Off the Wires

Isis hackers cut transmission of French broadcaster

April 9th, 2015  |  Source: FT.com

French broadcaster TV5Monde was trying to restore regular programming on Thursday after hackers claiming to be from the Islamic State of Iraq and the Levant (Isis) took over its channels and social media accounts.

The hackers cut transmission of the broadcaster’s 11 channels late on Wednesday for several hours and posted messages on its website, Yves Bigot, TV5Monde’s director, said.

They accused the French president, François Hollande, of having committed “an unforgivable mistake” by getting involved in “a war that serves no purpose”. France is part of a US-led coalition carrying out air strikes against Isis in Iraq and Syria, where the group has seized swaths of territory in the past year.

“That’s why the French received the gifts of Charlie Hebdo and Hyper Cacher in January,” the hackers said on the broadcaster’s Facebook page, referring to the twin attacks by Islamist gunmen in Paris in January that left 17 people dead over three days and deeply shocked France.

Mr Bigot told RTL radio Thursday morning that the network had regained control of its channels but was still only able to broadcast recorded programmes.

“We are not yet in a position to re-establish our broadcasting schedule nor to produce programmes,” Mr Bigot told RTL. “When you work in television . . . and discover that your 11 channels are down, that’s one of the most terrible things that can happen,” he said.

Meanwhile, the network’s website was still down for maintenance on Thursday morning after the hackers had earlier posted “I am IS [Isis]” on it together with a banner by a group calling itself Cybercaliphate.

AFP reported that the hackers also posted documents on TV5Monde’s Facebook page purporting to be the identity cards and CVs of relatives of French soldiers involved in anti-Isis operations, along with threats against the troops.


Kraft Will Merge With Heinz in Deal Backed by 3G and Buffett

March 25th, 2015  |  Source: Bloomberg

Kraft Foods Group Inc. will merge with H.J. Heinz Co. in a deal orchestrated by 3G Capital and Warren Buffett’s Berkshire Hathaway Inc., creating the third-largest food and beverage company in North America.

Kraft shareholders will receive 49 percent of the stock in the combined entity, plus a special cash dividend of $16.50 a share, the companies said in a statement Wednesday. Berkshire and 3G will invest $10 billion in the new business, which will be known as Kraft Heinz Co. It will have dual headquarters in Pittsburgh and the Chicago area, with current Heinz Chief Executive Officer Bernardo Hees staying at the helm.

The deal creates a stable of household names -- everything from Heinz ketchup to Jell-O -- with revenue of about $28 billion. It also could presage more consolidation in the U.S. food industry, which is struggling to reignite growth. Buffett and 3G, the private-equity firm founded by Brazilian billionaire Jorge Paulo Lemann, previously teamed up to buy Heinz in 2013 and they cut costs, a strategy they aim to repeat with Kraft.

“3G has squeezed a lot out of Heinz and now they will do the same job at Kraft,” David Turner, an analyst at research firm Mintel, said in an interview. “When Buffett invests in a sector, it gives a sign that the sector is ripe for acquisitions. This will flag up other opportunities.”

Kraft shares soared as much as 33 percent to $81.50 in New York, the biggest intraday gain since the company split from Mondelez International Inc. more than two years ago. That gives Kraft a valuation of about $48 billion.

Growth Opportunities

When the current Kraft was spun off in 2012, Mondelez inherited the overseas snack businesses, giving it bigger growth opportunities internationally. Though Kraft kept the name of the original business, it was smaller and relegated to the U.S. market. While Kraft has plenty of iconic brands, including Velveeta and Philadelphia Cream Cheese, the company hasn’t been able to energize sales in a mature industry.

With the merger, Kraft’s products will benefit from Heinz’s presence outside the U.S. The two companies also expect to trim $1.5 billion in annual costs by the end of 2017.


Israel spied on Iran talks

March 24th, 2015  |  Source: Marketwatch.com

Soon after the U.S. and other major powers entered negotiations last year to curtail Iran’s nuclear program, senior White House officials learned Israel was spying on the closed-door talks.

The spying operation was part of a broader campaign by Israeli Prime Minister Benjamin Netanyahu’s government to penetrate the negotiations and then help build a case against the emerging terms of the deal, current and former U.S. officials said. In addition to eavesdropping, Israel acquired information from confidential U.S. briefings, informants and diplomatic contacts in Europe, the officials said.

The espionage didn’t upset the White House as much as Israel’s sharing of inside information with U.S. lawmakers and others to drain support from a high-stakes deal intended to limit Iran’s nuclear program, current and former officials said.

“It is one thing for the U.S. and Israel to spy on each other. It is another thing for Israel to steal U.S. secrets and play them back to U.S. legislators to undermine U.S. diplomacy,” said a senior U.S. official briefed on the matter.

The U.S. and Israel, longtime allies who routinely swap information on security threats, sometimes operate behind the scenes like spy-versus-spy rivals. The White House has largely tolerated Israeli snooping on U.S. policy makers — a posture Israel takes when the tables are turned.

The White House discovered the operation, in fact, when U.S. intelligence agencies spying on Israel intercepted communications among Israeli officials that carried details the U.S. believed could have come only from access to the confidential talks, officials briefed on the matter said.


Supermoon Eclipses Sun as Spring Comes to Northern Hemisphere

March 20th, 2015  |  Source: Bloomberg

At 6:47 p.m. in New York, the sun will cross the celestial equator and spring will begin in the Northern Hemisphere. The big moment will occur at 10:47 p.m. in London, 7:47 a.m. Saturday in Tokyo.

In Wellington, New Zealand, and Sydney, as well as Sao Paulo and the rest of the Southern Hemisphere, autumn will descend at the same time.

Aside from its annual trip north across the equator, the sun has been busy this week. It may not be quite right to anthropomorphize the nearest star, but this week it seems to fit.

As the U.S. was waking up Friday, a supermoon -- so called because it’s at its closest point to the Earth, and therefore looks larger than usual -- was drifting in front of the sun.

“The path of the Moon’s shadow is quite narrow, so you usually have to travel to see a solar eclipse,” said William Pesnell, project scientist with the Solar Dynamics Observatory at NASA. Friday’s “total solar eclipse is visible only from the Faroe Islands and Svalbard, but most of Europe will see a partial solar eclipse.”

Earlier this week, the sun fired off a couple of eruptions that merged just as they arrived in the Earth’s neighborhood, setting off a brilliant aurora display across the high latitudes.

All of which begs the question: With the supermoon between the Earth and sun, could our largest natural satellite be a shield in the event of a huge coronal mass ejection?

Too Small

“Nope, too small to make a difference,” Robert Rutledge of the U.S. Space Weather Prediction Center said in an e-mail interview.

The sun is pretty big.

The earth, by comparison, is about the size of an average sunspot, according to the National Weather Service.

The power of the sun is about to have a major impact on the Northern Hemisphere’s weather.

As the sun creeps north and bathes the Arctic region in light and warmth, the weather mechanics across the entire hemisphere change, said Stephen Baxter, a meteorologist at the U.S. Climate Prediction Center in College Park, Maryland.

The temperature gradient from the North Pole to the equator weakens and becomes less extreme than it is in winter, when the cold, dark pole stands in stark contrast to the warm, bright equator.

“We tend to see less large-scale storm activity,” Baxter said. “Big, large-scale storms develop in response to the very strong temperature gradients.”


ACLU files new lawsuit over Obama administration drone 'kill list'

March 16th, 2015  |  Source: The Guardian

Top civil liberties group calls for greater transparency regarding ‘targeted killing program’ and how officials handle possibility of civilian deaths

As the US debates expanding its campaign against the Islamic State beyond Iraq and Syria, the leading US civil liberties group is intensifying its efforts to force transparency about lethal US counterterrorism strikes and authorities.

On Monday, the American Civil Liberties Union (ACLU) will file a disclosure lawsuit for secret Obama administration documents specifying, among other things, the criteria for placement on the so-called “kill list” for drone strikes and other deadly force.

Information sought by the ACLU includes long-secret analyses establishing the legal basis for what the administration terms its “targeted killing program” and the process by which the administration determines that civilians are unlikely to be killed before launching a strike, as well as verification mechanisms afterward to establish if the strike in fact has caused civilian deaths.

Read on here: http://www.theguardian.com/world/2015/mar/16/aclu-files-new-lawsuit-over...


Former SEC Director Rips the Red Tape Off His Mouth

March 10th, 2015  |  Source: Bloomberg

For more than a decade, John Ramsay had red tape over his mouth. Now that he’s left government bureaucracy, he says he’s been “uncorked.”

Ramsay, 55, formerly the U.S. Securities and Exchange Commission’s director of trading and markets, joined the stock-trading venue founded by Brad Katsuyama, IEX Group Inc., in June and soon began slamming the industry he’d overseen for the SEC. He called out the “convoluted” and “illogical” pricing rules of major stock exchanges and compared the $25 trillion U.S. stock market’s structure to the Death Star of “Star Wars.”

Ramsay’s denunciations come during a period of unprecedented scrutiny of equities trading. A chorus of criticism, sparked by the claim in Michael Lewis’s book about Katsuyama and IEX, “Flash Boys,” that the market is rigged against retail investors, has questioned the tactics involved in using algorithms to buy and sell shares in fractions of a second. Ramsay’s opinions, blunt and impassioned, have extra heft because of his experience as a regulator.

“I’ve been able to find my voice on these issues in a way I couldn’t have done when I was in the government, because you’re always limited by internal politics and not wanting to get too far out in front of the agency,” he said. “I feel like I’ve been a little bit uncorked.”


The Power of Water – Robert F. Kennedy, Jr

March 9th, 2015  |  Source: Globe-Net.com

Water has emerged as the target of choice for the robber barons of globalization. As freshwater supplies dwindle, global investors are scrambling to own what’s left. The World Bank already values water privatization at $1 trillion and predicts that many of the wars of the 21st century will be fought over water.

And the wars have already begun as citizens in South and Central America have fought back against water moguls whom they regard as bullies trampling democracy and basic human rights. When Bechtel, in 2000, privatized the Bolivian city of Cochabamba’s water and then raised rates high enough to threaten the lives of poor residents, the city erupted in deadly violence.

The “Bolivian Water War” ejected Bechtel and toppled the city government. Control of Syrian waters by corporate agriculture during a prolonged drought helped trigger the current rebellion there. Today, Chile is effectively a neo-colonial vassal after the Pinochet dictatorship sold her rivers (along with her forests, minerals, and even roads, railroads and airports) to foreign syndicates. Chile’s leading human-rights lawyer recently told me, “Today, Chile has only the trappings of democracy, since we have no sovereignty over the resources of our nation.”

Could this happen in the United States? It already is. Chinese and European sovereign wealth funds and global private-equity firms are taking control of America’s waterways by purchasing the assets of industrial companies which once held hydropower licenses granted by the Federal Energy Regulatory Commission (FERC), which, ironically, was established to keep the nation’s waterways in public ownership and to assure that the waters are used for public not private benefit.

These machinations are reminiscent of the Gilded Age, when aluminum and steel companies dammed America’s rivers to power their smelters, routinely corrupting state legislatures and federal officials to win exclusive licenses to privatize public waterways. Teddy Roosevelt warned in 1915, “Keep your eye on the aluminum company that is trying to get control of your water powers. I have no objection to big business making money but I do not want it to make it at the expense of the public interest.”

Like most Americans of his era, Teddy Roosevelt regarded the control of our nation’s waterways as a central concern of democratic governance. Commonwealth assets like rivers and streams, he believed, should not be held by private interests for private gain.

In 1920, Congress heeded his warning and passed the Federal Water Power Act. Renamed the Federal Powers Act in 1935, this statute created the Federal Energy Regulatory Commission (FERC) to protect the public interest. The law recognized that a permit is a giving away of public treasure, and provided that rivers could only be dammed and water diverted to private users when it served a compelling public benefit.

In return for permits to build privately owned dams and divert waterways from traditional recreational, agricultural and drinking-water purposes, FERC required proof that these plants would bring jobs and prosperity to watershed communities. But, since 1935, FERC has never refused to renew or transfer any hydropower license. And, as the old permits expire, the enfeebled agency is allowing industrial companies to close their factories and effectively sell our rivers to foreign investors without any meaningful demonstration of a public benefit.

Here is an example of how it works: In the 1950s, FERC issued the Aluminum Company of America (Alcoa) a 50-year license to operate five hydroelectric dams on the Little Tennessee and Cheoah Rivers. The project’s primary purpose was to support Alcoa’s aluminum smelter and rolling-mill operations in Alcoa, Tennessee, which were the region’s principal sources of employment.

To win the FERC license, Alcoa had to prove that its hydroelectric facilities would drive economic activity and bring prosperity. The license gave the company ample time to recover its capital investment. The license also limited free access to river water for citizens, towns and other users at a particular level, and required them to pay Alcoa to divert river water above that level for drinking, agriculture or industrial needs. FERC permittees effectively owned the river.

Alcoa applied to renew its license in February 2003, and on January 25, 2005, FERC awarded the company a new license without requiring any written guarantee that the company would maintain its manufacturing jobs, which were worth $400 million to the local economy. Subsequently, Alcoa shuttered the bulk of its facility and laid off 450 workers.

In 2010 Alcoa refurbished one of the dams with $12 million in federal subsidies. Then, in March 2012, the company suddenly shuttered the remainder of its Tennessee smelter plant and sold its newly minted license and its hydroelectric facilities for $600 million to Brookfield Asset Management. Brookfield now owns 25 percent of the Alcoa facilities. The remaining 75 percent is owned by global institutions and foreign governments, including China, whose investments Brookfield manages.

The new owners have no obligation to benefit the region’s economic interests. Private control of public water resources will inhibit economic growth, and the project will no longer drive industrial activity in Tennessee and North Carolina. As water becomes more scarce and electric rates rise, the new owner will charge local governments, farmers and water consumers higher rates.

With no control over the bulk of river flow, localities will lose the flexibility to deal with extended water-shortages. The dams will simply enrich Brookfield and its global investors by producing wholesale power for sale to the highest bidder. The profits will leave the United States.

With $200 billion in assets, and more than 10 percent of FERC licenses in its portfolio, the company has acquired over 130 hydropower generating-stations and 30 river systems in the United States – more than any other FERC license holder. And Brookfield is only one of a spate of foreign-owned private equity firms racing to privatize America’s waterways for profit.

Alcoa appears to be re-deploying the same strategy it used on the Little Tennessee and Cheoah Rivers on North Carolina’s Yadkin River. In 2007, Alcoa closed its Yadkin smelter, fired its workers, and began selling electricity from the Yadkin’s four dams outside North Carolina, generating $30 million for the company last year alone. Despite fierce local opposition, Alcoa is applying to renew its Yadkin power license.

FERC will almost certainly give Alcoa kneejerk support to relicense its dams and then sell the river to the highest bidder. Since the passage of the 1935 Federal Power Act, FERC has never refused to renew or transfer any hydropower license.

FERC ’s practice, in contrast, has been to grant exclusive use of our water resources to private companies and foreign governments and corporations to generate hydroelectricity and seize de facto control of public waters for 30 to 50 years, without regard for the mandates for public benefit the Federal Power Act stipulates.

Robert F. Kennedy, Jr., Founder and President of Waterkeeper Alliance. The Waterkeeper Alliance (www.waterkeeper.org ) and its members fight every day around the globe for their local waterways and landscapes and embody the 1935 Federal Power Act’s original intention to “promote the development of safe, reliable and efficient energy infrastructure that serves the public interest.”


Apple Will Join the Dow Jones Industrial Average

March 6th, 2015  |  Source: Bloomberg

Apple Inc. was added to the Dow Jones Industrial Average, ending a banishment that kept the world’s largest company out for years before a stock split made its shares palatable to the price-weighted measure.

The changes will push the number of technology-related companies in the 30-member gauge to six and boost their influence even more as Apple joins Microsoft Corp., Intel Corp., International Business Machines Corp., Cisco Systems Inc. and Visa Inc. AT&T is being kicked out after falling 4.5 percent in 2014. The changes will take effect after the close of trading on March 18.

“The Dow is supposed to be the dominant companies in each different sector of the economy and I don’t think anybody can argue that Apple isn’t by far the dominator in the phone sector,” Michael Chadwick, who manages $150 million as chief executive officer of Chadwick Financial Advisors in Unionville, Connecticut, said in a phone interview. “The digital age is taking over. It’s going to be a function of those who can adapt and change.”

The Dow average’s weighting methodology, which links a stock’s influence to its share price, had long barred Apple from joining the gauge. The timing of Apple’s addition hinged on not just its own 7-for-1 split last June but also Visa’s 4-1 split scheduled for March 19 of this year, according to David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices.

‘Clear Choice’

Stocks in the index are selected by a committee of Wall Street Journal and S&P Dow Jones Indices representatives based not on quantitative rules but on the companies’ reputation, relevance to investors and growth record.

“As the largest corporation in the world and a leader in technology, Apple is the clear choice for the Dow Jones Industrial Average,” Blitzer said in a statement.

Apple’s split brought the stock price closer to the median price in the Dow and the Visa split will reduce the technology weight and make room for Apple, Blitzer said.

“The DJIA is price weighted so extremely high stock prices tend to distort the index while very low stock prices have little impact,” Blitzer said.

The original American Telephone & Telegraph entered the Dow in October 1916 and was taken out in April 2004. The company removed today was created in the merger of SBC Communications and AT&T in November 2005. The removal announced today will leave Verizon Communications Inc. as the only telephone stock in the Dow.

‘Some Surprise’

“There’ll be some surprise that AT&T is the name that’s being removed and Verizon is being kept,” Michael James, a Los Angeles-based managing director of equity trading at Wedbush Securities Inc., said in a telephone interview. “From the historical standpoint, AT&T represents an American institution. To see that leaving the Dow is somewhat of a psychological blow. In terms of impact on the stock itself I don’t think it’s going to be overly significant.”

Charles H. Dow, the co-founder of Wall Street Journal publisher Dow Jones & Co., devised the Dow average in 1896 to provide a clear view of the stock market and “barometer of the times,” according to the S&P Dow Jones Indices website. It originally included American Tobacco, General Electric Co. and 10 other companies before expanding to 20 companies in 1916 and 30 in 1928.

Google Missing

Apple’s Dow entrance makes it only the second among the three largest U.S. companies by market capitalization to be included in the gauge. Class A shares of Google Inc., the third largest U.S. company, closed at $581.44 yesterday, effectively making them too expensive for inclusion in the Dow average even after what amounted to a 2-for-1 stock in April of 2014.

The last Dow reshuffling took place in September 2013 when Goldman Sachs Group Inc., Visa Inc. and Nike Inc. replaced Bank of America Corp., Hewlett-Packard Co. and Alcoa Inc. The changes boosted the influence of financial-related companies to five.

At $126.41, Apple’s shares will get the sixth-biggest weighting in the gauge, with a 4.3 percent share, according to data compiled by Bloomberg. AT&T was the fourth-smallest stock, priced at $34 with a weighting of 1.2 percent. Goldman Sachs will have the highest weighting following Visa’s split and Apple’s addition, based on current share prices.

There is more than $7 trillion benchmarked to the S&P 500, with index assets comprising approximately $1.9 trillion of the total, according to S&P Dow Jones’ web site. Only about $32.8 billion was directly indexed to the Dow at the end of 2013, according to Dave Guardino at S&P.

“It’s not going to change anything,” Andy Hargreaves, an analyst covering Apple at Pacific Crest Securities LLC in Portland, Oregon, said in a phone interview. “I couldn’t tell you the last time I thought about the Dow Jones Industrial Average and what it means for its constituent stocks. It has a kind of social significance, meaning the companies in it are old, and that’s the whole idea.”


Ukraine Raises Key Rate to World’s Highest to Stem Currency Rout

March 3rd, 2015  |  Source: Bloomberg

Ukraine’s central bank raised its benchmark interest rate to the world’s highest, the fifth emergency move since the beginning of last week to arrest a plunge in the hryvnia as the nation moves closer to obtaining a bailout.

The National Bank of Ukraine raised its refinancing rate to 30 percent from 19.5 percent, effective Wednesday, to “stabilize the situation on the money and lending markets,” Governor Valeriya Gontareva told reporters in Kiev. That’s the highest benchmark among all countries tracked by Bloomberg.

Policy makers are staggering from the turmoil wrecking the economy as the hryvnia, the world’s worst performer in the past year, spurs panic buying among shoppers and destabilizes banks. Before opting to push the key rate to the highest since 2000, the central bank in Kiev used tighter capital controls and a one-day freeze on currency trading to steady the hryvnia.

“The picture is being blurred: every day a different measure is taken,’” Simon Quijano-Evans, head of emerging-market research at Commerzbank AG in London, said by e-mail. “What the local population in particular needs is a clear policy picture from the central bank.”

The hryvnia, which has lost 60 percent against the dollar in the past year, strengthened or weakened more than 15 percent on a single day on five occasions in 2015, data compiled by Bloomberg show. The Ukrainian currency jumped 8.5 percent to 24.25 against the dollar as of 6:38 p.m. in Kiev.


This bill would halt Congress’s pay if Homeland Security shuts down

March 2nd, 2015  |  Source: Washington Post

A potential Department of Homeland Security shutdown would directly affect lawmakers’ pocketbooks under a bill introduced in the House this week.

The Democratic measure, sponsored by Reps. Brad Ashford (Neb.), Gwen Graham (Fla.), Scott Peters (Calif.) and Ami Bera (Calif.), would halt pay for members of Congress if they don’t agree to a new round of funding for the agency by Friday, in which case DHS would partially close.

The legislation is similar to several bills that would have halted lawmakers’ salaries during the government-wide shutdown of 2013. Those measures never made it out of committee that year.

Federal statute only allows lawmakers to change the salaries of future members of Congress, so the new House bill would put their wages in an escrow account until the potential Homeland Security shutdown ends.

“All across the country, folks live by the idea that if you don’t do your job, you shouldn’t get paid,” Ashford said in a joint statement with the bill’s other sponsors. “The same should hold true for members of Congress.”

No Homeland Security employees would be paid in the event of a shutdown, but 85 percent of the department’s roughly 240,000 employees would remain on the job because their roles are vital to national security or funded from sources outside of Congress.




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