News Items 2.0
The future coming at you.
1. Agents with the Federal Bureau of Investigation and Immigration and Customs Enforcement have turned state driver’s license databases into a facial-recognition gold mine, scanning through millions of Americans’ photos without their knowledge or consent, newly released documents show. Thousands of facial-recognition requests, internal documents and emails over the past five years, obtained through public-records requests by Georgetown Law researchers and provided to The Washington Post, reveal that federal investigators have turned state departments of motor vehicles databases into the bedrock of an unprecedented surveillance infrastructure.
2. A study of the employment information of thousands of Huawei staff has revealed deeper links with the Chinese military and intelligence apparatus than those previously acknowledged by China’s biggest telecom equipment maker. The findings are likely to add fuel to the debate among governments around the world over whether to block Huawei’s gear from the rollout of 5G telecoms networks for security reasons.
3. China’s plan to name foreign companies as a risk to national security is expected to be used as a key bargaining chip when trade talks with the United States resume, according to industry sources. The two sides are poised to restart negotiations in Beijing next week following the face-to-face meeting between US President Donald Trump and Chinese President Xi Jinping at the G20 summit in Osaka, Japan, last weekend. But sources and observers said China had several cards to play if the momentum towards a trade deal stalled again – including the proposed list of “unreliable entities."
4. Iranian officials said Sunday they would begin enriching uranium above the level allowed by the 2015 nuclear deal “within several hours,” in the latest scaling back of the country’s commitments to the accord following the U.S. withdrawal from it last year. A spokesman for the Atomic Energy Organization of Iran said international monitors would be able to confirm the breach Monday, but he did not give details.
5. Iran is producing oil at the slowest clip since 1986, making U.S. sanctions on crude sales as effective as the devastating Iraq-Iran war that ended more than 30 years ago. And there is no sign of relief as the Islamic Republic steps up uranium enrichment. President Donald Trump warned Iran of further penalties if it continues to advance its nuclear program.
6. U.S. gas production rose to a record of more than 37 trillion cubic feet last year, up 44% from a decade earlier. Yet the infrastructure needed to move gas around the country hasn’t kept up. Pipelines aren’t in the right places, and when they are, they’re usually decades old and often too small. The result, despite natural-gas prices that look low on commodities exchanges, is energy feast and famine.
7. In a new study, Venezuelan economist Francisco Rodriguez at New York brokerage Torino Capital set out evidence that US financial sanctions are associated with a 797,000 b/d drop in oil production, worth about $16.9 billion a year. He warned of disastrous consequences in a country which grows barely a third of the food it needs. “We’re going to see a famine in Venezuela,” Mr Rodriguez said. “Total imports in April were only $303 million and around half of those were oil-related. That is just 8 per cent of the 2012 figure . . . even if all the imports were of food, it would still be far off the amount needed to feed the country.” The human cost of Venezuela’s crisis is rising fast. The UN High Commissioner for Refugees estimates that more than 5m people will have fled the country by the end of this year while the Organization of American States predicts that the exodus will top 8m by the end of next year. US officials, however, believe sanctions will achieve their objective: regime change.
8. President Recep Tayyip Erdogan has dismissed the governor of Turkey’s central bank, sparking fresh investor concerns over the independence of an institution that has strained to combat runaway inflation. A presidential decree released Saturday said Murat Cetinkaya, who had run the central bank since April 2016 and defied Mr. Erdogan to increase the central bank’s main policy rate late last year, was replaced by his deputy, Murat Uysal. The decree didn’t cite a reason for the reshuffle.
9. President Trump wrapped up the weekend as he started it, jawboning the Federal Reserve to lower interest rates at a time when he may be sizing up his two latest picks for Fed governor as successors to Chairman Jerome Powell. If the Fed “knew what it was doing” it would cut rates, Mr. Trump told reporters before he boarded Air Force One in Morristown, New Jersey, to return to Washington after a weekend at his nearby golf club. Fed policy is putting the U.S. at a disadvantage versus Europe and suppressing gains in the stock market, Trump said. Sunday’s comments came after Trump said on Friday that the central bank “doesn’t have a clue” and was “our most difficult problem.”
10. Investors consider an economic recession in Germany inevitable, according to Sentix. An index measuring current conditions and expectations for Europe’s largest economy fell to its lowest level in almost a decade, according to a survey. A similar gauge for the euro area dropped to the lowest since 2014.
11. Germany’s economic slowdown, though no doubt bad for Europe in the short term, could be helpful over a longer period by easing a rift between the region’s economically stronger north and weaker south over pro-growth policies. The country accounts for nearly a third of all economic activity in the eurozone, but no European Union economy grew more slowly in the year through March, aside from Italy. That puts Germans more in sync with the rest of the region as global growth cools, Brexit drags on and trade tensions linger between the U.S. and China.
12. The culling of 18,000 jobs at Deutsche Bank has started just hours after the lender unveiled its most radical strategic overhaul in two decades, with whole teams of equity traders in Tokyo and other Asian locations dismissed on Monday morning. Drawing a line under a 20-year attempt to break into the top ranks of Wall Street, chief executive Christian Sewing on Sunday unveiled plans that will see Deutsche close down all of its loss-making equities trading business and shrink its bond and rates trading operations significantly.
13. Natixis has come out swinging to defend itself against criticism of its business model as the French bank tries to convince investors that a crisis of confidence in one its funds should not shake the entire structure. The French bank’s multi-boutique model has been hit by a crisis at H2O, a London-based fund manager that it owns half of.
14. The recent murder of Walter Lübcke, a politician who had publicly supported Chancellor Angela Merkel’s refugee policy, is raising questions about the Germany’s resolve to monitor and control far-right violence. Far-right militancy is resurgent in Germany, in ways that are new and very old, horrifying a country that prides itself on dealing honestly with its murderous past. Raw and hateful language has become increasingly common online, and politicians are increasingly under threat, with some now requiring protection.
15. Nearly half of young Jewish Europeans have considered moving away from their home countries out of fear for their safety amid a rise in anti-Semitic incidents on the continent, according to a new report issued by the European Union. The report also found that 80 percent of the people surveyed consider anti-Semitism to be a problem in their countries and almost half had experienced at least one anti-Semitic incident in the preceding year.
16. Five Russian couples who are deaf want to try the CRISPR gene-editing technique so they can have a biological child who can hear, biologist Denis Rebrikov has told New Scientist. He plans to apply to the relevant Russian authorities for permission in “a couple of weeks.” The case for using CRISPR for this purpose is stronger than for trying to make children HIV-resistant, as attempted previously, but the risks still outweigh the benefits, say other researchers.
17. Samsung Electronics said it expects its second-quarter operating profit to decline 56.3% from a year earlier as sluggish demand for memory chips was exacerbated by the nagging U.S.-China trade dispute. The company will report final results later this month.
18. WeWork, described by its CEO as "a state of consciousness," has a plan to shore up confidence in its business before it goes public: offer billions of dollars in debt that would fund its growth until it can turn a profit. WeWork, which lost $1.9 billion last year, has been dogged by comparisons to Uber and Lyft and haunted by a huge planned investment from SoftBank Group Corp. that fell apart after some key investors balked at the plan.
19. Time is tight for Donald Trump’s lawyers in their fight to keep the president’s financial records out of the hands of congressional Democrats. Attorneys for the president on Friday will ask a U.S. appeals court panel in Washington to reverse a trial judge’s decision giving a House committee access to documents dating back to 2011, currently held by Trump’s longtime accounting firm, Mazars USA LLP. If the panel rules against them, the lawyers might not get another shot.
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Quick Links: The world’s largest patch of seaweed. Unprecedented Arctic mega-fires are releasing a huge amount of CO2. Planting more trees could suck up a huge share of carbon emissions. Scientists are giving dead brains new life. A third CRISPR baby may have already been born in China. Disruption from automation will hit women workers hardest. The military roots of Silicon Valley. Netflix gets budget-conscious. Can sports betting save TV rights? It's a fentanyl world now: Mexican opium prices plummet, driving poppy farmers to migrate. El Chapo made a boatload of money dealing drugs. Federal prosecutors want him to pay it back. Total bill due: $12,666,181,704. Emerging market assets are running on empty. Why parts of Wall Street are fretting over ‘toxic’ loans. US banks look vulnerable to a leveraged loans ‘cancer.' Big bond rally boosts Italian banks. The weakness of Opec+ is evident. Twenty percent of the global oil supply flows through the Strait of Hormuz. Martin Sorrell takes aim at WPP. Video: Fully automatic landing for small aircrafts. Mad magazine is all but dead.
Political Links: Are efforts to end the long war in Afghanistan gaining momentum? Pension news: the Canadian model flounders. A three-way tussle between free markets, state capitalism and the tech giants is brewing. President Trump's approval rating has improved, markedly. British ambassador calls Trump ‘inept’ and ‘uniquely dysfunctional.’ Rep. Justin Amash, conservative critic of President Trump, won't rule out 2020 bid. Billionaire activist Tom Steyer plans to enter 2020 presidential race. The Joe Biden apology tour draws fire. Nancy Pelosi: "If the left doesn’t think I’m left enough, so be it." The left doesn't think Nancy Pelosi is left enough." Jeffrey Epstein has been taken into custody in New York on new charges having to do with sex crimes involving minors. A Vanity Fair profile of Mr. Epstein is here. The book on Epstein is here. Trump attacks Fox News "weekend anchors," says network is "loading up with Democrats." Resurgent center-right New Democracy party wins big in Greece. Marion Maréchal eyes long game in far-right quest for French power. Trump plans environmental speech. How The Nature Conservancy prospered but ran aground.
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John Ellis