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Everything You Always Wanted To Know About Swaps* (*But Were Afraid To Ask)
Hello, dummies It's your old pal, Fuzzy. As I'm sure you've all noticed, a lot of the stuff that gets posted here is - to put it delicately - fucking ridiculous. More backwards-ass shit gets posted to wallstreetbets than you'd see on a Westboro Baptist community message board. I mean, I had a look at the daily thread yesterday and..... yeesh. I know, I know. We all make like the divine Laura Dern circa 1992 on the daily and stick our hands deep into this steaming heap of shit to find the nuggets of valuable and/or hilarious information within (thanks for reading, BTW). I agree. I love it just the way it is too. That's what makes WSB great. What I'm getting at is that a lot of the stuff that gets posted here - notwithstanding it being funny or interesting - is just... wrong. Like, fucking your cousin wrong. And to be clear, I mean the fucking your *first* cousin kinda wrong, before my Southerners in the back get all het up (simmer down, Billy Ray - I know Mabel's twice removed on your grand-sister's side). Truly, I try to let it slide. Idomybit to try and put you on the right path. Most of the time, I sleep easy no matter how badly I've seen someone explain what a bank liquidity crisis is. But out of all of those tens of thousands of misguided, autistic attempts at understanding the world of high finance, one thing gets so consistently - so *emphatically* - fucked up and misunderstood by you retards that last night I felt obligated at the end of a long work day to pull together this edition of Finance with Fuzzy just for you. It's so serious I'm not even going to make a u/pokimane gag. Have you guessed what it is yet? Here's a clue. It's in the title of the post. That's right, friends. Today in the neighborhood we're going to talk all about hedging in financial markets - spots, swaps, collars, forwards, CDS, synthetic CDOs, all that fun shit. Don't worry; I'm going to explain what all the scary words mean and how they impact your OTM RH positions along the way. We're going to break it down like this. (1) "What's a hedge, Fuzzy?" (2) Common Hedging Strategies and (3) All About ISDAs and Credit Default Swaps. Before we begin. For the nerds and JV traders in the back (and anyone else who needs to hear this up front) - I am simplifying these descriptions for the purposes of this post. I am also obviously not going to try and cover every exotic form of hedge under the sun or give a detailed summation of what caused the financial crisis. If you are interested in something specific ask a question, but don't try and impress me with your Investopedia skills or technical points I didn't cover; I will just be forced to flex my years of IRL experience on you in the comments and you'll look like a big dummy. TL;DR? Fuck you. There is no TL;DR. You've come this far already. What's a few more paragraphs? Put down the Cheetos and try to concentrate for the next 5-7 minutes. You'll learn something, and I promise I'll be gentle. Ready? Let's get started. 1.The Tao of Risk: Hedging as a Way of Life The simplest way to characterize what a hedge 'is' is to imagine every action having a binary outcome. One is bad, one is good. Red lines, green lines; uppie, downie. With me so far? Good. A 'hedge' is simply the employment of a strategy to mitigate the effect of your action having the wrong binary outcome. You wanted X, but you got Z! Frowny face. A hedge strategy introduces a third outcome. If you hedged against the possibility of Z happening, then you can wind up with Y instead. Not as good as X, but not as bad as Z. The technical definition I like to give my idiot juniors is as follows: Utilization of a defensive strategy to mitigate risk, at a fraction of the cost to capital of the risk itself. Congratulations. You just finished Hedging 101. "But Fuzzy, that's easy! I just sold a naked call against my 95% OTM put! I'm adequately hedged!". Spoiler alert: you're not (although good work on executing a collar, which I describe below). What I'm talking about here is what would be referred to as a 'perfect hedge'; a binary outcome where downside is totally mitigated by a risk management strategy. That's not how it works IRL. Pay attention; this is the tricky part. You can't take a single position and conclude that you're adequately hedged because risks are fluid, not static. So you need to constantly adjust your position in order to maximize the value of the hedge and insure your position. You also need to consider exposure to more than one category of risk. There are micro (specific exposure) risks, and macro (trend exposure) risks, and both need to factor into the hedge calculus. That's why, in the real world, the value of hedging depends entirely on the design of the hedging strategy itself. Here, when we say "value" of the hedge, we're not talking about cash money - we're talking about the intrinsic value of the hedge relative to the the risk profile of your underlying exposure. To achieve this, people hedge dynamically. In wallstreetbets terms, this means that as the value of your position changes, you need to change your hedges too. The idea is to efficiently and continuously distribute and rebalance risk across different states and periods, taking value from states in which the marginal cost of the hedge is low and putting it back into states where marginal cost of the hedge is high, until the shadow value of your underlying exposure is equalized across your positions. The punchline, I guess, is that one static position is a hedge in the same way that the finger paintings you make for your wife's boyfriend are art - it's technically correct, but you're only playing yourself by believing it. Anyway. Obviously doing this as a small potatoes trader is hard but it's worth taking into account. Enough basic shit. So how does this work in markets? 2. A Hedging Taxonomy The best place to start here is a practical question. What does a business need to hedge against? Think about the specific risk that an individual business faces. These are legion, so I'm just going to list a few of the key ones that apply to most corporates. (1) You have commodity risk for the shit you buy or the shit you use. (2) You have currency risk for the money you borrow. (3) You have rate risk on the debt you carry. (4) You have offtake risk for the shit you sell. Complicated, right? To help address the many and varied ways that shit can go wrong in a sophisticated market, smart operators like yours truly have devised a whole bundle of different instruments which can help you manage the risk. I might write about some of the more complicated ones in a later post if people are interested (CDO/CLOs, strip/stack hedges and bond swaps with option toggles come to mind) but let's stick to the basics for now. (i) Swaps A swap is one of the most common forms of hedge instrument, and they're used by pretty much everyone that can afford them. The language is complicated but the concept isn't, so pay attention and you'll be fine. This is the most important part of this section so it'll be the longest one. Swaps are derivative contracts with two counterparties (before you ask, you can't trade 'em on an exchange - they're OTC instruments only). They're used to exchange one cash flow for another cash flow of equal expected value; doing this allows you to take speculative positions on certain financial prices or to alter the cash flows of existing assets or liabilities within a business. "Wait, Fuzz; slow down! What do you mean sets of cash flows?". Fear not, little autist. Ol' Fuzz has you covered. The cash flows I'm talking about are referred to in swap-land as 'legs'. One leg is fixed - a set payment that's the same every time it gets paid - and the other is variable - it fluctuates (typically indexed off the price of the underlying risk that you are speculating on / protecting against). You set it up at the start so that they're notionally equal and the two legs net off; so at open, the swap is a zero NPV instrument. Here's where the fun starts. If the price that you based the variable leg of the swap on changes, the value of the swap will shift; the party on the wrong side of the move ponies up via the variable payment. It's a zero sum game. I'll give you an example using the most vanilla swap around; an interest rate trade. Here's how it works. You borrow money from a bank, and they charge you a rate of interest. You lock the rate up front, because you're smart like that. But then - quelle surprise! - the rate gets better after you borrow. Now you're bagholding to the tune of, I don't know, 5 bps. Doesn't sound like much but on a billion dollar loan that's a lot of money (a classic example of the kind of 'small, deep hole' that's terrible for profits). Now, if you had a swap contract on the rate before you entered the trade, you're set; if the rate goes down, you get a payment under the swap. If it goes up, whatever payment you're making to the bank is netted off by the fact that you're borrowing at a sub-market rate. Win-win! Or, at least, Lose Less / Lose Less. That's the name of the game in hedging. There are many different kinds of swaps, some of which are pretty exotic; but they're all different variations on the same theme. If your business has exposure to something which fluctuates in price, you trade swaps to hedge against the fluctuation. The valuation of swaps is also super interesting but I guarantee you that 99% of you won't understand it so I'm not going to try and explain it here although I encourage you to google it if you're interested. Because they're OTC, none of them are filed publicly. Someeeeeetimes you see an ISDA (dsicussed below) but the confirms themselves (the individual swaps) are not filed. You can usually read about the hedging strategy in a 10-K, though. For what it's worth, most modern credit agreements ban speculative hedging. Top tip: This is occasionally something worth checking in credit agreements when you invest in businesses that are debt issuers - being able to do this increases the risk profile significantly and is particularly important in times of economic volatility (ctrl+f "non-speculative" in the credit agreement to be sure). (ii) Forwards A forward is a contract made today for the future delivery of an asset at a pre-agreed price. That's it. "But Fuzzy! That sounds just like a futures contract!". I know. Confusing, right? Just like a futures trade, forwards are generally used in commodity or forex land to protect against price fluctuations. The differences between forwards and futures are small but significant. I'm not going to go into super boring detail because I don't think many of you are commodities traders but it is still an important thing to understand even if you're just an RH jockey, so stick with me. Just like swaps, forwards are OTC contracts - they're not publicly traded. This is distinct from futures, which are traded on exchanges (see The Ballad Of Big Dick Vick for some more color on this). In a forward, no money changes hands until the maturity date of the contract when delivery and receipt are carried out; price and quantity are locked in from day 1. As you now know having read about BDV, futures are marked to market daily, and normally people close them out with synthetic settlement using an inverse position. They're also liquid, and that makes them easier to unwind or close out in case shit goes sideways. People use forwards when they absolutely have to get rid of the thing they made (or take delivery of the thing they need). If you're a miner, or a farmer, you use this shit to make sure that at the end of the production cycle, you can get rid of the shit you made (and you won't get fucked by someone taking cash settlement over delivery). If you're a buyer, you use them to guarantee that you'll get whatever the shit is that you'll need at a price agreed in advance. Because they're OTC, you can also exactly tailor them to the requirements of your particular circumstances. These contracts are incredibly byzantine (and there are even crazier synthetic forwards you can see in money markets for the true degenerate fund managers). In my experience, only Texan oilfield magnates, commodities traders, and the weirdo forex crowd fuck with them. I (i) do not own a 10 gallon hat or a novelty size belt buckle (ii) do not wake up in the middle of the night freaking out about the price of pork fat and (iii) love greenbacks too much to care about other countries' monopoly money, so I don't fuck with them. (iii) Collars No, not the kind your wife is encouraging you to wear try out to 'spice things up' in the bedroom during quarantine. Collars are actually the hedging strategy most applicable to WSB. Collars deal with options! Hooray! To execute a basic collar (also called a wrapper by tea-drinking Brits and people from the Antipodes), you buy an out of the money put while simultaneously writing a covered call on the same equity. The put protects your position against price drops and writing the call produces income that offsets the put premium. Doing this limits your tendies (you can only profit up to the strike price of the call) but also writes down your risk. If you screen large volume trades with a VOL/OI of more than 3 or 4x (and they're not bullshit biotech stocks), you can sometimes see these being constructed in real time as hedge funds protect themselves on their shorts. (3) All About ISDAs, CDS and Synthetic CDOs You may have heard about the mythical ISDA. Much like an indenture (discussed in my post on $F), it's a magic legal machine that lets you build swaps via trade confirms with a willing counterparty. They are very complicated legal documents and you need to be a true expert to fuck with them. Fortunately, I am, so I do. They're made of two parts; a Master (which is a form agreement that's always the same) and a Schedule (which amends the Master to include your specific terms). They are also the engine behind just about every major credit crunch of the last 10+ years. First - a brief explainer. An ISDA is a not in and of itself a hedge - it's an umbrella contract that governs the terms of your swaps, which you use to construct your hedge position. You can trade commodities, forex, rates, whatever, all under the same ISDA. Let me explain. Remember when we talked about swaps? Right. So. You can trade swaps on just about anything. In the late 90s and early 2000s, people had the smart idea of using other people's debt and or credit ratings as the variable leg of swap documentation. These are called credit default swaps. I was actually starting out at a bank during this time and, I gotta tell you, the only thing I can compare people's enthusiasm for this shit to was that moment in your early teens when you discover jerking off. Except, unlike your bathroom bound shame sessions to Mom's Sears catalogue, every single person you know felt that way too; and they're all doing it at once. It was a fiscal circlejerk of epic proportions, and the financial crisis was the inevitable bukkake finish. WSB autism is absolutely no comparison for the enthusiasm people had during this time for lighting each other's money on fire. Here's how it works. You pick a company. Any company. Maybe even your own! And then you write a swap. In the swap, you define "Credit Event" with respect to that company's debt as the variable leg . And you write in... whatever you want. A ratings downgrade, default under the docs, failure to meet a leverage ratio or FCCR for a certain testing period... whatever. Now, this started out as a hedge position, just like we discussed above. The purest of intentions, of course. But then people realized - if bad shit happens, you make money. And banks... don't like calling in loans or forcing bankruptcies. Can you smell what the moral hazard is cooking? Enter synthetic CDOs. CDOs are basically pools of asset backed securities that invest in debt (loans or bonds). They've been around for a minute but they got famous in the 2000s because a shitload of them containing subprime mortgage debt went belly up in 2008. This got a lot of publicity because a lot of sad looking rednecks got foreclosed on and were interviewed on CNBC. "OH!", the people cried. "Look at those big bad bankers buying up subprime loans! They caused this!". Wrong answer, America. The debt wasn't the problem. What a lot of people don't realize is that the real meat of the problem was not in regular way CDOs investing in bundles of shit mortgage debts in synthetic CDOs investing in CDS predicated on that debt. They're synthetic because they don't have a stake in the actual underlying debt; just the instruments riding on the coattails. The reason these are so popular (and remain so) is that smart structured attorneys and bankers like your faithful correspondent realized that an even more profitable and efficient way of building high yield products with limited downside was investing in instruments that profit from failure of debt and in instruments that rely on that debt and then hedging that exposure with other CDS instruments in paired trades, and on and on up the chain. The problem with doing this was that everyone wound up exposed to everybody else's books as a result, and when one went tits up, everybody did. Hence, recession, Basel III, etc. Thanks, Obama. Heavy investment in CDS can also have a warping effect on the price of debt (something else that happened during the pre-financial crisis years and is starting to happen again now). This happens in three different ways. (1) Investors who previously were long on the debt hedge their position by selling CDS protection on the underlying, putting downward pressure on the debt price. (2) Investors who previously shorted the debt switch to buying CDS protection because the relatively illiquid debt (partic. when its a bond) trades at a discount below par compared to the CDS. The resulting reduction in short selling puts upward pressure on the bond price. (3) The delta in price and actual value of the debt tempts some investors to become NBTs (neg basis traders) who long the debt and purchase CDS protection. If traders can't take leverage, nothing happens to the price of the debt. If basis traders can take leverage (which is nearly always the case because they're holding a hedged position), they can push up or depress the debt price, goosing swap premiums etc. Anyway. Enough technical details. I could keep going. This is a fascinating topic that is very poorly understood and explained, mainly because the people that caused it all still work on the street and use the same tactics today (it's also terribly taught at business schools because none of the teachers were actually around to see how this played out live). But it relates to the topic of today's lesson, so I thought I'd include it here. Work depending, I'll be back next week with a covenant breakdown. Most upvoted ticker gets the post. *EDIT 1\* In a total blowout, $PLAY won. So it's D&B time next week. Post will drop Monday at market open.
Are China and India engaged in a cold economic and information war?
Note: This is resubmitted after making edits to better fit the quality requirements of this sub. While most media attention on China focuses on China’s relationship with the US, one player that rarely gets mentioned--at least in mainstream Western media--is India. In an October 2019 analysis by Deborah Brautigam that explored the origin of the term "debt trap diplomacy" for Chinese investments, she revealed the following:
On 23 January 2017, a Chinese debt-trap diplomacy meme was born in a think tank in northern India and was furthered by a paperwritten by two Harvard University graduate students who called it Chinese ‘debt book diplo-macy’.
A recent thread on china revealed some surprising data (non-academic, I know, but it's a good barometer for general sentiment on China as many of the more critical stories regarding China has first emerged on that sub, and then slowly propagated out towards more mainstream subs/media). Namely--by analyzing 449 tweets with the hashtag of #TweetforTaiwan, it found that 49% of the tweets originated from India. Most recently, Times of India has also advocated for Taiwan's participation in the WHO by interviewing the foreign minister of Taiwan--which has since drawn an official statement from the Chinese embassy in India. But most importantly, India has recently announced that it is setting aside nearly half a million hectares of land to entice foreign firms into leaving China. PM Modi has also emphasized that he had little desire for India to play second fiddle to China. While some can argue that this is due to him pandering to the Hindu nationalist base that makes up his supporters, it's not a statement to be taken lightly because the BJP--by taking a supermajority in the Indian Congress--is in a position to enact its policies at will without regard for the opposition.
The Trade Reality of India vis-a-vis the United States
The United States has actively sought bilateral and multilateral opportunities to increase access to India’s market, and the government of India has pursued ongoing economic reform efforts. Nevertheless, U.S. exporters continue to encounter significant tariff and nontariff barriers that impede imports of U.S. products into India.
Other points raised in the document:
India maintains very high tariffs on a number of goods--some as high as 150%.
India has increased tariffs in 2018 key U.S. exports in the agricultural, information and communications technology, and automobile parts sectors, with no warning or public consultation process.
India maintains several export subsidy programs to boost production in domestic sectors
India remains on the Priority Watch List due to weak protection and enforcement of intellectual property rights
The Indian government maintains strong ownership presence in major services industries such as banking and insurance.
Foreign investment in businesses in certain major services sectors, including financial services and retail, is subject to limitations on foreign equity.
The document goes on to list additional trade barriers that India has put up against the United States, and they are far too many to list here. But taken as a whole, the overall summary seems to be this: India--from a trade policy perspective--is not that much different or even that advantageous compared to China. Yet in the face of greater US-China economic rivalry, India has emerged as a seemingly viable alternative to China despite data suggesting the contrary. This is due to the major advantage India has over China, which I will discuss in the next section.
The Advantages India Holds Over China
ADVANTAGE 1: ONLINE PRESENCE The biggest advantage that India holds over China in an economic cold war has little to do with any underlying economic strength, nor does it have anything to do with how easy it is for foreign companies to enter India. Instead, the biggest advantage India has over China is its online presence in the Western internet. With 560 million internet users, India is the second largest online market after China. But unlike China, India’s internet is not locked behind a government imposed barrier. The lack of such a barrier has given rise to a sophisticated disinformation/propaganda arm for Indian political parties—most notably the BJP—on Western internet channels such as Twitter and Facebook. The Centre for International Governance Innovation think tank has done the following analysis of how the BJP’s propaganda arm makes use of Western social media to set the narrative: - The grassroots workers share hyperlocal information about development activities — for instance, a beneficiary getting access to services offered under a government scheme — and work done by their party with voters in their area. They click images and videos as proof and circulate to demonstrate that the party cares about local issues. - The party foot soldiers broadcast their mobilization efforts to their superiors in the party, earning praise and encouragement from the leadership. - The networked system allows the party command to centrally share information through the chain of WhatsApp groups being operated — bypassing the editorial filter of news media. - On Twitter, an army of online warriors takes part in the narrative-setting game. Even though Twitter usage is largely restricted to the country’s elites, journalists and influencers hang out on the micro-blogging platform, meaning the sentiment smoothly seeps into the wider information ecosystem. Basically, India has coopted the Western internet and used it to their advantage, while China has taken the approach of shutting out the Western internet altogether in favor of cultivating its own walled garden. This means that China's closed off internet ecosystem is incapable of effectively competing with India's online presence. Moreover, Chinese netizens who do manage to overcome the barriers can find themselves facing state suppression and persecution. This limits Chinese disinformation methods to either state media, or state-sanctioned individuals who often must be vetted for political loyalty before they are set loose. This level of political control and loyalty that China demands has severely limited its ability to project its message outside of the Chinese internet. The ability for India's different political parties to set the narrative gives India a crucial advantage when it comes to either spreading pro-Indian messages or smearing potential adversaries. ADVANTAGE 2: MAINTAINING A SUPPORTIVE DIASPORA Indian Americans maintain a high degree of connection to their motherland (for lack of a better term), and this data is supported by India being the top remittance-receiving country in 2018. While Chinese immigrants maintain a similar level of connection to their motherland (China ranks second after India in the top remittance-receiving countries in 2018 from the same Times of India report), a prevailing attitude of Chinese diaspora has been one of pride for their homeland but suspicion for the government:
Many overseas Chinese have shown pride in the considerable economic achievements China has made over the past four decades, allowing it to become the world’s second largest economy. On the other hand, they also harbour deep-rooted suspicion and disapproval of the party’s authoritarian approach and its intolerance towards dissent or media freedom. Hence, when talking politics, those overseas Chinese like to highlight that their love of country is in no way related to a love of the Communist Party.
As the CCP increasingly demand that supporting China be intertwined with supporting the CCP—a message that the party can control and foster only within its walled garden—it is more likely to drive overseas Chinese further away from supporting the party’s policies. In 2019, the "Howdy Modi" convention in Houston, Texas drew a crowd of 50,000. It's difficult to imagine a similar number of supporters if a CCP politician were to announce a similar trip. The popularity Indian politicians like Modi can expect in the West, coupled with an effective propaganda wing from within India that has a massive presence on social media to set the narrative gives India a tremendous advantage in maintaining a high degree of loyalty in its diaspora population. This diaspora can later prove to be a useful tool in advancing Indian foreign policy by amplifying the messages from within India. Disclaimer: this by no means implies that Hindu Indian Americans are acting as a fifth column to advance India's goals, but merely suggests that Hindu Indian Americans are likely to share and disseminate Indian propaganda--with or without realizing that they are doing so.
Can China Counter this?
In the current information war, China is losing. Badly. By building a caged garden, China's information warriors are largely clueless as to how to effectively spread their propaganda. Two examples come to mind. The first example was during the recent Hong Kong protests. China's attempt at controlling the narrative fell apart almost as quickly as it began, as many of its messages included support for party control, casting the protesters as Hong Kong independence provocateurs, or suggesting CIA influence rather than focusing on specific instances of targeted violence and xenophobic attacks on Mandarin speaking individuals (including attacks on Taiwanese media). Another example is how China has been incapable of finding a way to reduce the influence of Falun Gong media such as the Epoch Times and New Tang Dynasty TV in the West. These channels can operate unimpeded from Chinese state repression on the Western internet, and when China does try and respond to them, the results often come across as clumsy and ham-fisted because attempts at control tend to follow Chinese internet control strategies. However, from experience, China can ill afford to relax its internet controls: both the 2008 Tibetan protests and the 2009 Urumqi attacks were organized through Facebook. Relaxing internet controls would also see the internet, both within and without China, be flooded with Chinese nationalists--a faction that Beijing has simultaneously encouraged and suppressed depending on the needs of the state. If China were to go on the information war offensive against India to retain its economic advantage, it must take a two-pronged approach:
On the world stage, it would highlight the unfair trade practices of India to portray India in the same light as China in terms of negative trade practices.
Within India, it would find local partners to sow the idea that India will be treated the same way as China by the West once it has developed enough.
On highlighting the unfair trade practices of India: The advantage that China holds in this regard is that the world has already formed a negative opinion on Chinese trade practices, therefore creating a situation in which China only has something to lose if other countries can offer a more attractive alternative. By depriving the world of seeing India as a viable alternative, China can join in international pressure to force the Indian economy to open up further without giving India the opportunity to develop an industrial base capable of protecting its fledgling industries. In such a scenario, China would be able to leverage its massive industrial capability into India and gobble up local Indian partners, or otherwise choose to support companies that would adopt pro-China practices. In essence, by attacking India before it can build an effective industrial base, China can enact a a softer version of the colonialist methods that the British used to subjugate India in the 19th century. This may possibly explain why the term "debt trap diplomacy" first emerged from an Indian think tank. On Using Local Indian Partners to Sow Ideas: By partnering with local voices in India and sowing the idea that once India becomes developed enough, it would also face the same trade scrutiny that China has faced, China can attempt to pivot India away from developing friendlier ties to the West and return it towards its Non-Aligned status it adopted during the Cold War. However, these efforts can largely be stymied by government policy--and in fact, the Modi government has required that Chinese investment into India be approved first. There is still a lot of room for the rivalry and/or partnership between China and India to continue developing in this coming decade. But it's clear that at the current moment, India seems to have a distinctive advantage.
A Short Story that Describes Imaginary Events and People of Worldwide Calamities and the Aftermath (the 2nd Edition)
The following story, all names, characters, and incidents portrayed in this post are fictitious. No identification with actual persons (living or deceased), places, buildings, and products is intended or should be inferred. However, the LINKS to real-life events and inspiring sources are placed here and there throughout the story. -------- Truth is the Only Light -------- INTRO ☞ [As of 2019] there are plenty of reasons to think the Chinese system will implode spectacularly without Japanese feeling the need to do a thing. — Peter Zaihan, Disunited Nations (Mar 03, 2020) It's apparent that two nations have been engaged in a high-stakes military & economy arms race. The current US admin has been hitting China with waves of tariffs, but that was merely a small part of what's actually going on.         On Oct 11, 2019, when they reached a tentative agreement for the first phase of a trade deal, the fact that China made the concession actually made my jaw drop. From where I sit, it was a worrisome scene. Aren't people saying, when challenging situations are bottled up, they will just grow and mutate into another terrible complications? Admittedly I was not certain how they are going to adhere to the agreement: It left most of the US tariffs (on China's exports) in place, and at the same time, came with an additional USD $200 Billion burden for China over the next two years. This agreement might seem a bit insignificant, but now China would need to purchase almost twice the size of the US products & services they did before the trade war began. With their current economic climate? I murmured, "No way." While watching Trump brag and boast around with said agreement, I expected China would soon come out and fling some improvised excuses in order to delay the document-signing process. It wouldn't be their first time. More importantly, even if China does so, there wouldn't be many (real) counterattack options left for the Trump admin during this year, the US presidential election year. Then, on Jan 16, 2020, the world’s two largest economies actually signed a partial trade agreement aimed at putting the brakes on an 18-month trade war. China would almost surely not sit down but come back to bite, I thought. Enter the worldwide chaos following so called the COVID-19 outbreak. -------- BACKGROUND ☞ Globalists have been heavily investing in China's economy and its components overseas. • Here are a couple of well known names: the Great Old One; George Soros; Koos Bekker; and Bill Gates. • For the sake of convenience, from here on, let's call these globalists, who are foreign investors in China's top tier state-owned/sponsored/controlled enterprises, Team-Z. • Team-Z has adopted big time lackeys like Henry Kissinger or small time ones like Larry Summers, Stephen Hadley, or Bill Browder as matchmakers to court Team-Z for China's top tier enterprises. When Israel's highest echelons chimed in, it has been through Israeli IT companies and the BRI projects. • Naturally, multinational investment banks have also been employed; such as Morgan Stanley, Goldman Sachs, Royal Bank of Scotland (RBS), UBS Group AG (formerly Union Bank of Switzerland), Blackstone Group, Canaccord Genuity, BlackRock, Hermitage, or Mirae Asset. ☞ Note: The Great Old One didn't use any matchmakers, something peasants would need. Because the Great Old One's power level is over 9000. • China's Shanghai clique used to keep the nation's state-sponsored enterprises under their firm grip: Enterprises such as Alibaba Group, Tencent, Baidu, Wanda Group, HNA Group, Anbang Group, Evergrande Group, CEFC Energy and Huawei, all of which Team-Z has massively invested in. • Here is how Shanghai clique and Team-Z, esp. Bill Gates, started to get together:[LINK] • However, in the name of anti-corruption campaign, Xi Jinping & his Princelings have been taking those businesses away from Shanghai clique's hand, and transforming those state-sponsored private enterprises into the state-owned enterprises, declaring the 國進民退 movement. • Slaying Shanghai clique's control =       • 國進民退 + Slaying Shanghai clique's control = [A] [B] [C] • Xi's reign didn't arrive today without challenges though: the BRI projects' poor outcome has frustrated Israel's great expectations. And since the US-China trade war has started, the problems of China's economic systems started to surface, not to mention China's economy has long been decaying. • Coupled with the US-China trade war, the current US admin has been trying to block Huawei from accessing the international financial systems that the US can influence, as well as the US banking systems. This is a good time to remind you again that Bill Gates has had a very close-knit relationship with Huawei. -------- TRADE WAR & INTERNET-BASED COMPANIES ☞ It's the trade war, but why were internet-based companies such as Tencent and Baidu suffering losses? Answer: The state-sponsored companies like Tencent, Baidu, or Huawei have heavily invested in international trade and commodity markets, which are easily influenced by aspects that IMF interest rates, the US sanctions, or trade war can create. Example: Let's say, Tencent invests in a Tehran-based ride-hailing company. Then, through said ride-hailing company, Tencent invests in Iran's petroleum industry. Now, China's most valuable IT company is in international petrochemical trade. The business is going to make great strides until the US imposes trade embargoes oand economic sanctions against Iran. -------- TL;DR China's economy going down = Team-Z losing an astronomical amount of money. ★ Wednesday, Sep 26, 2018 ★ "Gentlemen, you guys might want to do something before it's too bloody late, no? Hisspeechlast night was .... (sniggers) Mr. Gates, now is as good a time as any. Mr.Soros, hm, don't look at melikethat." ".... But," "Yes, Mr. Soros, yourHNAis going down, too. .... Ah,Schwarzmanxiansheng, we're very sorry to learn about Blackstone'sIran&SinopecChinasituation. So, we're guessing, you'd be happy to join Mr. Gates's operation, yes? Of course, We already contactedKissingerxiansheng. ....Okaythen,Gentlemen?" • Now you can take a guess why George Soros has recently been sending out confusing messages regarding Xi Jinping. • Wait, how about Wuhan Institute of Virology? Doesn't this story concern the COVID-19 outbreak? Is the Wuhan Institute also associated with Shanghai clique? Yes, indeed. Here's How Wuhan Institute of Virology and Shanghai Clique are related:[LINK] -------- EIGHT OBJECTIVES ☞ Calling for the tide to be turned, Team-Z and Shanghai clique started to devise the plan. The objectives are: ① By shutting down international trade, crashing world economy, and exploiting its aftermath, the plan should produce an outcome letting Team-Z earn back their loss from the trade war & the US sanctions, and collect additional profits from China's BRI projects & stock markets worldwide, including the US stock markets. • Don't forget this: This point number ① also concerns the developing nations on the BRI with the large deposits of natural resources that Team-Z has invested in through China. If everything comes together nicely, Team-Z will pick up trillions of dollars from those nations alone as if they are light as a feather. Ironically this will reinforce the BRI project governance and mitigate fraud & corruption risks inherent to the international development projects. ② By utilizing the aftermath in the US, a new US administration consisted of pro-Beijing personnels should be fostered at the 2020 election. In a worst-case scenario, the aftermath should be abused enough to make Robert Lighthizer to leave the admin. Mr. Mnuchin could stay. ③ Sometime next year, the phase one trade deal must be reassessed with the new US admin. The reassessment should help China take the upper-hand at the second phase trade talk. ④ The pandemic crisis should yield a situation which allows China to delay the payments for its state-firm offshore debts. With the point number ①, this will give China a breathing room to manage its steadily-fallen forex reserves. ⑤ Since their current turf (in China) is education industry & medical science industry, Shanghai clique will have no issue with earning hefty profits by managing China's export of medical equipments & health care products which can be supplied worldwide mainly by China. People in the west will bent the knees for the clique's support. ☞ Regarding Jiang Zemin's son and medical science industry in China [LINK] ⑥ The outcome should weaken Xi & his Princelings' political power considerably in favour of Shanghai clique & Team-Z. This will let Jiang's Shanghai clique (A) reclaim some of political status & business interest controls they have lost to Xi & his Princelings. • And once this point number ⑥, with the point number ② , is realized, it would be much easier for the clique to (B) recover their huge assets hidden overseas that the current US admin or Xi & his Princelings have frozen. ⑦ Combining good old bribery with sex, the outcome should support China to re-secure control over the US governors. Once the plan is executed successfully, those governors would desperately need solutions to local economic problems and unemployment. ⑧ Lastly, implementing an e-ID system in the US similar to Beijing's Alipay and WeChat could be the cherry on top of the operation's entire outcomes. Who's supporting such a system worldwide? None other than Microsoft and Rockefeller Foundation. ಠ_ಠ -------- OLD COMRADE BECOMES A NEW RECRUIT ☞ They were afraid more talents were needed. The main target was the world’s largest economy with the most powerful military capability, after all. They ended up asking Mr. Fridman to see Lord Putin about that. The old Vova was going through a lot nowadays, people said. It could be because his nation's energy business to Europeseems to be hitting wall after wall. He is said to have enough on his plate with no end in sight, so maybe he'll join. ★ Monday, Jan 15, 2018 ★ "(pours a drink for himself) I know, but. ... What would happen if Bashar falls? How long you think you can keep it up? .... Erdogan is many things (sniggers) but he's nevergentle. (sips his drink slowly) WhenBenji'sEastMed Pipeline starts to actively compete, then what? They got the Chinamoneynow. ....Vagitand his buddies will be very unhappy. You know that. Not great, Vova." "...." "Ah, you mean what are we going to do? Hm? Hm. I'll tell you what we're going to do. This time, we're going to bankrupt the US shale gas sector. Then, of course, we can maybe convince Benji to take their time with the pipeline. Perhaps for good. (sips his drink slowly) Don't worry, Vova, It'll work. You worry too much. We'll come out the other side stronger." "So, how long until they set it off? "Hahaa, yes. They'll soon put all things in place. While marching in place, they'll play the tune a couple of months before the next sochelnik." "Nearly 20 months to brace things here, then?" "(nod slowly in happiness) Hm. Оторви́сь там, оттопы́рься, Vova" -------- USEFUL IDIOTS ☞ When the directive came, these idiots answered claiming they would be gladly "on it." All in the name of rejuvenating China's economy without grasping the real objective prevailing throughout the entire operation. Thing is, they would never realize what they are to Team-Z & their Asian overlord until it’s too late. Who are they? It's A and B, not A or B: (A) the American corporations that are too big to fail and have suffered a considerable loss because of the US-China trade war. Among those corporations, (B) the ones that have been structured with massive interest-profit relationships in/with China. "We need China in order for the US as a nation to continue being prosper," they've been shouting. No surprise there, because they've enjoyed the strides of extraordinary profits over the years while the US middle class has continued to shrink. But, in 2019 when China's stock markets nosedived for the first time since 2015 and China's authorities in financial stability & resiliency fumbled their response; it wiped that smile off their face. Still, they'll keep behaving not to offend their Asian overlord, nonetheless. -------- PERFECT PLAN ☞ Many crucial components had to come into play all at once in order to cause World War I. If one of the components were missing or different, it is unlikely that the World War I as we know of could be produced. ① The US in 2019: Overbought bubbles + Over borrowed corporations ② The US in 2020: It's an Election Year. ③ Russia has been dumping US Treasuries for the past few years. ④ Russia has been hoarding golds as if they were recreating Inca Empire. ⑤ China in 2019: Immense & long term financial troubles has started to surface. ⑥ China in 2020: The phase-one deal has been signed; leaving most of tariffs on China intact and adding another $200 Billion burden for China. ⑦ Team-Z sets up a situation in the US where some event(s) would freeze the US supply chains & demand for the next three to ten months. • Just like the 9/11, the event will be initiated at the clique's own region. However, unlike in China, the US will report multiple epicentres simultaneously. • And the CDC and the US medical task force will carry on with a number of sabotage acts, to secure enough time for the infected yet untested in those US epicentres to spread plenty.    • Here's a feasible timeline of the operation. ⑧ Then, the BOOM: Team-Z (a) manipulates the markets to make sure MM will have liquidity concerns (b) when they need it most. The (c) bottomed out oil price will be an enforcement, which will also wreck the US energy sector as a kicker. The (d) WHO will also join as a disinformation campaign office. • Then a couple of big name investment managers will lead a movement that (will try to) bring back foreign money back to China.   • Meanwhile, in US, the disinformation campaign will continue to be pushed until the second wave of attack arrives. -------- MEASURABLE SHORT-TERM OUTCOME ☞ We're now going through World War III. The global structure laid down by World War II had been shaken by globalization and the rise of China. This pandemic event will shock the structure further. Human history will be divided into Before 2021 and After 2021. ① Outcome pt. 1: Immediate Aftermath [pt.1] [pt.2] ② Outcome pt. 2: The US economy goes deep dive along with world economy, and the only thing Team-Z has to do is to exploit the aftermath which has been thoroughly calculated and eagerly anticipated. — Favoured assessment: There won't be a V curve ever, unless drastic measures taken within the timeframe of four months. Unprecedented market crash, the rapid unemployment acceleration because of the supply-chain shut down, and the near-death security which in turn forces consumer confidence to plummet. We're looking at a super long L shape curve unless the US prepares fast for the second wave of their asymmetric warfare. ③ Outcome pt. 3: Arguably the most important outcome. — Because of the unprecedented shutdown of international trade, the nations heavily rely on exporting natural resources will face the extreme financial threats. What if some of those are emerging markets AND massively in debt to China? What do you think China would do to said nations while the aftermath is hitting the globe hard? [PDF] Something comparable to Latin American Debt Crisis will happen. ④ Outcome pt. 4: Not that significant compared to the others but still notable outcome. — The world will need Shanghai clique's help to get medical products and equipments. -------- WHAT'S NEXT? ☞ Several analysts have discussed off the record that next it'd be a proxy warfare not using armed conflicts but with spreading a galaxy of counterfeit-currency across every possible channels. Coincidently, on Dec 13, 2017, Business Insider reported in an article "A $100 counterfeit 'supernote' found in South Korea could have been made in North Korea" that:
"It was the first of a new kind of supernote ever found in the world," Lee Ho-Joong, head of KEB Hana Bank's anti-counterfeit centre told Agence France-Presse.
Reporting the same news, The Telegraph published an article on Dec 11, 2017:
"It seems that whoever printed these supernotes has the facilities and high level of technology matching that of a government", said Lee Ho-jung, a bank spokesman from KEB Hana Bank in South Korea. "They are made with special ink that changes colour depending on the angle, patterned paper and Intaglio printing that gives texture to the surface of a note".
A REVIEW ON EXERGLOBAL AND CURRENT IMPRESSIVE FEATURES
https://preview.redd.it/64wgt0e4atn41.jpg?width=728&format=pjpg&auto=webp&s=84cc964015d074caf5530802b2c6b1e4a06ed552 Blockchain technology emerged into the mainstream market because of cryptocurrency. Bitcoin was the first digital currency to adopt blockchain for it's transactions, overtime the potential of this technology was discovered to be more than a medium of transaction for cryptocurrencies. Several industries can benefit from the use of blockchain technology. Despite the finance industry being first to adopt this technology, other prestigious startups and industries have also started incorporating blockchain after noticing it's excellent features and qualities. Today, blockchain continues to transform conventional business models in different ways, thus acknowledged as the foundation for numerous development. Startups are more focused on harnessing the potential of blockchain to provide technical and innovative solutions to problems of current society. Integrating this technology into activities of modern business and startups creates pathways for gaining competitive advantage in the market. ExerGlobal is an example of such companies that have researched and adopted this technology which secures more advantage to move ahead of the competition. WHAT IS EXERGLOBAL? ExerGlobal, a worldwide affiliate and investment business venture that offers various services in Mining, Cannabis CBD products, Digital Currencies Education and Investment. The company was founded in 2017, since then, expanded it's services into cultivation and sales of cannabis in Switzerland. ExerGlobal became involved in cannabis production due to Swiss new legislation declared in 2017. This changed legislation allowed companies to manufacture and sale cannabis including associated products if only it contains less than 1% THC. Therefore, ExerGlobal aims to allow investors make huge returns from established legal cannabis farms in Switzerland via introduced secure and profitable cryptocurrency (VIRIDI coin), fully supported by viable and successful cannabis industry. MAIN FEATURES OF EXERGLOBAL- Viridi Coin A cryptocurrency created and launched by ExerGlobal in 2018. The Viridi coin is built on POW/POS, for the cannabis industry and enables users to invest as well receive good returns easily. Benefits of Viridi Coin - Viridi coin serve as Crypto to one solution which possess cryptocurrency based digital economic system.- Available cross platform wallet named Viridi wallet.- Gives investors access to various types of investments, exchanges, wallet and transactions.- Viridi coin is developed on Explorer Blockchain that permit users to evaluate wallet balances and obtain simpler access to the wallet.- Inbuilt ecosystem enables Viridi coin owners to perform online and offline transactions. https://preview.redd.it/kdkdidgpatn41.png?width=640&format=png&auto=webp&s=7bc49c8496d6f570ce703291fcb10104e6af969f - Exer School This is another interesting project from ExerGlobal. The mission of Exer School is to educate interested individuals about cryptocurrencies and their impact in modern economy. Anyone can easily join and become an expert on digital currencies by learning through Exer School and it's incredible innovation. - Exer Mining Exer Mining plays a unique role of being an excellent mining program from ExerGlobal. This allows users to mine Ethereum and Monero digital currencies and can be stored in personal online account. The mined digital currencies can be traded for Litecoin. ExerGlobal team have announced that users can mine Viridi coin from the year 2020. - XPC Coin XPC coin was designed by ExerGlobal to be a proof of stake coin, which produces returns from Trading, Exer Games and Forex Trading. XPC is made available in three forms such as Life, Premium and Invest. - Exer Games A Game development branch from ExerGlobal company. Exer Games was introduced in mid 2019 and focuses on developing proprietary Casino and Smart phone games recognized as Youniq Games. The developed games is connected to XPC coin and owners will receive micro dividends from Casino and Adventure games including Viridi Forex. CONCLUSION The ExerGlobal project have introduced a new dimension of profitable investment that is unrivaled by competitors. These innovative products and services available within the expanded network of Exer Global will help propel the project ahead of the competition in the market, hence ExerGlobal requires more attention from investors because it will definitely become successful in the future. For more details, kindly visit the official links below ;Website: https://exerglobal.com/Mining: http://exermining.com/White Paper: https://exerglobal.com/Download/pdf/sv/eXer%20Presentation%207lvl.pdfFacebook: https://www.facebook.com/youniqexerglobalgroupTwitter: https://twitter.com/YouniqGTelegram: https://t.me/youniq\_exerglobal\_groupWRITER DETAILS,Bitcointalk Username : Johnson KnightBitcointalk Profile URL : https://bitcointalk.org/index.php?action=profile;u=2326370;sa=summaryTelegram username : @crimson_osito
Gold has some critical detriments like its stockpiling issue. In the event that you put into Gold you need to store your Gold some place, where it is secured and safe. Another viewpoint is what one can not go with 100 kg of Gold in your packs. There are various potential outcomes to put resources into Gold: Gold Testaments Certain money related testaments mirror the gold cost, yet are not stored with physical gold. In the event that the backer of the speculation gets bankrupt, the financial specialist is in danger of misfortunes up to and including all out misfortune. ETCs Trade Exchanged Wares (ETCs) are bonds that securitize the estimation of a specific measure of gold and regularly incorporate a privilege to the physical conveyance of that gold. There is likewise a danger of the guarantor failing, since financial specialists may then need to uphold their cases in court. https://preview.redd.it/kzpwmua7x7j41.jpg?width=275&format=pjpg&auto=webp&s=43694a344dc66a645d5651cd306015d47e765b0e Gold offers Interests in the portions of gold mine administrators are likewise viewed as a type of interest in gold. Notwithstanding, not just the gold cost is significant at the cost improvement, yet additionally different factors, for example, the pioneering aptitudes of the particular administrator and the general advancement of the financial exchanges.
This is the motivation behind why Digital Gold (https://gold.storage/de/home) thought of its Gold-token. Every Gold token is supported up by 1 ounze of 1 Gramm Gold — 99,99% Gold. Every GOLD token is 100% secured by physical gold, which is kept in a safe vault. The Gold.storage site permits the GOLD token holders that a boundless measure of GOLD can be purchased/traded quickly and whenever on their site this implies GOLD token can be sold whenever. Focal points First you don't have to stress where to store your gold on the off chance that you have bigger measures of gold ounzes. Your capacity expenses and administration costs, contrasted with the expense of putting away gold at a bank, are essentially lower. https://preview.redd.it/ytv906eax7j41.jpg?width=299&format=pjpg&auto=webp&s=d9fecc441727ab347c8d78ca01069873613cf999 Also, it takes care of the issue of going with gold — Essentially, you simply need to have your private key with you. The GOLD-Token is an ERC20 token which menas it depends on the ethereum blockchain. Along these lines you just need the private key for your eth wallet so as to get to you gold. Finally, on the off chance that you need your Gold in physical structure you can return to the gold.storage site and exchange your tokens for physical gold at some random time. Where would you be able to get GOLD-tokens DigitalGold is currently recorded on BitForex, Livecoin, Cryptex trade. Get further details below; Official Website : https://gold.Storage/ White paper: https://gold.Storage/wp.Pdf Telegram: https://t.Me/digitalgoldcoin Twitter: https://twitter.Com/golderc20
On the off chance that one had put 300 Dollars in 2000, these 300 Dollars would be worth 1450 Dollars in 2020.
On the off chance that one would have recently held his cash in US-Dollar these 300 Dollar would have a purchasing intensity of around 200 Dollars. What's more, not normal for paper cash, gold can't be duplicated freely. This restriction and the colossal interest simultaneously guarantee that the Gold value ascends after some time.
Certain monetary authentications mirror the gold cost, however are not saved with physical gold. In the event that the backer of the speculation gets indebted, the financial specialist is in danger of misfortunes up to and including complete misfortune.
Trade Exchanged Products (ETCs) are bonds that securitize the estimation of a specific measure of gold and frequently incorporate a privilege to the physical conveyance of that gold. There is likewise a danger of the guarantor failing, since speculators may then need to authorize their cases in court.
Interests in the portions of gold mine administrators are likewise viewed as a type of interest in gold. Nonetheless, not just the gold value is significant at the cost improvement, yet in addition different factors, for example, the pioneering abilities of the individual administrator and the general advancement of the securities exchanges.
This is the motivation behind why Digital Gold (https://gold.storage/de/home) thought of its Gold-token. Every Gold token is supported up by 1 ounze of 1 Gramm Gold - 99,99% Gold.
First you don't have to stress where to store your gold on the off chance that you have bigger measures of gold ounzes. Your stockpiling expenses and administration costs, contrasted with the expense of putting away gold at a bank, are essentially lower.
Also, it takes care of the issue of going with gold - Fundamentally, you simply need to have your private key with you. The GOLD-Token is an ERC20 token which menas it depends on the ethereum blockchain. In this way you just need the private key for your eth wallet so as to get to you gold. Ultimately, on the off chance that you need your Gold in physical structure you can return to the gold.storage site and exchange your tokens for physical gold at some random time.
I want to use this thread to present the key findings of going through recent Wayland news releases. Everything shown here is public accessible. I have no intention to accuse someone of fraud or something like this, just asking questions .... Feb 20 2019: Wayland Group Provides Corporate Update I do not want to speak about the well below average generated revenues nor the revenue forecasts. Just as a side note: Ben had a forecast of ~ $15,000,000 for Q4 2018 (October – December 2018). The corporate update states $1,305,033 for Q4 2018 (< 10 percentage of the forecast). In addition, you cannot whitewash the 480% increase to the previous quarter.
“Wayland has also entered into an agreement to obtain additional funds to support the expansion of the Company’s global footprint and fund development of its flagship Langton facility. This agreement is with certain investment funds managed by Alpha Blue Ocean Inc. (“Alpha Blue”) a money manager based in London, United Kingdom with a strong track record of partnering with public companies and delivering meaningful value to their shareholders.”
QuickCool AB (Publ) ("QuickCool" or the "Company") has entered into a financing agreement with European High Growth Opportunities Securitization Fund through its financial advisor Alpha Blue Ocean Inc.
MAR 28 2018: CybAero and European High Growth Opportunities Securitization Fund (“EHGO”), advised by Alpha Blue Ocean Advisors Ltd, member of the Alpha Blue Ocean Investment Group (“ABO”), has now signed an agreement regarding a financing solution of up to SEK 52.5 million in the form of thirteen convertible loans, the first loan of SEK 4.5 million and the following twelve loans each of SEK 4 million.
“CybAero had provisionally negotiated a financing solution with the Luxembourg-based European High Growth Opportunities Securitization Fund, or EHGO, to raise $6 million in the form of 13 convertible loans. The EHGO had hired the London-based Alpha Blue Ocean Advisors to mediate a deal. The first tranche in this solution involved a bridge loan amounting to $227,000. Nasdaq First North rejected this first tranche arrangement and insisted that, in order for trading in its share to resume, CybAero needed to place a minimum of $114,000 in escrow on a authorized bank account. Moreover, Nasdaq First North launched an investigation to determine if the negotiated financing solution violated stock exchange rules.”
Liquidity crisis, request for a tranche and changes to financial calendar and date of the Annual General Meeting Despite the financing agreement in force, Alpha Blue Ocean (”ABO”) has not paid tranches envisaged by the agreement since 12 November 2018. This has resulted in a liquidity crisis in FIT Biotech Oy (”Company”). The Company has today filed a latest request for a tranche with ABO. Unless ABO pays this tranche by 22 February 2019, Company will have to file for bankruptcy.
I could go on like this, but I think you got it. So this means “strong track record and delivering meaningful value to their shareholders.” for Ben? Next news release: Feb. 07, 2019: Wayland Group Receives EU-GMP Certification for German Facility
“Wayland Group is pleased to announce that it has received both Good Manufacturing Practices and Good Distribution Practices certifications from the national authority in the State of Saxony for the Company’s Ebersbach facility in Germany.”
“These certifications provide Wayland with the foundation to start selling product into the lucrative German and other developing European markets …”
Oh really? Not in my view … Next news release: Jan. 31, 2019: Wayland Group Comments on Recent Promotional Market Activity
“Since September 1, 2017 the Company has engaged MJM Markets and Consulting (Toronto, Canada; Follow The Money Investor Group, o/a 2632436 Ontario Limited (Toronto, Canada); Harbor Access LLC (NY, USA); Investing News Network; M. Davis & Associates Capital Inc (Vancouver, Canada); ERPR AS (Oslo, Norway); BlackX GmbH (Germany); Tycona Media (Vancouver, Canada); DiePRBerator (Germany); Global Financial Network (Toronto, Canada), and Prosdocimi (London, UK) at various times to provide investor relations services, public relations services, marketing, native advertising or other related services including the promotion of the Company, its business and/or its securities.”
The Falcon Funds bust is a big thing. See also Malta Civil Court https://www.gov.mt/en/Government/DOI/Government%20Gazette/Court%20Notices/Pages/2018/09/CourtNotices2009.aspx. “By the present, the Agency, refers to your involvement inter alia as the final person in control, director and/or shareholder of Oxxy Group Polc, Rock Energy AS, Element ASA (previously known as Intex Resources AS) and White November Fund, in respect of which a number of transactions have been carried out to the detriment of the Sub-Funds and any other direct or indirect involvment in the investments made in the name of the Sub-Funds. It results that these Sub-Funds have suffered a loss, and there could be futher substantial loss, and this loss is, inter alia, the direct or indirect result of your actions and/or omissions, resulting from your negligence, and/or fraud, and/or carelessness, lack of skill and/or for your failure to observe the laws and rules applicable and also because of default in your obligations.”
I know this is much content, but if you want to make your own picture of Beitnes just dig into this whole Element ASA debacle starting last year. Two auditors (EY & PwC) and the CFO left Element … Then Beitnes left as Chairmen but now serving as external consultant for Element receiving 100.000 NOK monthly. https://www.dn.no/bors/element/lars-christian-beitnes/rikard-storvestre/avtroppende-styreleder-far-100000-kroner-i-maneden-for-radgivning/2-1-498862 would be a good start. Or dig deeper into the Swedish Pensions Authority lawsuit against Beitnes. Finally … just ask yourself why does Ben deals with such shady persons? Did Ben no DD on those guys or did he not want to … And that is just the top of the iceberg. TO BE CONTINUED
Trump Didn’t Kill the Global Trade System. He Split It in Two.
This article is taken from the Wall Street Journal written about nine months ago and sits behind a a paywall, so I decided to copy and paste it here. This article explains Trump's policies toward global trade and what has actually happened so far. I think the article does a decent job of explaining the Trade War. While alot has happenedsince the article was written, I still think its relevant. However, what is lacking in the article, like many articles on the trade war, is it doesn't really explain the history of US trade policy, the laws that the US administration is using to place tariffs on China and the official justification for the US President in enacting tariffs against China. In my analysis I will cover those points.
When Trump entered the White House people feared he would dismantle the global system the US and its allies had built over the last 75 years, but he hasn't. He has realign into two systems. One between the US and its allies which looks similar to the one built since the 1980s with a few of quota and tariffs. As the article points out
Today, Korus and Nafta have been replaced by updated agreements(one not yet ratified) that look much like the originals. South Korea accepted quotas on steel. Mexico and Canada agreed to higher wages, North American content requirements and quotas for autos. Furthermore, the article points out Douglas Irwin, an economist and trade historian at Dartmouth College, calls these results the “status quo with Trumpian tweaks: a little more managed trade sprinkled about for favored industries. It’s not good, but it’s not the destruction of the system.” Mr. Trump’s actions so far affect only 12% of U.S. imports, according to Chad Bown of the Peterson Institute for International Economics. In 1984, 21% of imports were covered by similar restraints, many imposed by Mr. Reagan, such as on cars, steel, motorcycles and clothing. Protectionist instincts go so far in the US, there are strong lobby groups for both protectionist and freetrade in the US.
The second reflects a emerging rivalry between the US and China. Undo some of the integration that followed China accession to the WTO. Two questions 1) How far is the US willing to decouple with China 2) Can it persuade allies to join.
The second is going to be difficult because China's economic ties are greater than they were between the Soviets, and China isn't waging an ideological struggle. Trump lacks Reagan commitment to alliance and free trade. The status quo with China is crumbling Dan Sullivan, a Republican senator from Alaska, personifies these broader forces reshaping the U.S. approach to the world. When Mr. Xi visited the U.S. in 2015, Mr. Sullivan urged his colleagues to pay more attention to China’s rise. On the Senate floor, he quoted the political scientist Graham Allison: “War between the U.S. and China is more likely than recognized at the moment.” Last spring, Mr. Sullivan went to China and met officials including Vice President Wang Qishan. They seemed to think tensions with the U.S. will fade after Mr. Trump leaves the scene, Mr. Sullivan recalled. “I just said, ‘You are completely misreading this.’” The mistrust, he told them, is bipartisan, and will outlast Mr. Trump. both Bush II and Obama tried to change dialogue and engagement, but by the end of his term, Obama was questioning the approach. Trump has declared engagement. “We don’t like it when our allies steal our ideas either, but it’s a much less dangerous situation,” said Derek Scissors, a China expert at the American Enterprise Institute whose views align with the administration’s more hawkish officials. “We’re not worried about the war-fighting capability of Japan and Korea because they’re our friends.”
The article also points out unlike George Kennan in 1946 who made a case for containing the Soviet Union, the US hasn't explicitly made a case for containing the Soviets, Trump's administration hasn't, because as the the article explains its divided Michael Pillsbury a Hudson Institute scholar close to the Trump team, see 3 scenarios
New Cold War with drastically reduced economic ties
China resolve their tensions, integrate and run the world together
Transactional US-China relationship of the sort during the 1980s
Pillsbury thinks the third is most likely to happen, even though the administration hasn't said that it has adopted that policy. The US is stepping efforts to draw in other trading partners. The US, EU and Japan have launched a WTO effort to crack down on domestic subsidies and technology transfers requirement. US and Domestic concerns with prompted some countries to restrict Huawei. The US is also seeking to walloff China from other trade deals. However, there are risk with this strategy
Other countries like Japan and South Korea to dependent on China. Too integrated.
Raise objections to Belt and Road. But no alternative
My main criticism of this article is it tries like the vast majority of articles to fit US trade actions in the larger context of US geopolitical strategy. Even the author isn't certain "The first goes to the heart of Mr. Trump’s goal. If his aim is to hold back China’s advance, economists predict he will fail.". If you try to treat the trade "war" and US geopolitical strategy toward China as one, you will find yourself quickly frustrated and confused. If you treat them separately with their different set of stakeholders and histories, were they intersect with regards to China, but diverge. During the Cold War, trade policy toward the Soviet Union and Eastern Bloc was subordinated to geopolitical concerns. For Trump, the trade issues are more important than geopolitical strategy. His protectionist trade rhetoric has been fairly consistent since 1980s. In his administration, the top cabinet members holding economic portfolios, those of Commerce, Treasury and US Trade Representative are the same people he picked when he first took office. The Director of the Economic Council has changed hands once, its role isn't as important as the National Security Advisor. While State, Defense, CIA, Homeland Security, UN Ambassador, National Security Advisor have changed hands at least once. Only the Director of National Intelligence hasn't changed. International Trade makes up 1/4 of the US economy, and like national security its primarily the responsibility of the Federal government. States in the US don't implement their own tariffs. If you add the impact of Treasury policy and how it relates to capital flows in and out of the US, the amounts easily exceed the size of the US economy. Furthermore, because of US Dollar role as the reserve currency and US control of over global system the impact of Treasury are global. Trade policy and investment flows runs through two federal departments Commerce and Treasury and for trade also USTR. Defense spending makes up 3.3% of GDP, and if you add in related homeland security its at most 4%. Why would anyone assume that these two realms be integrated let alone trade policy subordinate to whims of a national security bureaucracy in most instances? With North Korea or Iran, trade and investment subordinate themselves to national security, because to Treasury and Commerce bureaucrats and their affiliated interest groups, Iran and the DPRK are well, economic midgets, but China is a different matter. The analysis will be divided into four sections. The first will be to provide a brief overview of US trade policy since 1914. The second section will discuss why the US is going after China on trade issues, and why the US has resorted using a bilateral approach as opposed to going through the WTO. The third section we will talk about how relations with China is hashed out in the US. The reason why I submitted this article, because there aren't many post trying to explain US-China Trade War from a trade perspective. Here is a post titled "What is the Reasons for America's Trade War with China, and not one person mentioned Article 301 or China's WTO Commitments. You get numerous post saying that Huawei is at heart of the trade war. Its fine, but if you don't know what was inside the USTR Investigative report that lead to the tariffs. its like skipping dinner and only having dessert When the US President, Donald J Trump, says he wants to negotiate a better trade deal with other countries, and has been going on about for the last 35 years, longer than many of you have been alive, why do people think that the key issues with China aren't primarily about trade at the moment.
OVERVIEW OF THE UNITED STATES TRADE ORIENTATION
Before 1940s, the US could be categorized as a free market protectionist economy. For many this may seem like oxymoron, how can an economy be free market and protectionist? In 1913, government spending made up about 7.5% of US GDP, in the UK it was 13%, and for Germany 18% (Public Spending in the 20th Century A Global Perspective: Ludger Schuknecht and Vito Tanzi - 2000). UK had virtual zero tariffs, while for manufactured goods in France it was 20%, 13% Germany, 9% Belgium and 4% Netherlands. For raw materials and agricultural products, it was almost zero. In contrast, for the likes of United States, Russia and Japan it was 44%, 84% and 30% respectively. Even though in 1900 United States was an economic powerhouse along with Germany, manufactured exports only made up 30% of exports, and the US government saw tariffs as exclusively a domestic policy matter and didn't see tariffs as something to be negotiated with other nations. The US didn't have the large constituency to push the government for lower tariffs abroad for their exports like in Britain in the 1830-40s (Reluctant Partners: A History of Multilateral Trade Cooperation, 1850-2000). The Underwood Tariffs Act of 1913 which legislated the income tax, dropped the tariffs to 1850 levels levels.Until 16th amendment was ratified in 1913 making income tax legal, all US federal revenue came from excise and tariffs. In contrast before 1914, about 50% of UK revenue came from income taxes. The reason for US reluctance to introduced income tax was ideological and the United State's relative weak government compared to those in Europe. After the First World War, the US introduced the Emergency Tariff Act of 1921, than the Fordney–McCumber Tariff of 1922 followed by a Smoot-Hawley Act of 1930. Contrary to popular opinion, the Smoot-Hawley Act of 1930 had a small negative impact on the economy, since imports and exports played a small part of the US economy, and the tariffs were lower than the average that existed from 1850-1914. Immediately after the Second World War, when the US economy was the only industrialized economy left standing, the economic focus was on rehabilitation and monetary stability. There was no grandiose and ideological design. Bretton Woods system linked the US dollar to gold to create monetary stability, and to avoid competitive devaluation and tariffs that plagued the world economy after Britain took itself off the gold in 1931. The US$ was the natural choice, because in 1944 2/3 of the world's gold was in the US. One reason why the Marshall Plan was created was to alleviate the chronic deficits Europeans countries had with the US between 1945-50. It was to rebuild their economies so they could start exports good to the US. Even before it was full implemented in 1959, it was already facing problems, the trade surpluses that the US was running in the 1940s, turned to deficits as European and Japanese economies recovered. By 1959, Federal Reserves foreign liabilities had already exceeded its gold reserves. There were fears of a run on the US gold supply and arbitrage. A secondary policy of the Bretton woods system was curbs on capital outflows to reduce speculation on currency pegs, and this had a negative impact on foreign investment until it was abandoned in 1971. It wasn't until the 1980s, where foreign investment recovered to levels prior to 1914. Factoring out the big spike in global oil prices as a result of the OPEC cartel, it most likely wasn't until the mid-1990s that exports as a % of GDP had reached 1914 levels. Until the 1980s, the US record regarding free trade and markets was mediocre. The impetus to remove trade barriers in Europe after the Second World War was driven by the Europeans themselves. The EEC already had a custom union in 1968, Canada and the US have yet to even discuss implementing one. Even with Canada it took the US over 50 years to get a Free Trade Agreement. NAFTA was inspired by the success of the EEC. NAFTA was very much an elite driven project. If the Americans put the NAFTA to a referendum like the British did with the EEC in the seventies, it most likely wouldn't pass. People often look at segregation in the US South as a political issue, but it was economic issue as well. How could the US preach free trade, when it didn't have free trade in its own country. Segregation was a internal non-tariff barrier. In the first election after the end of the Cold War in 1992, Ross Perot' based most of independent run for the Presidency on opposition to NAFTA. He won 19% of the vote. Like Ross Perot before him, Donald Trump is not the exception in how America has handled tariffs since the founding of the Republic, but more the norm. The embrace of free trade by the business and political elite can be attributed to two events. After the end of Bretton Woods in 1971, a strong vested interest in the US in the form of multinationals and Wall Street emerged advocating for removal of tariffs and more importantly the removal of restrictions on free flow of capital, whether direct foreign investment in portfolio investment. However, the political class embrace of free trade and capital only really took off after the collapse of the Soviet Union propelled by Cold War triumphalism. As mentioned by the article, the US is reverting back to a pre-WTO relations with China. As Robert Lighthizer said in speech in 2000
I guess my prescription, really, is to move back to more of a negotiating kind of a settlement. Return to WTO and what it really was meant to be. Something where you have somebody make a decision but have it not be binding.
The US is using financial and legal instruments developed during the Cold War like its extradition treaties (with Canada and Europe), and Section 301. Here is a very good recent article about enforcement commitment that China will make.‘Painful’ enforcement ahead for China if trade war deal is reached with US insisting on unilateral terms NOTE: It is very difficult to talk about US-China trade war without a basic knowledge of global economic history since 1914. What a lot of people do is politicize or subordinate the economic history to the political. Some commentators think US power was just handed to them after the Second World War, when the US was the only industrialized economy left standing. The dominant position of the US was temporary and in reality its like having 10 tonnes of Gold sitting in your house, it doesn't automatically translate to influence. The US from 1945-1989 was slowly and gradually build her influence in the non-Communist world. For example, US influence in Canada in the 1960s wasn't as strong as it is now. Only 50% of Canadian exports went to the US in 1960s vs 80% at the present moment.
BASIS OF THE US TRADE DISCUSSION WITH CHINA
According to preliminary agreement between China and the US based on unnamed sources in the Wall Street Journal article US, China close in on Trade Deal. In this article it divides the deal in two sections. The first aspects have largely to do with deficits and is political.
As part of a deal, China is pledging to help level the playing field, including speeding up the timetable for removing foreign-ownership limitations on car ventures and reducing tariffs on imported vehicles to below the current auto tariff of 15%. Beijing would also step up purchases of U.S. goods—a tactic designed to appeal to President Trump, who campaigned on closing the bilateral trade deficit with China. One of the sweeteners would be an $18 billion natural-gas purchase from Cheniere Energy Inc., people familiar with the transaction said.
The second part will involve the following.
Commitment Regarding Industrial Policy
Provisions to protect IP
Mechanism which complaints by US companies can be addressed
Bilateral meetings adjudicate disputes. If talks don't produce agreement than US can raise tariffs unilaterally
China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from U.S. companies.
China deprives U.S. companies of the ability to set market-based terms in licensing and other technology-related negotiations.
China directs and unfairly facilitates the systematic investment in, and acquisition of, U.S. companies and assets to generate large-scale technology transfer.
China conducts and supports cyber intrusions into U.S. commercial computer networks to gain unauthorized access to commercially valuable business information.
In the bigger context of trade relations between US and China, China is not honoring its WTO commitments, and the USTR issued its yearly report to Congress in early February about the status of China compliance with its WTO commitments. The points that served as a basis for applying Section 301, also deviate from her commitments as Clinton's Trade Representative Charlene Barshefsky paving the way for a trade war. Barshefsky argues that China's back sliding was happening as early as 2006-07, and believes the trade war could have been avoided has those commitments been enforced by previous administrations. I will provide a brief overview of WTO membership and China's process of getting into the WTO. WTO members can be divided into two groups, first are countries that joined in 1995-97, and were members of GATT, than there are the second group that joined after 1997. China joined in 2001. There is an argument that when China joined in 2001, she faced more stringent conditions than other developing countries that joined before, because the vast majority of developing countries were members of GATT, and were admitted to the WTO based on that previous membership in GATT. Here is Brookings Institute article published in 2001 titled "Issues in China’s WTO Accession"
This question is all the more puzzling because the scope and depth of demands placed on entrants into the formal international trading system have increased substantially since the formal conclusion of the Uruguay Round of trade negotiations in 1994, which expanded the agenda considerably by covering many services, agriculture, intellectual property, and certain aspects of foreign direct investment. Since 1994, the international community has added agreements covering information technology, basic telecommunications services, and financial services. WTO membership now entails liberalization of a much broader range of domestic economic activity, including areas that traditionally have been regarded by most countries as among the most sensitive, than was required of countries entering the WTO’s predecessor organization the GATT. The terms of China’s protocol of accession to the World Trade Organization reflect the developments just described and more. China’s market access commitments are much more far-reaching than those that governed the accession of countries only a decade ago. And, as a condition for membership, China was required to make protocol commitments that substantially exceed those made by any other member of the World Trade Organization, including those that have joined since 1995. The broader and deeper commitments China has made inevitably will entail substantial short-term economic costs.
What are the WTO commitments Barshefsky goes on about? When countries join the WTO, particularly those countries that weren't members of GATT and joined after 1997, they have to work toward fulfilling certain commitments. There are 4 key documents when countries make an accession to WTO membership, the working party report, the accession protocol paper, the goods schedule and service schedule. In the working party report as part of the conclusion which specifies the commitment of each member country what they will do in areas that aren't compliant with WTO regulations on the date they joined. The problem there is no good enforcement mechanism for other members to force China to comply with these commitments. And WTO punishments are weak. Here is the commitment paragraph for China "The Working Party took note of the explanations and statements of China concerning its foreign trade regime, as reflected in this Report. The Working Party took note of the commitments given by China in relation to certain specific matters which are reproduced in paragraphs 18-19, 22-23, 35-36, 40, 42, 46-47, 49, 60, 62, 64, 68, 70, 73, 75, 78-79, 83-84, 86, 91-93, 96, 100-103, 107, 111, 115-117, 119-120, 122-123, 126-132, 136, 138, 140, 143, 145, 146, 148, 152, 154, 157, 162, 165, 167-168, 170-174, 177-178, 180, 182, 184-185, 187, 190-197, 199-200, 203-207, 210, 212-213, 215, 217, 222-223, 225, 227-228, 231-235, 238, 240-242, 252, 256, 259, 263, 265, 270, 275, 284, 286, 288, 291, 292, 296, 299, 302, 304-305, 307-310, 312-318, 320, 322, 331-334, 336, 339 and 341 of this Report and noted that these commitments are incorporated in paragraph 1.2 of the Draft Protocol. " This is a tool by the WTO that list all the WTO commitment of each country in the working paper. In the goods and service schedule they have commitments for particular sectors. Here is the a press release by the WTO in September 2001, after successfully concluding talks for accession, and brief summary of key areas in which China hasn't fulfilled her commitments. Most of the commitments made by China were made to address its legacy as a non-market economy and involvement of state owned enterprises. In my opinion, I think the US government and investors grew increasingly frustrated with China, after 2007 not just because of China's back sliding, but relative to other countries who joined after 1997 like Vietnam, another non-market Leninist dictatorship. When comparing China's commitments to the WTO its best to compare her progress with those that joined after 1997, which were mostly ex-Soviet Republics. NOTE: The Chinese media have for two decades compared any time the US has talked about China's currency manipulation or any other issue as a pretext for imposing tariffs on China to the Plaza Accords. I am very sure people will raise it here. My criticism of this view is fourfold. First, the US targeted not just Japan, but France, Britain and the UK as well. Secondly, the causes of the Japan lost decade were due largely to internal factors. Thirdly, Japan, UK, Britain and France in the 1980s, the Yuan isn't undervalued today. Lastly, in the USTR investigation, its China's practices that are the concern, not so much the trade deficit.
REASONS FOR TRUMPS UNILATERAL APPROACH
I feel that people shouldn't dismiss Trump's unilateral approach toward China for several reasons.
The multilateral approach won't work in many issues such as the trade deficit, commercial espionage and intellectual property, because US and her allies have different interest with regard to these issues. Germany and Japan and trade surpluses with China, while the US runs a deficit. In order to reach a consensus means the West has to compromise among themselves, and the end result if the type of toothless resolutions you commonly find in ASEAN regarding the SCS. Does America want to "compromise" its interest to appease a politician like Justin Trudeau? Not to mention opposition from domestic interest. TPP was opposed by both Clinton and Trump during the election.
You can't launch a geopolitical front against China using a newly formed trade block like the TPP. Some of the existing TPP members are in economic groups with China, like Malaysia and Australia.
China has joined a multitude of international bodies, and at least in trade, these bodies haven't changed its behavior.
Trump was elected to deal with China which he and his supporters believe was responsible for the loss of millions manufacturing jobs when China joined the WTO in 2001. It is estimate the US lost 6 Million jobs, about 1/4 of US manufacturing Jobs. This has been subsequently advanced by some economists. The ball got rolling when Bill Clinton decided to grant China Most Favored Nation status in 1999, just a decade after Tiananmen.
China hasn't dealt with issues like IP protection, market access, subsidies to state own companies and state funded industrial spying.
According to the survey, 39 percent of the country views China’s growing power as a “critical threat” to Americans. That ranked it only eighth among 12 potential threats listed and placed China well behind the perceived threats from international terrorism (66 percent), North Korea’s nuclear program (59 percent) and Iran’s nuclear program (52 percent). It’s also considerably lower than when the same question was asked during the 1990s, when more than half of those polled listed China as a critical threat. That broadly tracks with a recent poll from the Pew Research Center that found concern about U.S.-China economic issues had decreased since 2012.
In looking at how US conducts relations foreign policy with China, we should look at it from the three areas of most concern - economic, national security and ideology. Each sphere has their interest groups, and sometimes groups can occupy two spheres at once. Security experts are concerned with some aspects of China's economic actions like IP theft and industrial policy (China 2025), because they are related to security. In these sphere there are your hawks and dove. And each sphere is dominated by certain interest groups. That is why US policy toward China can often appear contradictory. You have Trump want to reduce the trade deficit, but security experts advocating for restrictions on dual use technology who are buttressed by people who want export restrictions on China, as a way of getting market access. Right now the economic concerns are most dominant, and the hawks seem to dominate. The economic hawks traditionally have been domestic manufacturing companies and economic nationalist. In reality the hawks aren't dominant, but the groups like US Companies with large investment in China and Wall Street are no longer defending China, and some have turned hawkish against China. These US companies are the main conduit in which China's lobby Congress, since China only spends 50% of what Taiwan spends lobbying Congress. THE ANGLO SAXON WORLD AND CHINA I don't think many Chinese even those that speak English, have a good understanding Anglo-Saxon society mindset. Anglo Saxons countries, whether US, UK, Canada, Australia, New Zealand and Ireland are commerce driven society governed by sanctity of contracts. The English great philosophical contributions to Western philosophy have primarily to do with economics and politics like Adam Smith, John Locke, David Hume and Thomas Hobbes. This contrast with the French and Germans. Politics in the UK and to a lesser extent the US, is centered around economics, while in Mainland Europe its religion. When the Americans revolted against the British Empire in 1776, the initial source of the grievances were taxes. Outside of East Asia, the rest of the World's relationship with China was largely commercial, and for United States, being an Anglosaxon country, even more so. In Southeast Asia, Chinese aren't known for high culture, but for trade and commerce. Outside Vietnam, most of Chinese loans words in Southeast Asian languages involve either food or money. The influence is akin to Yiddish in English. Some people point to the Mao and Nixon meeting as great strategic breakthrough and symbol of what great power politics should look like. The reality is that the Mao-Nixon meeting was an anomaly in the long history of relations with China and the West. Much of China-Western relations over the last 500 years was conducted by multitudes of nameless Chinese and Western traders. The period from 1949-1979 was the only period were strategic concerns triumphed trade, because China had little to offer except instability and revolution. Even in this period, China's attempt to spread revolution in Southeast Asia was a threat to Western investments and corporate interest in the region. During the nadir of both the Qing Dynasty and Republican period, China was still engaged in its traditional commercial role. Throughout much of history of their relations with China, the goals of Britain and the United States were primarily economic, IMAGINE JUST 10% OF CHINA BOUGHT MY PRODUCT From the beginning, the allure of China to Western businesses and traders has been its sheer size I. One of the points that the USTR mentions is lack of market access for US companies operating in China, while Chinese companies face much less restrictions operating in the US.
China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from U.S. companies.
China deprives U.S. companies of the ability to set market-based terms in licensing and other technology-related negotiations.
Trade with China has hurt some American workers. And they have expressed their grievances at the ballot box. So while many attribute this shift to the Trump Administration, I do not. What we are now seeing will likely endure for some time within the American policy establishment. China is viewed—by a growing consensus—not just as a strategic challenge to the United States but as a country whose rise has come at America’s expense. In this environment, it would be helpful if the US-China relationship had more advocates. That it does not reflects another failure: In large part because China has been slow to open its economy since it joined the WTO, the American business community has turned from advocate to skeptic and even opponent of past US policies toward China. American business doesn’t want a tariff war but it does want a more aggressive approach from our government. How can it be that those who know China best, work there, do business there, make money there, and have advocated for productive relations in the past, are among those now arguing for more confrontation? The answer lies in the story of stalled competition policy, and the slow pace of opening, over nearly two decades. This has discouraged and fragmented the American business community. And it has reinforced the negative attitudinal shift among our political and expert classes. In short, even though many American businesses continue to prosper in China, a growing number of firms have given up hope that the playing field will ever be level. Some have accepted the Faustian bargain of maximizing today’s earnings per share while operating under restrictions that jeopardize their future competitiveness. But that doesn’t mean they’re happy about it. Nor does it mean they aren’t acutely aware of the risks — or thinking harder than ever before about how to diversify their risks away from, and beyond, China.
What is interesting about Paulson's speech is he spend only one sentence about displaced US workers, and a whole paragraph about US business operating in China. While Kissinger writes books about China, how much does he contribute to both Democrats and the Republicans during the election cycle? China is increasingly makING it more difficult for US companies operating and those exporting products to China.
On Tuesday 16th July, just a few weeks ago I was invited to attend a Karatbit, Karatbars/Karatbank presentation. The presentation was touting everything including a blockchain mobile phone. Someone had approached me over the weekend to investigate an investment, they had made with Karatbit/Karatbars. I attended the presentation with some research which, to be honest, was not that favourable to the company but nevertheless still went with an open mind. KaratBank, a Singapore-based financial organization, has propelled another digital currency that it claims is bound to real physical gold. Is this a progressive thought – or a trick? KaratBank, an organization located in Singapore, has quite recently declared the dispatch of KaratBank Coins (KBC), another digital currency it said is attached to gold. Be that as it may, not just the cost of gold, as different monetary forms — to real bits of gold: they're embedded in plastic cards or banknotes. In any event, that is the way it appears upon first sight. KaratBank is a sister company of KaratBars International, located in Germany. KaratBars really sells gold in exceptionally small quantities (like 0.1g to 1g bullions), inserted into plastic cards (Karatbars) or money like notes (CashGold). The notes are famously overpriced: back when 1 gram of gold was $40, the 1g CashGold note cost $65. As per KaratBank whitepaper, 10,000 KBC can be traded for 0.1g CashGold notes. The initial coin offering kicked off earlier this year and proceeded until March 21, with the ICO starting March 22 (1 KBC = $0.05), Coin Telegraph reports. Be that as it may, KaratBars International as an organization is emphatically connected with scams. A basic search for KaratBars on Google returns three connections with the word "scam" in them on the first page. KaratBars was prohibited in Canada in 2014 over an Autorité des marchés agents (AMF) with a Scam warning. The Canadian government found that KaratBars executes some kind of multi-layered marketing (MLM), or "pyramid" scheme organisation that urged individuals to get new recruits and profit from their sales, promising a return of $15,000 to $136,000 every month. In any case, Is KaratBank is a different story? All things considered, yes and no. Upon a more intensive look at the organization's whitepaper, one finds the following: "United States of America citizens, residents (tax or otherwise) or green card holders, as well as residents of Canada, the People's Republic of China or the Republic of Singapore, are not qualified to partake in the KaratBank ICO." As indicated by the Behind MLM site, the explanation behind this may lie in the way that those nations have actualized strict regulation on ICOs, and KaratBank does not have any desire to have anything to do with them. "ICOs are not unlawful in the US or Canada. In the US, however, ICOs are ordinarily viewed as securities and require registration with the [Securities and Exchange Commission]," the site reads. "Singapore hasn't prohibited ICOs however it is one of the nations KaratBars International works in through the shell companies KaratPay and KaratBars Singapore. Singapore regulators closing those organizations down would cripple KaratBars International. The board most likely figure it's best not to take any risks." To work lawfully in any purview, KaratBars International would need to register itself with the proper securities regulator in that jurisdiction, which the organization appears to need to abstain from, raising doubts. From one's point of view what is disheartening is that blockchain is a great new technology and companies like this seem to mix their existing business with cryptocurrencies. Knowing full well that the general public does not really understand cryptocurrencies, let alone blockchain or Distributed Ledger Technology (DLT). As a blockchain consultant, one feels obligated to pose some questions anyone thinking of getting involved should be asking. At the presentation, I heard the presenters say “ Karatbars is giving its members the opportunity to buy gold in small quantities. They also encourage you to save in gold instead of paper money. This can easily be done by buying as little as 0.1 gram of gold or 1 gram - 2.5 gram or 5 grams.” They said members can keep their gold in Karatbars' vault or ask them to send it to you. Cash gold is the most popular form of buying gold as the gold is embedded in a banknote. 24kt gold 99.9% pure makes it easier for anyone to accumulate wealth. Karatbars is also involved in cryptocurrency and got their own coins, namely KBC and KCB coins. I'm going to get very deep into this, but the main thing to remember is that they say, “these coins are increasing in value and that it is backed by gold”. whereas and another Cryptocurrency is backed by nothing. As a self-proclaimed proponent of blockchain and a graduate of Digital Forensics, I feel obligated to say a few words about this presentation on Karatbit or at least as a conscious citizen of this global world of technology users. Blockchain is a magnificent emerging technology that can be harnessed to do so many things. But most importantly it is a technology that provides one single source of truth. If groups are using this single source of truth technology to spread untruths, someone concerned must come out to say something. Blockchain is a technology that can put everyone on an even playing field but it seems very few understand it. The individuals with even the fleeting basic understanding can influence the general public perception of cryptocurrencies. This leads me to ask a great quote from a book called Richest Man in Babylon …. “if you want advice on investing in expensive jewels, why would you go to a butcher?” The following is what the masses are being manipulated to attach their hopes and dreams. It is that “a further drop in the value of Bitcoin and other cryptocurrencies has recently left investors nursing heavy losses. Many proponents are holding out for a new breakout “if their digital assets can go mainstream.” The most important part of that statement is “if their digital assets can go mainstream”. This made me ask some questions about Karatbit and this is what I came up with. Something is fishy!! Can someone clarify the following? Claim 1: Gold mine worth $900 million provides security. Can’t find any official source as proof. Reference: https://www.youtube.com/watch?v=TyKQIckXyIU Claim 2: Backed by a gold mine in Africa Can’t find any official source as proof. Reference: https://www.youtube.com/watch?v=d5Q3ZvR4b04 Claim 3: Audit report by MM Revisors for a gold mine in Madagascar Can’t find proof that MM Revisors exists. Not sure if this report was published by Karatbars Int (can’t find it on their official website), but this is being circulated by some investors as if it were. Reference: https://karatbars-me.webnode.es/\_files/200000070-01d6002d18/audit.pdf Claim 4: Karatcoin Bank is a fully licensed crypto bank and is situated in Miami Can’t find proof that they are registered as a licensed financial institute in Miami, Florida. Can’t find Karatcoin Bank as a registered corporation, but found Karat Coin Corp. Reference: http://search.sunbiz.org/Inquiry/CorporationSearch/SearchResults?inquiryType=EntityName&searchNameOrder=KARATBANK&searchTerm=Karatbank Reference: https://www.youtube.com/watch?v=YXip2Fizz5U&t=152s Claim 5: Not a pyramid scheme Karatbit describes this as an affiliate program but clearly is a pyramid scheme at best, see links below; Canada: https://www.newswire.ca/news-releases/karatbars-quebec-activities-covered-by-prohibition-orders-514201571.html Namibia: https://economist.com.na/43874/extra/karatbars-international-is-a-scamsays-central-bank/ Netherlands: https://www.afm.nl/en/nieuws/2014/mei/waarschuwing-karatbars Claim 6: 100KBC = 1g of Gold at $40 per gram (1 KBC = $0.40) (guaranteed) Total supply = 12,000,000,000 KBC (can’t find figures of circulating, so using supply instead) Total gold needed to cover buy back of all coins: 12,000,000,000 / 100 = 120 000 000g = 120 tons (South Africa as a whole produced 139.9 tons of Gold in 2017). Total money needed to buy back all the coins: 120 000 000g x $40 = $4.8 Billion Can’t find proof that they have 120 tons of gold in storage (or backed up by the mines as claimed) or that they are at least worth $4.8 Billion to buy the gold? Taking a more conservative approach: According to icobench.com, they raised $100 000 000 with their ICO from 60% of the total supply. Let’s assume the 60% of 12,000,000,000 is in circulation. This equals to 7,200,000,000 KBC. Total gold needed for the buyback of 7,200,000,000 KBC: 7,200,000,000 / 100 = 72 000 000g = 72 tons Total money needed to buy back all coins: 72 000 000g x $40 = $2.88 Billion Loss for buying back the KBC that were sold during the ICO: $100,000,000 - $2,880,000,000 = - $2,780,000,000 A potential loss of $2,78 Billion!!! Or am I taking crazy pills? Reference: https://www.youtube.com/watch?v=KgeHjhlMfn0 Reference: https://icobench.com/ico/karatgold-coin Claim 7: This Forbes.com article gives credibility to the KBC coin This article was written by a Contributor. Reference: https://www.forbes.com/sites/joresablount/2019/05/31/10-blockchain-companies-to-watch-in-2019/#308b507e543f There is no traditional editing of contributors’ copy, at least not prior to publishing. If a story gets hot or makes the homepage, a producer will “check it more carefully,” DVorkin said. Reference: https://www.poynter.org/reporting-editing/2012/what-the-forbes-model-of-contributed-content-means-for-journalism/ “Blogging for Forbes requires being what is commonly referred to as a "self-starter." So far, nobody has said, "Um, you can't do that," or, "Oh, my God, no!" Reference: https://www.forbes.com/sites/susannahbreslin/2011/04/06/how-to-become-a-forbes-blogge#231bb9972862 “Warning over 'scammers paradise' as watchdog reveals victims lost £27m to bitcoin, cryptocurrency and forex frauds last year” • Some 1,850 cases were reported to Action Fraud, a 250% increase on 2017-18 • Victims lost an average of £14,600 - with fewer than 1 in 20 getting money back • Investors are often initially told they've made a profit • They are then encouraged to put in more money - at which point the fraudsters run off with their cash Potential victims have been warned over bogus online 'get rich quick' schemes as it emerged people lost more than £27million to cryptocurrency and foreign exchange scams last year. Fraudsters promise high returns to those who invest, according to Action Fraud and the Financial Conduct Authority. Victims lost an average of £14,600 in 2018-19 and stand little chance of getting their money back. Reports of cryptocurrency and forex investment scams increased by nearly 250 per cent in 2017-18, from 530 to nearly 1,850. The scams work by criminals promoting get-rich-quick online trading platforms through social media. Posts often use fake celebrity endorsements and images of luxury items like expensive watches and cars. Beat the scammers: These then link to professional-looking websites where consumers are persuaded to invest. Often investors are led to believe their first investment has successfully returned a profit, and are then enticed to invest more money or introduce friends in return for greater profits. But the returns stop, the customer account is closed, and the scammer disappears with no further contact. 'Anyone handing over their hard-earned cash should make sure they understand what they're getting into, they've checked it's a legitimate investment, and not rely on hype and excitement from friends or social media. 'Investing isn't a get-rich-quick scheme - and anything that uses fear of missing out or requires you to invest before thinking is best to be avoided.' Those considering an investment to check the following for tips on how to avoid investment fraud at www.fca.org.uk/scamsmart. Scammers can be very convincing so always do your own research into any firm you are considering investing with, to make sure that they are the real deal. 'It's vital that people carry out the necessary checks to ensure that an investment they're considering is legitimate. UK consumers are being increasingly targeted by crypto asset-related investment scams. Certain crypto assets, like Bitcoin and Ether (also known as cryptocurrencies), are not regulated in the UK. This means that buying, selling or transferring these crypto-assets falls outside FCA remit. The same is true for the operation of a cryptocurrency exchange. However, some types of crypto-asset products may be or may involve regulated investments depending on their nature and how they are structured. For example, firms that sell regulated investments with an underlying crypto asset element may need to be authorised by the FCA to do so. In recent months, the FCA claims it has received an increasing number of reports about crypto-asset investment scams. Some of them may involve regulated activities, others don’t, but all use similar tactics. How crypto-asset investment scams work Cryptoasset fraudsters tend to advertise on social media – often using the images of celebrities or well-known individuals to promote cryptocurrency investments. In this case, laughably they said KaratBit was endorsed by Barak Obama’s sister. Who is she and what does she know about cryptocurrencies and blockchain? The ads then link to professional-looking websites. Consumers are then persuaded to make investments with the firm using cryptocurrencies or traditional currencies. The firms operating the scams are usually based outside the UK but will claim to have a UK presence, often a prestigious City of London address. Scam firms can manipulate software to distort prices and investment returns. They may scam people into buying the non-existent crypto asset. They are also known to suddenly close consumers’ online accounts and refuse to transfer the funds to them or ask for more money before the funds can be transferred. Action Fraud has also issued a warning on cryptocurrency scams. How to protect yourself Be wary of adverts online and on social media promising high returns on investments in a crypto asset or crypto asset-related products. Most firms advertising and selling investments in crypto-assets are not authorised by the FCA. This means that if you invest in certain crypto assets you will not have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme if things go wrong. The FCA doesn’t regulate crypto assets like Bitcoin or Ether which are vastly the most recognized cryptocurrencies, let alone KBC, they do regulate certain crypto-asset derivatives (such as futures contracts, CFDs and options), as well as those crypto assets I would consider securities. A firm must be authorised by FCA to advertise or sell these products in the UK – check FCA Register to make sure the firm is authorised. You can also check the FCA Warning List of firms to avoid. You should do further research on the product you are considering and the firm you are considering investing with. Check with Companies House to see if the firm is registered as a UK company and for directors' names. To see if others have posted any concerns, search online for the firm's name, directors' names and the product you are considering. If you’ve already decided you want to invest in gold, this might not be a bad company to side with. But if you’re just looking for an opportunity to earn a sustainable income and become financially independent, there are better options out there.
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