Hong Kong (CNN)Hong Kong’s protest movement grabbed the world’s attention with million-strong rallies and city-stopping unrest. But it won big on the weekend by staying silent. The landslide victory for pro-democracy candidates in Sunday’s district council elections is a stinging rebuke to the city’s government — and an example of what protesters can achieve given the opportunity. By avoiding unrest and trusting voters to support them, protesters scored a bigger victory than if they had disrupted the polls. They also demonstrated that far from devolving into anarchy, as some on the government side have claimed, the protest movement can — unlike the police, Beijing or the city’s leaders — control when and where the unrest takes place. Sunday saw beautiful blue skies, long queues and one of the calmest days in Hong Kong since the protests began in June. Far from the visions of destruction and anger that have dominated coverage recently, this was a city that worked. And judging by the results, it worked in spite of, not because of, its government. According to public broadcaster RTHK, opposition candidates took nearly 90% of the seats up for grabs. Going into Sunday’s elections, all 18 district councils were controlled by pro-Beijing parties. As counting wrapped up Monday, all but one had flipped to overall pro-democratic control. The only outlier, the Islands council, includes a number of appointed members — even then, pro-democracy candidates took a majority of the elected seats. In this, the elections were a demonstration of people power in more ways than one. Protesters showed they had the discipline to let people speak, and they were rewarded with a resounding vote of confidence. The question now is whether the government will listen. District council elections should be boring. Only in a system like Hong Kong’s, where other avenues for democracy have been increasingly stifled, could they gain such outsized importance.Sunday’s vote was framed as a de facto referendum on the protests by all sides. With turnout high from the moment polls opened — and overtaking the 2015 total by midday — many were predicting a win for pro-democracy candidates, but few expected the utter drubbing they delivered.
Goldman Sachs sees a ‘baby bear market’ in bonds
Betting against bonds has not, to say the least, worked well for the last 40 years or so. The yield on the 10-year Treasury TMUBMUSD10Y, +0.92% was close to 16% in 1981. This year it’s fallen below 1.5%. Yields move in the opposite direction to prices. So the new Goldman Sachs call for a “baby bear market” in bonds is a noteworthy call of the day. The argument, laid out in the bank’s 10 market themes for 2020, is that the Federal Reserve is done cutting interest rates after three reductions this year. The bank does admit that it will take a while for yields to rise. “We think the message from history is that bond yields will start rising when the market prices meaningful odds of rate increases, and that point still seems far off. Fed officials have signaled that they would like to be done with cutting but that the hurdle for hiking again is high. So, although we are cautiously optimistic on the global economy, we forecast only moderately higher 10-year Treasury yields next year, targeting a rebound to 2.25%, mostly skewed toward the second half of 2020,” the company says. It expects emerging market equities generally, and cyclical stocks in both the U.S. and emerging markets, to rise a bit. “We expect moderately better economic and earnings growth, and therefore decent risky asset returns,” the research note says. “But we also see plenty of risks, and more challenging valuations, so the upside is limited. Tony Dwyer, strategist at Canadian broker Canaccord Genuity, says the stock market’s internals aren’t healthy. The percentage of S&P 500 SPX, +0.22% components above their 10-day average is just 50%, and, through Thursday, decliners have outnumbered advancers on the New York Stock Exchange for 8 of the past 11 days. “Many have been so focused on the record highs and strategist targets that they have ignored the overbought condition and internal deterioration,” he said.
Defense Chief Esper Ousts Navy Secretary in SEAL Fallout
In his resignation letter, which was posted on Twitter, Spencer said he no longer shares “the same understanding with the Commander in Chief who appointed me, in regards to the key principle of good order and discipline.”
“I cannot in good conscience obey an order that I believe violates the sacred oath I took,” Spencer said. , adding that the president deserves a Secretary “aligned with his vision.”
That comment echoed the resignation letter of James Mattis, Trump’s first defense chief, who wrote to Trump in December that “you have the right to have a Secretary of Defense whose views are better aligned with yours.” Esper was sworn in as secretary in July.
Trump called Trump Braithwaite, a retired Navy Rear Admiral proposed for the post by Esper, “a man of great achievement and success” and said he would “do an outstanding job.” Navy Under Secretary Thomas Modley will fill the role for now, according to the Pentagon. In the lead-up to to Spencer’s ouster Trump criticized the Navy’s handling of the case in a tweet on Thursday, and even promoted an appearance by Gallagher Sunday on Fox News. He granted clemency to Gallagher on Nov. 15. The SEAL had been acquitted of killing a prisoner in Afghanistan but was found guilty on another charge because he posed next to the prisoner’s corpse. Trump on Sunday said Gallagher “will retire peacefully with all of the honors that he has earned, including his Trident Pin.” Spencer, 65, has served as Navy Secretary since August 2017. The former U.S. Marine worked on Wall Street for about 15 years, including time at investment bank Goldman Sachs. Trump’s tweets on Sunday also referenced Navy contracting procedures and “large cost over-runs” that hadn’t been addressed to his satisfaction. Bloomberg News reported Nov. 2 that Spencer told Trump months ago to fire him if he wasn’t able to correct persistent problems with the USS Gerald R. Ford, the Navy’s costliest ship. “He just said keep going,” Spencer said at the time. Nick Note: Another hero a good honest man sacrificed on the Trump alter of lies ad deceit!
Oil gains on U.S.-China trade talks optimism
SINGAPORE (Reuters) – Oil prices rose on Monday as positive comments from the United States and China rekindled hopes in global markets that the world’s two largest economies could soon sign an interim deal to end their bitter trade war. West Texas Intermediate (WTI) crude CLc1 rose 26 cents, or 0.45% to $58.03 a barrel by 0759 GMT, having ended last week little changed after tracking the trade talks through their ups and downs. Brent crude futures LCOc1 were at $63.73, up 34 cents or 0.54%, the benchmark having also finished little changed last week. “It is still all about trade talks,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney. “It seems to be dominating markets action at the moment.” Monday’s higher opening prices came after U.S. national security adviser Robert O’Brien said on Saturday that an initial trade agreement with China is still possible by the end of the year. This came a day after U.S. President Donald Trump and Chinese President Xi Jinping expressed a desire to sign an initial trade deal and defuse a 16-month tariff war that has lowered global growth – though Trump said he had yet to decide whether he wanted to finalize a deal, while Xi said he would not be afraid to retaliate when necessary. China’s foreign ministry said on Monday it hopes the United States will work with Beijing on a basis of equality and mutual respect on the ongoing bilateral trade negotiations. A move by China to protect intellectual property was also providing a supportive atmosphere for the trade talks, McCarthy added. “This is a big step forward for potential trade negotiation if they are adopted as official policy,” he said. Still, concern remains that events in Hong Kong, riven by months of anti-government unrest, could overshadow trade talk progress. U.S. national security adviser O’Brien warned on Saturday that Washington would not turn a blind eye to what happens in Hong Kong, where demonstrators were angry at what they see as an erosion of freedoms promised to the ex-British colony when it returned to Chinese rule more than 20 years ago. Over the weekend, pro-democracy candidates scored a resounding win in district council elections. The Organization of the Petroleum Exporting Countries meets on Dec. 5 at its headquarters in Vienna, followed by talks with a group of other oil producers, led by Russia, known as OPEC+. Prices could be pushed higher if OPEC+ agrees to extend its supply cut by three more months to mid-2020.
China and U.S. ‘very close’ to phase one trade deal: Global Times
BEIJING (Reuters) – China and the United States are ‘very close’ to a phase one trade deal, the Global Times, a tabloid run by the ruling Communist Party’s official People’s Daily, said on Monday, discounting “negative” media reports. China also remains committed to continuing talks for a phase two or even a phase three deal with the United States, the state-backed Global Times said on its Twitter feed, citing experts close to the Chinese government. Trade experts and people close to the White House said last week that completion of a “phase one” deal, which had been expected in November, could slide into the new year, as Beijing presses for more extensive tariff rollbacks and Washington counters with demands of its own. According to U.S. and Beijing officials as well as lawmakers and trade experts, the ambitious “phase two” trade deal is looking less likely as the two countries struggle to strike a preliminary agreement. The outlook for a phase one deal was further complicated last week when the U.S. Congress approved legislation to back protesters in Hong Kong, although the completion of district council elections in the Chinese controlled territory on Sunday, without major disruptions, could help. On Saturday, U.S. National Security Adviser Robert O’Brien said an initial trade deal with China was still possible by the end of the year. He warned that Washington would not turn a blind eye to what happens in Hong Kong, but also said it would be “a good sign” if the elections took place without violence.
Russia to Create New Tactics for Using Robots in Urban Warfare by 2020
The news comes amid recent reports about the Russian military boosting its high-tech research, and plans to create multifunctional robotic machines for elaborate combat tasks by 2025. Russia’s defence industry is developing new strategies for robots in possible urban combat, as well as in coastal warfare, a source in the sector stated on Sunday. According to the source, various facilities will offer their solutions to the Combined Arms Academy of the Armed Forces at the beginning of 2020. Uran 9 fighting multi-purpose robotics complex at the exhibition during the Robotization of the Russian Armed Forces 2nd Military & Scientific Conference at Patriot Congress and Exhibition Center The source also noted that at the moment there is no common conception of using robots in combat, so the Russian military plans to establish a compehensive strategy that can be used by the country’s armed forces in the future. The robots will be created with the help of the platform, Marker, which was revealed for the first time in mid-October 2019.
US Lawmakers Push for Nord Stream 2 Sanctions as Project Nears Completion
‘Window is Closing’
MOSCOW (Sputnik) – The US Congress plans to block the further construction of the Russia-sponsored Nord Stream 2 natural gas pipeline by passing a defence bill that would extend sanctions on the project’s European partners, the US Defenсe News media outlet reported, citing US Senator Jim Risch.
Risch, who is the chairman of the US Senate Foreign Relations Committee, told the media outlet that the committee added sanctions on companies involved in the Nord Stream 2 project to the draft 2020 National Defense Authorisation Act.
“The reason for the push is that this window is closing. A lot of Nord Stream is done already. … It will cost them dearly. I think if those sanctions pass [the companies] will shut down, and I think the Russians will have to look for another way to do this if they can do this”, Risch said.
The senator added that the addition to the bill reflects an agreement between the US administration, the US House and Senate and the banking committees.
In late October, US Senator Ted Cruz called on the Senate to pass the bill, saying that it had just a few short months to halt the construction of the pipeline which threatened US energy security.
Nord Stream 2
Nord Stream 2
The Nord Stream 2 project is a joint venture between Russia’s Gazprom and five European companies — France’s ENGIE, Austria’s OMV, the UK-Dutch Royal Dutch Shell, and Germany’s Uniper and Wintershall. The 745-mile-long twin pipeline will carry up to 1.942 trillion cubic feet of gas per year from Russia to Europe.
Russian Energy Minister Alexander Novak said on Wednesday that gas deliveries via the Nord Stream 2 may be launched before the New Year already.
The US and its allies, including Poland and the Baltic nations, repeatedly raised concerns about the project, urging the European countries to break the deal with Moscow citing security issues. Washington insists its threats are only aimed at “protecting” Europe from becoming overly dependent on Russian energy supplies.
Saudi Aramco’s CEO met Kuwait sovereign fund to discuss IPO: source
DUBAI (Reuters) – Saudi Aramco’s top executives have met officials of Kuwait’s sovereign wealth fund to convince them to invest in the oil giant’s initial public offering (IPO), which could raise as much as $25.6 billion, a source familiar with the matter said. The meeting, which was led by Aramco’s Chief Executive Amin Nasser, took place weeks ago, the source said, confirming an earlier report on Sunday in the Kuwaiti newspaper Alrai. The Kuwaiti newspaper said the Kuwait Investment Authority’s (KIA) decision to participate in the deal or not will depend on a “study” of the IPO. Aramco and KIA did not immediately respond to separate Reuters requests for comment. In late October, KIA’s managing director Farouk Bastaki had said Aramco had not approached the fund then, but KIA would look at the IPO like any other investment. Aramco has struggled to attract a major cornerstone or anchor investor for its IPO, which could be potentially the world’s biggest. Talks have taken place with sovereign investors including the Abu Dhabi Investment Authority, Singapore’s GIC and other funds, sources have told Reuters. The company has also canceled marketing roadshows for its listing outside of the Gulf because of the lack of interest from foreign institutional investors. Aramco plans to sell 1.5% of the company, giving it a potential market value of between $1.6 trillion and $1.7 trillion. The deal is the centrepiece of Crown Prince Mohammed bin Salman’s plans to diversify the Saudi economy away from its reliance on oil.
China attacks U.S. at G20 as the world’s biggest source of instability
Hong Kong could blow up China/US trade deal
BEIJING, Nov 23 (Reuters) – The United States is the world’s biggest source of instability and its politicians are going around the world baselessly smearing China, the Chinese government’s top diplomat said on Saturday in a stinging attack at a G20 meeting in Japan. Relations between the world’s two largest economies have nose-dived amid a bitter trade war – which they are trying to resolve – and arguments over human rights, Hong Kong and U.S. support for Chinese-claimed Taiwan. Meeting Dutch Foreign Minister Stef Blok on the sidelines of a G20 foreign ministers meeting in the Japanese city of Nagoya, Chinese State Councillor Wang Yi did not hold back in his criticism of the United States.m”The United States is broadly engaged in unilateralism and protectionism, and is damaging multilateralism and the multilateral trading system. It has already become the world’s biggest destabilising factor,” China’s Foreign Ministry cited Wang as saying. The United States has, for political purposes, used the machine of state to suppress legitimate Chinese businesses and has groundlessly laid charges against them, which is an act of bullying, he added. “Certain U.S. politicians have smeared China everywhere in the world, but have not produced any evidence.” The United States has also used its domestic law to “crudely interfere” in China’s internal affairs, trying to damage “one country, two systems” and Hong Kong’s stability and prosperity, he added. China was incensed this week after the U.S. House of Representatives passed two bills to back protesters in Hong Kong and send a warning to China about human rights, with President Donald Trump expected to sign them into law, despite delicate trade talks with Beijing. China runs Hong Kong under a “one country, two systems” model whereby the territory enjoys freedoms not enjoyed in mainland China like a free press, though many people in Hong Kong fear Beijing is eroding this. The government denies that. Wang said that China’s development and growth was an inevitable trend of history that no force could stop. “There is no way out for the zero-sum games of the United States. Only win-win cooperation between China and the United States is the right path.”
FERC Approved Four More LNG Projects
The U.S. Federal Energy Regulatory Commission (FERC) approved on Thursday another four liquefied natural gas (LNG) projects, which will add to the growing American LNG exports in coming years. FERC approved, with conditions, three projects planned to be located along the Brownsville Ship Channel in Brownsville, Texas—Texas LNG Brownsville, Rio Grande LNG Terminal, and Annova LNG Brownsville—as well as a fourth project to expand an operating facility near Corpus Christi, Texas. All four projects have applied before the U.S. Department of Energy to be authorized to export gas to countries that don’t have free trade agreements with the United States. Today’s approvals add to the approval of seven other LNG projects this year. “The Commission has now completed its work on applications for 11 LNG export projects in the past nine months, helping the United States expand the availability of natural gas for our global allies who need access to an efficient, affordable and environmentally friendly fuel for power generation,” FERC Chairman Neil Chatterjee said in a statement. The United States will be the global leader in newly built LNG liquefaction capacity between 2019 and 2023, data and analytics company GlobalData said last month. The increase in the U.S. of 157 million tons per year (mtpa) of liquefaction capacity will account for 73 percent of total global LNG capacity growth through 2023, according to GlobalData. In the first half of 2019, the U.S. saw its net natural gas exports more than double from the same period last year, thanks to more LNG export capacity coming online in recent months, according to the U.S. Energy Information Administration (EIA). The United States, which exports natural gas via pipelines to neighbors Canada and Mexico and exports LNG to several other countries, became a net natural gas exporter on an annual basis in 2017, for the first time in nearly 60 years. A large part of the recent increase in U.S. natural gas exports is due to a growing number of LNG facilities coming online. U.S. exports of LNG jumped by 37 percent in the first half of 2019 compared to the first half of 2018, according to EIA data. Nick Note: Think over invested, think over capacity, think the stupid money is rushing in!