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The
Most Ambitious Project In Atlantic City History Is Closing Down - (www.businessinsider.com) Revel, the most expensive hotel
and casino in Atlantic City history, will shut down Sept. 10 after no qualified
bidders emerged to bail out the project. CBS' Jeff Kolakowski reports over
3,200 workers' jobs will be affected. Earlier this summer, the resort
filed for bankruptcy for the second time in two years, listing liabilities
of up to $1 billion. The development posted an operating loss of $21.7
million in the first quarter of 2014. Revel first filed for bankruptcy less
than a year after it opened in 2012. Revel cost $2.6 billion to develop and is
New Jersey's second-tallest building. Planned at the height of the pre-Lehman
bubble, the project face numerous delays after the financial crisis. The
greatest setback came when principal owner Morgan Stanley walked away from its
$1 billion investment in 2010.
Over
100 rally against proposed Atlantic City tax increase - (www.pressofatlanticcity.com) Holding signs "Do AC: Do Low Tax" and
"Very soon, Atlantic City will be a ghost town", more than 100
Atlantic City residents protested Tuesday morning outside City Hall against the
29 percent tax increase proposed by Mayor Don Guardian and approved by City
Council. Organized by Emily Vu, who had talked the Vietnamese community into a
protest last month, this protest brought together marchers of all backgrounds,
from the South Asian community that supported Guardian in last year's election,
to members of the black community. "The message is that these are
outrageous taxes," Kenny Pham said. "People can't afford to pay
property taxes like this." David Tayoum said that with the closing of
several casinos and tax appeals, it was understandable there would be some
increases.
Brokers
Lure Soldiers Out of Low-Fee Federal Retirement Plan - (www.bloomberg.com) John
Turner suspected that brokers were encouraging federal workers to ditch their
top-flight retirement plan. So he went under cover. The former U.S. Labor
Department economist called representatives at companies such as Bank of America Corp., Charles Schwab Corp. and Wells Fargo &
Co. He identified himself as a potential client grappling with what to do with
his own nest egg. Turner thought he knew the right answer: Leave it alone. As a
legacy of his government service, he kept his money in the Thrift Savings Plan,
considered the gold standard of 401(k)-type programs for its rock-bottom fees.
Yet all but one company told him to roll over all his money into individual
retirement accounts. On average, stock funds charge almost 50 times more than
the government plan. “It’s a scandal,” said Turner, director of the Pension Policy Center in Washington. “They are trying to sell
me an IRA clearly not in my interest. It’s in their interest. They want to get
the fees.”
Chavez
Friends Get Rich After His Death as Venezuela Slides Into Chaos - (www.bloomberg.com) Retired
Venezuelan Army Captain William Biancucci paces around his sparsely furnished
Caracas office, clutching a red, bound copy of Hugo Chavez’s socialist constitution.
He’s discussing his plans to buy a private jet to ease travel to and from his
cattle ranch in Brazil’s Amazon rain forest. From a sprawling stretch of
pastureland, he packs cows by the thousands on ships headed to Venezuela. Biancucci,
55, who grew up poor, says he won contracts to supply Venezuela with livestock
thanks to friendships with military officers now in the government. His voice
rises with emotion as he says he’s been a devotee of Chavez since military
college, when the late leader was his history professor. In 1992, Biancucci
joined 140 other officers in staging a coup attempt led by Chavez. Although the
coup failed, Chavez was elected president six years later -- and Biancucci’s
business thrived. Socialism, Biancucci says, is the solution to poverty, Bloomberg
Markets magazine will report in its September issue. Chavez’s socialism, he
says, has made him personally rich. “I’m a socialist, but I love having cash in
my hands,” he says, shaking a fist holding an imaginary wad of money.
“Socialism is wealth.” Biancucci is one of a coterie of Venezuelans close to
Chavez who acquired wealth during his 14 years inpower and under his successor, former bus
driver and union leader Nicolas Maduro.
Bubble
Market Stunner: Revenueless Biotech Goes Public, Drops, Trades For Six Days,
Then Voids Entire IPO - (www.zerohedge.com) In
what is certainly a historic, and quite stunning, market first, not to mention prima
facie evidence that Janet Yellen was right about the biotech (and not
only) bubble, last week the equity markets experienced something that has not
happened in decades: a biotech firm went public, traded for six days, only
to announce Friday that it would void its IPO and won't issue shares after all,
thanks to a key investor's failure to follow through on a commitment to buy
stock. In other words, days after going public, yet another darling of the momo
bubble mania du jour, decided to undo everything, and went back to being
private (and soon: bankrupt).
European
Bond Traders Suffer High-Yield Anxiety on Losses - (www.bloomberg.com) Warning
signals are starting to flash for Europe’s biggest money managers as a selloff
in the U.S. high-yield bond market shows signs of crossing the Atlantic. Investors
in London and
Edinburgh say they’re either cutting holdings of junk notes, buying credit
derivatives to
insure against losses or moving into high-yielding debt backed by collateral,
such as oil rigs and cable networks. “We are treading very carefully in the
high yield space,” said Ariel Bezalel, who oversees the $3.8 billion Jupiter Strategic Bond (JUPSTII) fund in London. “We have had to say no to
the vast majority of transactions this year.” While the change in sentiment
isn’t as marked as in the U.S., where a record $7.1 billion was pulled out of
funds buying junk bonds in the week ended Aug. 6, bondholders that snapped up a
record $115 billion of high-yield securities in Europe this year are growing
wary. The region’s junk investors lost 0.3 percent in July after 12 straights
months of gains, while in the U.S. speculative-grade debt forfeited 1.3
percent.
Top
medical expert calls Ebola outbreak 'suspicious'; others cite use as bio-weapon - (www.allvoices.com) After
much speculation about the current Ebola outbreak, one medical expert has gone
on record to voice concerns about what is being called the worst Ebola outbreak
in recorded history. “I am concerned about the prevalence and pathogenicity of
the situation, which is too much even for Ebola. Too many people are dying. I
don't rule out that there's something artificial here .... What is happening
with Ebola there, could there also be something man-made about it?” Gennady
Onischenko, Russia's former chief medical officer, told RT News on Thursday. Onischenko's comments are
the first from a credible medical expert that openly cast doubt on the current
outbreak's natural origin. The World Health Organization's head of health
security, Keiji Fukuda, also voiced concern over whether current measures are
sufficient to contain the outbreak, but stopped short of questioning the
outbreak's origin.
Sanctions
bite-back: Bickering, EU infighting over Russia retaliation - (www.rt.com) There is growing dissent in the EU over
policies that led to a de fact trade war with Russia. Meanwhile the countries
not toeing the line are reaping the benefits, irritating those who jumped on
the sanctions bandwagon. Greek members of the European Parliament demanded
Sunday that the EU cancel sanctions against Russia. MEPs Kostantinos Papadakis
and Sotiris Zarianopoulos said in a letter to some senior EU officials that
Russia’s ban on food import from the EU, which was Moscow’s response to anti-Russian sanctions, was ruinous to
Greek agriculture. “Thousands of small- and middle-sized Greek farms producing
fruit and vegetables and selling them primarily to the Russian market have been
hit hard now as their unsold products are now rotting at warehouses,” the
letter said.
Nevermind:
Ukraine Quickly Backs Off Threat Of Halting Russian Gas Transit After Europe
Screams - (www.zerohedge.com) That
didn't take long. A few short days after Ukraine's always entertaining puppet
government, whose very existence is to benefit its western overlords and
certainly Victoria Nuland's
superiors, briefly forgot it has absolutely zero leverage should it alienate
not only Russia but also Europe (read Angela Merkel) and announced it may halt
Russian energy transits through the country (i.e., Russian gas deliveries for
Germany) without obtaining Angela Merkel's preapproval to such a ridiculous
threat, Europe - suffering a major flashback to early 2009 and realizing winter
is just around the corner - promptly reminded Kiev just who is in control and
advised its puppets that it opposes any Ukrainian cut-off of Russian gas, Bloomberg
reports citing an EU official. "Different parts" of the Ukrainian
government are “actively considering” a cut-off of Russian natural gas in
transit through Ukraine as part of possible sanctions against Russia, a
European Union official says. The EU would oppose such a step by the Ukrainian
government, which is drawing up legislation to allow sanctions against Russia
because of its encroachment in eastern Ukraine, the EU official tells reporters
in Brussels on the condition of anonymity.
US
Postal Service: Over $47 Billion In Losses In The Past Decade And Counting – (www.zerohedge.com) Curious
what pure, unadulterated government efficiency in practice, if not in
theory, looks like? Then the following chart of USPS operating profits, pardon,
losses over the past decade should be sufficient. The punchline: having
generated revenues of nearly $700 billion in the past 40 quarters, the USPS has
been bleeding red ink more or less consistently since 2006, and has now
generated just over $47 billion in operating losses over the past ten years. From the WSJ:
"The USPS said its total liabilities were $67.16 billion at the end of the
period, compared with $23.16 billion in assets." That means the net
capital deficiency, or "cost", to keep the USPS alive, amounts to some $44 billion as of this moment (which includes $3.1 billion in
contributions from the US government and a $47 billion deficit since the 1971
reorganization). Continuing: "The Postal Service reached its $15 billion
credit limit with the Treasury Department in 2012. Under law, the USPS must pay
its own way. It doesn't receive an annual taxpayer subsidy, but is reimbursed
by Congress for some services such as delivering mail to the blind and overseas
voters. The agency is saddled with a congressional mandate that requires it to
prefund more than $5.5 billion annually for health benefits for future
retirees. The service said Monday that it won't be able to make its required
$5.7 billion payment by Sept. 30."
U.S.
Government Caught Using Humanitarian HIV Program As Front To Foster Cuban
Dissent - (www.zerohedge.com) Regular readers of Liberty Blitzkrieg will recall that earlier this year
I highlighted how the U.S. government covertly created a “Cuban
Twitter” called ZunZuneo in a failed attempt to overthrow the island
nation’s regime. The elaborate plot was implemented under the umbrella of
the U.S. Agency for International Development (USAID), which
is responsible for overseeing billions of dollars in U.S.
humanitarian aid. If you need a refresher, check out the post: Conspiracy Fact – How the U.S.
Government Covertly Invented a “Cuban Twitter” to Create Revolution. Well we now
know that USAID went a lot further than that. Another scheme to unseat the
Cuban government has now been revealed. This time with even more immoral
foundations, and which could disrupt genuine humanitarian relief efforts the
world over. Incredibly, the U.S. government used an HIV program as a front
to foster dissent amongst Cuba’s youth. The HIV-prevention workshop was even
referred to as the “perfect excuse to recruit political activists.”
Despicable.
French
builders steal $1.2M in buried treasure - (www.cnbc.com) "If
you find any treasure, let me know!" This instruction, given by French
woman to the three workers she had hired for landscaping work, was meant as a
joke. But the unfortunate homeowner failed to see the funny side when the
workers found -- and then stole -- $1.2 million in gold buried in the bottom of
her garden. According to the French regional daily Paris Normandie, three
men will soon appear in court in northern France charged with theft, after
uncovering and stealing 16 gold bars and hundreds of gold coins in a couple's
garden. The three workers, hired to level out the couple's garden in view of a
house extension raised Tracfin's – a service from the French ministry of
finances tasked with fighting money laundering –suspicions after one of them
cashed in two checks worth 270,000 euros ($361,000) and 30,000 euros ($40,000)
into his account.
German
Economy Backbone Bending From Lost Russia Sales - (www.bloomberg.com) MWL
Apparate Bau GmbH, based in the eastern German town of Grimma, has relied on
strong ties with Russia to bolster business. Today, those links
don’t mean much. The maker of equipment such as pressure vessels and hot water
tanks for the chemical and petrochemical industries has seen a “significant”
decline in orders in the last six months due to the crisis, sales chief
Reinhard Weber said. The company has annual revenue of about 20 million euros
($27 million). “There are two contracts from Russia we didn’t get and we think
that’s for political reasons,” Weber said in a telephone interview.
Russian
Sanctions Dim Greek Hopes for Exit From Recession - (www.bloomberg.com) Greece’s
hopes of a 2014 exit from its deepest recession in a half-century may hit a
stumbling block after Russia banned European Union food imports in retaliation
for sanctions stemming from the insurgency in Ukraine. “The estimated total
cost of Russian counter-sanctions for the Greek economy may look tolerable, but
the impact could be quite damaging for industries such as tourism and
agriculture amid the fragility of a slowly recovering economy,” said Thanos Dokos, director-general of the Hellenic
Foundation for European and Foreign Policy, a Greek think-tank. “It also raises questions
about energy security in the coming autumn and winter.”
European
Bond Traders Suffer High-Yield Anxiety on Losses - (www.bloomberg.com) Warning
signals are starting to flash for Europe’s biggest money managers as a selloff
in the U.S. high-yield bond market shows signs of crossing the Atlantic. Investors
in London and
Edinburgh say they’re either cutting holdings of junk notes, buying credit
derivatives to
insure against losses or moving into high-yielding debt backed by collateral,
such as oil rigs and cable networks. “We are treading very carefully in the
high yield space,” said Ariel Bezalel, who oversees the $3.8 billion Jupiter Strategic Bond (JUPSTII) fund in London. “We have had to say no to
the vast majority of transactions this year.” While the change in sentiment
isn’t as marked as in the U.S., where a record $7.1 billion was pulled out of
funds buying junk bonds in the week ended Aug. 6, bondholders that snapped up a
record $115 billion of high-yield securities in Europe this year are growing
wary.
German
Handelsblatt Releases Stunning Anti-West Op-Ed, Asks If "West
Rabble-Rousers Are On The Payroll Of The KGB" - (www.zerohedge.com) Up
until this point Angela Merkel, and German media in general, had been staunchly
on the side of the west when it comes to dealing with Russia, Putin and
realpolitik in broader terms. That changed dramatically today when Gabor
Steingart, the chief editor of Handelsblatt, Germany's leading economic
newspaper, came out with a stunning op-ed, in German,English and Russian,
titled simply that "The West on the wrong path" in which the editor
comes out very vocally against the autopilot mode German media has been on for
the past several months and calls for an end to a strategy of sanctions and
Russian confrontation that ultimately "harms German interests" and is
a dead end.
Obamacare
a windfall for insurers: Ex-Obama advisor
- (www.cnbc.com) Don't
believe the hype that insurance companies are getting squeezed on Obamacare.
That's the message from one of the architects of the president's health-care
law. "All of these companies are expanding greatly in the exchanges,"
Dr. Ezekiel Emanuel, former special advisor on health policy, told CNBC's
"Squawk Box"
on Friday. "Their revenues are up. Their profits are up. Their stocks are
up. They're not suffering because of" Obamacare. Last week, Aetna Chairman and CEO Mark Bertolini appeared
on the program, saying the insurer priced its 600,000 Obamacare customers who
tend to be older and sicker at lower margins.
US
May Introduce New Sanctions Against Russia Over Iran Oil Deal - (www.en.ria.ru) The
United States may introduce new sanctions against Russian companies due to the
recently signed oil deal between Moscow and Tehran, the US Treasury’s Under
Secretary for Terrorism and Financial Intelligence David Cohen said Thursday,
as reported by Reuters. Although it was still unclear whether Russia and Iran had agreed on an oil-for-goods swap, Cohen said
Washington had warned Russia against such a deal under the threat of additional
US sanctions, according to Reuters. Moscow and Tehran signed a five-year
memorandum of understanding on Monday aimed at boosting bilateral economic
cooperation. The agreement also envisions Russia taking an active role in the
construction and overhaul of Iran’s energy production facilities and electric
grids. The next high-profile meeting between the countries' delegations is
scheduled to take place in Tehran on September 9-10.
Draghi
Takes Aim at Italy as Recession Scars Euro Area - (www.bloomberg.com) Mario Draghi says Italy can only blame itself for its
third recession since 2008. The European Central Bank president singled out his
country’s lack of structural reform after data showed the euro-area’s
third-biggest economy unexpectedly contracted last quarter. The comments in
Draghi’s monthly press conference came a day before Italian Prime Minister Matteo Renzi won a key vote in his drive to remake the
country’s political system. “I keep on saying the same thing, really -- I mean,
of reforms in the labor market, in the product markets, in the competition, in
the judiciary, and so on and so forth,” Draghi, the former Bank of Italy
governor, said in Frankfurt yesterday after keeping ECB interest rates
unchanged at record lows.
