of gross domestic product, the deficit totaled 3.5%, up from 3.2% in fiscal year 2016. The good news is that after contracting for 4 consecutive months in early 2017, federal government receipts have once again started grown on a Y/Y basis.

“Today’s budget results underscore the importance of achieving robust and sustained economic growth,” Treasury Secretary Steven Mnuchin said in a statement accompanying the report. “Through a combination of tax reform and regulatory relief, this country can return to higher levels of GDP growth, helping to erase our fiscal deficit.” It remains unclear how incurring another $1.5 trillion in debt in a time of rising rates to provide debt relief mostly to the wealthy is synonymous with erasing the fiscal deficit.

A more sober voice of reason, that of Mick Mulvaney, the White House budget director, said the figures “should serve as a smoke alarm for Washington” and a reminder to “get our fiscal hour in order.”

Meanwhile, deficit hawks, including some in Congress, warned that a GOP plan to rewrite the tax code could make the country’s fiscal situation worse if it adds to the deficit, which it will: the Senate approved a budget resolution Thursday that would allow Congress to pass a tax cut that lowers federal revenues by $1.5 trillion over the next 10 years.

Declining government revenues and long-term costs associated with an aging population, including higher Social Security and Medicare spending, are expected to continue pushing up deficits over the coming decades.

As a reminder, this is what the CBO - and JPM - forecast the future trajectory of US debt looks like. It also explains why, at this point, the Fed will stop at nothing to cause hyperinflation.

 

The post US Spent A Record $4 Trillion In Fiscal 2017, Pushing Deficit To $666 Billion appeared first on crude-oil.news.

The post US Spent A Record $4 Trillion In Fiscal 2017, Pushing Deficit To $666 Billion appeared first on Forex news forex trade.

Continue Reading

Latest Fear Mongering About Self Sufficiency: Salmonella in Backyard Chickens

Via The Daily Bell

Two years ago I moved to Florida from Massachusetts. When people found out I was moving, they would often immediately remark, “Get ready for the brutal heat and humidity!”

It was their first instinct to bring up any possible negative about moving to a much more pleasant climate.

About a year later, I posted pictures of vegetables we had grown, and chickens we keep. I also mentioned the name we call our mini-farm: Prickly Pear Plantation.

Was the first comment from my progressive liberal friend all about how great it is that we aren’t using any pesticides? Was it about how happy our free-range chickens look, or about how great it is that we aren’t supporting Monsanto? Did he remark on the fact that basically everything we build has some materials recycled from old projects and equipment on the property?

No. He said we shouldn’t call our mini-farm a plantation because it is apparently politically incorrect.

I’ve also had fat people tell me that running is bad for my knees. There actually are some health risks related to too much exercise. And there’s ten times more related to not enough exercise.

It isn’t just peers that seem so eager to bring attention to the negatives in any positive situation.

The media does it too.

I just read a report about how the trend of raising backyard poultry is contributing to a rise in salmonella infections. Fox, the New York Times, NPR and other popular outlets have reported the same thing within the last few months. CBS actually titled their article: “Backyard Chicken Trend Turns Deadly.”

All the reports are based on a Centers for Disease Control warning about the “outbreak” of salmonella among small-scale chicken keepers.

Now I certainly don’t object to good information about staying healthy while raising livestock. A lot of people who keep chickens on a small scale are new to it.

But looking at the numbers of infections, I doubt the salmonella risk is even as great as buying chicken and eggs from the store.

Since January, more than 1,100 people have contracted salmonella poisoning from chickens and ducks in 48 states, according to the Centers for Disease Control. Almost 250 were hospitalized and one person died. The toll was four times higher than in 2015.

If the trend of keeping chickens is growing, it shouldn’t be surprising that the rates of salmonella infection are keeping pace. And while these numbers may seem high at first glance, over one million people countrywide come down with salmonella a year. So only about one-tenth of 1% of cases stem from people keeping chickens at home.

The general population has a risk of about 1 in 320 of getting salmonella in a given year. That means if there are more than about 320,000 people who keep chickens in their backyards in the USA, they have a lower risk than the general population of contracting salmonella.

There aren’t very reliable statistics on how many people in the U.S. keep chickens for personal use. But a 2013 survey estimated .8% of American households keep backyard chickens. That means about one million households keep chickens. Going with the average household of 2.58 people, you could say perhaps 2.5 million people live in a household that keeps backyard chickens.

If these numbers are even close to accurate–or even off by a factor of five–that means the risk of salmonella is actually lower for backyard chicken farmers than for the general population!

Another interesting thing to note is that the distribution of baby chicks is still pretty centralized. But the centralized food industry is one of the biggest problems relating to foodborne illness in the first place. So is the problem keeping chickens in your backyard, or is the problem sourcing those chickens from one of a handful of hatcheries?

In that sense, scaring people away from keeping chickens in their backyard is just ushering them into another centralized food industry just as–or more–likely to get them sick. The real solution is keeping chickens as well as sourcing them locally from a farm you can visit.

So the problem with these kinds of alarmist articles is that they could curb an overall more healthy behavior. They encourage people to do the same old unhealthy thing, instead of pursuing a healthier alternative for fear of a relatively obscure risk.

Keeping chickens might actually reduce the overall chance of getting salmonella from poultry products. But even if it increases the risk, it doesn’t take into account the long-term health benefits of eating homegrown versus storebought food.

And then there are so many other factors that one alarming statistic does not take into account. Maybe keeping chickens is better for your mental health. Maybe knowing where your eggs come from decreases your stress levels. Perhaps being exposed to livestock inoculates you against more serious diseases.

(An interesting side note: In the late 1700’s, smallpox was a devastating disease. But Dr. Edward Jenner noticed that milkmaids who had previously come down with cowpox were immune to smallpox. The symptoms of cowpox were much milder compared to deadly smallpox. Yet the diseases were similar enough so that having had cowpox acted as an inoculation against smallpox.)

The overblown fear of salmonella from backyard chickens probably makes people less healthy overall.

Society seems to hate anything that empowers individuals.

Basically, the overall message from society and the media seems to encourage the status quo–even when the status quo is less healthy or riskier.

I see this attitude even in the comments of The Daily Bell. If I am too optimistic about a trend, technology, or movement, I basically hear, don’t you know people have always been slaves and always will be!

If I talk about exiting an unjust society its: oh so you’re just going to run and hide? If I talk about standing up to the powers that be its: wow, you really think you could defeat the machine? If I talk about finding a group of like-minded people to form a voluntary community with its: what are you some kind of hippie communist?

Most people don’t want anyone else to change. Misery loves company. People would rather drag others down than build themselves up.

If one person isn’t into keeping chickens, they get some sort of pleasure hearing about any possible pitfall. Fat people like that runners injure themselves. Liberals care more about the name of my mini-farm than about the positive impact it has. And the people freezing their asses off in Massachusetts just have to make themselves feel better by telling me how miserable I’ll be in the summer.

But individuals actually do have control over their lives. They can divorce themselves from a centralized and unhealthy food industry. They can make themselves free, happy, and prosperous. They don’t have to live in a place they hate or continue a depressing lifestyle.

It is a victim mentality that seeks excuses not to make a positive change in one’s own life. Why bother if the alternative is just as unhealthy. Why try if I will just get beat down by society.

And the media definitely doesn’t want people to change. They have a vested interest in making sure there is an army of negatrons to counter every positive utterance. That is how the media protects the status quo. It is how they make sure people don’t step too far out of line.

It is how they make sure people don’t empower themselves to stop depending on the state and corporate institutions.

Don’t fall for their hype.

The post Latest Fear Mongering About Self Sufficiency: Salmonella in Backyard Chickens appeared first on crude-oil.news.

The post Latest Fear Mongering About Self Sufficiency: Salmonella in Backyard Chickens appeared first on Forex news forex trade.

Continue Reading

Putin Slams US – “The Biggest Mistake Russia Ever Made Was To Trust You”

Russian President Vladimir Putin has not yet formally declared his intention to seek another term as leader of Russia, but many observers noted that a sweeping speech he gave at the Valdai Discussion Club in Sochi this week served as a template for his campaign ahead of the March election.

The speech’s overarching theme was to burnish Putin’s accomplishments as the man who restored “power and respect” to Russia. But in doing so, he heaped abuse on the US and its western allies, accusing them of selectively adhering to international law, and of taking advantage of Russia during the 1990s when the country was struggling to rebuild following the collapse of the Soviet Union, Bloomberg reported.

He accused the US of abusing Russia’s trust, and seeking to take advantage of the political and economic chaos that persisted for much of the 1990s and early 2000s, according to Russia Today.

“The biggest mistake our country made was that we put too much trust in you; and your mistake was that you saw this trust as a lack of power and you abused it,’’ he said during a question-and-answer session that was carried on national television. What was needed, he said, was “respect.’’

High on Putin’s list of perceived slights was the US’s failure to keep its end of the bargain in a host of international disarmament agreements. He explained that, while Moscow doesn’t plan to exit any existing treaties, he promised an “instant, symmetrical response” if Washington decides to quit first.

He accused the US of slighting Russia by forcing the country to accept international monitors during the implementation of the “megatons to megawatts” program, where the Russian nuclear arsenal was dramatically reduced by converting highly enrichment weapons-grade uranium to lower quality uranium suitable for use in nuclear power plants.  Between 1993 and 2013, Russia downblended enriched uranium from the equivalent of about 20,000 of its nuclear warheads into low-enriched uranium to be used as fuel by US power stations.

During this process, Putin said, Russia operated with “unprecedented openness and trust” with as many as 100 US officials entitled to carry out surprise inspections of Russian nuclear facilities.

But in return, the US has repeatedly disregarded the Russian national interest, Putin said.

“What we got in return is well-known – a complete disregard for our national interests, support for separatism in the Caucasus, a circumvention of the UN Security Council, the bombing of Yugoslavia, the invasion of Iraq, and so on. The US must have seen the state of our nuclear weapons and economy and decided to do away with international law.”

He also accused the US of hypocrisy by not adhering to the terms of the 1993 Chemical Weapons Convention, a treaty that was spearheaded by the US. Russia has destroyed its chemical weapons stockpile and honored its obligations under the treaty, Putin said, while the US has repeatedly pushed back its deadline.

These betrayals are threatening to send the US-Russia relationship back to the 1950s, he said.

“We can’t actively participate in several international treaties, because the US is not doing anything itself. We can’t just do it unilaterally,” said Putin, citing the 1993 Chemical Weapons Convention, as an example of the US taking advantage.

 

Last month, Russia declared that all its chemical weapons stockpiles had been disposed of – news that Western media “decided to stay silent on,” according to Putin – while the US has persistently delayed its own destruction schedule, and now plans to complete the process in 2023 at the earliest.

 

“We destroyed everything, and then our American partners said – ‘Not yet, we don’t have money.’ So, they have a dollar printing press, yet they don’t have money. But we, on the other hand, do?” said Putin with heavy sarcasm.

But Putin’s biggest gripe with US foreign policy relates to George W Bush’s decision to withdraw from the 1972 Anti-Ballistic Missile Treaty in 2002 – a decision that was made to pave the way for the construction of a missile defense shield in Europe. The Kremlin has vehemently objected to the missile shield.

“This treaty was the cornerstone of the entire international security framework in the area of strategic weapons. But despite spending years trying to persuade our colleagues otherwise, we weren’t able to hold our partners inside the agreement,” said Putin.

Putin also responded to US President Donald Trump criticisms of another treaty between Russia and the US - the New START treaty signed in 2011. Through 2021, it stipulates that both sides are allowed to have up to 1,550 active nuclear warheads. Trump has criticized the treaty as an example of poor Obama-era dealmaking. Putin has also expressed dissatisfaction with the treaty.

“We are hearing that the other side is also not pleased with New START,” Putin said. “We are not going to quit it. Maybe we are ourselves dissatisfied with certain aspects of it, but there is always an element of compromise. So, we are going to fulfil our obligations.”

Other parts of Putin’s election strategy were also on display during the carefully choreographed session, according to Evgeny Minchenko, a political consultant attending the forum who spoke with Bloomberg. Sharing the stage with Putin in Sochi was Jack Ma, the founder and chairman of China’s Alibaba Group Holding Ltd. Ma delivered a motivational speech on the future benefits of technology and offered to “join in the development of the Russian economy.’’

Putin will make a high-profile push to digitize the Russian economy as a key plank in his election campaign, Minchenko said. A second campaign message will be government renewal, replacing longer-serving officials with a younger cadre, both in the administration and regional governorships. Some governors have already been replaced.

“I’m pretty sure Putin is going to run,’’ Minchenko said. 

Watch the full speech below:

The post Putin Slams US – “The Biggest Mistake Russia Ever Made Was To Trust You” appeared first on crude-oil.news.

The post Putin Slams US – “The Biggest Mistake Russia Ever Made Was To Trust You” appeared first on Forex news forex trade.

Continue Reading

How Many Hours Americans Need To Work To Pay Their Mortgage

When it comes to the cost of living in cities, a general rule of thumb is that housing prices are much higher in the country’s economic and population hubs, especially in the cities along the coasts.

As Visual Capitalist's Jeff Desjardins notes, particularly in recent years, prices have been pushed sky-high in places like New York City or San Francisco through a combination of limited supply of new homes, increasing demand, shifting demographics, and government regulations.

PUTTING IT INTO PERSPECTIVE

Today’s visualization from HowMuch.net applies a common denominator to compare 97 of the biggest cities in the United States. Using a measure of median household income against the average mortgage payment in each city, we get a gauge of how many hours must be worked each month just to pay down the house.

The visualization uses data from the U.S. Census for household income and Zillow for median home listing price, while calculating mortgage payments based on a standard 30-year term.

Courtesy of: Visual Capitalist

THE RESULTS

Using the above method to compare the amount of hours it takes to pay down a monthly mortgage, we see some interesting contrasts in the country.

Here are the five most expensive cities in the United States for housing:

With about 170 hours in a normal work month, the average people in these cities are spending 50% or more of their income just to pay down their mortgages. It’s worst in New York City and Los Angeles, where at least 65% of income is going towards housing.

These cities stand in stark contrast to the five cheapest cities based on hours of work needed:

In a city like Memphis, TN it takes only 18.4 hours of work a month to pay down the average mortgage. That’s equal to only about 10% of monthly household income.

COASTAL DISPARITY

Interestingly, even though coastal hubs have high prices relative to the cities in the middle of the country, they differ quite widely against each other. This discrepancy does not necessarily show in terms of ranking, but more in terms of the actual hours of work needed.

Washington, D.C., for example, requires less than half the hours of work to pay down a mortgage than Los Angeles or New York City. Meanwhile, a popular west coast hub like Seattle only needs 72.8 hours in comparison to New York’s 113.5 hours.

The post How Many Hours Americans Need To Work To Pay Their Mortgage appeared first on crude-oil.news.

The post How Many Hours Americans Need To Work To Pay Their Mortgage appeared first on Forex news forex trade.

Continue Reading

Mandalay Bay, MGM Resorts Ordered To Preserve Evidence In Vegas Massacre

Just hours after rumors that MGM Resorts had pressured Jesus Campos to appear on a 'soft' talkshow, rather than a hard-hitting news show, local Laws Vegas NBC affiliate News3LV reports that Mandalay Bay and its corporate owner MGM Resorts have been ordered to preserve evidence relate to the October 1st massacre.

As we previously noted, sources told DailyMail.com, MGM is worried that families of the 58 people murdered as well as many of the 546 injured  in the Mandalay Bay massacre will launch lawsuits potentially worth billions of dollars against the company, and they thought Campos might not keep his story straight under the pressure of the TV lights and tough questioning.

That is why Campos, 25, appeared on a daytime chat show hosted by a fast-talking, dancing comedienne, rather than take questions from TV hardhitters such as Fox News’ Sean Hannity, NBC News or ABC News.

 

‘MGM was behind the decision to call off all the interviews and did a deal with Ellen, knowing she would not play hardball on the timeline as long as she had the exclusive,’ a TV insider told DailyMail.com.

But now, as News3LV.com reports, Mandalay Bay and its corporate owner MGM Resorts have been ordered not to destroy anything that could be considered evidence in a civil negligence trial over events related to the Route 91 music festival. The order was sought by attorneys who represent Rachel Sheppard, a California woman who survived the attack, despite being shot in the chest three times.

“The shooter was in that hotel for six days,” says attorney Brian Nettles.

 

The order, granted by Judge Mark Denton, restrains Mandalay Bay from destroying anything of evidentiary value until another hearing set for Oct. 30 at 9 a.m.

 

That’s when MGM will have a chance to argue against the ruling, before a possible ruling to would make the order permanent.

 

“There’s evidence that’s coming out about surveillance cameras that he may have set up himself, evidence about ways that he may have altered his room or that hallway,” he says.

 

The lawsuit alleges that negligence on the part of Mandalay Bay, and MGM Resorts, contributed to the shooting massacre that claimed 58 lives and injured more than 500 people.

Perhaps now - in discovery - we may actually get to the bottom of the 'real' timeline...

The post Mandalay Bay, MGM Resorts Ordered To Preserve Evidence In Vegas Massacre appeared first on crude-oil.news.

The post Mandalay Bay, MGM Resorts Ordered To Preserve Evidence In Vegas Massacre appeared first on Forex news forex trade.

Continue Reading

Hurricane Ravaged Dominica: “It’s All Gone” And Fighting For Survival

Authored by Mac Slavo via SHTFplan.com,

In just the blink of an eye, island life on Dominica was turned upside down.  Like Puerto Rico, Dominica was violently ravaged by Hurricane Maria, and residents are still fighting for survival.

The wooden frames and scattered, water-damaged belongings are all that remains of some homes of on Dominica, which was ravaged by Hurricane Maria last month.

Without warning, the storm rapidly accelerated from a Category 3 to a Category 5, and residents said they could do little to prepare.

 “There was lightning, there was heavy rain…[it was like] the hurricane was in the house,” said Dominica’s Prime Minister Roosevelt Skerrit according to ABC News.

 

“We have lost everything that money can buy, and that is a fact.”

The roof of Roosevelt Skerrit’s house was blown away and its floors flooded. On the night Hurricane Maria hit, Skerrit took to Facebook to post updates including one that said, “I am at the complete mercy of the hurricane. House is flooding” and another that said, “The winds are merciless! We shall survive by the grace of God!” Later he posted, “I have been rescued.”

“You can still see the shock, the anxiety, the fear the trauma in the eyes and the expressions of people every day,” he told ABC’s Nightline.

 

“Their entire life investments, life’s savings, blown away.”

 

Another now displaced resident named Emmanuel Peter said he can still remember the roar of the hurricane-force winds.

 

 “It was just whistling, whistling,” he said. “I thought it would burst my eardrums.”

Puerto Rico was not the only island in Hurricane Maria’s path, and almost a month later, both islands still look like post-apocalyptic zones.  But the island with the highest death toll per capita was Dominica; a close-knit, mostly Christian nation that was left at the mercy of a hurricane that shared a name with the mother of Christ: Maria.  

To date, 26 people are confirmed dead, 31 are still missing, and more than 50,000 people are displaced on the island that has a total population of roughly 74,000.

When  ABC’s Nightline visited Dominica six days after the storm, the only way to reach its interior was with the United States military. Upon arrival, many who had the option to evacuate the island were already in the process of doing so, including 1,300 students at Ross University Medical School, an American college based in Dominica.

“I do feel sadness for the people of Dominica,” said Carey James, the college’s associate dean of operations, analysis, and admissions. “My wife’s family is from Dominica … and it’s hard to see a place that you love go through that kind of a storm.” And nearly four weeks after the storm, people are still fighting to survive.

No one on the island has access to running, drinkable water, and with sewage systems destroyed, residents are contending with fears of diarrhea, dehydration, and dysentery. Much of the island still remains without power. For the vast majority of Dominicans, the choice to leave their home country isn’t financially available. More than 85 percent of houses have been damaged, and of those, more than a quarter simply do not exist anymore, leaving many of the residents homeless.

The post Hurricane Ravaged Dominica: “It’s All Gone” And Fighting For Survival appeared first on crude-oil.news.

The post Hurricane Ravaged Dominica: “It’s All Gone” And Fighting For Survival appeared first on Forex news forex trade.

Continue Reading

The Scandalous Truth About Obamacare Is Laid Bare

Authored by Jeffrey Tucker via The Foundation for Economuc Education,

A government program that is ruined by permitting more choice is not sustainable.

It’s not just that Obamacare is financially unsustainable. More seriously, it is intellectually unsustainable, even though this truth has been slow to emerge. This has come to an end with President Trump’s executive order last week.

What does it do? It cuts subsidies to failing providers, yes. It also redefines the meaning of “short term” policies from one year to 90 days. But more importantly–and this is what has the pundit class in total meltdown–it liberalizes the rules for providers to serve health-coverage consumers.

In the words of USA Today: the executive order permits a greater range of choice “by allowing more consumers to buy health insurance through association health plans across state lines.”

The key word here is “allowing” – not forcing, not compelling, not coercing. Allowing.

Why would this be a problem?

Because allowing choice defeats the core feature of Obamacare, which is about forcing risk pools to exist that the market would otherwise never have chosen. If you were to summarize the change in a phrase it is this: it allows more freedom.

The tenor of the critics’ comments on this move is that it is some sort of despotic act.

But let’s be clear: no one is coerced by this executive order. It is exactly the reverse: it removes one source of coercion. It liberalizes, just slightly, the market for insurance carriers.

Here’s a good principle: a government program that is ruined by permitting more choice is not sustainable.

The New York Times predicts:

Employers that remain in the A.C.A. small-group market will offer plans that are more expensive than average, and they will see premiums increase. Only the sickest groups would remain in the A.C.A. regulated risk pool after several enrollment cycles.

Vox puts it this way:

The individuals likely to flee the Obamacare markets for association plans would probably be younger and healthier, leaving behind an older, sicker pool for the remaining ACA market. That has the makings of a death spiral, with ever-increasing premiums and insurers deciding to leave the market altogether.

The Atlantic makes the same point:

Both short-term and associated plans would likely be less costly than the more robust plans sold on Obamacare’s state-based insurance exchanges. But the concern, among critics, is that the plans would cherry-pick the healthiest customers out of the individual market, leaving those with serious health conditions stuck on the Obamacare exchanges. There, prices would rise, because the pool of people on the exchanges would be sicker. Small businesses who keep the more robust plans—perhaps because they have employees with serious health conditions—would also likely face higher costs.

CNBC puts the point about plan duration in the starkest and most ironic terms.

If the administration liberalizes rules about the duration of short-term health plans, and then also makes it easier for people to get hardship exemptions from Obamacare's mandate, it could lead healthy people who don't need comprehensive benefits to sign up in large numbers for short-term coverage.

Can you imagine? Letting people do things that are personally beneficial? Horror!

Once you break all this down, the ugly truth about Obamacare is laid bare. Obamacare didn’t create a market. It destroyed the market. Even the slightest bit of freedom wrecks the whole point.

Under the existing rules, healthy people were being forced (effectively taxed) to pay the premiums for unhealthy people, young people forced to pay for old people, anyone trying to live a healthy lifestyle required to cough up for those who do not.

This is the great hidden truth about Obamacare. It was never a program for improved medical coverage. It was a program for redistributing wealth by force from the healthy to the sick. It did this by forcing nonmarket risk pools, countering the whole logic of insurance in the first place, which is supposed to calibrate premiums, risks, and payouts toward mutual profitability. Obamacare imagined that it would be easy to use coercion to undermine the whole point of insurance. It didn’t work.

And so the Trump executive order introduces a slight bit of liberality and choice. And the critics are screaming that this is a disaster in the making. You can’t allow choice! You can’t allow more freedom! You can’t allow producers and consumers to cobble together their own plans! After all, this defeats the point of Obamacare, which is all about forcing people to do things they otherwise would not do!

This revelation is, as they say, somewhat awkward.

What we should have learned from the failure of Obamacare is that no amount of coercion can substitute for the rationality and productivity of the competitive marketplace.

Even if the executive order successfully liberalizes the sector just a bit, we have a very long way to go. The entire medical marketplace needs massive liberalization. It needs government to play even less of a role, from insurance to prescriptions to all choice, over what is permitted to be called health care and who administers it.

Freedom or coercion: these are the two paths. The first works; the second doesn’t.

The post The Scandalous Truth About Obamacare Is Laid Bare appeared first on crude-oil.news.

The post The Scandalous Truth About Obamacare Is Laid Bare appeared first on Forex news forex trade.

Continue Reading

A Look Inside The Secret Swiss Bunker Where The Ultra Rich Hide Their Bitcoins

Somewhere in the mountains near Switzerland’s Lake Lucerne lies a hidden underground vault containing a vast fortune.

It’s no ordinary vault, according to Quartz. Built inside a decommissioned Swiss military bunker dug into a granite mountain, it’s precise location is a closely guarded secret, and access is limited by myriad security precautions.

But instead of gold bars, the bunker contains hard drives on which customers’ bitcoins are being kept in what’s call “cold storage” – i.e. the owners’ private keys are protected by an air-gapped hard drive. The vault is one of many operated by Xapo, an early bitcoin company known for its cold storage wallet products and a debit card that pays for transactions in digital currencies.

The company won’t disclose how much bitcoin is stored in the vault, but one employee who spoke with Quartz said he sometimes takes customers with millions of dollars in bitcoin on tours of the vaults where their fortune is stored. Xapo was founded by Argentinian entrepreneur and current CEO Wences Casares, whom Quartz describes as “patient zero” of bitcoin among Silicon Valley’s elite. Cesares reportedly gave Bill Gates and Reed Hoffman their first bitcoins.

As Quartz explains, the bitcoin vault doesn’t store actual bitcoin units. Instead, what’s being stored are the owners’ private cryptographic keys that allow the owner to access and transfer his or her bitcoins by matching the key with a public key that’s used to identify the coin on the blockchain. Gaining unauthorized access to someone’s private keys is akin to making off with a gold bar.

The inexorable rise in bitcoin’s valuation has been marred by notable hacking incidents like the collapse of Mt. Gox, which ushered in the longest bear market in bitcoin’s history. Security fears appear to have subsided as bitcoin’s price has soared to all-time highs, but incidents like the collapse of the DAO have inspired investors with substantial bitcoin wealth to look into protecting it.

To store the coins, Xapos contracts Deltalis, the company that technically operates the 10,000-square-foot data-center that now inhabits the decommissioned bunker.

Server racks for banks, and any client who needs secure data processing, fill a cavity dug over 320 meters deep in the granite mountain. The Swiss military built the facility in 1947, and it served as the army’s secret headquarters during the Cold War, Agence-France Presse has reported. Inside, walls covered with detailed maps and ancient radio electronics serve as vestiges of its military past.

To enter Xapo’s private vault in the Deltalis data center, visitors must endure an exhausting series of security procedures.

Streiff leads us to a concrete facade jutting out of the mountainside, the bunker’s entrance. We step through about a foot of concrete and enter the lobby. I sign in as I would at any office building, except I also have to present my fingerprints and be photographed. After that I step through a “man-trap”—a phone booth-sized cylinder made of bullet-proof glass that shuts me in until an operator opens the door on the opposite side.

 

Once through the man-trap, we touch our ID cards and pass through a set of steel revolving doors, then walk down a 100-meter long passageway through the granite. At the end of the passageway are two red steel doors that I’m told can survive a nuclear blast. Streiff invites me to try to close one—my 90 kg (198 pound) frame can’t budge it. “They’re closed every night,” he tells me, showing me how to hang off the handle and use his body’s momentum to gradually swing it shut.

 

Streiff and Kon are taking me to see Xapo’s “private suite,” an ultra-secure, customized, portion of the data center. We pass through a second man-trap and then end up in front of a nondescript white door. “This is further than anyone outside Xapo has been,” Streiff tells me, as he unlocks it. Inside is a space about the size of a walk-in closet containing a cooling unit, and yet another door. But that’s as far as they’ll let me go, and I’m not allowed to take photographs.

Security is similarly tight inside the vault. Nobody is allowed the enter the “cold room” where the bitcoins are stored on air-gapped hard drives. To protect against an electromagnetic pulse attack, the cold room is equipped with a Faraday cage, a type of barrier meant to block electromagnetic fields.

Beyond that door, I rely on what Carlos Rienzi, Xapo’s head of security, tells me later, when I’m back in London. Rienzi chose the vault for Xapo, and he designed the private suite and its security protocols. His “threat model,” as computer security jargon goes, is to protect against attacks from “well-funded terrorist groups or hackers.”

 

There are two more portals inside the suite: the first leads to an operators’ room, and the second to a “cold room.” The cold room is encircled with steel slabs to form a Faraday cage: a barrier that protects against a possible electromagnetic pulse (EMP) attack that could wipe out the data—and thus the keys to the bitcoin—stored in the room. For digital assets like bitcoin, thick walls and a secret location are not enough. A shield against invisible modes of attack like an EMP bomb must be provided for.

 

No one, not even the operator, enters the cold room. Its door is sealed with tape—like a crime scene—to ensure it’s not tampered with. The cold room contains hardware, which is never connected to the internet, used to sign bitcoin transactions. Signing a transaction can be performed offline. The operator accesses that hardware using “special cabling,” sending encrypted data to the hardware for signing. Finally, before a transaction can be approved, two more sign-offs, in two other vaults located on separate continents, must be performed.

 

I ask Rienzi if he feels pretty confident about the security measures he has in place in Switzerland. “We are under attack 24/7,” he tells me, referring to the terrorists and hackers he designed the vault to guard against. “This is not a race. It is a chess game. You have to think about the opponent’s next movement. You can never relax.”

Of course, all the security measures in the world can’t protect investors from a sudden plunge in the bitcoin price. However, the digital currency’s indomitable - for now - performance has silenced at least one of its most prominent critics. Then said, unlike precious metal specie, one carefully targeted EMP would be all it takes to sever the ownership chain for a long, long time.

Still, with the digital currency recently reaching yet another record high, despite relentless jawboning and rhetoric by everyone from Jamie Dimon to central bankers to China, we can only imagine the business of protecting bitcoin fortunes is set to boom.

The post A Look Inside The Secret Swiss Bunker Where The Ultra Rich Hide Their Bitcoins appeared first on crude-oil.news.

The post A Look Inside The Secret Swiss Bunker Where The Ultra Rich Hide Their Bitcoins appeared first on Forex news forex trade.

Continue Reading

SEC Hires JPM Banker As Its Most Important Markets Regulator; May Blow Up HFTs

Yes, it's another glaring case of "revolving door" cronyism between Wall Street and the SEC: on Wednesday, the Securities and Exchange Commission announced it had hired Brett Redfearn, a JPMorgan banker, to head the agency's Division of Trading and Markets, arguably the most important group within the SEC, one which oversees U.S. stock markets and brokerages. Redfearn, who is currently head of market structure at JPM, would fill a slot that has been vacant since January when the previous head of Trading & Markets, Stephen Luparello left the SEC... and three months later joined Citadel as General Counsel, which as a reminder is one of the biggest HFT operators and retail orderflow frontrunners in the world, is responsible for one-fifth of all trading on the $26 trillion US stock market and lists Ben Bernanke as its advisor.

The regulator's Division of Trading and Markets group plays a key role in dealing with some of the most pressing matters facing the agency, including overseeing the construction of a massive trade database being built to help U.S. regulators police the stock market and keep tabs on high frequency traders, as well as writing rules for exchanges and dark pools.

To simplify: a JPMorgan guy is coming in to fill the most important regulatory position at the SEC, one that looks at market structure - and fairness - and which until recently was filled by a guy who now works at Citadel as its new general counsel. A revolving door, if there ever was one...

To be sure, that this is another glaring example of regulatory capture, is painfully obvious. Only this time there may be a twist.

While SEC Chairman Jay Clayton has signaled a willingness to change market-structure rules that some critics argue are antiquated, he’s provided few details on his approach. Clayton, a former deals lawyer whose career wasn’t focused on market-structure issues, has prioritized bolstering initial public offerings according to Bloomberg. As a result, Redfearn - the former head of market structure at America's biggest bank - will likely have significant sway at the agency because of his expertise.

As Bloomberg reports, Redfearn has been at JPMorgan for more than nine years. Earlier this year he expanded his role, moving from running equity market structure strategy to overseeing global market structure for all asset classes. Where it gets interesting, is that in the past, Redfearn has advocated for a regulatory overhaul of markets, and in April, he said Regulation NMS - a landmark SEC rule approved in 2005 that accelerated a shift to electronic trading in the U.S. stock market, and which allowed the uncontrolled, explosive proliferation of HFT algos - is “overdue for reform.”

This, as Bloomberg writes, may set up a clash with not only stock exchanges, who are among the most influential - and "generous" - voices in Washington around financial regulation, but also the just as powerful HFT lobby. Also notable - Redfearn has emerged as a critic of the increasingly costly fees that U.S. stock exchanges charge traders who want access to vital data on prices. Of course, those fees only make sense in a world in which some traders, those with millions to burn, with to receive trade data ahead of everyone else, whether by laser, microwave or fiber optic. Which would suggest that Redfearn's criticism is ultimately aimed at not only the current multi-tiered nature of the market, but at high frequency traders as well.

“We have a fundamental tension in our system of self-regulation that needs to be addressed,” Redfearn said in April. The tension, he argued, comes from the fact that stock exchanges, once public utilities, have over time become publicly traded companies themselves. Which, ironically, is absolutely correct, and if the now former-JPM executive wishes to indeed engage with the practices he finds as unfair, that could well mean the end of the HFT dominance in capital markets.

As for what JPM gets out of it, well that remains to be seen...

The post SEC Hires JPM Banker As Its Most Important Markets Regulator; May Blow Up HFTs appeared first on crude-oil.news.

The post SEC Hires JPM Banker As Its Most Important Markets Regulator; May Blow Up HFTs appeared first on Forex news forex trade.

Continue Reading