Implode-Explode Heavy Industries news feed Tracking the many faces of the global credit implosion. en-us iehi-feed-63546 Sun, 21 Jan 2018 19:20:35 GMT Shutdown Day 2: Congress Seems Far Apart on a Resolution Congress appeared to make little headway early Sunday toward ending a two-day-old government shutdown, trading blame as lawmakers reconvened for another rare weekend session to try to find a resolution before the workweek began.

With the Senate meeting at 1 p.m. and the House to follow at 2, lawmakers remained mired in partisan disputes. Senator Mitch McConnell of Kentucky, the majority leader, said he would move ahead with a vote on a temporary spending bill, which would occur by 1 a.m. Monday, unless Democrats allowed it to proceed sooner.

The best hope for a breakthrough appeared to reside with a group of about 20 moderate senators from both parties who met for much of Saturday to try to hammer out a compromise to present to Mr. McConnell and the Democratic leader, Senator Chuck Schumer of New York.

The group was considering various proposals, including one that would keep the government open through early February, provide disaster funding for states ravaged by last year's hurricanes and ensure long-term funding for the Children's Health Insurance Program. It would also include a promise of some sort to hold votes on an immigration deal in the coming weeks.

iehi-feed-63540 Fri, 19 Jan 2018 23:05:56 GMT Trump and Senators Scramble to Avoid Midnight Government Shutdown By Friday afternoon, it appeared that only a last-minute congressional deal could stop what would be a rare shutdown of a federal government under one-party control. The House cleared stopgap spending legislation on Thursday night that would keep the government funded through Feb. 16, but Senate Democrats were intent on withholding their votes until they secured concessions that would protect from deportation young immigrants brought to the country illegally as children, increase domestic spending, aid Puerto Rico and bolster the government's response to the opioid epidemic.

Mr. Trump did not appear able or willing to suggest his own solution. Senator John Cornyn of Texas, the No. 2 Senate Republican, said the White House chief of staff, John F. Kelly, had told him "there were no agreements with Senator Schumer."

"The president told him to go back and talk to Paul Ryan and Mitch McConnell and work it out," Mr. Cornyn said, referring to the House speaker and Senate majority leader.''


with the clock ticking, no votes were even scheduled before federal funds are to run out, and White House officials were not optimistic. Perhaps the best chance to avert a crisis lay in a proposal simply to keep the government open for another four or five days.

Are we a banana republic yet?

iehi-feed-63537 Fri, 19 Jan 2018 15:01:32 GMT Jeddah Tower, the world's next tallest skyscraper, set to open in Saudi Arabia When the 3,280-feet-tall (1,000-meter-tall) Jeddah Tower, in Saudi Arabia, opens in 2020, it will knock Dubai's iconic Burj Khalifa off its throne as the tallest skyscraper in the world by 236 feet (72 meters). Construction of the landmark is estimated to cost $1.4 billion... While today the site is surrounded by desert, upon completion the tower will be the center of the Jeddah Economic City development... Jeddah Tower's construction fits into Saudi Vision 2030, a government plan that aims to diversify the economy in the kingdom and reduce its dependence on oil...

But the project hasn't been smooth sailing. There have been various delays since construction began in 2013. Since November 2017, two of the project's most prominent backers -- Saudi Arabia's Prince Al-Waleed bin Talal, a prolific investor and businessman, and Bakr Bin Laden, chairman of Jeddah Tower's construction company Bin Laden Group -- have been caught up in the kingdom's anti-corruption purge, which saw hundreds questioned on accusations of corruption.

iehi-feed-63536 Fri, 19 Jan 2018 14:51:05 GMT Apple HQ2: Where Will the iPhone Maker's Second Campus Go? iehi-feed-63535 Thu, 18 Jan 2018 18:54:40 GMT Weirdly-Evasive Hedge Fund Expat Browder is All Over Simpson Russia Testimony... And No One Notices iehi-feed-63530 Tue, 16 Jan 2018 16:16:17 GMT Citigroup Plays Up Investor Payouts Once Tax Cuts Trigger Profits As big U.S. banks weigh how to divvy up their windfall from a massive U.S. tax cut, Citigroup Inc.'s approach appears to be set: Shower profits on investors. Lower tax rates mean the bank can stick to its multiyear plan to pay out at least $60 billion in capital to shareholders even after booking a larger-than-forecast charge of $22 billion to adjust to the new tax regime, the bank said Tuesday. Executives had braced investors last month for a $20 billion hit.

Banks face competing demands for a slice of the gains -- potentially raising pay for staff, cutting prices for clients or plowing more into charity. Wells Fargo & Co. executives said last week they'll boost donations to a philanthropic foundation, while JPMorgan Chase & Co. leaders said they're working on a plan to share the tax savings. Citigroup's statement announcing quarterly results only called out the cash coming investors' way.


The bank took a bigger up-front hit from the changes because it had been sitting on a massive pile of deferred-tax assets -- a form of IOU that cuts tax bills. The company had accrued them by suffering losses during the financial crisis, then long touted them as a way to burnish future payouts to investors. But the tax overhaul wiped out almost half of their value.

iehi-feed-63527 Tue, 16 Jan 2018 16:10:08 GMT Bitcoin, rival cryptocurrencies plunge on crackdown fears Bitcoin slid as much as 18 percent on Tuesday to a four-week low, as fears of a regulatory crackdown on the market spread after reports suggested it was still possible that South Korea could ban trading in cryptocurrencies.


That came amid news that a senior Chinese central banker had said authorities should ban centralised trading of virtual currencies and prohibit individuals and businesses from providing related services.

China shut down exchanges operating on the mainland last year - a move that also sparked a selloff, though the market later recovered.

"It's mainly been regulatory issues which are haunting (bitcoin), with news around South Korea's further crackdown on trading the driver today," said Think Markets chief strategist Naeem Aslam, who holds what he described as "substantial" amounts of bitcoin, Ethereum and Ripple.

"But we maintain our stance. We do not think that the complete banning of cryptocurrencies is possible," he said.

iehi-feed-63524 Mon, 15 Jan 2018 19:56:39 GMT Three years on from currency shock, Swiss central bank can't get back to normal If it raises rates, the Swiss franc strengthens. If it sells off its massive balance sheet, the Swiss franc strengthens. If a global crisis hits, the Swiss franc strengthens.


"The SNB will most probably be one of the last central banks to change course, and it will take years or even decades for monetary policy to return to ‘normal'," said Daniel Rempfler, head of fixed income Switzerland at Swiss Life Asset Managers.

The Bank of Japan illustrated the problem of reducing expansive policy when a small cut to its regular bond purchases sent the yen and bond yields higher.


"It is very difficult to say you are ready to intervene in the forex markets when you also winding down the balance sheet," said Florian Weber, an analyst at Bank J.Safra Sarasin.

iehi-feed-63523 Mon, 15 Jan 2018 19:46:12 GMT Euro Resurgence and QE Wind-down, US Political Dysfunction Weigh on Dollar ... the drop [in the dollar of 12% this year so far and last year] is a bit of a mystery because the Federal Reserve has been raising interest rates for the past year... Hussein Sayed, chief market strategist at FXTM, an online currency brokerage firm, wrote in a report Monday that signs of life in Europe's economy, particularly Germany and France, are causing some investors to flock to the euro instead of the dollar.

Sayed added that the resurgence in Europe even has more investors betting that the European Central Bank will unwind its massive bond-buying program, similar to the Fed's after the 2008 financial crisis, sooner than expected.


But the dollar's slide can't be pinned entirely on what's happening overseas. Some analysts suggest that political dysfunction in the United States is also pushing the dollar down.

Boris Schlossberg, managing director of foreign exchange strategy at BK Asset Management, said in a report Monday that "there is more to dollar weakness than just the global feel-good story."

Schlossberg said more investors are starting to believe there is a real chance of a government shutdown in Washington later this week. That would happen Friday unless Congress passes a short-term funding resolution to keep the government open.''

iehi-feed-63520 Sun, 14 Jan 2018 18:45:24 GMT Trump Floated Post-2007 By Secretive, High Money Laundering-Risk Condo Purchases More than one-fifth of Donald Trump's US condominiums have been purchased since the 1980s in secretive, all-cash transactions that enable buyers to avoid legal scrutiny by shielding their finances and identities, a BuzzFeed News investigation has found.

Records show that more than 1,300 Trump condominiums were bought not by people but by shell companies, and that the purchases were made without a mortgage, avoiding inquiries from lenders.


Treasury's financial-crimes unit has, in recent years, launched investigations around the country into all-cash shell-company real-estate purchases amid concerns that some such sales may involve money laundering. The agency is considering requiring real-estate professionals to adopt anti-money-laundering programs.


The surge was driven by the opening of 11 Trump condo buildings between 2008 and 2010 as Trump shifted his real-estate business from developing high-rises to licensing them. Nine were Trump-licensed, and they drew hundreds of shell companies that paid an average of $1.2 million in cash for a condo. In six of the licensed buildings, cash-paying shell companies bought at least a third of the condos, records show.

It's not clear how much Trump received from the sale of Trump-licensed condos, but when Trump announced his candidacy in 2015, he said his "real estate licensing deals" and other brands were worth $3.3 billion.


Eighty-three percent of the secretive sales occurred in markets that FinCEN is investigating for possible money laundering in real estate sales. In those markets -- Manhattan, South Florida, and Honolulu -- FinCEN is examining every luxury-home sale to a shell company that paid cash.

At least 28 shell companies resold their Trump properties within six months of buying them in cash. The National Association of Realtors says that immediate resales can indicate money laundering, "especially if the resale price is significantly higher or lower than the original purchase price."

At the Trump SoHo Hotel Condominium New York in Manhattan, 77% of the sales were to shell companies that paid cash. One of the project's Russia-born developers was convicted of money laundering in the 1990s. A pending lawsuit calls Trump SoHo a "monument to spectacularly corrupt money-laundering and tax evasion," though it says in a footnote that "there is no evidence that Trump took any part in, or knew of, their racketeering."

iehi-feed-63519 Sun, 14 Jan 2018 17:10:17 GMT Trump's 'Shithole' Moment Is His Ugliest Yet The president's remarks were met with disbelief even among hardcore conservatives. The right-wing commentator Erik Erikson wrote on Twitter: "So the President would prefer we allow Norwegian socialists with no special love of America into the country, but not the Ghanan who will work his ass off with a grand appreciation for our free market system and raise his kids to be proud Americans."


By presenting Salvadorans, Haitians, and Africans as dangerous, non-contributing, and unable to assimilate, the president has given his mass-deportation scheme the taint of ethnic cleansing. Philip Gourevitch, who chronicled Rwanda's genocide, tweeted ominously about Trump's language: "To speak of whole categories of people as coming from shitholes & other categories as desirables -- that's the language of apartheid and race war and annihilation," Gourevitch wrote. "The verbal violence invites physical violence -- & in this one realm, at least, he knows exactly what he's doing."

iehi-feed-63513 Fri, 12 Jan 2018 21:36:22 GMT Dept. Commerce finishes probe on steel imports; Is mum on findings The U.S. Commerce Department said on Thursday it had completed its probe into whether imports of certain steel products threatened U.S. national security and sent its conclusions to President Donald Trump. In a statement that offered no indication of the investigation's findings, the Commerce Department said Trump now has 90 days to decide "on any potential action."

The probe could lead to broad tariffs or import quotas.


In August, senior executives from 25 U.S. steel and steel-related companies sent a letter to Trump asking for immediate import restrictions. The executives from companies including Nucor, U.S. Steel, ArcelorMittal and Commercial Metals said the sustained surge of steel imports into the United States had "hollowed out" much of the domestic steel industry and was threatening its ability to meet national security needs.

Critics charge that using national security to erect steel tariffs could trigger a trade war with China, undermine the global rules-based trading system and hurt U.S. allies more than China and damage global growth prospects.

iehi-feed-63511 Fri, 12 Jan 2018 15:58:38 GMT Greece to Remain Under Lenders' Supervision Until 2059 iehi-feed-63507 Thu, 11 Jan 2018 16:43:05 GMT China moves to shutter bitcoin mines

China is moving to eradicate the country's bitcoin mining industry over concerns about excessive electricity consumption and financial risk, reflecting authorities' judgment that cryptocurrencies are not a strategic industry.

A multi-agency task force has instructed provincial governments to "actively guide" companies in their respective regions to exit the cryptocurrency mining industry, according to a document seen by the Financial Times. The move to pressure miners follows China's shutdown of local bitcoin exchanges and its ban on initial coin offerings.


Many bitcoin miners have established operations in remote areas without even registering a company. Some have also skirted Chinese regulations that forbid end users from purchasing electricity directly from power producers rather than grid operators.


Bitcoin mining "consumes a large amount of electricity and also encourages a spirit of speculation in 'virtual currencies'", according to the document. Mining operations contradict efforts to prevent financial risk and to discourage activities that "deviate from the needs of the real economy", it added.


The order does not call on regional authorities to shut mining operations directly, but rather to squeeze them out by strictly enforcing policies on electricity consumption, land use, tax collection and environmental regulation.


Chinese miners are now seeking ways to transfer their operations abroad, either by physically moving factories or selling their expertise. Cheap electricity and a cool climate, which helps prevent computers from overheating, are the main requirements. Canada, Iceland, eastern Europe and Russia are seen as the most promising destinations.

iehi-feed-63506 Thu, 11 Jan 2018 16:40:14 GMT China Weighs Slowing or Halting Purchases of U.S. Treasuries China added to bond investors' jitters on Wednesday as traders braced for what they feared could be the end of a three-decade bull market. Senior government officials in Beijing reviewing the nation's foreign-exchange holdings have recommended slowing or halting purchases of U.S. Treasuries, according to people familiar with the matter. The news comes as global debt markets were already selling off amid signs that central banks are starting to step back after years of bond-buying stimulus. Yields on 10-year Treasuries rose for a fifth day, touching the highest since March.

... It isn't clear whether the officials' recommendations have been adopted. The market for U.S. government bonds is becoming less attractive relative to other assets, and trade tensions with the U.S. may provide a reason to slow or stop buying American debt, the thinking of these officials goes...


"With markets already dealing with supply indigestion, headlines regarding potentially lower Chinese demand for Treasuries are renewing bearish dynamics," said Michael Leister, a strategist at Commerzbank AG. "Today's headlines will underscore concerns that the fading global quantitative-easing bid will trigger lasting upside pressure on developed-market yields."

Sh-- or get off the pot! It's obvious by now that China is stuck in the same pattern of interdependency it has been with the US for a couple decades now. They've made noises about dumping US government securities loudly since 2008, and even despite short reductions, have always come back to the same high level of holdings...

iehi-feed-63505 Thu, 11 Jan 2018 15:51:45 GMT Japan will trigger ‘the great unwind': Edwards iehi-feed-63504 Thu, 11 Jan 2018 14:59:53 GMT South Korea could ban cryptocurrency trading South Korea's presidential office said that any potential bill "is not a measure that has been finalized," according to News1, a South Korean news site.

Reuters further reported that a press official said the proposed ban on cryptocurrency trading was announced after "enough discussion" with other government agencies including the nation's finance ministry and financial regulators.

The news wire later added that once a bill is drafted, legislation for an outright ban of virtual coin trading will require a majority vote of the total 297 members of the National Assembly, a process that could take months -- or even years.


Bitcoin tumbles on talk of South Korea preparing a crypto trading ban

2 Hours Ago | 02:59

South Korea's justice minister said on Thursday that a bill is being prepared to ban all cryptocurrency trading in the country.

That news is a major development for the cryptocurrency space, as South Korea is one of the biggest markets for major coins like bitcoin and ethereum.

According to industry website CryptoCompare, more than 10 percent of ethereum is traded against the South Korean won -- the second largest concentration in terms of fiat currencies behind the dollar. Meanwhile, 5 percent of all bitcoin are traded against the won.

"There are great concerns regarding virtual currencies and justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges," Park Sang-ki said at a press conference, according to the ministry's press office.

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Bitcoin tumbled more than 12 percent following Park's remarks, before recovering. It was down 1.6 percent on the Coinbase exchange.

Ethereum tanked on the news and remained 11 percent lower on Coinbase.

Park added that he couldn't disclose more specific details about proposed shutdown of cryptocurrency trading exchanges in the country, adding that various government agencies would work together to implement several measures.

Later in the day, South Korea's presidential office said that any potential bill "is not a measure that has been finalized," according to News1, a South Korean news site.

Reuters further reported that a press official said the proposed ban on cryptocurrency trading was announced after "enough discussion" with other government agencies including the nation's finance ministry and financial regulators.

The news wire later added that once a bill is drafted, legislation for an outright ban of virtual coin trading will require a majority vote of the total 297 members of the National Assembly, a process that could take months -- or even years.

Cryptocurrency trading in South Korea is very speculative and similar to gambling. Major cryptocurrencies like bitcoin and ethereum are priced significantly higher in the country's exchanges than elsewhere in the world. For example, bitcoin traded at $17,169.65 per token at local exchange Bithumb, which was a 31 percent premium to the CoinDesk average price.

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That difference in price is called a "kimchi premium" by many traders.

In fact, earlier this week, industry data provider CoinMarketCap tweeted that it would exclude some South Korean exchanges in price calculations due to the "extreme divergence in prices from the rest of the world" and for "limited arbitrage opportunity." The exchanges that were removed from the price calculation included Bithumb, Korbit and Coinone.



This morning we excluded some Korean exchanges in price calculations due to the extreme divergence in prices from the rest of the world and limited arbitrage opportunity. We are working on better tools to provide users with the averages that are most relevant to them.

1:02 PM - Jan 8, 2018

1,493 1,493 Replies 2,817 2,817 Retweets 6,103 6,103 likes

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Last month, the South Korean Financial Services Commission said it was prohibiting cryptocurrency exchanges from issuing new trading accounts. If an exchange does allow new accounts, the government has the ability to take action to either stop trading or shut the exchange down, the commission said in a statement.

The commission added that, since much of the cryptocurrency trading was being done anonymously, users must use their real names.

The government also indicated it would closely monitor banks and would "swiftly" step in to limit fund flows into cryptocurrencies if necessary.

iehi-feed-63491 Tue, 09 Jan 2018 15:38:34 GMT Why African millennials can't get enough of Bitcoin iehi-feed-63490 Sun, 07 Jan 2018 19:54:24 GMT UK companies will face huge new VAT burden after Brexit More than 130,000 UK firms will be forced to pay VAT upfront for the first time on all goods imported from the European Union after Brexit, under controversial legislation to be considered by MPs on Monday.

The VAT changes spelled out in the taxation (cross-border trade) bill -- one of a string of Brexit laws passing through parliament -- are causing uproar among UK business groups, which say that they will create acute cashflow problems and huge additional bureaucracy.

Labour and Tory MPs and peers said that the only way to avoid the VAT Brexit penalty would be to stay in the customs union or negotiate to remain in the EU-VAT area.

iehi-feed-63488 Sun, 07 Jan 2018 16:23:27 GMT Iranian protests caused by economic hardships and bank failures The unnamed woman is one of countless Iranians who say their savings have been wiped out by the collapse of fraudulent businesses and unlicensed credit institutions in recent years. Economists are now pointing to the abrupt closure of these poorly regulated institutions as laying the foundation for the unrest that struck Iran starting in late December.

"Banks are shutting down without any kind of notice, and it's creating a huge political and economic backlash at a local level," said Suzanne Maloney, senior fellow on Middle East policy at the Brookings Institution.

Anger over these losses came on top of years of pent-up frustration over a sluggish economy. When the government announced recent price increases and released an austere budget bill, it ignited at-times violent protests that spread rapidly to dozens of cities nationwide. Demonstrators quickly turned their fury on corrupt officials and the Islamic republic as a whole.


"Most protests in Iran are over economic issues," Maloney said. "What's different is that it seems to have tapped into a deep sense of alienation and frustration, that people aren't just demonstrating for better working conditions or pay, but insisting on wholesale rejection of the system itself."