Macro Links Feb 14th – “The United States is Under Attack”
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MACRO LINKS TABLE OF CONTENTS (Click or Scroll Down)
- BITCOIN, CRYPTOCURRENCY, INITIAL COIN OFFERINGS
- FOREX, CARRY TRADES, EXCHANGE RATES
- TRADE, PROTECTIONISM, REGULATION, OVERSIGHT
- HEALTHCARE, BUDGET, INFRASTRUCTURE
- RUSSIA MEDDLING, RUSSIA PROBE
- NORTH / SOUTH KOREA, IRAN, NUCLEAR WEAPONS
- INFLATION, DEBT LEVELS, CREDIT FLOWS, BALANCE SHEETS
- VOLATILITY, BLACK SWANS, LIQUIDITY, TAIL RISKS
- MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS
- CENTRAL BANKS & MONETARY POLICY
- GLOBAL ECONOMY, INTERNATIONAL
- POSITIONING, INFLECTION, MARKET CALLS
- COLOR, EARNINGS, SENTIMENT, VALUATIONS
- DEALS, MERGERS, IPOs, LBOs, RESTRUCTURINGS
- REAL ESTATE, HOUSING, REITS, COMMERCIAL
- HEDGE FUNDS, PRIVATE EQUITY, MONEY MGMT
- ENERGY COMPANIES, NOCs, INDUSTRY
- ENERGY CRUDE OIL, OIL SANDS, SHALE
- DACA, TRAVEL BAN, IMMIGRATION, WALL
- GEOPOLITICS, CRIME, TERRORISM
- TRUMP WORLD
- ELECTORAL POLITICS
- SCANDALS, LAWSUITS, FINES, REGULATORY
- SILICON VALLEY, UNICORNS, STARTUPS, VC
- CONSUMER TECH, SOCIAL MEDIA, E-COMMERCE, MOBILE
- RETAIL APPAREL, SPECIALTY, DINING, BIG BOX
- AUTOS, ELECTRIC, SELF-DRIVING
- ARTIFICIAL INTELLIGENCE, DRONES, FUTURE TECH
BITCOIN, CRYPTOCURRENCY, INITIAL COIN OFFERINGS
They’re calling themselves Crypto Watchdogs, and while they’re being secretive about their identities, they’re offering a bounty for information on anyone involved with BitConnect. Eventually, they say, payment will be made in JusticeCoins, which they will mint. “We are coming for every one of you!” Crypto Watchdogs says on its website, where it posts videos of people it believes are linked to BitConnect. “We know where you are, what you’re doing and when!”
The Federal Bureau of Investigation (FBI) has claimed that Sergey Sergeyvich Medvedev, a Russian national recently arrested in Bangkok, was the co-founder and second in command of the Infraud group – a notorious international cyber crime syndicate. It has been reported that at the time of his arrest, Mr. Medvedev was in possession of more than 100,000 bitcoins.
Salon will profit by selling “a small percentage of [users’] spare processing power to contribute to the advancement of technological discovery, evolution and innovation,” the company explained. While they don’t come out and say it directly, the site, according to The Verge, is using the open-source CoinHive software in order to mine the cryptocurrency monero.
The central bank released a circular Monday that bans banks in Thailand from investing and trading in crypto, as well as participating in and creating exchanges and platforms for crypto trading.The circular applies specifically to banks, not to exchanges or other services, which are still allowed to operate freely in the country.
While Powell said that Kraken does its best to ensure that every coin they list is legitimate, they can’t make any “promises about the future of any coin, things can change when you raise $1 billion in 10 minutes.” Kraken is currently ranked in 8th place by trading volume on CoinMarketCap, trading a total of about $300 million over a 24-hour period to press time.
Two new bills introduced by the representative include “virtual coin,” “blockchain” and “virtual coin offering” as new terms to be included in the Arizona government’s list of definitions, particularly as they relate to securities and crowdfunding. Notably, the first bill defines “virtual coin” as “a digital representation of value that can be digitally traded and that functions as a medium of exchange, unit of account and store of value.”
The relatively nascent practice of holding an ICO means legislation is yet to catch up, meaning questions around what happens to a person’s rightful tokens when they die are numerous. But following a number of lawsuits, U.S. lawmakers will soon decide whether a token acquired from an ICO will be considered no different to a share bought through an IPO.
The Canadian Securities Exchange plans to create North America’s first clearing house based on blockchain technology, allowing companies to issue digital tokens with the blessing of regulators. The small Canadian bourse will build the clearing and settlement platform for so-called security token offerings, which would be subject to full regulation by securities commissions, the Toronto-based company said Tuesday in a statement. This would differentiate the tokens from initial coin offerings, which currently fall into a regulatory grey area.
Hackers have been able to exploit a vulnerability in the Telegram messaging app’s desktop client to earn units of cryptocurrencies such as Monero and ZCash, according to Kaspersky Lab. Telegram is one of the most popular messaging hubs used by members of the cryptocurrency community.
As reported in the post, Microsoft is looking to provide new a model of digital identity that would not be controlled by any centralized institution and would guarantee fully private data storage, enabling the individual to have full control of “all elements of [their] digital identity.”
Also hitting out at cryptocurrencies’ decentralized nature, he continued: “The euro is backed by the European Central Bank. The dollar is backed by the Federal Reserve. Currencies are backed by the central banks or their governments. Nobody backs bitcoin.”
Some of the key requirements presented to digital token issuers require nominal capital of about 100 mln rubles – approximately equal to $1.7 mln – and a license for the development, production, and issuance of tokens. Additionally, token issuers are obligated to possess a specially licensed bank account.
FOREX, CARRY TRADES, EXCHANGE RATES
U.S. regulators are keeping a keen eye on liquidity in the world’s largest financial market. The ability to buy and sell currencies when needed has been a focus for participants in the $5.1 trillion-a-day market amid stricter regulation and increased electronic trading. Declining liquidity has been blamed for flash crashes in foreign-exchange markets, including the British pound’s plunge in October 2016.
TRADE, PROTECTIONISM, REGULATION, OVERSIGHT
President Trump suggested on Tuesday that the United States was likely to impose restrictions on imported metals, reviving the prospects for a continuing investigation whose future has been called into question amid months of pushback and delays. Republican and Democratic lawmakers who gathered at the White House on Tuesday are generally split along party lines on the restrictions. Most Democrats voiced support for the president’s action on metals, and Republicans, with the exception of Senator Rob Portman of Ohio, urged caution.
The Trump administration’s largest anticipated trade move against China has become bogged down in an internal debate focused in large part on legal concerns, even as Beijing is stepping up a frantic lobbying campaign to avert confrontation. The China charge in Washington is being led by Mr Trump’s trade representative, long-time China hawk Robert Lighthizer, who has said in private meetings that he wants to take action before entering into any substantive discussions, according to people who have met with him.
China is the biggest buyer of American soybeans, picking up about a third of the entire U.S. crop, which it uses largely to feed 400 million or so pigs. President Xi Jinping’s administration is studying the impact of restricting soybean imports in retaliation for U.S. tariffs on washing machines and solar panels, people familiar with the situation told Bloomberg last week.
The U.S. has exhibited little to no flexibility during talks to revise the North American Free Trade Agreement, resulting in “fairly limited progress,” Canada’s chief negotiator told a conference here Tuesday. Meanwhile, U.S. Trade Representative Robert Lighthizer said there was “real headway” being made in the Nafta talks, “particularly in regard to the Mexicans.” He did not cite Canada.
HEALTHCARE, BUDGET, INFRASTRUCTURE
“We’re going to introduce several smaller bills and see. I certainly think it could be packaged,” said Senate Majority Whip John Cornyn (R., Texas), who said he was working on three bills related to infrastructure. “The president put a proposal out there, but obviously the biggest question is: How do you pay for it? The money’s got to come from somewhere.”
Donald Trump’s infrastructure spending plan has been given a cool reception by Wall Street bankers and investors who are already looking to invest hundreds of billions of dollars in private capital to rebuild America’s crumbling roads and bridges. The plan drew some applause from bankers and asset managers who have been calling for measures to unlock spending on infrastructure in the world’s largest economy. But they noted that Washington is relying heavily on other parties to come up with funds, and that a bill could be blocked by a sceptical Congress.
President Trump’s $200 billion plan to rebuild America upends the criteria that have long been used to pick ambitious federal projects, putting little emphasis on how much an infrastructure proposal benefits the public and more on finding private investors and other outside sources of money.
RUSSIA MEDDLING, RUSSIA PROBE
Director of National Intelligence Dan Coats said that Russia “views the 2018 midterm elections as potential for Russian influence operations … Frankly, the United States is under attack,” Coats said speaking to the Senate Intelligence Committee in a hearing Tuesday with other intelligence directors.
As the midterm elections approach, Russia is likely to throw more propaganda at Americans in an effort to deepen political divisions, American intelligence chiefs said.
The nation’s top intelligence chiefs were united Tuesday in declaring that Russia is continuing efforts to disrupt the U.S. political system and is targeting the 2018 midterm elections, following its successful operation to sow discord in the most recent presidential campaign.
Even as his intelligence chiefs unanimously told a Senate panel Tuesday that Russia meddled in 2016 and is planning to do so again in 2018, three sources familiar with the President’s thinking say he remains unconvinced that Russia interfered in the presidential election.
FBI Director Christopher Wray on Tuesday said President Trump hasn’t directed him to stop Russian efforts to interfere in this year’s midterm elections. Wray — along with CIA Director Mike Pompeo, National Security Agency Director Adm. Mike Rogers and Director of National Intelligence Dan Coats — spoke at a Senate Intelligence Committee hearing about threats to U.S. national security.
A study carried out by 89up, a British communications and social media analytics firm, has concluded that there was a substantial amount of pro-Brexit Russian media interference during the UK’s 2016 EU referendum. In November last year, the British Prime Minister Theresa May had accused Russia of “weaponizing information,” although May refrained from directly accusing the Kremlin government of meddling in the referendum.
NORTH / SOUTH KOREA, IRAN, NUCLEAR WEAPONS
North Korea’s leader has called for a “further livening up” of the “warm climate of reconciliation” with the South created by the Winter Olympics. Kim Jong-un, whose nuclear bomb and missile tests have stoked international tension, praised the South for hosting his state at the games in Pyeongchang. Kim’s apparent Games charm offensive was led by his sister Kim Yo-jong.
INFLATION, DEBT LEVELS, CREDIT FLOWS, BALANCE SHEETS
Wednesday’s report on the U.S. consumer price index will be the most closely watched in recent memory, with investors seeking to understand the recent plunge in the stock and bond markets. They’ll probably need to look beyond the main numbers for the full story.
Judging by the historical record, even a brief period of 3 per cent inflation could potentially be messy for emerging market equities. “Emerging market crashes tend to have been triggered by US inflation breaching 3 per cent, as we saw in the 1994 tequila crisis, the 1997-98 Asian-Russian crisis, the 2000 tech crisis, the 2008 global financial crisis and the 2011 reversal of EM outperformance,” says Mr Salter.
The premium investors are demanding to own loans that are packaged into bonds has tumbled to the lowest since the financial crisis, in a sign that the market has not been roiled by the return of volatility in stocks. The market for collateralised debt obligations, as the securities are known, has boomed over the past two years as the juicier yields they offer draws buyers. That, in turn, has driven the issuance of collateralised loan obligations that this year has already eclipsed the record pace of 2017.
American households’ outstanding debt climbed to an all-time high of $13.1 trillion in the October-December period, according to data released Tuesday by the Federal Reserve Bank of New York. It marked the fourth straight quarter in which borrowing reached a record.
Total debt was the most on record, though the figure wasn’t adjusted for inflation or population growth. As a share of U.S. economic output, household debt was about 67% last quarter, barely edging up from the third quarter and well below a high of about 87% in early 2009.
Chinese banks logged a record amount of new loans in January, as the government’s effort to contain financial risks caused a shift toward traditional lending from murkier forms of financing. Rather than reflecting a new round of government stimulus, the unexpected increase in bank credit was primarily driven by banks bringing loans back onto their books to heed regulators’ demands, economists and analysts say. “This is an absolute monstrous number no matter how you look at it,” said Christopher Balding, an economics professor at Peking University.
The January credit data are a signal that the deleveraging push is taking its toll on shadow finance. A jump in bank lending and fall in shadow finance activity means banks are bringing shadow finance activities on to their balance sheets in the face of mounting regulatory pressure. The threat of tougher regulations and rising interest rates may even have spurred increased borrowing by businesses in January, helping to inflate lending.
As President Xi Jinping steps up leverage curbs, borrowing costs in China have jumped. The nation’s most high-profile deal makers including HNA Group Co. have come under mounting regulatory scrutiny, and have been selling assets as they try to rein in borrowings. HNA missed payments to several Chinese banks and its bond yields have in recent months traded at times at levels that are often considered distressed.
VOLATILITY, BLACK SWANS, LIQUIDITY, TAIL RISKS
A U.S. regulator is looking into whether prices linked to the stock market’s widely watched “fear index” have been manipulated, according to people with knowledge of the matter. Separately, a letter from a law firm Monday representing an unidentified client urged U.S. regulators to investigate VIX manipulation, claiming it has cost investors hundreds of millions of dollars in losses each month. If evidence of manipulation is found, it would be a black mark for the VIX, which has soared in popularity over the last decade as a hedging tool for investors.
Commodity trading advisers, which bet on market trends and across asset classes, did sell positions but not indiscriminately, the chief executive officer of the world’s largest publicly-traded hedge fund said in an interview with Bloomberg Television. Instead, the market fall was triggered by worries about inflation that would usually tend to hurt bonds.
MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS
“Three hours for five dollars’ worth of coffee is not a model that works,” said David Wynn, co-owner of Triniti. Owners face a choice: Get tough and encourage workers to relocate, or embrace them and hope that a combination of guilt and loyalty will inspire them to spend more or leave sooner.
Over-optimism is the natural precursor of excessive risk-taking, asset price bubbles and then financial and economic crises. The turbulence seen last week was exactly what was needed. It is a pity it did not happen far earlier. But fear has returned. Hurrah. If a policy designed to stabilise our economies destabilises finance, the answer has to be even more radical reform of the latter. The role of Mr Market is to support the economy, not endanger it. We must never forget this.
Rents interfere with incentives in a big way. Companies will spend more time and effort trying to preserve those rents — often by working to block rivals from their markets. Rivals will fight to grab a share of those rents for themselves, perhaps through lobbying. Amid all this jockeying, investment in productive capabilities will most likely be neglected as a secondary consideration. And inevitably, inequality will rise: The owners of the shares in the powerful corporations capturing the economy’s growing monopoly rents will peel further and further away from the average Jane and Joe, who own little but their labor.
That the US equity market is obscenely overvalued can hardly be news to anyone. Even a cursory glance at Exhibit 1 reveals that we are now at the second most expensive level of the Shiller P/E ever seen – surpassed only by the TMT bubble of the late 1990s! Only a handful of what we might call valuation deniers remain. They are dedicated to finding new and inventive ways to make equities look reasonable, and they have never yet met a bull market that they didn’t love.
The scourge of crystal meth, with its exploding labs and ruinous effect on teeth and skin, has been all but forgotten amid national concern over the opioid crisis. But 12 years after Congress took aggressive action to curtail it, meth has returned with a vengeance. In Oregon, meth-related deaths vastly outnumber those from heroin. At the United States border, agents are seizing 10 to 20 times the amounts they did a decade ago. Methamphetamine, experts say, has never been purer, cheaper or more lethal.
Google, Facebook, Apple, Amazon.com, Uber Technologies, and others dangle dazzling pay packages to lure top academics to work on teams developing facial recognition, digital assistants, and self-driving cars. Even newly minted Ph.D.s in machine learning and data science can make more than $300,000. Beyond the tech industry, among those betting on similar expertise tailored to their interests are banks, hedge funds, carmakers, and drug companies.
A top oil executive walked into the marble lobby of an exclusive Milan hotel on a chilly winter night. His dinner date was a former Nigerian oil minister offering to sell one of Africa’s biggest untapped oil discoveries. Eight years later, the question of whether the $1.3 billion paid for the license to that prized oil field was mostly a bribe is at the heart of one of the biggest bribery scandals the oil industry has ever seen.
Durs Grünbein was conceived two months after the Berlin Wall was built, in the cold winter of 1961. He spent half his life behind the wall, or, as he prefers to put it: “I spent one life as a hostage and another life free.” Last week, the barrier that once divided Berlin, Germany and the world quietly passed an equinox of German unity. The wall was gone for as long as it stood: 28 years, 2 months and 26 days. Roughly one generation lived with the wall. Roughly one generation has now lived without it.
California has accounted for about 20 percent of the nation’s economic growth since 2010, significantly more than its share of the population or overall output. But Mr. Brown, in his final year in office, has raised the question on the minds of those paid to think about the economy: How long can this last?
California is the world’s sixth-largest economy, with a gross domestic product of $2.6tn, placing it above France and India. Its population of about 39m, on a par with that of Poland, makes it by far the biggest US state. Its energy use is similarly massive. According to the California Energy Commission, the state consumed 290,567 gigawatt-hours of electricity in 2016 — more than one-third from natural gas and roughly one-quarter from renewable sources. After years of hype and false starts, the shift to clean power has begun to accelerate at a pace that has taken the most experienced experts by surprise.
U.S. shale companies are churning out crude oil at a record pace that could overwhelm global demand and reverse the oil market’s fragile recovery, a top energy-market observer said Tuesday. U.S. shale production is growing faster in 2018 than it did even during the boom years of $100 a barrel oil prices from 2011 to 2014, said the International Energy Agency in its closely watched monthly report. The difference this time: Oil prices are about 40% lower.
As oil rebounded last year, it seemed that the U.S. shale patch had found religion—the worship of cash flow. That would have been both bullish for oil prices and, in the long run, good for investors in those companies. The brief era of discipline by drillers is over. Analysts at Raymond James surveyed about 150 industry representatives last week at the North American Prospects Expo, a large industry gathering. Only 9% predicted that U.S. exploration and production companies would “live within cash flows” with crude at $60 a barrel.
CENTRAL BANKS & MONETARY POLICY
Federal Reserve Chairman Jerome Powell suggested that the U.S. central bank would push ahead with gradual interest-rate increases even as it remains on the lookout for threats to the financial system in the wake of the recent stock market rout.
The jump up in bond yields that tripped up stocks this month ultimately came from concerns over the U.S. fiscal outlook, rather than a realization that the Federal Reserve’s monetary tightening would restrict liquidity, according to Evercore ISI analysis.
Federal Reserve Bank of Cleveland President Loretta Mester said the U.S. central bank should press forward with interest-rate increases this year, while adding the recent wave of volatility in financial markets hasn’t derailed a solid economic outlook
History suggests it’s hardly a coincidence to have stocks take a spill not long after a new Federal Reserve chair is installed – Jerome Powell just received the drubbing a little sooner than most, on his very first day on the job. “As Janet Yellen hands over the reins to Jerome Powell at the Federal Reserve (Fed), a look back at history shows that markets have a funny way of testing new Fed chairs,” LPL analysts wrote in a blogpost.
GLOBAL ECONOMY, INTERNATIONAL
While manufacturing in the trade-reliant economy was boosted last year by a surge in electronics exports, output has weakened recently as demand moderated. Even with that easing, the economy posted full-year growth of 3.6 percent in 2017, and is set to expand slightly above the middle of the 1.5-3.5 percent forecast range this year, the trade ministry said.
Japan recorded its eighth straight quarter of growth, the longest streak since its heyday in the late 1980s, and economists generally expect modest expansion to continue this year. Policy makers say Japan’s economy is on a more solid footing than in the late-1980s bubble years, which turned at the beginning of the 1990s into decades of stagnation and deflation.
POSITIONING, INFLECTION, MARKET CALLS
Short sellers just got burned, badly. Under Armour Inc., the second-most targeted by short sellers among S&P 500 stocks, surged 17 percent Tuesday for the best performance in the benchmark index. Chegg Inc. and GNC Holdings Inc., whose bearish wagers each amounted to at least one-tenth of their total shares available for trading according to IHS Markit, advanced 17 percent and 18 percent, respectively. The pain continued in post-market trading as Fossil Group Inc., a producer of fashion accessories whose short interest just spiked to a record 38 percent, surged as much as 60 percent after reporting an increase in fourth-quarter sales.
One of Canada’s best-performing hedge funds says stocks are still expensive after last week’s correction and he sees little to get excited about. “Right now we’re still nowhere close to an equalization in interest rates with equity markets,” said David McLean, managing director at Toronto-based McLean Asset Management Ltd.
If the semblance of calm that’s returned to markets sticks, then this will have been a remarkably small correction in U.S. stocks — despite it having erased $2 trillion at one point. The sell-off on the S&P 500 Index from the late January peak to last Thursday’s nadir counts as the shortest on record since 1945, and is joint second in terms of the magnitude, according to an analysis from Bespoke Investment Group. The median postwar decline for corrections — drops of more than 10 percent — is 14.8 percent, the research shows.
COLOR, EARNINGS, SENTIMENT, VALUATIONS
SQM shares more than doubled last year amid rising demand for lithium, a key component in rechargeable batteries. Investors have been piling in as electric-car makers including Tesla Inc. race to secure supply. A gauge that tracks prices of lithium around the world climbed to a record for a 12th straight month in January, according to Benchmark Mineral Intelligence data compiled by Bloomberg.
Days after canceling an outside law firm’s investigation into alleged sexual misconduct involving former Chairman and Chief Executive Steve Wynn, a special committee of the Wynn Resorts Ltd. board has hired a new law firm with longstanding connections to the casino company.
Brian Niccol, the chief executive of Taco Bell, will replace Chipotle’s founder, Steve Ells, as chief executive on March 5, Chipotle said on Tuesday. Mr. Niccol is tasked with replicating his success transforming Taco Bell from a fast food afterthought to a social media-savvy company with sleek new stores and the hugely popular Doritos Locos Tacos.
Apple Inc. Chief Executive Officer Tim Cook told shareholders at the company’s annual meeting to expect higher dividends and stressed that succession planning is a priority. Cook also made some of his most explicit comments on succession planning, saying that one of his most important roles as CEO is properly “passing the baton” to a new leader. Every Apple board meeting in recent years has had succession planning on the agenda for all key executive roles, he said.
Shares in Blue Apron opened almost 10 per cent higher in New York on Tuesday after the US group said quarter-on-quarter losses shrank 55 per cent, although compared with the same period the previous year they expanded to $39m from $26m. Blue Apron’s cost of acquiring new customers — and even maintaining existing ones — has been a cause of concern for investors, particularly since its debut on the stock market in June.
DEALS, MERGERS, IPOs, LBOs, RESTRUCTURINGS
Twitter Inc Chief Executive Jack Dorsey said on Tuesday that he saw value in the social media network remaining an independent company, downplaying recent speculation by analysts that it could be an acquisition target.
Rising U.S. government spending on the Pentagon is fueling a spree of deal making among defense companies. The U.S. Republican party’s willingness to boost the Pentagon’s budget to nearly $700 billion last year, helped by December’s corporate tax cuts, is also pushing up valuations for even lesser known companies in the sector and making sellers more willing to entertain overtures.
A listing will give iQiyi much-needed financial power as Baidu faces off against Tencent Holdings Ltd. and Alibaba Group Holding Ltd. in a hugely expensive streaming video market. Content costs soared 82 percent to $2.06 billion in 2017 and Chief Financial Officer Herman Yu warned it would likely climb at the same pace in 2018, suggesting a rise to almost $4 billion. While costly, video is vital to keeping users hooked and generating ad sales.
REAL ESTATE, HOUSING, REITS, COMMERCIAL
Singapore looks set for another year of record-breaking property deals as developers flush with cash replenish their land banks. Developers’ land purchases may reach S$16 billion ($12 billion) this year, squeaking past last year’s tally, according to Christine Li, a director of research at Cushman & Wakefield Inc.
HEDGE FUNDS, PRIVATE EQUITY, MONEY MGMT
Lauren Bonner, the claimant in the lawsuit and an associate director at the fund since August 2016, filed the case on Monday in Manhattan federal court. She alleges that female employees at the company are “forced to endure . . . sexist and misogynist treatment” and that male executives “flout gender discrimination laws and openly subject their female subordinates to abhorrent bias”.
A decision on the sale of SkyBridge Capital LLC, owned by former White House communications director Anthony Scaramucci, to a consortium that includes Chinese conglomerate HNA Group should be made by the end of February, the firm’s chief investment officer said on Tuesday.
ENERGY COMPANIES, NOCs, INDUSTRY
A giant U.S. crude import terminal is moving closer toward loading large vessels that could carry oil abroad, a move that would allow bigger shipments to Asia and other lucrative overseas markets. A successful test run is likely to be followed by carriers shipping crude abroad from the port, providing U.S. producers with better access to fast-growing foreign markets.
Just as TransCanada Corp.’s Keystone XL pipeline finally seemed ready to roll, activists are taking one more shot at stopping it. A year after President Donald Trump gave the O.K. for the line to be built, groups including Bold Alliance and Sierra Club argue in a motion that the federal decision short-circuited the review process, relying on an outdated environmental assessment.
ENERGY CRUDE OIL, OIL SANDS, SHALE
OPEC and its allies have almost achieved their goal of clearing an oil glut, but their efforts could be derailed by rising supplies from the U.S. and other rivals, the International Energy Agency said. Oil stockpiles in developed nations fell the most in more than six years in December as supply cuts by the Organization of Petroleum Exporting Countries and Russia took effect. The surplus is also being cleared by higher consumption, with the agency boosting its forecast for global demand growth in 2018 by about 100,000 barrels a day to 1.4 million a day.
French President Emmanuel Macron is re-introducing compulsory national military service for young people in France, the government said today. By bringing back national service two decades after it was scrapped, Macron is fulfilling one of his campaign pledges. During his presidential campaign, Macron promised to make all young people spend a month getting ‘a direct experience of military life with its know-how and demands’.
DACA, TRAVEL BAN, IMMIGRATION, WALL
Senate Democrats are starting to get behind a bipartisan immigration plan that could win over reluctant activists on the left — offering a chance for the party to coalesce after struggling for months to craft a workable strategy. But the proposal has little chance of being passed by the Senate.
No Republican has been more deeply involved in negotiating immigration legislation than Senate Majority Whip John Cornyn of Texas, who says he wants a bipartisan deal. Just what sort of deal he is willing to cut will become clearer this week as the Senate begins voting on immigration.
GEOPOLITICS, CRIME, TERRORISM
The party said Mr Zuma, who has resisted days of pressure to step aside, asked to remain in office for between three and six months, but ANC leaders rebuffed him due to the urgency of the need to restore the integrity of public institutions.
An escalating standoff between South Africa’s two most powerful politicians plunged the presidential-succession saga into disarray and threatened to fracture the continent’s most famous liberation movement.
Hundreds of thousands of Venezuelans are fleeing their country’s misery and pouring across borders into nearby countries, particularly Colombia, creating a sharpening challenge for the region.
Driven from home by a crumbling economy, thousands of Venezuelans, including large numbers of indigenous Warao people, have ventured south to start over in northern Brazilian cities like Boa Vista.
Russian military contractors were among those killed in a rare U.S. airstrike in Syria last week, U.S. and Russian officials said, highlighting the continued risks as Moscow and Washington vie for influence in the region after the defeat of Islamic State.
Devastated by a war with Islamic State extremists that razed its cities and left millions homeless, Iraq has asked affluent allies led by the United States for $88 billion to rebuild. They are basically saying no.
Dutch Foreign Minister Halbe Zijlstra resigned on Tuesday after admitting that he had lied about attending a meeting in 2006 at which he said Russian President Vladimir Putin had outlined a strategy for building a greater Russia.
Rohingya refugees who have fled ethnic violence in Myanmar are at risk of “a humanitarian crisis within the crisis” as the impending monsoon season threatens to flood camps and fuel the spread of disease, diplomats at the United Nations Security Council warned on Tuesday.
Ahmad Khan Rahimi, the New Jersey man convicted of detonating a bomb in Manhattan in 2016 that injured 31 people and caused millions of dollars in damage, was sentenced to spend life in prison.
Like many such games, this one appears to be another wrinkle that has returned from the grave of the Cold War as diplomatic relations have suffered. In the 1980s, United States congressional leaders renamed the area in front of the Russian Embassy in Washington “Sakharov Plaza,” to protest the detention of Andrei D. Sakharov, the famed Russian dissident, Nobel Peace Prize recipient and nuclear physicist.
When Mr. Tillerson finally made it to Cairo on Monday, at the start of a five-country tour of the Middle East, he appeared keen to make amends. He expressed staunch support for Mr. Sisi’s latest counterterrorism drive in Sinai, and avoided even mild criticism of next month’s presidential election — widely seen as charade to reinstall Mr. Sisi for another four years in power.
The chair of the Republican party in Michigan has resigned, saying he could “no longer remain silent” on US President Donald Trump. “I have not seen a leader, I’ve only seen more of the same,” said Brandon DeFrain in a Facebook post.
More than a year into his administration, President Trump is presiding over a staff in turmoil, one with a 34 percent turnover rate, higher than any White House in decades. He has struggled to fill openings, unwilling to hire Republicans he considers disloyal and unable to entice Republicans who consider him unstable. Those who do come to work for him often do not last long, burning out from a volatile, sometimes cutthroat environment exacerbated by tweets and subpoenas.
An email circulated to the Office of Management and Budget in November said existing employees could keep working on interim clearances, but new hires would have to get full clearances.
Mr. Wray’s words strongly suggested that Mr. Porter, who had been given an interim security clearance, was allowed to continue serving in his influential post in the West Wing long after officials had received word of the troublesome accusations. Mr. Wray’s testimony also raised questions about the credibility of Mr. Trump’s most senior advisers and the degree of tolerance they may have shown to a colleague apparently eager to cover up a past.
Chief of Staff John Kelly’s White House enemies are ready to use FBI Director Chris Wray’s testimony as a weapon: “Wray’s FBI timeline makes one thing clear: the Kelly coverup is unraveling right before our eyes,” a White House official says.
The latest bout of turbulence is exacerbated by the administration’s reputation, earned over 13 chaotic months, for flouting institutional norms and misrepresenting facts to the public — a culture set by the president himself. The public relations fallout is further compounded by Trump’s own history of alleged sexual assault and his seeming reluctance to publicly condemn violence against women and give voice to the national #MeToo reckoning.
We’ve reached the stage in the Rob Porter saga where the White House’s previous statements now appear so blatantly false that all press secretary Sarah Huckabee Sanders can do is suggest she didn’t know they were false.
More than a year after joining the White House as a senior adviser, the president’s son-in-law, Jared Kushner, is among those without a permanent security clearance. Questions about the security clearance process at the White House have become more urgent after the scandal surrounding Mr. Porter and the still-unanswered questions about when the president’s aides knew about the abuse allegations against him. On Monday, Sarah Huckabee Sanders, the White House press secretary, again refused to provide a detailed explanation.
For the third Florida bellwether election in a row, the Republican candidate lost to the Democrat, giving activists and elites in both parties a sense that the GOP’s political grip is slipping in the nation’s largest swing state heading into President Donald Trump’s first midterm election.
SCANDALS, LAWSUITS, FINES, REGULATORY
The Israeli police recommended on Tuesday that Prime Minister Benjamin Netanyahu be charged with bribery, fraud and breach of trust, casting a pall over the future of a tenacious leader who has become almost synonymous with his country. The announcement instantly raised doubts about his ability to stay in office.
The police said prosecutors should charge the Israeli leader for receiving gifts from businessmen, including billionaire Hollywood producer Arnon Milchan and Australian billionaire James Packer, according to a statement. They also said Mr. Netanyahu tried to negotiate favorable coverage in a newspaper in return for limiting the influence of another daily.
SILICON VALLEY, UNICORNS, STARTUPS, VC
Despite a turbulent year for the ride-hailing company, sales were $7.5 billion. But the company also posted a substantial loss of $4.5 billion. There are few historical precedents for the scale of its loss. Uber isn’t publicly traded but has chosen to release select financial information to investors and the public in recent quarters.
The privately held company isn’t obligated to disclose financial results publicly, and didn’t provide year-ago comparisons. Uber did provide results for all four quarters of the year, showing sales rising at least 10% between each three-month period.
CONSUMER TECH, SOCIAL MEDIA, E-COMMERCE, MOBILE
Google is ramping up its efforts to make the web work more like a smartphone app, launching its own version of the “stories” format popular on Snapchat and Instagram that promises publishers a wider audience for visual narratives and additional income from advertising.
RETAIL APPAREL, SPECIALTY, DINING, BIG BOX
Amazon has been well known for most of its 24-year history, but recently the company has reached a new level of renown. Now, anything Amazon does draws outsize attention, which the company has smartly parlayed into a grab for even more attention that has burnished business.
Amazon is pushing to turn its nascent medical-supplies business into a major supplier to U.S. hospitals and outpatient clinics that could compete with incumbent distributors of items from gauze to hip implants. The market for medical supplies is one of a growing number of businesses the online retail giant has set in its sights, from groceries to clothing, often with market-moving results. Health-care distributor shares dropped Tuesday, in part from The Wall Street Journal’s report of Amazon’s intensified push into the industry, analysts said.
AUTOS, ELECTRIC, SELF-DRIVING
With a charging network five times more dense than that in America, Germany is poised to become the world’s No.3 electric-car market. The number of outlets soared by a third last year to 8,515, according to Statista. While that may not sound like many, on average that’s one every for every 16 square miles, in a nation that’s larger than New Mexico but not quite the size of Montana.
With the Fed hiking rates three times last year and forecasting three more in 2018, carmakers are coming under pressure. So far, they’ve been wary of backing away from cheap financing offers, which could cost them market share as U.S. auto sales stop growing. At some point, the cost of dangling those deals to consumers will sacrifice too much profit, according to Doll.
ARTIFICIAL INTELLIGENCE, DRONES, FUTURE TECH
Autonomous drones have long been hyped, but until recently they’ve been little more than that. The technology in Skydio’s machine suggests a new turn. Drones that fly themselves — whether following people for outdoor self-photography, which is Skydio’s intended use, or for longer-range applications like delivery, monitoring and surveillance — are coming faster than you think.
White soared high above the pipe, ran off a run of staggeringly difficult tricks and landed them all. The result, a 97.75, won him his third gold medal. After learning that he had won, White howled in victory, hurled his board, then dropped to his knees in tears. When he embraced his mother, Cathy, the tears flowed even more heavily.
Iran’s Western enemies used lizards that “attract atomic waves” to spy on the country’s nuclear program, the former chief-of-staff of Iran’s military announced Tuesday. “In their possessions were a variety of reptile desert species like lizards, chameleons…. We found out that their skin attracts atomic waves and that they were nuclear spies who wanted to find out where inside the Islamic Republic of Iran we have uranium mines and where we are engaged in atomic activities,” Firuzabadi said.
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