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Greece's Grand Plan: Default and Stay in the Euro - Telegraph


Unlike the widely-held conjecture that a default would lead inexorably to Greece's ejection from the eurozone, analysts and economists now think there are a number of ways the debt-addled country can retain its membership of the euro while stiffing its international lenders.

"The actual cost of severing Greece will prove equal to that of dismantling the eurozone itself painfully, slowly, catastrophically," Yanis Varoufakis wrote in his blog in three years ago.

Athens’ Leftist government was elected on a clear mandate to retain the euro. But faced with a cash crisis that will force them to choose between paying public sector workers, rather than the Troika, the prospect of an intra-euro default is now a very real one.

Here's how it all could work.

Stopping repayments - but which ones?

Greece has 15 separate debt payments to make between now and the end of July, totalling €16.5bn. These include redemption of its short-term government debt (T-bills), paying down IMF loans, and calling-in maturing bonds held by the European Central Bank.

The viability of a default within the euro would depend heavily on which of these payments is not fulfilled, say analysts.


The "most straightforward default event" would be triggered by Greece's failure to redeem government bonds held by the European Central Bank, says Carsten Brzeski, chief economist at ING.

Senior Greek officials have hinted this is their preferred default option, as it has been the central bank which has kept the country on a tight leash since Syriza were swept into power at the end of January.

But the prospect of a sovereign bond default would have to wait until July, when €3.5bn of ECB debt is due to mature. Whether or not the cash-starved government will be able to limp on until then remains in doubt.


Greece's immediate cash crunch comes in the form of payments to its senior creditor - the International Monetary Fund.

With a disbursement of cash looking unlikely until well into May, the most likely date Greece could stall on the Fund is on May 12 when it has to make a €760m loan payment.

But as noted here, missing an IMF payment would not immediately trigger a default scenario. The government would be afforded a 30-day grace period, after which a silent arrears process would kick in and lead to no further disbursement of aid until obligations are met.

However, a failure to pay the IMF on time would immediately call into question Greece's other loans from the European Financial Stability Fund and the ECB.

Whether or not Greece will be considered to be in default on these payments will depend heavily on political sentiment among its creditor partners. There is enough ambiguity in the legal documentation to allow creditors to continue providing emergency assistance to Greece even if it can't fulfill its obligations to the Fund.


The bulk of Greece's upcoming cash crunch - €12bn - is in the form of maturing T-bills.

So far, the cash-starved government has managed to rollover this short-term paper with domestic buyers continuing to snap up most of the debt. Foreign appetite has been decidedly muted however. The only notable interest has come from the Chinese who have chipped in with around €200m in recent bond auctions.

Should this continue however, and Athens could well manage to trundle along rolling over the debt, making a default on T-bills unlikely despite the liquidity squeeze, according to analysts at ING.

It's all about the banks

In any possible default scenario, it is the health of the Greek banking system which will determine how close the country will come to the abyss of a euro exit.

As the largest holders of Greek debt, the fate of the banks is tied inextricably to the stricken government's finances. Should default ensue, the position taken by the ECB will be the key determining factor in triggering a Grexit.

The central bank, which has been drip feeding emergency cash (ELA) to the country for three months, has already prevented banks from increasing their sovereign debt holdings. The limits on ELA have also been repeatedly hit and now stand at €75.5bn. But the assistance is conditional on Greek banks remaining solvent and having enough collateral to receive the funds.

In the event lenders are left with dud government debt on their balance sheets, the ECB is almost certain to pull the plug.

"The "E" in ELA stands for "emergency", not "eternity"," notes Giles Moec, Europe economist at Bank of America Merrill Lynch.

"It would be difficult for the central bank to look the other way for too long on the solvency issues, but we suggest that there are ways to keep the Greek financial system minimally functional even after a missed payment for some time," adds Mr Moec.

A post-default world

Should Greece fall into arrears, markets will be gripped by chaos. The rush to withdraw money would mean capital controls will quickly become necessary. Enforced bank holidays, deposit withdrawal limits and caps on external transaction would help the government stem the tide of money fleeing the country.

The prospect of such draconian controls has already been touted in the highest echelons of the Troika.

ECB vice president Vitor Contancio has said resorting to such measures would not lead ineluctably to the ECB pulling the plug on Greece. Flexibility around collateral rules could also see the ECB continuing to keep banks afloat following a default.

"In theory the ECB could do almost whatever it wants to do in the event of a Greek default," says Mr Brzeski.

With controls in place, the government would have to start issuing IOU's to pay suppliers, salaries and pensions. This paper would effectively take on the role of a parallel scrip currency, say analysts at Citi.

The next crucial job facing the government would be to find the funds to recapitalise the beleaguered banking system and stave off a full-blown financial collapse.

Greece would face no alternative to turn cap into hand to Europe or find themselves a "sugar daddy", notes Mr Brzeski.

Despite courting Russian and Chinese aid, it is highly uncertain either powers would want to pump cash into Greece's financial black hole just to keep it afloat for a matter of weeks.

At this point politics will takeover.

'Playing with fire'

Pushing Greece to default may be the inevitable result of the dangerous brinkmanship on display from both sides.

"It would be playing with fire", says Mr Brzeski.

"The creditors think they need to push Greece over the edge, to finally get on top of this. The Greeks are threatening to default because they believe this is the last thing the Europeans want, and they will eventually bow down."

With its creditor powers refusing to blink, falling into arrears may seem the best stick the Leftist government can wield against their paymasters. But defaulting would only provide short lived financial relief.

Athens will still need a new bail-out package at the end of June, further relief on its €320bn debt mountain and a relaxation of its fiscal targets, if it is ever to get its finances back on a stable footing.

Risking political acrimony, a dissenting populace and the prospect of a plebiscite on its euro membership, would leave Greece and the eurozone in truly uncharted territory in a post-default world.

In the more recent words of Mr Varoufakis: "Anyone who pretends they know what would happen the day we'll be pushed over the cliff is talking nonsense".
Sat, April 25, 2015 - 9:02 AM — permalink - 0 comments - add a comment

When Your Banana-Guy Starts Trading Stocks, You Know It's Over


Submitted by Tyler Durden on 04/24/2015 21:30 -0400

Presented with no comment... ok well one! WTF!?

Source: @wmiddelkoop

No comment... not one... seriously.
Sat, April 25, 2015 - 8:51 AM — permalink - 0 comments - add a comment

Hundreds Killed After 7.9-Magnitude Earthquake Strikes Nepal, Death Toll Rising


Published time: April 25, 2015 06:33
Edited time: April 25, 2015 11:03

A 7.9-magnitude earthquake has struck Nepal and India, killing nearly 450 people. The most severe damage was seen in Nepal’s capital, Kathmandu, where buildings collapsed, reportedly causing numerous injuries.

"The number of dead so far is 449," Police Deputy Inspector General Kamal Singh Bam said.

Thirty-six bodies have been counted so far by Kathmandu's main civil hospital. In addition, 21 bodies were seen on the ground, reported Nepal's Kantipur TV.

"Hundreds of people are feared dead and there are reports of widespread damage to property. The devastation is not confined to some areas of Nepal. Almost the entire country has been hit," Krishna Prasad Dhakal, deputy chief of mission at Nepal's embassy in New Delhi, said.

People wait at a school after a 7.7 magnitude earthquake struck, in Kathmandu, Nepal, April 25, 2015. (Reuters)
People wait at a school after a 7.7 magnitude earthquake struck, in Kathmandu, Nepal, April 25, 2015. (Reuters)

It occurred 33km east of Lamjung District and 80km northwest of Kathmandu, which has a population of about 1 million. The quake was at a depth of 31km.

Everyone is out in the streets of Kathmandu and people are rushing to hospitals, local media reported.

Reuters witness said a child has been killed in a town near Kathmandu when a statue fell in a park. A 15-year-old girl also reportedly died in India after the tremor brought a house wall down.

The historic Dharahara (Bhimsen) Tower, dating back to 1832, has reportedly collapsed in Kathmandu, said witnesses. The 62-meter-high monument was a part of Architecture of Kathmandu recognized by UNESCO.

According to witnesses at least one body was removed from the tower and a second lay further up the road. About 50 people are now being trapped inside the collapsed tower, Nepal media reported.

Some tremors were reportedly felt in some cities in eastern and northern India, including the capital, New Delhi, said JL Gautam, Head Operations Seismology of Indian Meteorological Department (IMD).

People were seen running from their houses after the buildings shook for several minutes in Delhi and parts of the National Capital Region.

“News has come in about an earthquake in Nepal. Several parts of India also experienced tremors,” Indian PM Narendra Modi tweeted.

Also tremors were felt in the cities of Patna, Lucknow, Kolkata, Jaipur and Chandigarh.

The quake caused an avalanche on Mount Everest, mountaineer Alex Gavan tweeted from Mount Pumori, about 8km (5 miles) west of Mount Everest, tweeted.

"Everest base camp huge earthquake then huge avalanche from [Mount] pumori. Running for life from my tent. Unhurt. Many many people up the mountain," Gavan wrote.
Sat, April 25, 2015 - 7:03 AM — permalink - 0 comments - add a comment

FBI Finds Gold Bar from Highway Heist in Florida


On March 1, three armed men stole $4.9 million in gold bars from two guards who had pulled over on the side of I-95 with car trouble — it was the eleventh-largest gold heist in history. Details were sparse at the time although a local CBS affiliate was able to provide the following color:

The sheriff's office says the guards reported that three armed men in a white van approached them, ordered them to the ground, tied their hands behind their backs and forced them to walk into some nearby woods. Investigators, who responded to the scene shortly before 7 p.m., said the men then reportedly took several barrels of gold and left while the guards were in the woods.

For our part, we suggested Simon Gruber (or someone else whose relatives had been killed by John McLane) may have been behind the plot.

This morning, further details about the ongoing case were released after one of the missing bars turned up in South Florida. Here’s more via ABC:

One of the gold bars stolen in a highway heist last month has been found in South Florida, according to the FBI.

"We believe that additional gold bars from the robbery may still be in South Florida and we continue to need the public’s help in solving this crime,” the agency says.

Two suspects made off with approximately $4.9 million in gold bars after holding up an unmarked van on March 1 in North Carolina, authorities have said. The van was transporting about $10 million in precious metals from Florida to Massachusetts...

Days after the robbery, Wilson County, North Carolina, Sheriff Calvin Woodard Jr. said the suspects placed a traffic cone behind the van while they unloaded the gold from the trunk. That cone had the marking of a company that only does work in Florida.


“This confirms that there is a South Florida nexus to this crime,” said supervisory agent Jeff Fleck, proving yet again that nothing gets by an FBI agent.

In another example of how — through a careful examination of the facts and via the use of uncanny deductive reasoning skills — police are putting the pieces together to form a hypothesis about the heist, ABC says authorities believe it might be pertinent that the drivers apparently changed their story regarding why they pulled over and furthermore, the fact that they were robbed immediately upon stopping seems to suggest that someone knew something ahead of time.

Three suspects allegedly stole $4.8 million-worth of gold after one of the two armed guards -- the driver and another man, both inside the truck's cabin -- said that he felt sick and prompted the driver to pull over, Wilson County Sheriff Calvin Woodard Jr. told reporters today.

That account is different from what was presented in the first police report on the case, which said that a mechanical issue caused the truck's driver to pull over.

“There is suspicion at this time that this could be an inside job due to the circumstances of the robbery," a Wilson County Sheriff’s Office detective wrote in a search warrant application to get access to one of the guards' cell phones, one of two search warrants in the case obtained today.

"The fact that the truck was robbed immediately upon it pulling over at an unannounced stop is suspicious in and of itself," the document added. "It is also suspicious because there are no markings on the side of the truck that would indicate the type of cargo contained therein. The suspects also went directly to the trailer and found the gold which was in unmarked five gallon buckets. It is not believed that this is a random act due to the nature and facts of this robbery."

That sounds like a reasonable assumption to us as well.

Fortunately, police have sketches depicting two of the three perpetrators:


So if you see two men of completely indeterminate race one of which may have a goatee while the other has short hair and appears to be wearing some manner of lipstick, you can report them to the FBI and, if the information you provide leads authorities to any buried treasure, you will receive a generous reward of $25,000.

We doubt that reward will be sufficient to cause any of the suspects to turn on their compatriots however, given that each bar is apparently worth nearly $500,000.
Tue, April 21, 2015 - 3:51 PM — permalink - 0 comments - add a comment

Stunned Greeks React to Initial Capital Controls and the "Decree to Confiscate Reserves", and They Are Not Happy


Earlier today, following weeks of speculation, Greece finally launched the first shot across the bow of capital controls, when it decreed that due to an "extremely urgent and unforeseen need" (ironically the need was quite foreseen since about 2010, but that is a different story), it would be "obliged" to transfer - as in confiscate - "idle cash reserves" located across the country's local governments (i.e., various cities and municipalities) to the Greek central bank.

Several hours later the decree which was posted in the government gazette has finally percolated among the population, and the response to what even ordinary Greeks realize is now the endgame, is less than exuberant.

Bloomberg reports, that "as Greece struggles to find cash to stay afloat, local authorities say they oppose a government decision to use their reserves for short-term financing."

“The government’s decision to seize our reserves not only raises legal and constitutional issues, but also a moral one,” said George Papanikolaou, mayor of Glyfada, the third-largest municipality in the metropolitan region of Attica after Athens and Piraeus. “We have a responsibility to serve our citizens,” Papanikolaou said by phone on Monday. Glyfada has about 16 million euros in cash reserves, he said.

George is unhappy because as recently as tomorrow, he will find there is precisely zero euros in his public bank account, as all the money has now been forcibly sequestered by the government in order to repay future Troika, pardon, IMF obligations.

Sadly for Greece, this is the only option left as the money has now fully run out: Greek Prime Minister Alexis Tsipras ordered local governments and central government entities to move their cash balances to the central bank for investment in short-term state debt.

From Bloomberg:

The decree to confiscate reserves held in commercial banks and transfer them to the Bank of Greece could raise as much as 2 billion euros ($2.15 billion), according to two people familiar with the decision. The money is needed to pay salaries and pensions at the end of the month, the people said.

“It is a politically and institutionally unacceptable decision,” Giorgos Patoulis, mayor of the city of Marousi and president of the Central Union of Municipalities and Communities of Greece, said in a statement on Monday.“No government to date has dared to touch the money of municipalities.”

It took the radical leftist one all of 2 months since coming to power.

And the punchline is that the use of confiscated proceeds is unclear: the government says it is to pay pensions and wages, but recall that the same government recently confiscated pensions to repay the IMF, so according to the chain of logic, the government first raided pensions, and now municipalities, just to repay the dreaded Troika.

The Athens city council and the union of municipalities and communities in Greece will convene tomorrow to debate the order, a press officer of the mayor’s office said.

And one everyone realizes what just happened, expect the riot cam and the Greek Pay-Per-Riot channel, which has been on hiatus since the summer of 2012, to be fully reactivated.
Tue, April 21, 2015 - 5:52 AM — permalink - 0 comments - add a comment

Truth in Media: Feds Say Cannabis Is NOT Medicine While Holding the Patent on Cannabis as Medicine

It's 4-20! Pass it on...


Published on Sep 16, 2014

Take Action: Click on this story and View the "ACTIVATE" PDF at the end of the story

For those who believe in marijuana and cannabis freedom, the future has never been brighter. Right now there is an awakening to the benefits of cannabis for medicinal purposes, specifically something called CBD oil. But is the new CBD craze being manipulated by media and politicians? If it weren’t we wouldn’t need to do a show about it.

The first step toward truth is to be informed.


See also: Angela Brown: Case Of Mother Who Treated Son With Cannabis Oil Reaches End
Mon, April 20, 2015 - 8:56 AM — permalink - 0 comments - add a comment

FBI Admits Flaws in Hair Analysis over Decades


The Justice Department and FBI have formally acknowledged that nearly every examiner in an elite FBI forensic unit gave flawed testimony in almost all trials in which they offered evidence against criminal defendants over more than a two-decade period before 2000.

Of 28 examiners with the FBI Laboratory’s microscopic hair comparison unit, 26 overstated forensic matches in ways that favored prosecutors in more than 95 percent of the 268 trials reviewed so far, according to the National Association of Criminal Defense Lawyers (NACDL) and the Innocence Project, which are assisting the government with the country’s largest post-conviction review of questioned forensic evidence.

The cases include those of 32 defendants sentenced to death. Of those, 14 have been executed or died in prison, the groups said under an agreement with the government to release results after the review of the first 200 convictions.

The FBI errors alone do not mean there was not other evidence of a convict’s guilt. Defendants and federal and state prosecutors in 46 states and the District are being notified to determine whether there are grounds for appeals. Four defendants were previously exonerated.

The admissions mark a watershed in one of the country’s largest forensic scandals, highlighting the failure of the nation’s courts for decades to keep bogus scientific information from juries, legal analysts said. The question now, they said, is how state authorities and the courts will respond to findings that confirm long-suspected problems with subjective, pattern-based forensic techniques — like hair and bite-mark comparisons — that have contributed to wrongful convictions in more than one-quarter of 329 DNA-exoneration cases since 1989.

In a statement, the FBI and Justice Department vowed to continue to devote resources to address all cases and said they “are committed to ensuring that affected defendants are notified of past errors and that justice is done in every instance. The Department and the FBI are also committed to ensuring the accuracy of future hair analysis testimony, as well as the application of all disciplines of forensic science.”

Peter Neufeld, co-founder of the Innocence Project, commended the FBI and department for the collaboration but said, “The FBI’s three-decade use of microscopic hair analysis to incriminate defendants was a complete disaster.”

“We need an exhaustive investigation that looks at how the FBI, state governments that relied on examiners trained by the FBI and the courts allowed this to happen and why it wasn’t stopped much sooner,” Neufeld said.

Norman L. Reimer, the NACDL’s executive director, said, “Hopefully, this project establishes a precedent so that in future situations it will not take years to remediate the injustice.”

While unnamed federal officials previously acknowledged widespread problems, the FBI until now has withheld comment because findings might not be representative.

Sen. Richard Blumenthal (D-Conn.), a former prosecutor, called on the FBI and Justice Department to notify defendants in all 2,500 targeted cases involving an FBI hair match about the problem even if their case has not been completed, and to redouble efforts in the three-year-old review to retrieve information on each case.

“These findings are appalling and chilling in their indictment of our criminal justice system, not only for potentially innocent defendants who have been wrongly imprisoned and even executed, but for prosecutors who have relied on fabricated and false evidence despite their intentions to faithfully enforce the law,” Blumenthal said.

Senate Judiciary Committee Chairman Charles E. Grassley (R-Iowa) and the panel’s ranking Democrat, Patrick J. Leahy (Vt.), urged the bureau to conduct “a root-cause analysis” to prevent future breakdowns.

“It is critical that the Bureau identify and address the systemic factors that allowed this far-reaching problem to occur and continue for more than a decade,” the lawmakers wrote FBI Director James B. Comey on March 27, as findings were being finalized.

The FBI is waiting to complete all reviews to assess causes but has acknowledged that hair examiners until 2012 lacked written standards defining scientifically appropriate and erroneous ways to explain results in court. The bureau expects this year to complete similar standards for testimony and lab reports for 19 forensic disciplines.

Federal authorities launched the investigation in 2012 after The Washington Post reported that flawed forensic hair matches might have led to the convictions of hundreds of potentially innocent people since at least the 1970s, typically for murder, rape and other violent crimes nationwide.

The review confirmed that FBI experts systematically testified to the near-certainty of “matches” of crime-scene hairs to defendants, backing their claims by citing incomplete or misleading statistics drawn from their case work.

In reality, there is no accepted research on how often hair from different people may appear the same. Since 2000, the lab has used visual hair comparison to rule out someone as a possible source of hair or in combination with more accurate DNA testing.

Warnings about the problem have been mounting. In 2002, the FBI reported that its own DNA testing found that examiners reported false hair matches more than 11 percent of the time. In the District, the only jurisdiction where defenders and prosecutors have re-investigated all FBI hair convictions, three of seven defendants whose trials included flawed FBI testimony have been exonerated through DNA testing since 2009, and courts have exonerated two more men. All five served 20 to 30 years in prison for rape or murder.

University of Virginia law professor Brandon L. Garrett said the results reveal a “mass disaster” inside the criminal justice system, one that it has been unable to self-correct because courts rely on outdated precedents admitting scientifically invalid testimony at trial and, under the legal doctrine of finality, make it difficult for convicts to challenge old evidence.

“The tools don’t exist to handle systematic errors in our criminal justice system,” Garrett said. “The FBI deserves every recognition for doing something really remarkable here. The problem is there may be few judges, prosecutors or defense lawyers who are able or willing to do anything about it.”

Federal authorities are offering new DNA testing in cases with errors, if sought by a judge or prosecutor, and agreeing to drop procedural objections to appeals in federal cases.

However, biological evidence in the cases often is lost or unavailable. Among states, only California and Texas specifically allow appeals when experts recant or scientific advances undermine forensic evidence at trial.

Defense attorneys say scientifically invalid forensic testimony should be considered as violations of due process, as courts have held with false or misleading testimony.

The FBI searched more than 21,000 federal and state requests to its hair comparison unit from 1972 through 1999, identifying for review roughly 2,500 cases where examiners declared hair matches.

Reviews of 342 defendants’ convictions were completed as of early March, the NACDL and Innocence Project reported. In addition to the 268 trials in which FBI hair evidence was used against defendants, the review found cases in which defendants pleaded guilty, FBI examiners did not testify, did not assert a match or gave exculpatory testimony.

When such cases are included, by the FBI’s count examiners made statements exceeding the limits of science in about 90 percent of testimonies, including 34 death-penalty cases.

The findings likely scratch the surface. The FBI said as of mid-April that reviews of about 350 trial testimonies and 900 lab reports are nearly complete, with about 1,200 cases remaining.

The bureau said it is difficult to check cases before 1985, when files were computerized. It has been unable to review 700 cases because police or prosecutors did not respond to requests for information.

Also, the same FBI examiners whose work is under review taught 500 to 1,000 state and local crime lab analysts to testify in the same ways.

Texas, New York and North Carolina authorities are reviewing their hair examiner cases, with ad hoc efforts underway in about 15 other states.
Mon, April 20, 2015 - 7:33 AM — permalink - 0 comments - add a comment


"Money talks and our government is for sale. Just ask Marco Rubio what the going rate for naming rights is on a presidential campaign these days. The power and money that Kristol represents do not provide their support without expectations. These thugs absolutely want their return on capital. The returns come by way of a currency only a President carries.”—From


While Republican Senator Marco Rubio may want to usher in a new generation in American politics, his slogan, which appeared on the front of his podium today, is hardly that.


He stood at a podium bearing his campaign slogan “A New American Century,” underscoring a strategy that will try to position Rubio as a transformational figure.

It’s fine as a slogan, but it is worth pointing out it’s existence as a Neoconservative think tank.

The Project for the New American Century (PNAC) was a neo-conservative think tank (1997 to 2006) that had strong ties to the American Enterprise Institute. PNAC’s web site said it was “established in the spring of 1997″ as “a non-profit, educational organization whose goal is to promote American global leadership.”

Certainly, as USA Today points out, he’s correct in that Hillary Clinton is old and of the past. However, as the latest Republican to announce for President in an increasingly crowded field, Rubio may have left himself open to some competitive criticism for his choice of a somewhat old slogan.

U.S. Sen. Marco Rubio cast himself tonight as a Republican who can be the leader of a “new American century,” framing the 2016 election as a “generational choice” and himself as the candidate with a fresh outlook and ideas.
Sun, April 19, 2015 - 7:17 AM — permalink - 0 comments - add a comment

Hillary Clinton, Cisco and China: Company Funded Foundation, Was Lauded by Clinton Despite Role in Repression


Cisco Systems had a public relations problem: Having invested $16 billion in the Chinese market, the technology giant was suddenly facing congressional scrutiny over its alleged complicity in building the so-called Great Firewall that helps China's authoritarian regime censor information and surveil its citizens.

The San Jose, California, company endured a high-profile Senate hearing about its Chinese operations in 2008 and reaffirmed its “continued commitment to China.” But the issue wouldn’t die. A group of investors stormed the company’s annual meeting in November 2009, pressing a shareholder resolution that would force the company to prevent the Chinese government from using Cisco technology to engage in what critics said was widespread human-rights abuse.

That’s when then-Secretary of State Hillary Clinton tossed the company a lifeline. Weeks after Cisco executives opposed the initiative and it was then voted down by shareholders, Cisco was honored as a finalist for the State Department’s award for “outstanding corporate citizenship, innovation and democratic principles.” The next year, the company won the award. While the honors were for the company’s work in the Middle East, they gave Cisco a well-timed opportunity to change the subject and present itself as a champion of human rights.

What Clinton did not say at the State Department award ceremonies was that Cisco had been pumping money into her family’s foundation. Though the foundation will not release an exact timeline of the contributions, records reviewed by International Business Times show that Cisco had by December 2008 donated from $500,000 to $1 million to the foundation. The company had hired lobbying firms run by former Clinton aides. After the money flowed into the foundation, Clinton’s State Department not only lauded Cisco’s human rights record, it also delivered millions of dollars worth of new government contracts to the company.

The most recent foundation records available show that Cisco has donated between $1 million and $5 million to the Clinton Foundation, all told. Cisco employees have been generous financial supporters of Hillary Clinton’s political career, delivering more than $140,000 to her campaigns, data compiled by the Sunlight Foundation show. The foundation, the State Department, and Hillary Clinton’s presidential campaign all declined IBTimes’ requests for comment.

A spokesman for Cisco said the company does “not participate in business activities that would aid repression.” The company declined to answer when asked specifically about human rights in China and declined to comment on the nature of the contracting work it has with the U.S. government.

'Crony Capitalism'

Internet freedom advocates say Clinton’s moves helped Cisco whitewash its image and also raise questions about the sincerity of her often-stated commitment to human rights.

“Crony capitalism has defined Clinton's career, from her tenure on the board of Walmart, to the Wall Street execs whom she surrounded herself with at the State Department, to her allegiance to Cisco, even as it violated principles on which she staked her tenure,” said David Segal, executive director of the Internet freedom advocacy group Demand Progress.

Clinton begins her campaign for the presidency amid intensifying questions about whether donations to her foundation unduly influenced her actions as a top U.S. government official. The Wall Street Journal reported that the board of the Bill, Hillary and Chelsea Clinton Foundation will continue to accept donations from Australia, Britain, Canada, Germany, the Netherlands and Norway; other countries can still participate in the Clinton Global Initiative, a subsidiary of the foundation.

An IBTimes report last week demonstrated how Clinton changed her position on a Colombia trade deal and backed military aid to that country after the Colombian subsidiary of a Canadian oil company and its founder delivered large donations to the foundation. Clinton’s family foundation also has received donations from countries like Morocco, Saudi Arabia and the United Arab Emirates, all of which had sensitive relationships with Clinton’s State Department.

The State Department’s relationship with China was also delicate. Over the years, Clinton developed a reputation as someone willing to be tough on Beijing. In 1995, as first lady, she gave a speech in the Chinese capital firmly declaring that “women’s rights are human rights, once and for all.” When Chinese authorities moved to assert control ahead of the Beijing Olympics in 2008, she spoke out for the cause of Tibet and for jailed dissidents.

In her 2014 memoir "Hard Choices," Clinton reiterated her support for human-rights advocates in China. She specifically criticized the Great Firewall, writing that after she made comments about the right to dissent in China in 2011, “censors went right to work erasing mentions of my message from the Internet.”

But the issue of Chinese repression -- and Cisco’s role -- was already known by then. In 2009, weeks after Clinton’s State Department had named Cisco a finalist for the secretary of state’s Awards for Corporate Excellence (ACE), a report from the Electronic Freedom Foundation noted “Cisco's deep involvement” in building the Chinese government’s censorship system. The report pointed out that “Cisco engineers gave a presentation acknowledging the repressive uses for their technology.”

In 2010, the Clinton Foundation gave Cisco CEO John Chambers a high-profile speaking role at its “Turning Ideas Into Action” annual meeting. Cisco also won an ACE that year -- just before the Human Rights Law Foundation filed a lawsuit against Cisco outlining what the foundation's executive director, Terri Marsh, said was the “key role Cisco played in the design, construction, and maintenance of China’s Internet surveillance system.”

In an interview with IBTimes, Marsh said that “Cisco’s conduct has enabled an unprecedented and widespread crackdown on religious minorities, Tibetans, and democracy activists in China.” Cisco’s work in China, she said, “runs contrary to Secretary Clinton's stated commitment to ‘a single Internet where all of humanity has equal access to knowledge and ideas.’” She added: “We are disappointed that the State Department has chosen to reward rather than condemn such a company, and believe that the United States should instead be sending a clear message to American technology corporations that complicity in global human rights abuses is not acceptable.”

Cisco has argued that it cannot control how its products are used, and can’t be held responsible for a government that might employ its technology to undermine democratic rights.

“We have never customized our equipment to help the Chinese government -- or any government -- censor content, track Internet use by individuals or intercept Internet communications,” the company said in a statement in 2011. “Cisco does not supply equipment to China that is customized in any way to facilitate blocking of access or surveillance of users. Equipment supplied to China is the same equipment we provide worldwide.”

Wired magazine reported in 2008 that internal company documents show that Cisco saw the Great Firewall as an opportunity to expand its business operations in China.

Daniel Wade, an attorney who represented Chinese dissidents in a lawsuit against Cisco, told IBTimes that “Cisco knew full well that its products were going to be used to suppress and facilitate the torture of democracy activists.”

'Ample Evidence'

The Electronic Frontier Foundation, which today works with Cisco on an Internet encryption project, said Cisco technology enabled violent repression by the Chinese government.

“We have ample evidence to indicate that the technology Cisco created was instrumental in the tracking down of religious minorities, detaining them, and murdering them,” said Rainey Reitman, the EFF’s activism director. “Unfortunately, there hasn’t been a full public accounting.”

Clinton’s State Department did more than simply praise Cisco’s human rights record. Starting in 2010, Cisco began receiving lucrative contracting work from the department, totaling more than $3.5 million during Clinton’s time as secretary of state (January 2009 to February 2013). There’s no data available indicating that Cisco had received contracting work from the State Department prior to Clinton’s tenure.

The human rights award and government contracts coincided with Cisco hiring lobbying firms Franklin Square Group, Capitol Solutions, and Capitol Counsel, which are all run by former Clinton aides. The firms received almost $2 million in lobbying business from Cisco during Clinton’s tenure as secretary of state, federal records show.

None of the firms had received lobbying business from Cisco prior to Clinton’s appointment to head the department.

Bill Clinton’s financial relationships in China add another layer of complexity. The Clinton Foundation has received more than $500,000 from the Alibaba Group, which has assisted Chinese government efforts to crack down on dissent in Tibet. And in 2005, Bill Clinton appeared in China at an event jointly sponsored by Yahoo and Alibaba after Yahoo had handed over evidence to the Chinese government for its legal case against a critical journalist.

Meanwhile, Hillary Clinton’s relationship with Cisco has continued. In August, she appeared at the company for a surprise visit. Chambers interviewed her onstage, telling employees: “I’m a strong Republican, but I think President Clinton got it right with business and knocked the ball out of the park."

UPDATE: This story was updated to reflect that Cisco executives did not themselves kill the 2009 shareholder initiative -- they publicly opposed it, and shareholders then voted it down. Additionally, this story was updated to reflect that Cisco's donation to the Clinton Foundation was not for climate change work - it was a membership donation to the Clinton Global Initiative.
Sun, April 19, 2015 - 7:00 AM — permalink - 0 comments - add a comment

Putin Just Bought Greece’s Eurozone Veto Vote (Against Future Sanctions) for a Mere $5 Billion!

The Greek "White Knight" Emerges: Putin to Give Athens €5 Billion for Advance Gas Pipeline Fees


With Greece teetering on the edge of insolvency and forced to raid pension and most other public funds, ahead of another month of heavy IMF repayments which has prompted even the ECB to speculate Greece should introduce a parallel "IOU" currency, a white knight has appeared out of nowhere for Greece, one who may offer $5 billion in urgently needed cash. The white knight is none other than Vladimir Putin. “Just because Greece is debt-ridden, this does not mean it is bound hand
and foot, and has no independent foreign policy,” Putin said previously.

Putin Tsipras 2_0.jpg

According to Spiegel, citing a senior figure in the ruling Syriza party, Greece is poised to sign a gas deal with Russia as early as Tuesday which could bring up to €5 billion into the depleted Greek coffers.

The move could now "turn the tide" for the debt-stricken country according to a senior Greek official.

As Reuters adds, during a visit to Moscow earlier this month, Greek Prime Minister Alexis Tsipras expressed interest in participating in a pipeline that would bring Russian gas to Europe via Turkey and Greece.

Under the proposed deal, Greece would receive advance funds from Russia based on expected future profits linked to the pipeline. The Greek energy minister said last week that Athens would repay Moscow after 2019, when the pipeline is expected to start operating.

Greek government officials were not immediately available to comment on the Spiegel report.

Of course, this being Greece, the probability of actual repayment is negligible: after all the likelihood of a Greek default is astronomical, and €5 billion will do little to change the mechanics of Greek debt sustainability. And Putin very well knows this.

However, the Russian leader is not acting out of the kindness of his heart, but merely engaging in another calculated move, one which kills two birds with one stone:

Following the death of the South Stream, whereby the EU pressured Bulgaria to refuse passage of the Russian gas pipeline to Europe, Russia needed an alternative route of bypassing Ukraine (and Bulgaria) entirely, something which according to Kremlin's plan should happen over the next 3 years. And with Hungary and Serbia all eager to transit Russian gas to the Austrian central european gas hub, Greece was the missing link for a landline transit. With this agreement, Russia gets the green light to extend the Blue Stream all the way to Austria and preserve its dominance over the European energy market while leaving Ukraine in a completely barganining vacuum.
Blue Stream_0.jpg

Perhaps just as importantly, suddenly Russia will energy as the generous benefactor riding to Greece's salvation, in turn even further antagonizing the Eurozone and further cementing favorable public opinion. As a reminder, several weeks ago we showed that Russia already has a higher approval rating among the Greek population thatn the Eurozone. In this way, Russia has just won a critical ally for the very low price of just €5 billion, without even having to restructure the entire Greek balance sheet should Greece have exited the euro and been attracted to the Eurasian Economic Union. Which also means that all future attempts to impose further sanctions on Russia by Europe will fail thanks to the Greek veto vote.
Russia is not alone in seeking to divide the spoils of the collapsing Eurozone: Beijing has also sought to invest in Greece's infrastructure and bought up €100m worth of short-term government debt last week the Telegraph reports.

Ironically, it was none other than Germany's finance minister Wolfgang Schauble who said the Greeks are free to pursue deals with Russia and China as they rush to avoid an impending bankruptcy. Turns out the Greeks decided to do precisely as the German suggested, and the outcome will certainly not be to Germany's liking.

The only question following what may well be another masterful stroke by Putin is what will Europe do, now that Putin has in the span of under one year, not only "annexed" Crimea but fully drawn Greece (and the Mediterranean courtesy of Cyprus) into its sphere of influence.

* * *

While we are sure the European leadership will be 'disappointed' at Greece's get-out-of-Troika-jail card thanks to Russia, The Greek people have already expressed their opinion on just who they trust more...

Despite all the western propaganda...


* * *

Finally, for those confused about the flow of funds, here it is:

Russia (Gazprom) gives Greece money, which Greece uses to repay the IMF, which uses the Greek money to fund a loan to Kiev, which uses the IMF loan to pay Russia (Gazprom).

A perfect circle.
Sun, April 19, 2015 - 6:55 AM — permalink - 0 comments - add a comment
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