A massive 7.1 earthquake hit Mexico City on Tuesday, collapsing buildings and sending people into the streets 32 years to the day after a 1985 quake that did major damage to the capital. Coincidentally, buildings across the city had been holding earthquake drills earlier in the day due to the anniversary.
Damage and injury reports have not yet been officially reported from the quake, which had an epicenter approximatley 93 miles southeast of Mexico City in the state of Puebla.
Center of Mexico City right now after 7.4 earthquake. Scary. Hope folks are ok. Video shot by a friend in DF pic.twitter.com/tlYtpEShcB
The UK has deployed elite Special Air Service (SAS) troops to patrol the busy tube network in London following last Friday’s ISIS-claimed explosion of a homemade bomb at Parsons Green Station which left 30 injured during rush hour.
Armed with 9mm Glocks and disguised as romantic couples, the special forces troops will ride the tube system looking for trouble, alongside the not-so covert police patrolling the streets of London.
According to the Daily Star, “The task force is comprised of some of the most experienced special forces personnel in the Army – both male and female personnel from the Special Reconnaissance Regiment who are trained killers and can pose as couples while travelling on public transport.”
Those involved in the covert operation have been trained at the SAS base in Hereford for the past several months, and are fully skilled in “rapid fire techniques” according to the Express.
Suspects in train attack
The suspects are an unnamed 18 year old Iraqi refugee who was detained trying to flee the country and a 21 year old local named Yahya Farroukh. ISIS has claimed credit for the attack – however it emerged over the weekend that UK police arrested the 18 year old suspect two weeks before the attackfor reasons unknown, and subsequently released him to the foster parents he had lived with for the past three years.
The foster parents, Penelope and Ronald Jones, have housed hundreds of children over the past four decades.
Neighbor Serena Barber, 47 said of the ‘I know about two weeks ago he was arrested by police at Parsons Green, for what I don’t know and returned back to Penny and Ron. After that Penny said she was going to have to stop caring for him, she couldn’t handle him.’
Fear not Londoners – armed undercover SAS officers who look like regular couples are watching your every movement during your morning commute to prevent terrorism.
Less than two weeks after Hurricane Irma left 22 dead, rendering several Caribbean islands uninhabitable and leaving hundreds of thousands without power in Puerto Rico and elsewhere – Hurricane Maria is barreling down on America’s unofficial 51st state with 160 MPH winds.
Early Monday forecasts predicted Maria would likely experience “significant strengthening” over the next 48 hours, possibly strengthening to a category 4 by the time it hit Puerto Rico. Well, moments ago the National Hurricane Center skipped right past “possibly” – classifying Maria as an “extremely dangerous” Category 5 hurricane.
While Hurricane Irma never made landfall on Puerto Rico, Maria looks to be a direct hit tomorrow. Puerto Rico governor Ricardo Rossello said around 450 shelters had been prepared with the ability to house between 68,000 and 125,000 people in an emergency.
Puerto Rico has a population of 3.4 million, not including tourists.
In response, President Trump has directed FEMA and the Department of Homeland Security to coordinate all disaster relief efforts in advance of Maria.
CNN is reporting from three mystery sources that former Trump campaign manager Paul Manafort had been under FISA court-ordered surveillance by the Obama FBI since 2014 in relation to his work with a pro-Russian former ruling party in Ukraine. Of note, Manafort’s firm worked with the Podesta group for the same client.
After the 2014 surveillance was discontinued due to lack of evidence, the FBI restarted the investigation after obtaining a new FISA warrant which extended into early 2017. The June 2016 meeting at Trump Tower which included Manafort, Trump Jr., Jared Kushner, and a handful of other people wasn’t surveilled, according to the report.
Given the revelations of ‘unmasking’ and the fact that surveillance of Trump associates meant anyone they were communicating with were also surveilled – including Trump, it appears that CNN has some crow to eat…
Trump: I was "wire tapped" CNN: Haha. That idiot @realDonaldTrump thinks he was wiretapped. ..Six months later.. CNN: Trump was wiretapped
One of CNN’s mystery leakers says that intercepted communications show Manafort ‘encouraging the Russians to help with the [Trump] campaign,’ however two of the leakers say that evidence is not conclusive.
The details of Manafort’s communications have been apparently passed to FBI Special Counsel Robert Mueller as part of his investigation into Russian meddling in the 2016 election.
Ongoing communications with Russia?
Apparently the FBI wasn’t just hot to trot over communications between Manafort and ‘suspected Russian operatives,’ but information gathered from surveilence of the Russians themselves.
The FBI interest deepened last fall because of intercepted communications between Manafort and suspected Russian operatives, and among the Russians themselves, that reignited their interest in Manafort, the sources told CNN. As part of the FISA warrant, CNN has learned that earlier this year, the FBI conducted a search of a storage facility belonging to Manafort. It’s not known what they found.
The conversations between Manafort and Trump continued after the President took office, long after the FBI investigation into Manafort was publicly known, the sources told CNN. They went on until lawyers for the President and Manafort insisted that they stop, according to the sources.
Manafort had previously denied ever “knowingly” communicating with Russian intelligence operatives during the election, and has denied any involvement in efforts to “undermine the interests of the United States.”
Threatened with indictment
The New York Times reports that during an early morning raid in July of this year of Manafort’s Virginia home, FBI investigators picked his locks to gain entry. Once inside, Mueller’s team took binders and copies of computer files in search of evidence that Manafort had established secret offshore bank accounts. They even photographed the suits in his closet.
On top of that, Manafort was reportedly threatened with indictment during the search. Via the NYT:
The special counsel, Robert S. Mueller III, then followed the house search with a warning: His prosecutors told Mr. Manafort they planned to indict him, said two people close to the investigation.
The moves against Mr. Manafort are just a glimpse of the aggressive tactics used by Mr. Mueller and his team of prosecutors in the four months since taking over the Justice Department’s investigation into Russia’s attempts to disrupt last year’s election, according to lawyers, witnesses and American officials who have described the approach. Dispensing with the plodding pace typical of many white-collar investigations, Mr. Mueller’s team has used what some describe as shock-and-awe tactics to intimidate witnesses and potential targets of the inquiry.
The New York Times paints a surprisingly sympathetic picture of Manafort, while framing Mueller’s tactics as ‘strongarm’ and aggressive.
“They are setting a tone. It’s important early on to strike terror in the hearts of people in Washington, or else you will be rolled,” said Solomon L. Wisenberg, who was deputy independent counsel in the investigation that led to the impeachment trial of President Bill Clinton in 1999. “You want people saying to themselves, ‘Man, I had better tell these guys the truth.’”
Chipping away at the periphery
While Manafort hasn’t been indicted as threatened in July, his associates have received a far more intensive investigation from Mueller’s team. Per the NYT, “Instead of invitations to the prosecutor’s office, they have been presented with grand jury subpoenas, forcing them to either testify or take the Fifth Amendment and raise suspicions that they had something to hide. At least three witnesses have recently been subpoenaed to testify about Mr. Manafort: Jason Maloni, a spokesman who appeared before the grand jury for more than two hours on Friday, and the heads of two consulting firms — Mercury Public Affairs and the Podesta Group — who worked with Mr. Manafort on behalf of Viktor F. Yanukovych, the pro-Russia former president of Ukraine.”
“Mr. Mueller’s team also took the unusual step of issuing a subpoena to Melissa Laurenza, a specialist in lobbying law who formerly represented Mr. Manafort, according to people familiar with the subpoena. Conversations between lawyers and their clients are normally considered bound by attorney-client privilege, but there are exceptions when lawyers prepare public documents that are filed on behalf of their client.” –NYT
The Sword of Damocles still hangs precariously a decade later. -Ambrose Evans-Pritchard
The Bank for International Settlements (BIS) has uncovered a $14 trillion dollar-denominated debt bubble hidden in derivatives and swap contracts – a shocking sum that doubles the amount of offshore USD credit in the international system.
While the debt serves as a lubricant and a hedging mechanism for global commerce, its mere existence greatly adds to the risk of a global debt crisis if the the Dollar surges via Fed tightening or extreme risk-off trading.
A forensic study by the BIS concludes that enormous liabilities have accumulated through FX swaps, currency swaps, and “forwards” – all hidden in the footnotes of bank reports.
“Contracts worth tens of trillions of dollars stand open and trillions change hands daily. Yet one cannot find these amounts on balance sheets. The debt is, in effect, missing,” reports a BIS investigative team led by chief economist Claudio Borio.
“A defining question for the global economy is how vulnerable balance sheets may be to higher interest rates,” said Borio, adding “These transactions are functionally equivalent to borrowing and lending in the cash market. Yet the corresponding debt is not shown on the balance sheet and thus remains obscured.”
Booked as a derivative, acts like a debt
Due to global accounting rules, the trillions in new-found debt has been booked as a notional derivative – “even though it is in effect a secured loan with principal to be repaid in full at maturity,” says the BIS.
The dollar swaps serve as a “money market” for global finance. Investors often take out short-term contracts that must be rolled over every three months. The great majority have maturities of less than a year. Much of the money is used to make long-term investments in illiquid assets, the time-honoured cause of financial blow-ups. “Even sound institutional investors may face difficulties. If they have trouble rolling over their hedges, they could be forced into fire sales,” said the Swiss-based watchdog.
Signs of strain
The BIS goes on to warn of the massive excesses in debt across the spectrum. “Corporate debt is now considerably higher than it was pre-crisis. Leverage indicators have reached levels reminiscent of those that prevailed during previous corporate credit booms. A growing share of firms face interest expenses exceeding earnings before interest and taxes,” said the report.
The BIS also warns that margin debt on equities exceeds the dotcom extreme in 2000, and so-called ‘leveraged loans’ have surged to a record $1 trillion.
Of interest
So far, the global financial system has been able to service these derivative-based debts thanks to low interest rates – however once rates begin to rise, the entire house of cards will be subject to increasing levels of risk.
“The structure is deeply unhealthy. Central bankers dare not lift rates despite economic recovery because of what they might detonate. “There is a certain circularity that points to the risk of a debt trap,” said Borio.”
FP reports “the Achilles Heel is global dollar debt. It was a seizure of the offshore dollar capital markets in late 2008 that turned the Lehman and AIG bankruptcies into a global event, and came close to bringing down the European banking system. “The meltdown in dollar-denominated structured products caused funding markets to seize up and banks to scramble for dollars. Markets calmed only after coordinated central bank swap lines to supply dollars,” said the BIS.”
Will the Fed come to the rescue again?
After former Fed chairman Ben Bernanke and Treasury Secretary Hank Paulson held a gun to congress’ head in September of 2008, kicking off Trillions of bailouts and a massive revolving liquidity complex – the U.S. Fed effectively saved the global banking system from disaster. The question now is whether or not they’ll do it again. One would assume that team Yellen / Mnuchen / Cohn could easily convince President Trump to turn on the spigot.
Emerging markets screwed
If the dollar spikes violently, for whatever reason – be it interest rates rising or global risk-off trading and a flight to bonds, the emerging markets stand to suffer the most from a strong dollar.
Via FP:
Currency analysts say it would be an emerging market bloodbath. While the “fragile five” – India, South Africa, Indonesia, Turkey, Brazil – have mostly cut their current account deficits and are in better shape than during the “taper tantrum” of 2013, the problem has rotated to oil producers. China’s corporate debt has soared to vertiginous levels.
Recorded dollar debt in emerging markets has doubled to US$3.4 trillion in a decade, without including the hidden swaps. Local currency borrowing has risen by leaps and bounds. They are no longer low-debt economies.
The BIS credit gap indicator of banking risk is flashing a red alert for Hong Kong, reaching 35 per cent of GDP. While it has dropped to 22.1 per cent in China, the country is still in the danger zone. Any sustained reading above 30 is a warning signal for a banking crisis three years later.
So – enjoy historically low interest rates while they last. Lord knows central banks around the globe will be keeping them as low and liquidity-generating as long as they possibly can.
After what may be the largest data breach of sensitive information in history, Equifax is now coming under fire for allegedly scrubbing the background of its (now former) Chief Security Officer’s background, which reveals she had zero formal training in security.
Susan Mauldin, who was fired today, was Equifax’s CSO / CISO since 2013. Prior to that, she served as Senior VP and Chief Security Officer for First Data – and before that, she was a VP at SunTrust Bank from 2007 – 2009.
While Mauldin had been involved in security since 2009, her educational background contains no security or tech credentials. In fact, the woman in charge of safeguarding the information of over 100 million Americans has a bachelor’s degree in music composition and a Master of Fine Arts degree in music composition from the University of Georgia.
Furthermore, ZeroHedge catalogs attempts by “someone” to scrub Mauldin’s background from Linkedin:
As MarketWatch’s Brett Arends writes, “there has been very little coverage so far of Susan Mauldin’s background and training. Given the ongoing disaster of the hack and Equifax’s handling of the affair, the media spotlight has so far been elsewhere.” It now emerges that someone was very keen on keeping as little information about Mauldin’s background in the public domain as possible.
Shortly after the Equifax scandal broke, Maludin’s LinkedIn page was made private and her last name replaced with “M.” Below is a screengrab showing Susan Mauldin’s old and current LinkedIn pages in Google search results as of 9/9/2017.
Mauldin’s original LinkedIn page was on this url before it was made completely private: linkedin.com/in/susan-mauldin-93069a (now a 404 page not found)
A few days after the news of the data hacking broke, the following page reappeared a with a different url, with the specific detail that her degrees were in Music Composition removed. Also, her surname Mauldin was replaced with the initial letter M. to complicate profile discovery.
Additionally, two videos of interviews with Mauldin have been removed from YouTube. A podcast of an interview has also been taken down. As Hollywoodlanews.com reports, in March 2016, Mauldin was interviewed on camera by the CEO of the big-data company Cazena.
The videos featuring parts of an interview with Susan Mauldin, which were embedded on this page, have been taken down as of the afternoon of September 10.
A partial transcript of her remarks during the interview have been archived for posterity by a third party. http://archive.is/6M8mg
The full interview videos went far in explaining what may have been the eventual cause of the massive leak of information now gravely affecting 143 million Americans.
The audio-only version of the interview that was publicly available on Soundcloud has also been scrubbed from the web.
With pensions around the country facing funding shortfalls, Boeing has taken an unorthodox approach to shoring up its $20 billion funding gap – the second largest shortfall of any S&P 500 company behind General Electric with $57 billion in assets and $77 billion in obligations.
The planemaker transferred $3.5 billion of its own shares into the pension – essentially betting on continued growth after what’s already been a massive rally in share prices.
It’s a bold move, and one cheered by many on Wall Street. Yet to pension experts, it isn’t worth the risk. After a record-setting, 58 percent rally this year, Boeing is betting it can keep producing the kind of earnings that push shares higher. If all goes well, not only will the pension benefit, but Boeing says it will be able to forgo contributions for the next four years.
But if anything goes awry, the $57 billion pension — which covers a majority of its workers and retirees — could easily end up worse off than before.
Critics of the move say it’s a dangerous move. “It’s an irresponsible thing to do certainly from the perspective of the plan participants,” said Daniel Bergstresser, a finance professor at the Brandeis International Business School. “Ideally, you would like to put assets in the pension plan that won’t fall in value at exactly the same time that the company is suffering.”
Boeing disagrees
The company says the stock strategy as a win-win. “We continue to see Boeing stock as a good value,” said a spokesman for the company, adding “This action further reduces risk to our business while increasing the funding level of our pension plans. Our employees and retirees benefit as well since this action provides funding earlier, giving the plan sponsor more flexibility to grow the plans’ assets.”
While Boeing has the assets to shore up as much as $30 billion in underfunded pension liabilities, 186 of the 200 largest defined-benefit plans in the S&P 500 are underfunded.
Trump sparks anger in the U.K. over London terror tweets. President Trump was accused of betraying intelligence details following a terrorist attack in London on Friday, by saying those responsible for an explosion on an underground train “are sick and demented people who were in the sights of Scotland Yard,” before adding “must be proactive!” His comments prompted an immediate backlash. Prime Minister Theresa May and police led criticism of his intervention.
Tropical Storm Jose could threaten New York next week, according to a National Hurricane Center advisory. The storm, currently about 360 miles northeast of the Bahamas, is expected to strengthen to a Category 1 hurricane in the next 48 hours as it moves through the Atlantic Ocean. Jose’s path could put it near New Jersey and New York by Wednesday morning, though it may weaken to a tropical storm again by then.
Farewell, Cassini. We’ll always have your photos. NASA’s Cassini orbiter hurtled into Saturn at nearly 80,000 miles an hour to incinerate itself on Friday morning, ending its 20-year mission. NASA still has a ton of data to sift through, including the spacecraft’s closest sniff of Saturn’s atmosphere as it melted the orbiter into nothing. Here are some of the most stunning photos it captured.
Your identity is for sale on the dark web. Verified high-limit credit cards from countries including the U.S., Japan, and South Korea are selling on the dark web for the bitcoin equivalent of about $10 to $20, according to an annual report on cybercrime. It’s not just credit cards: An underground hacker market is selling identities that are detailed enough to facilitate “impersonation-based fraud” for as little as $10 apiece.
Amtrak wants to remind you how awful flying is. As former CEO of Delta, Richard Anderson knows why so many people hate air travel — and he appears ready to exploit those pain points in his new role as president and co-CEO of Amtrak. From free Wi-Fi to the absence of middle seats to the two bags you may check for free, Amtrak is pitching itself as a more comfortable, civilized travel alternative to an airline.
Where are the Mar-a-Lago visitor logs? A government transparency group vowed to continue a court battle to open visitor logs at Trump’s Florida resort, after the administration provided only the names of Japanese staff who attended a February visit from Prime Minister Shinzo Abe. Ethics specialists have criticized Trump for not divesting from his business holdings, including Mar-a-Lago, saying they provide an avenue for those seeking influence to curry the president’s favor.
Read this before you spend $2 billion on your own submarine. For those bored with multimillion-dollar megayachts, with their ho-hum helipads and snooze-inducing jacuzzis, consider the 928-foot-long M7, designed by the Austrian company, Migaloo Private Submersible Yachts.
Hundreds of consumer records stored on an Argentinian Equifax database were allegedly protected by the generic username and password: ‘admin.’
After the credit monitoring company announced a massive breach last week in which over 140 million Americans’ private data was hacked, Milwaukee based cybersecurity firm Hold Security began probing Equifax’s other websites, when they discovered the company’s South American site was woefully un-secure.
The Argentinian Equifax database is unrelated to the breach in the U.S.
[T]hey were able to uncover personal employee information housed on Equifax’s South American site, including names, emails, and Social Security equivalents of over 100 individuals.
The researchers easily acquired administrative access and quickly discovered consumer complaint records, complete with the Argentine equivalent of Social Security numbers, known as Documento Nacional de Identidad (National Identity Document).
“You don’t expect anything like that,” said Alex Holden, Hold Security’s chief information security officer. “An ability to lookup cases for individuals based on a single numeric ID and gender drew our attention.”
Equifax responded to CNBC, telling the network:
“We learned of a potential vulnerability in an internal portal in Argentina which was not in any way connected to the cybersecurity event that occurred in the United States last week. We immediately acted to remediate the situation, which affected a limited amount of public information strictly related to consumers who contacted our customer service center and the employees who managed those interactions.”
“What I can tell you is that we fixed the vulnerability immediately upon learning of it, and that this internal portal has not been in use since 2013. The Argentine consumer dispute information that was mentioned in the Krebs article is all publicly available, searchable and not confidential. Additionally, our consumer credit and commercial databases were not accessed or affected.”
Multiple investigations
Equifax is facing several investigations, including a major probe by the Federal Trade Commission (FTC) announced Thursday.
Shares take a nosedive
Since announcing the hack last Thursday, Equifax shares have dropped more than 30 percent, closing at a 2.5 year low of $96.66.
Google parent company Alphabet, Inc. ($GOOG) is reportedly in discussions to invest a cool $1 billion in Lyft, a move which signals support for Uber’s main U.S. competitor – and very likely designed to go hand-in-hand with the Mountain View, CA tech giant’s investments in autonomous vehicles.
‘People familiar with the matter’ tell Bloomberg said the discussions are private, and the investment may come from Google or Alphabet’s private-equity arm, CapitalG.
E-Cab
Waymo, an Alphabet subsidiary, has signed an agreement with Lyft to test autonomous vehicles together. Although Alphabet is an Uber shareholder through it’s GV venture capital arm, Waymo is currently suing Uber over self-driving technology.
Via Recode
The self-driving technology arm of Google parent Alphabet, filed the lawsuit in February, alleging theft of trade secrets that Uber planned to use in its autonomous vehicles. The case centers around engineer Anthony Levandowski, who Waymo claims stole 14,000 documents before leaving the company and founding Otto, a self-driving trucking company which Uber later acquired.
If at first you don’t succeed…
Lyft failed to find a taker for a $9 billion buyout in 2016 after shopping themselves to GM, Alphabet, Amazon, Microsoft, and even Apple, according to recode.
While not exactly what they were looking for, Lyft can use an extra $1 billion to pursue more aggressive growth – offering subsidies to drivers, discounts to riders, and marketing. Lyft kicked off an ad campaign this month starring Jeff Bridges.
Lyft co-founder John Zimmer has said financial independence is a priority, however some investors have suggested Alphabet would be a natural home for the ride-hailing startup. Lyft held informal talks with Alphabet and other potential acquirers last year but didn’t pursue a sale.
Waymo, an Alphabet subsidiary, has signed an agreement with Lyft to test autonomous vehicles together. Although Alphabet is an Uber shareholder through it’s GV venture capital arm, Waymo is currently suing Uber over self-driving technology.
