Category Archives: United States

(CNBC) Europe is not headed for a ‘digital war’ with the US, Dutch minister says

(CNBC)

  • Europe is concerned that some U.S. tech companies may not be taking the proper steps needed to protect the personal information of its citizens, Raymond Knops, minister of the interior and kingdom relations in the Netherlands, said.
  • But that does not mean Europe and the United States are headed for a “digital war”, he said.
  • German Chancellor Angela Merkel this week urged Europe to take control of its data from U.S. tech giants.

WATCH NOWVIDEO02:05Governments have to ‘speed up,’ regulate new tech: Dutch minister

Europe is concerned that some U.S. tech companies may not be taking the proper steps needed to protect the personal information of its citizens, a Dutch politician said on Wednesday.

But that does not mean Europe and the United States are headed for a “digital war” over the ownership of consumer data, Raymond Knops, minister of the interior and kingdom relations in the Netherlands, told CNBC’s “Squawk Box.”

Knops, the state secretary, took over the ministerial role from Kajsa Ollongren in November.

“What you can see is that Europe is self-confident about how we deal with our data and the data of our citizens,” Knops said. Last year, the EU’s General Data Protection Regulation went into law, giving individuals sweeping new powers in controlling their data, including the right to demand companies tell them how that information is used.

“What we want is to protect this data of civilians, not be used too easily by private companies. Especially, when there was no consent from these people to deal with this data,” Knops added.

German Chancellor Angela Merkel this week urged Europe to take control of its data from U.S. tech giants. She said the European Union should claim “digital sovereignty” by building its own technology products to manage data and reduce dependency on the likes of Amazon, Google, and Microsoft, the Financial Times reported.

Lawmakers in Europe are likely to keep big American tech firms under close scrutiny, according to experts.

When asked about the possibility of digital protectionism, Knops pointed out that Europe, as a continent, is “very much depending on international trade.”

“The last thing we would do is to isolate ourselves,” he said, re-emphasizing the focus lawmakers there have on protecting user data. “What we’ve seen in the last decade is that a lot of companies were not very careful with dealing with data of civilians.”

GP: Facebook EU Parliament protest 180522

Global activists of Avaaz, set up cardboard cutouts of Facebook chief Mark Zuckerberg, on which is written ‘Fix Fakebook’, in front of the European Union headquarters in Brussels, on May 22, 2018.John Thys | AFP | Getty Images

Knops also explained that governments need to speed up their pace in keeping up with new technologies that are being developed in order to better regulate them. “Not to stop developments, but just to put it in the right direction.” He was addressing the trend of private companies, like Facebook, trying to launch new digital currencies and payments systems.

He explained that it’s not just the European Union that’s working to develop a set of principles and guidelines for companies and governments that deal with new tech like artificial intelligence — other countries are also exploring such options, Knops said.

In the event that U.S. tech firms fail to adhere to established principles and guidelines, Knops said there could be a potential consequence: “It’s not the intention but when you set a set of principles, and guidelines about transparency and respecting privacy, and companies don’t comply with that, the ultimate consequence could be that you say, ‘You’re not welcomed.’”

(ZH) Feds Launch Investigation Into Google’s Secretive “Project Nightingale”

(ZH) Big Tech can’t seem to go one month without becoming involved in some new data privacy scandal, but this time, Google parent Alphabet has outdone itself.

Yesterday, WSJ broke a story about a deal between Alphabet and Ascension Health System, a Catholic non-profit that operates hospitals and nursing homes in 21 states and Washington DC. Ascension has more than 2,600 facilities, but its data – including critical patient data – is presently spread across 40 data centers in more than a dozen states.

But thanks to a deal between the two organizations that spawned Google’s “Project Nightingale”, all of that data are being moved into Google’s cloud, and Google engineers are working on a system that they say could revolutionize how doctors use patient health data to make diagnoses.

The only problem, is some regulators have expressed concerns that the patient data aren’t being properly protected, or that Google might illegally use the data to hone its ad micro-targeting. The sensitive health data of millions of Americans would be quite a score.

And there’s reason to be suspicious: Without notifying patients or doctors, Ascension recently started sharing personally identifiable information on millions of patients with Google. The data include: patients’ names and dates of birth; lab tests; doctor diagnoses; medication and hospitalization history; and some billing claims and other clinical records.

Now, the Office for Civil Rights in the Department of Health and Human Services is investigating the arrangement to see if “this mass collection of individuals’ medical records to ensure that HIPAA protections were fully implemented.”

For those who are unfamiliar with the term, HIPAA protections are the same rights that prevent doctors from giving out patients’ information without their authorization.

Some Ascension patients who spoke with WSJ said they were suspicious of Google’s motives, since, according to its agreement with Ascension, Google is responsible for building the infrastructure, then Ascension will pay Google to manage the data after the project is completed.

Patients are worried that Google might find another payout somewhere else by using their data to court advertisers.

“Google is not doing this out of the goodness of their heart,” said Tim Wiesner, a 63-year-old retired nurse and Ascension patient in Wichita, Kan. He said he was disappointed not to have been notified of the data sharing directly by his doctor. “It just seems deceitful. I’m sure they are going to make money off our information.”

One academic agreed with the patients, adding that “the optics are bad.”

“The optics are bad. The legal argument is tenuous. Ethically, this is a bad strategy. They need to tell people what they are doing,” said Ellen Wright Clayton, a professor of biomedical ethics at Vanderbilt University. She said the Alphabet Inc. unit risks running afoul of the rules if it uses the health data to perform independent research outside the direct scope of patient care.

Some lawmakers have expressed reservations about ‘Nightingale’, and have asked Google to suspend the project.

“The optics are bad. The legal argument is tenuous. Ethically, this is a bad strategy. They need to tell people what they are doing,” said Ellen Wright Clayton, a professor of biomedical ethics at Vanderbilt University. She said the Alphabet Inc. unit risks running afoul of the rules if it uses the health data to perform independent research outside the direct scope of patient care.

Google employees working on the project might have access to the sensitive information. It’s not clear what the company is doing to try and prevent this. Google stands to reap tens of millions in profits by repeating this work for other health-care giants. It should be able to figure out a way to satisfy those who are concerned about illegal sharing of data.

(ZH) Trump Celebrates “A New Record” As Stocks, Bond Yields, & The Dollar Soar

(ZH) Another day, another trade-deal headline saying nothing new but good enough for the algos…

US equity markets love it…

Surging to new record highs, a fact not missed by the president…

BofA Merrill’s Paul Ciana Recommends Buying Bonds, Shorting Dollar-Yen

Donald J. Trump@realDonaldTrump

Stock Market up big today. A New Record. Enjoy!58.4K3:43 PM – Nov 7, 2019Twitter Ads info and privacy22.5K people are talking about this

But he probably will not be happy that the dollar is also soaring…

Source: Bloomberg

Gold is, of course, getting monkeyhammered…

And interest rates are also spiking…

Source: Bloomberg

Housing markets won’t like that much.

And as rates rise, will gold catch down to global volumes of negative-yielding debt?

Source: Bloomberg

(Independent) Trade war: China and US agree to roll back tariffs in phases, giving boost to prospects for world economy

(Independent) Stock markets soar as world’s two economic superpowers agree deal

Reuters

China and the US have agreed to cancel tariffs on billions of dollars of goods in the first sign that a damaging trade war between the world’s two largest economies could be winding down.

European stock markets surged  to their highest level since 2015 on Thursday morning as hopes rise that trade hostilities will thaw, giving a boost to the global economy.

China’s Commerce Ministry said that Washington and Beijing had agreed to roll back tariff hikes that have already been imposed, depending on further progress in trade talks.  TOP ARTICLES1/5READ MORERed Star Belgrade vs Tottenham LIVE: Resultand latest reaction from Champions League match

“In the past two weeks, top negotiators had serious, constructive discussions and agreed to remove the additional tariffs in phases as progress is made on the agreement,” spokesperson Gao Feng said Thursday.

“If China and the US reach a phase-one deal, both sides should roll back existing additional tariffs in the same proportion simultaneously,” Mr Gao said.

6 November 2019

“The trade war started with tariffs, and should end with the cancellation of tariffs,” Gao told reporters.

Neither side has yet laid out a timetable for the roll back.

The announcement comes amid increasing signs that the trade war is hurting US businesses, including some in key swing states for the 2020 US presidential election.

Donald Trump has made attacking China’s trade practices a hallmark of his presidency, imposing import tariffs on hundreds of billions of dollars of Chinese goods and placing Chinese companies such as Huawei on a blacklist.

Tit-for-tat tariff hikes between the two sides have dragged down confidence in global trade, hurting economic growth which had already showed signs of slowing.

China’s imports of American soybeans and other goods tumbled 26.4 per cent in the first nine months of this year following tariff hikes and orders to importers to find other suppliers.

Independent news email

Only the best news in your inboxContinue

Register with your social account or click here to log inwould like to receive morning headlinesMonday – Friday plus breaking news alerts by email

Trump and Chinese premier Xi Jinping were due to meet at this month’s gathering of Asia-Pacific leaders in Chile but that event was cancelled due to protests there.

That dampened hopes a face-to-face meeting might produce progress. But US officials say the two governments are looking for a different location.

US Commerce Secretary Wilbur Ross said this week any “Phase 1” agreement would be general and cover trade in specific areas such as soybeans and liquefied natural gas.

More complicated issues would be tackled in later negotiations, Ross said. He gave no indication whether rolling back tariffs was a possibility at this stage.

(SCMP) China’s yuan soars above key level against US dollar on hopes that Trump considering ditching some tariffs

(SCMP)

  • Yuan surged back above key psychological level of 7 to the US dollar on reports that Donald Trump could agree to removing tariffs on China in phase one trade deal
  • Market expectations for further yuan decline have completely evaporated, analysts say, amid surprise suggestion of more significant trade deal than expected
Chinese 100 yuan banknotes are seen in a counting machine while a clerk counts them at a branch of a commercial bank in Beijing, China. Photo: Reuters

Chinese 100 yuan banknotes are seen in a counting machine while a clerk counts them at a branch of a commercial bank in Beijing, China. Photo: Reuters

China’s yuan surged on Tuesday to its highest level against the US dollar since August amid rising optimism that US President Donald Trump would agree to roll back tariffs on Chinese imports.The phase one deal, which may be signed later this month by Trump and Chinese President Xi Jinping at a yet-to-be determined location, is widely expected to include a US pledge to scrap tariffs that are scheduled for December 15 on about US$156 billion worth of Chinese imports, including mobile phones, laptops and toys.Officials in Beijing demanded that Washington take a further step and retract some existing levies on Chinese goods for the first time since the start of the trade war in July 2018, a step that has been resisted by Trump to date. However, White House officials are now debating whether to remove or scale back levies on US$112 billion of Chinese goods, including clothing, appliances and flat-screen monitors, which were introduced at a 15 per cent rate on September 1, the Financial Times reported citing five unnamed sources.

In response, the yuan jumped by 0.59 per cent to 6.9890, breaking a key resistance level of 7.00 to the dollar, as traders and fund managers closed position betting against a rise in the currency that triggered a wave of automatic trades set up to avoid losses. The yuan’s rise also pulled up other regional currencies, including the South Korean won, the Taiwanese dollar and Singapore’s dollar.

“This [would be] totally unexpected by the US side,” said Ken Cheung Kin-tai, chief Asian currency strategist at Mizuho Bank, on the prospect of tariff removal. “If tariffs are being removed, that could really mark a major turning point in the trade war. It may not even be a mini-deal or just a ceasefire, but a much more significant trade deal to be signed.”

The yuan jumped by 0.59 per cent to 6.9890 on Tuesday, breaking a key resistance level of 7.00 to the dollar. Photo: AFP

The yuan jumped by 0.59 per cent to 6.9890 on Tuesday, breaking a key resistance level of 7.00 to the dollar. Photo: AFPShare:

Trump may be using the phase one deal to ensure large Chinese purchases of US agricultural products as a means of securing support from his electoral base in farm states as he seeks re-election next November, analysts said.“A tariff detente, or even removal of some tariffs, is not a bridge too far to cross, especially as President Trump moves to bolster his political ambitions and guarantee that US voters do not end up with a lump of coal in their holiday stockings this year,” said Stephen Innes, Asia-Pacific Market Strategist at AXITrader. “The doom and gloom fear of a rapid yuan depreciation is quickly evaporating.”

Given that the previous two tranches of tariff increases saw the yuan drop to 7.10 to the dollar from 6.90, there is downside potential for the yuan to rise to 6.90 again if both the October and December tariffs are entirely removed, Innes said.

Optimism around a US-China trade deal, the driver of the currency appreciation, is based on the fact that an ailing Chinese economy could do with a shot in the arm.

Adding to this optimism, Xi reiterated on Tuesday the government’s extensive pledges to continue to open China’s economy and markets and strengthen protection of intellectual property rights to attract foreign capital flows.

“China’s door will only open wider and wider,” Xi said at the China International Import Expo in Shanghai, suggesting additional government efforts to facilitate foreign trade and investment.

(CNBC) Pentagon echoes Trump, says securing Syrian oil fields is top priority after ISIS leader’s death

(CNBC)

  • The Pentagon emphasized Monday that U.S. troops will secure oil fields in northeast Syria in the wake of ISIS leader Abu Bakr al-Baghdadi’s death.  
  • “At the height of Baghdadi’s reign, these oil fields provided ISIS with the bulk of financial resources used to fund its terror,” Secretary of Defense Mark Esper said Monday at the Pentagon.
  • What’s more, the latest revelation comes as the Trump administration works to withdraw the U.S. military presence in war-torn Syria.
GP: DOD Secretary Esper And Chairman Of Joint Chiefs Milley Discuss Al-Baghdadi Raid

U.S. Defense Secretary Mark Esper (L) and Chairman of the Joint Chiefs of Staff Gen. Mark Milley hold a news conference at the Pentagon the day after it was announced that Abu Bakr al-Baghdadi was killed in a U.S. raid in Syria October 28, 2019 in Arlington, Virginia.Chip Somodevilla | Getty Images News | Getty Images

WASHINGTON — The Pentagon emphasized Monday that U.S. troops will secure oil fields in northeast Syria in the wake of ISIS leader Abu Bakr al-Baghdadi’s death.

“At the height of Baghdadi’s reign, these oil fields provided ISIS with the bulk of financial resources used to fund its terror,” Secretary of Defense Mark Esper said Monday at the Pentagon. “U.S. troops will remain positioned in this strategic area to deny ISIS access to those vital resources and we will respond with overwhelming military force against any group that threatens the safety of our forces there,” he added.

“The fundamental purpose of securing those oil fields is to deny those oil fields access to ISIS in order to prevent ISIS from resurgence,” Chairman of the Joint Chiefs Gen. Mark Milley said alongside Esper.

On Sunday, President Donald Trump confirmed Baghdadi’s death and identified Syria’s oil as a U.S. national security priority. Trump also highlighted a potential U.S. energy market opportunity by tapping into Syrian oil.

“What I intend to do, perhaps, is make a deal with an ExxonMobil or one of our great companies to go in there and do it properly…and spread out the wealth,” Trump said, adding that U.S. troops would be tasked with retaining control of the oil facilities.

″[The oil] fueled ISIS, number one. Number two, it helps the Kurds – because it’s basically been taken away from the Kurds… And, number three, it can help us, because we should be able to take some also,” he said.

What’s more, the latest revelation comes as the Trump administration works to withdraw the U.S. military presence in war-torn Syria.

“Baghdadi’s death will not rid the world of terrorism or end the ongoing conflict in Syria but it will certainly send a message to those who question America’s resolve and provide a warning to terrorists who think they can hide,” Esper said.

Last year, Trump went through a similar debate over whether to withdraw U.S. troops from Afghanistan, ultimately agreeing to keep them there but only after repeatedly raising questions about why they should stay. 

(Reuters) Oil prices fall a second day ahead of U.S. stockpile numbers

(Reuters) TOKYO (Reuters) – Oil prices fell for a second day on Tuesday as investors awaited U.S. crude inventory data for more insight into oil demand trends, while concerns about economic growth overshadowed signs of a thawing in the trade war between Washington and Beijing.

Brent LCOc1 futures were down 30 cents, or 0.5%, at $61.27 a barrel by 0733 GMT, having fallen 0.7% on Monday.

U.S. West Texas Intermediate (WTI) CLc1 crude was down 40 cents, or 0.7%, at $55.41, after falling 1.5% in the previous session.

Prices rose sharply last week amid a decline in U.S. inventories and signs of an easing in the U.S.-China trade war, but worries on Monday about weaker economic growth offset hopes of a rise in oil demand even if trade talks progress.

“Where the market remains beaten down by demand concerns, traders could be waiting for signs that the economic data is bottoming and the inventory surpluses are decreasing before fully committing to the long risk-on positions,” said Stephen Innes, Asia Pacific market strategist at AxiTrader.

U.S. crude inventories were forecast to have increased by around 700,000 barrels last week, according to a Reuters poll of analysts, having unexpectedly fallen the previous week, the first decline in six weeks.

Graphic: U.S. crude inventories, weekly changes since 2017, here

Reuters Graphic

U.S. crude oil stockpiles at Cushing, Oklahoma, the delivery point for WTI, have risen by about 1.5 million barrels in the week through Oct. 25, traders said earlier, citing data from market intelligence firm Genscape.

The American Petroleum Institute releases industry data later on Tuesday, while the U.S. government’s Energy Information Administration releases inventory data on Wednesday.

The United States Trade Representative is studying whether to extend tariff suspensions on $34 billion of Chinese goods set to expire on Dec. 28 this year, the agency said on Monday.

U.S. President Donald Trump said earlier on Monday he expected to sign a significant part of the trade deal with China ahead of schedule but did not elaborate on the timing.

Leaders of the world’s two biggest economies are working to agree on the text for a “Phase 1” trade agreement announced by Trump on Oct. 11. Trump has said he hopes to sign the deal with China’s President Xi Jinping next month at a summit in Chile.

The trade war has hit economic growth around the world and kept oil prices range-bound for months.

(Reuters) ‘We know we made mistakes’ on 737 MAX: Boeing CEO

(Reuters) WASHINGTON (Reuters) – Boeing Co Chief Executive Dennis Muilenburg will acknowledge on Tuesday that the aircraft manufacturer made mistakes, as he appears at a congressional hearing on two 737 MAX crashes that killed 346 people, according to written testimony made public on Monday.FILE PHOTO: Boeing Chairman, President and CEO Dennis Muilenburg speaks at the New York Economic club luncheon in New York City, New York, U.S., October 2, 2019. REUTERS/Shannon Stapleton

“We have learned and are still learning from these accidents, Mr. Chairman. We know we made mistakes and got some things wrong,” Muilenburg will tell the U.S. Senate Commerce Committee.

The testimony, which was first reported by Reuters and made public later on Monday, added that the company had made improvements to the now-grounded 737 MAX airplane “that will ensure that accidents like these never happen again.”

Muilenburg, who was stripped of his title as Boeing chairman by the board earlier this month, will also testify before the U.S. House of Representatives Transportation and Infrastructure Committee on Wednesday.

U.S. airlines have canceled flights into January and February because of the grounding and the Federal Aviation Administration is not expected to approve the 737 MAX’s ungrounding until December at the earliest.

“We also know we can and must do better,” Muilenburg’s testimony says. It also expresses “deepest sympathies to the families and loved ones” of those killed, noting the hearing would be taking place on the anniversary of the crash of Lion Air Flight 610 in Indonesia that killed 189 people.

Muilenburg visited the Indonesian embassy in Washington on Monday to meet with the country’s ambassador, offer condolences and pay respects to those lost on the flight, Boeing said in a statement.

Muilenburg’s prepared testimony for Tuesday said that when the 737 MAX returns, “it will be one of the safest airplanes ever to fly.”

In March, after a 737 MAX crash of Ethiopian Airlines 302 killed 157 people, the plane was grounded worldwide.

Senate Commerce Committee Chairman Roger Wicker told Reuters last week that the 737 MAX “won’t fly unless 99.9% of the American public and American policymakers are convinced that it’s absolutely safe.”

Indonesian investigators reported on Friday that Boeing acting without adequate oversight from U.S. regulators and failed to grasp risks in the design of cockpit software on the 737 MAX, sowing the seeds for Lion Air 610 that also involved errors by airline workers and crew.

‘LONGER THAN EXPECTED’

Muilenburg noted that both crashes involved the repeated activation of a flight control software function known as MCAS after it received faulty sensor input.

Boeing’s development of that software has come under criticism in reports and from lawmakers and the company is adding safeguards to the system. Muilenburg said the changes would “eliminate the possibility of even extremely unlikely risks that are unrelated to the accident.”

Boeing has admitted few mistakes since the two fatal crashes. Earlier this month, the FAA questioned why Boeing withheld instant messages from a former pilot for months that raised questions about MCAS.

In May, Boeing acknowledged it did not tell the FAA for 13 months that it inadvertently made an alarm alerting pilots to a mismatch of flight data optional on the 737 MAX, instead of standard as on earlier 737s. The company insisted the missing display represented no safety risk.

Muilenburg acknowledged that getting the plane in the air “has taken longer than we originally expected, but we’re committed to getting it right, and return-to-service timing is completely dependent on answering each and every question from the FAA.”

He added that “regulators should approve the return of the MAX to the skies only after they have applied the most rigorous scrutiny, and are completely satisfied as to the plane’s safety.

The flying public deserves nothing less.”

U.S. Representative Peter DeFazio, who chairs the House panel, has one main question for Boeing at Wednesday’s hearing: “How the hell did this happen?”

(HP) ISIS Leader Abu Bakr Al-Baghdadi Reportedly Killed In US Military Operation

(HP) President Trump tweeted in the early hours of Sunday morning that “something very big” had just happened.

Iran was informed of IS leader Baghdadi’s death – Iranian officials tell Reuters https://reut.rs/346lLUc 

View image on Twitter

2256:01 AM – Oct 27, 2019Twitter Ads info and privacy177 people are talking about this

The leader of ISIS is believed to have been killed in a secretive US military operation, media reports suggest. 

APCNNFox News and Defense One, amongst other outlets, reported that Abu Bakr al-Baghdadi died during the targeted attack. 

Iranian officials told Reuters that Tehran had been informed of Baghdadi’s death by Syrian officials “who got it from the field.”

The White House has not confirmed the ISIS leader’s killing, but said President Donald Trump would have a “major announcement” at 9 a.m. Sunday morning local time. No other information about the announcement was provided.

The secret operation targeting Baghdadi was reportedly approved by Trump earlier this month. There were reports Saturday of US military helicopters over Syria’s northwestern Idlib province.

A team from the Joint Special Operations Command carried out the operation after receiving actionable intelligence, sources told Newsweek. The location had been under surveillance for some time. A senior US defence official told CNN that the CIA had assisted in locating the ISIS leader.

Trump appeared to cryptically hint at the news in a tweet, writing that “something very big just happened,” however did not elaborate. 

Donald J. Trump@realDonaldTrump

Something very big has just happened!323K1:23 AM – Oct 27, 2019Twitter Ads info and privacy175K people are talking about this

The ISIS leader has been in hiding for the past five years. In April, a video was published by the ISIS media wing al-Furqan that showed a man purporting to be Baghdadi.

Several U.S. officials said Baghdadi had been wounded in an airstrike in 2017 and had to give up control of the terror organisation for several months. He became the head of ISIS in 2010. 

(BBG) Boeing Max Design Faulted in Lion Air Crash, Indonesia Says

(BBG)

  •  Reliance on one sensor made flight-control system vulnerable
  •  Investigators presented final findings to relatives of victims
Investigators examine engine parts from Lion Air flight JT 610, Nov. 2018.
Investigators examine engine parts from Lion Air flight JT 610, Nov. 2018. Photographer: Bay Ismoyo/AFP via Getty Images

Design flaws in Boeing Co.’s 737 Max and a lack of information for pilots on how to deal with malfunctions contributed to last year’s crash of Lion Air Flight 610, which killed 189 people, Indonesian investigators found.

In a nine-point presentation to victims’ families, the National Transportation Safety Committee criticized certification procedures for the jet, saying that a flight-control mechanism was approved based on incorrect assumptions. The so-called Maneuvering Characteristics Augmentation System was also implicated in the crash of an Ethiopian Airlines 737 Max in March that claimed 157 lives.You’ve reached your free article limit.Try 3 months for $105 $6. Cancel

(Reuters) Exxon, New York prosecutors face off in climate change fraud trial

(Reuters)

(Reuters) – A lawyer for New York’s attorney general on Tuesday told a state judge Exxon Mobil Corp (XOM.N) used two sets of books to hide the true cost of climate change regulations from investors, while an attorney for the oil major assailed the claims as false and politically motivated.

The lawyers’ opening statements kicked off a long-awaited trial in a civil lawsuit filed by the attorney general last year accusing Exxon of defrauding investors out of up to $1.6 billion.

The trial, expected to last up to three weeks, will take place before Justice Barry Ostrager in Manhattan Supreme Court without a jury and could feature testimony from Rex Tillerson, who served as Exxon chief executive officer and U.S. Secretary of State.

It is the first of several lawsuits currently pending against major oil companies related to climate change to go to trial.

The attorney general sued Exxon in October 2018 under the Martin Act, a New York state law that had been used primarily to go after financial fraud.

The lawsuit claimed Exxon falsely told investors it had properly evaluated the impact of future climate regulations on its business using a “proxy cost” of up to $80 per ton of carbon emissions, but internally used figures as low as $40 per ton or none at all.

“Exxon only ever told its investors about a single set of assumptions,” Kevin Wallace, acting chief of the New York Attorney General’s Investor Protection Bureau, told Ostrager Tuesday.

“What we are saying, and the law demands, is that Exxon not mislead its investors,” he said.

Theodore Wells, a lawyer for Exxon, said that after Tillerson became chief executive in 2006, the company put in place a “robust system” to manage the risk of increasing climate change.

He said the $80 per ton proxy cost represented a “global,” “macro level” assessment of the cost, while lower figures, known as greenhouse gas or GHG costs, were used for particular capital projects.

“There is no document that says … proxy costs and GHG costs were one and the same,” he said.

Wells also accused former New York Attorney General Eric Schneiderman of bringing the case for political reasons.

“They didn’t stay in their lane of objectivity and fairness,” he said.

Massachusetts is separately investigating whether Exxon concealed its knowledge of the role fossil fuels play in climate change.

Both Massachusetts and New York began investigating Exxon after news reports in 2015 saying company scientists had determined that fossil fuel combustion must be reduced to mitigate the impact of climate change.

Those reports, by InsideClimate News and the Los Angeles Times, were based on documents from the 1970s and 1980s. Exxon said the documents were not inconsistent with its public positions.

Exxon and other oil companies including BP Plc (BP.L), Chevron Corp (CVX.N) and Royal Dutch Shell (RDSa.AS) face lawsuits by cities and counties across the United States seeking funds to pay for seawalls and other infrastructure to guard against rising sea levels brought on by climate change.

(Barrons) Boeing Stock Dropped After the Downgrades Started Rolling In

(Barrons)

Photograph by Jim Watson/AFP/Getty Images

Throughout the many troubles of the 737 MAX, most Wall Street analysts have kept faith in Boeing stock—or at the very least, have taken a wait-and-see approach. That is starting to change as scrutiny of the company ramps up.

After a stream of MAX-related news over the weekend, multiple brokerages got off the fence and downgraded Boeing shares on Monday.

On Friday, emails and instant messages from 2016 surfaced that appear to indicate Boeing was aware its new flight control software—implicated in two deadly crashes—had issues. Boeing stock (ticker: BA) fell more than $25, or almost 7%, that day.

On Sunday, Boeing responded to the emergence of the emails provided by the House Subcommittee on Aviation, and provided more information on what happened between 2016—when the troubling emails were exchanged—and 2017, when the first MAX jets were delivered.

“It is unfortunate that this document, which was provided early this year to government investigators, could not be released in a manner that would have allowed for meaningful explanation,” reads the company’s news release. The company didn’t immediately respond to a request for comment on Monday.

Even though Boeing handed over those documents as early as February—before the second crash of the MAX involving an Ethiopian Airlines flight—some analysts no longer felt comfortable recommending the stock.

There is “too much new information to not re-look at cause [and] regulatory response [and MAX] timeline,” wrote UBS analyst Myles Walton in a Monday research report. “We now have to append [our] assessment further based on source material provided to Congress and the FAA on Friday that reinforces the perception of and heightens the potential of incomplete disclosure, which inherently puts more money [and] trust and time at stake.”

The new disclosure could mean the MAX doesn’t return to service around the end of 2019 as Boeing has said it would. Walton still believes the plane will fly again, but says his confidence has been eroded. He downgraded shares to Hold from the equivalent of Buy. and cut his price target for shares all the way to $375 from $470.

Credit Suisse also cut its stock rating, according to multiple reports. Analyst Robert Spingarn downgraded Boeing to Hold from the equivalent of Buy, and cut his price target to $323 from $416. “We can no longer defend the shares in light of the latest discoveries, discoveries which significantly increase the risk profile for investors,” wrote Spingarn in a Monday research report.

Baird analyst Peter Arment also moved to the sidelines on Monday because of what he called “textgate,” downgrading the stock from the equivalent to Hold from Buy. “We see increased production risks the next 24 months,” wrote Arment. “While a recovery in free cash flow will happen in 2020 and 2021, it will be at reduced levels tied to increased 737 MAX production costs.” His new $342 price target is based on an 8% free cash flow yield on his 2021 numbers. The average industrial company in the S&P 500 trades for about 4% to 5% free cash flow yield.

Gordon Haskett analyst Don Bilson thinks this weekend’s news doesn’t bode well for CEO Dennis Muilenburg. “House Transportation Committee Chairman Peter DeFazio told [The Wall Street Journal] that he thinks the board’s oversight has so far been pretty lame,” wrote Bilson in a Monday research note. Bilson doesn’t cover Boeing shares, instead focusing on special situations, including management change and board realignment.

There is, however, a small bit of good news from Wall Street on Boeing stock. Morgan Stanley analyst Rajeev Lalwani says the email release is a “false alarm,” noting that the company disclosed the documents earlier in 2019. He maintained his Buy rating on shares and has a $500 price target for the stock.

Boeing dropped 3.8% to $331.06 in Monday trading. The Dow Jones Industrial Average finished up 0.2%.

(CBS) Boeing 737 Max crash revelations could cost shareholders $53 billion

(CBS)

  • Wall Street analysts on Monday downgraded Boeing’s stock and said the company’s market value could drop $53 billion.
  • A UBS analyst estimated the company could lose $8.5 billion in cash flow over the next five years.
  • Famed consumer advocate Ralph Nader said Boeing CEO Dennis Muilenburg should go.

Boeing’s revelation late last week that a company test pilot had a strong indication that a system meant to prevent the 737 Max from crashing had “egregious” issues could cost the aircraft maker and its investors tens of billions of dollars, according to Wall Street analysts. 

Both of the analysts, from UBS and Credit Suisse, downgraded the stock. The two also independently cut their price targets for Boeing’s stock by $95, suggesting that the new safety evidence — and the growing legal and reputational hit to the company — could slice as much as $53 billion from the company’s total worth.

The test pilot messages, and the disclosure last week that Boeing has known about them for months, has also sparked new calls for the company’s top executives to resign. Consumer advocate Ralph Nader, whose grandniece was killed in the March crash of an Ethiopian Airlines flight, told CBS MoneyWatch on Monday that Boeing CEO Dennis Muilenburg, as well as the company’s entire board for directors, should go.

Trending News

“They need a new team,” Nader said. “The bosses and board at Boeing were complicit with what happened. It’s a conflict.”

Boeing did not return a request for comment on Nader’s statement. 

The analyst downgrades come as Boeing prepares to announce earnings later this week. The company is expected to have earned $1.5 billion in the third quarter of this year. But UBS analyst Myles Walton said those earnings were in jeopardy. 

He predicted the issues with the 737 Max, and the damage the episode has done to Boeing’s reputation, could lower the company’s cash flow by as much as $8.5 billion in the next five years. Walton said his “working assumption” was that the 737 Max crashes were a result of “poor assumptions.” But there is growing evidence to suggest that Boeing knew there was a problem and didn’t disclose it, and that’s a much bigger issue, Walton told clients.

Boeing shares fell 3.8%, or $12.94, on Monday to $331.06, adding to the sharp drop in the stock price during the past month. The stock entered October at just under $390.

The stock drop shows that Boeing’s efforts to steady itself in recent months haven’t fully reassured investors. Earlier this month, Boeing’s board stripped Muilenburg of his dual role as chief executive and chairman and elevated the company’s lead director, David Calhoun, to chairman. 

The company seemed to believe that would appease shareholders and critics, who have questioned whether Boeing has been upfront with shareholders about its problems with the 737 Max and whether it has moved fast enough to correct the issues.

Instead, Calhoun’s appointment has raised new questions about Boeing’s leadership. Besides taking on the Boeing chairmanship, Calhoun is also the lead independent director at construction equipment giant Caterpillar as well as chairman of the board of Gates International, which makes power transmission systems and has 15,000 employees worldwide. And that is all on top of Calhoun’s day job, being a top executive of Blackstone, the largest private equity firm in the world. 

“Shareholders of Boeing and Caterpillar should be concerned,” said Charles Elson, a corporate governance expert at the University of Delaware. “It would be ideal if he would step down from one of these roles.”

Nader called Boeing’s chairman and CEO split a “sop to shareholders” and a move that protects the company’s management. He said he believed Muilenburg was still essentially in charge, but he also predicted whistleblowers are likely to emerge and that could put more pressure of the company to make real changes. 

“Boeing is in a tremendous crisis,” Nader said.

(ZH) Pence Says US, Turkey Reach Ceasefire Deal In Syria; Lira Soars On “Agreement To Withdraw Sanctions”

(ZH) update: A deal has been reached for Turkey to suspend military operations in northern Syria, as Vice President Pence has confirmed in a briefing to reporters. “A pause in military operations for 120 hours” – or 5 days – while the US facilitates an “orderly withdrawal” of its forces as well as partner SDF Kurdish forces outside a 20-mile ‘safe zone’ will take effect based on Thursday’s meeting with President Erdogan, Pence said. Meanwhile a senior Turkish official has told Middle East Eye “We got exactly what we wanted out of the meeting.”

  • POMPEO: WORK REMAINS IN REGION, DEAL SETS GROUND FOR RESOLUTION
  • PENCE: TURKEY AGREED TO CEASE OPS PERMANENTLY AFTER WITHDRAWAL
  • PENCE SAYS TRUMP VERY GRATEFUL FOR EFFORT ON CEASEFIRE

Donald J. Trump@realDonaldTrump

This deal could NEVER have been made 3 days ago. There needed to be some “tough” love in order to get it done. Great for everybody. Proud of all!53.9K7:03 PM – Oct 17, 2019Twitter Ads info and privacy23.4K people are talking about this

Donald J. Trump@realDonaldTrump

This is a great day for civilization. I am proud of the United States for sticking by me in following a necessary, but somewhat unconventional, path. People have been trying to make this “Deal” for many years. Millions of lives will be saved. Congratulations to ALL!67.5K7:13 PM – Oct 17, 2019Twitter Ads info and privacy36K people are talking about this

The deal involves removal of US sanctions conditioned on the “pause” and road map to permanent ceasefire:

“Part of our understanding is that with the implementation of the ceasefire, the United States will not impose any further sanctions on Turkey,” Pence said“And once a permanent ceasefire is in effect, the President has agreed to withdraw the economic sanctions that were imposed this last Monday.”

CBS News@CBSNews

Trump on Syria ceasefire agreement: “What Turkey is getting now is, they’re not going to have to kill millions of people, and millions of people aren’t going to have to kill them” http://cbsnews.com/live 697:25 PM – Oct 17, 2019Twitter Ads info and privacy138 people are talking about this

Concerning the 5-day “pause” the Vice President said, “On the basis of a pause… we will not be implementing additional sanctions during that period of time.”

A copy of the printed agreement, handed out the press pool: 

Steve Herman@W7VOAReplying to @W7VOA and 4 others

Here’s a copy of the joint US-#Turkey statement via print pool reporter @EliStokols.

View image on Twitter

1107:07 PM – Oct 17, 2019Twitter Ads info and privacy165 people are talking about this

The Turkish Lira surged on the announcement, rallying as much as 1.15% to a session high of 5.8194, the strongest point since Oct. 10.

* * *

Visible tension pervaded the icy photo opp during Thursday’s meeting between Vice President Mike Pence and Turkey’s President Tayyip Erdogan in Ankara — a meeting which the latter initially rejected, saying he would only meet with Trump, amid a White House initiative to push for a ceasefire in northern Syria. 

The Pence-Pompeo-Erdogan meeting, which reports say lasted for about 90 minutes, which was significantly “longer than planned,” also came after Trump’s strange “don’t be a fool” letter to Erdogan was made public, which Turkish officials say Erdogan threw in the trash.

Ragıp Soylu@ragipsoyluReplying to @ragipsoylu

More pics from Pence, Erdogan meeting.

STILL NOT HAPPY

View image on Twitter
View image on Twitter

7202:04 PM – Oct 17, 2019Twitter Ads info and privacy326 people are talking about this

It was further less than 24 hours after Trump seemed to downplay Turkey’s invasion against US-backed Kurdish forces in Syria, saying the fight was over land that “has nothing to do with us.”

Ragıp Soylu@ragipsoyluReplying to @ragipsoylu

VIDEO from Erdogan, Pence meeting

Pence and Erdogan are stiff.

“Thanks for seeing me” Pence says.

Ambassador Jeffrey addresses Erdogan in Turkish 6352:09 PM – Oct 17, 2019Twitter Ads info and privacy460 people are talking about this

The president told reporters in the Oval Office Wednesday, “If Turkey goes into Syria, that’s between Turkey and Syria,” and added, “It’s not between Turkey and the United States.”

Jake Sherman@JakeSherman

Here is ⁦@SecPompeo⁩ and ⁦@VP⁩ and erdogan. A US official tell us pence asked ⁦@trpresidency⁩ twice to allow media in. We were allowed in — no questions allowed — for about 45 seconds.

View image on Twitter

1303:33 PM – Oct 17, 2019Twitter Ads info and privacy118 people are talking about this

All of this means that the US delegation went to Ankara with perhaps significantly less leverage (also considering Erdogan isn’t dealing with Trump directly); however, also after the White House authorized sanctions on Turkey this week, vowing that more could come. 

The US has demanded that Erdogan immediately halt his ‘Operation Peace Spring’ — to which Erdogan responded this week he’ll pursue the Turkish ‘safe zone’ in northern Syria even without international backing or support of allies. 

A Turkish official told Reuters of Trump’s now viral letter, which apparently wasn’t reviewed or proofed by his staff: “The letter Trump sent did not have the impact he expected in Turkey because it had nothing to take seriously.”

“What is clear is that Turkey does not want a terrorist organization on its border and the operation will not stop because of the reaction that has been coming.”

developing…

(CNBC) Pompeo and Pence will meet with Erdogan after Turkish leader backs off refusal

(CNBC)

  • Secretary of State Mike Pompeo said on Wednesday that he and Vice President Mike Pence will meet with Turkish President Recep Tayyip Erdogan despite the foreign leader earlier saying he would not attend. 
  • “At this point, the vice president and I are planning to take off later this afternoon,” Pompeo said. “And we have every expectation that we will meet with President Erdogan. And it’s important, Maria, we need to have this conversation with him directly.”
  • Erdogan earlier told Sky News that he would not meet with the U.S. delegation led by Pence before reversing himself in comments to the Turkish press.
GP: Mike Pompeo Mike Pence

US Secretary of State Mike Pompeo (L) and Vice President Mike Pence listen as President Donald Trump speaks about the government shutdown on January 25, 2019, from the Rose Garden of the White House in Washington, DC. – Trump says will sign bill to reopen the government until February 15.Brendan Smialowski | AFP | Getty Images

Secretary of State Mike Pompeo said on Wednesday that he and Vice President Mike Pence will meet with Turkish President Recep Tayyip Erdogan in Ankara despite the foreign leader earlier saying he would not attend.

“At this point, the vice president and I are planning to take off later this afternoon,” Pompeo said. “And we have every expectation that we will meet with President Erdogan. And it’s important, Maria, we need to have this conversation with him directly.”

The comments came during an interview with Fox Business’s Maria Bartiromo. They came shortly before the U.S. delegation, including Pence, Pompeo and national security adviser Robert O’Brien were scheduled to travel to Turkey in an effort to stymie the country’s military actions in neighboring Syria.

Erdogan earlier told Sky News that he would not meet with the U.S. delegation led by Pence, and would only meet with President Donald Trump, before reversing himself in comments to the Turkish press.

The U.S.-Turkey relationship is on rocky footing following a Turkish incursion into northern Syria apparently prompted by Trump’s decision to pull U.S. troops from the area. Following the incursion, the U.S. imposed sanctions on the country and has pushed for a ceasefire.

The president’s decision to withdraw U.S. troops from Syria has been widely condemned. Democratic and Republican lawmakers and security officials have cast the move as an abandonment of America’s Kurdish allies, who served as the chief ground force in the U.S. effort against the so-called Islamic State, and a “win” for Russia, Iran and the Assad regime.

Trump pledged debilitating economic retaliation against Turkey if they did anything “that I, in my great and unmatched wisdom, consider to be off limits,” though so far the financial punishment has been limited.

Nonetheless, Ankara has pledged to retaliate against the sanctions, with Foreign Minister Mevlut Cavusoglu saying he expected the U.S. Congress to walk back its “damaging approach.” A spokesperson for the Turkish president’s office said the country was preparing sanctions of its own on Wednesday, Reuters reported. 

As the American delegation heads to Turkey, the vice president is on a mission to convince Erdogan to commit to a ceasefire in northern Syria and pursue a peaceful resolution with U.S.-backed Kurdish militias governing the region that Turkey has long viewed as terrorists. Pompeo reiterated that a ceasefire was the goal of the trip on Wednesday.

“We need them to stand down. We need a cease fire. At which point, we can begin to put this all back together again,” Pompeo said in the interview.

Erdogan has said that a ceasefire is not on the table.

“They say ‘declare a ceasefire’. We will never declare a ceasefire,” Erdogan told reporters this week.

Turkey’s offensive in Syria, marked by airstrikes and artillery shelling, is now in its seventh day amid reports of human rights atrocities, ISIS jailbreaks and mass fleeing of civilians.

The UN says 130,000 people have already been displaced, and Kurdish forces say more than 200 have been killed. Pro-Turkish forces have cut off the main road between Syria’s east and west Kurdish-held territory, blocking the main highway to the Kurdish city of Kobani where U.S. troops are based.

Pompeo pushed back on criticism of U.S. sanctions, which have yet to make waves in Turkish financial markets.

“We have to remember, this is a complex situation Maria,” he said. “You saw the initial set of sanctions that the president chose to put on Turkey. I think, frankly, the world has underappreciated the severity of those sanctions and how much impact they will ultimately have on the Turkish economy.”

Trump on Monday signed an executive order sanctioning Turkish officials, hiking tariffs on Turkish steel up to 50% and “immediately” halting trade negotiations with the country. Turkish markets the following day were relatively flat, with the country’s lira actually firming against the dollar as analysts described the penalties as “not very serious” and “window dressing.”

(Reuters) Exclusive: U.S. carried out secret cyber strike on Iran in wake of Saudi oil attack: officials

(Reuters)

WASHINGTON (Reuters) – The United States carried out a secret cyber operation against Iran in the wake of the Sept. 14 attacks on Saudi Arabia’s oil facilities, which Washington and Riyadh blame on Tehran, two U.S. officials have told Reuters.

The officials, who spoke on condition of anonymity, said the operation took place in late September and took aim at Tehran’s ability to spread “propaganda.”

One of the officials said the strike affected physical hardware, but did not provide further details.

The attack highlights how President Donald Trump’s administration has been trying to counter what it sees as Iranian aggression without spiraling into a broader conflict.

Asked about Reuters reporting on Wednesday, Iran’s Minister of Communications and Information Technology Mohammad Javad Azari-Jahromi said: “They must have dreamt it,” Fars news agency reported.

The U.S. strike appears more limited than other such operations against Iran this year after the downing of an American drone in June and an alleged attack by Iran’s Revolutionary Guards on oil tankers in the Gulf in May.

The United States, Saudi Arabia, Britain, France and Germany have publicly blamed the Sept. 14 attack on Iran, which denied involvement in the strike. The Iran-aligned Houthi militant group in Yemen claimed responsibility.

Publicly, the Pentagon has responded by sending thousands of additional troops and equipment to bolster Saudi defenses – the latest U.S. deployment to the region this year.

The Pentagon declined to comment about the cyber strike.

“As a matter of policy and for operational security, we do not discuss cyberspace operations, intelligence, or planning,” said Pentagon spokeswoman Elissa Smith.

GULF TENSIONS RISE SHARPLY

The impact of the attack, if any, could take months to determine, but cyber strikes are seen as a less-provocative option below the threshold of war.

“You can do damage without killing people or blowing things up; it adds an option to the toolkit that we didn’t have before and our willingness to use it is important,” said James Lewis, a cyber expert with the Washington-based Center for Strategic and International Studies.

Lewis added that it may not be possible to deter Iranian behavior with even conventional military strikes.

Tensions in the Gulf have escalated sharply since May 2018, when Trump withdrew from the 2015 Joint Comprehensive Plan of Action with Tehran that put limits on its nuclear program in exchange for the easing of sanctions.

It was unclear whether there have been other U.S. cyber attacks since the one in late September.

Iran has used such tactics against the United States. This month, a hacking group that appears linked to the Iranian government tried to infiltrate email accounts related Trump’s re-election campaign.

Over 30 days in August and September, the group, which Microsoft dubbed “Phosphorous,” made more than 2,700 attempts to identify consumer accounts, then attacked 241 of them.FILE PHOTO: A man types on a computer keyboard in Warsaw in this February 28, 2013 illustration file picture. Kacper Pempel//File Photo

Tehran is also thought to be a major player in spreading disinformation.

Last year a Reuters investigation found more than 70 websites that push Iranian propaganda to 15 countries, in an operation that cybersecurity experts, social media firms and journalists are only starting to uncover.

Tensions with Iran have been high since the Sept. 14 attack. Tehran has said an Iranian tanker was hit by rockets in the Red Sea last week and warned that there would be consequences.

On Monday, President Hassan Rouhani reiterated his country’s policy toward the Trump administration, ruling out bilateral talks unless Washington returns to the landmark nuclear deal and lifts crippling U.S. economic sanctions.