Off the Wires

Brexit: from an American perspective, there is only one good outcome

June 22nd, 2016  |  Source: The Guardian

While UK voters have good reasons to either stay in or leave the European Union this Thursday, a British exit would only hurt the US

While there are good reasons for British voters to either support or oppose theproposed withdrawal of the UK from the European Union, there is little argument at all from an American perspective that Brexit would hurt the US.

The strongest argument for the UK leaving the EU is that European bureaucrats have usurped many of the powers that should be vested in democratically elected officials in Westminster. Laws in Brussels are not made by people who can be readily held accountable to voters. Instead, a maze of one-size-fits-all bureaucracy has slowly and steadily eroded the role of national parliaments and other political institutions.

This is a convincing argument for British voters. However, it needn’t matter at all to Americans. What may matter to Americans, however, is the economic and national security impact of the UK deciding to leave the bloc.

There is consensus among economists that Britain leaving the EU would lead to a major economic shock, which would have worldwide impacts. In recent days, global markets have followed polls in the UK. The less likely it is that Britain leaves the better markets have done, and vice versa. Janet Yellen, the chair of the Federal Reserve, warned on Tuesday that Brexit could have “significant economic repercussions” in the US.

Furthermore, from a national security perspective, Brexit would deprive the US of a crucial window and important pro-American voice in pan-European meetings.

It also would risk Scottish independence, which would probably require the relocation of Britain’s nuclear submarines and weaken the UK’s military at a time when Europe faces a growing threat from Russian expansionism.

There is also an argument that the pro-Brexit campaign in the UK has set a disturbing trend for western democracies. Those campaigning for Britain to leave the EU have not focused on the gaping democratic deficit in European institutions. Instead, much of the campaign has focused on inflated anti-immigration rhetoric and demagoguery. One pro-Brexit poster unveiled by UK Independence party (Ukip) leader Nigel Farage featured a picture of a number of Middle Eastern refugees with the slogan “Breaking point: the EU has failed us all.” A win by pro-Brexit forces would be yet another signal of the potency of this variety of demagoguery in western politics and probably further influence the tone of what is already a historically divisive and bitter US presidential election.

British voters will make their decision on Thursday about whether the UK is better off within or without the European Union. And while the subject can be the topic of fair and reasonable debate in the UK, there is only one good outcome from the American perspective.

Wall Street donors seek to block Warren VP pick

June 20th, 2016  |  Source:

If Clinton chooses the Massachusetts senator as her running mate, donations will dry up, fundraisers warn.

Big Wall Street donors have a message for Hillary Clinton: Keep Elizabeth Warren off the ticket or risk losing millions of dollars in contributions.

In a dozen interviews, major Democratic donors in the financial services industry said they saw little chance that Clinton would pick the liberal firebrand as her vice presidential nominee. These donors despise Warren’s attacks on the financial industry. But they also think her selection would be damaging to the economy. And they warned that if Clinton surprises them and taps Warren, big donations from the industry could vanish.

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“If Clinton picked Warren, her whole base on Wall Street would leave her,” said one top Democratic donor who has helped raise millions for Clinton. “They would literally just say, ‘We have no qualms with you moving left, we understand all the things you’ve had to do because of Bernie Sanders, but if you are going there with Warren, we just can’t trust you, you’ve killed it.’”

Most big donors don’t want Warren on the ticket because she is the most accomplished anti-Wall Street populist in the Democratic Party. But many also think her presence would drive a potential Clinton administration too far to the left, poison relations with the private sector from the start and ultimately be damaging to the economy.

A constant theme that emerged in the interviews is that executives in the financial industry believe the first 100 days of a Clinton administration could feature potential deal making with Republicans, who are likely to maintain their majority in the House of Representatives.

The dream deal for Wall Street would be a combination of targeted infrastructure spending that appeals mostly to Democrats and corporate and international tax reform that could bring Republicans along. The fear is that Warren would make such a deal more difficult.

“Clinton is going to face a divided government unless there is a total tsunami,” said one moderate Washington Democrat with close ties to the banking industry. “What you want in a vice president is someone who can negotiate for you on the Hill, someone like Joe Biden. And that is not a Warren strength.”

All of the donors and senior Democrats interviewed for this story demanded that their names not be used both because they were not authorized to speak about the Clinton campaign’s internal deliberations and because they feared Warren’s wrath. “There is no upside to my talking to you on the record,” one big donor said. “Either I piss off the Clinton campaign or I piss off Warren, or both.”

Several donors said they did not really fear Warren going on the ticket because they do not believe Clinton has a strong relationship with the senator and would not trust Warren to be a loyal No. 2, either on the campaign or in the White House.

“First of all, they don’t particularly like each other,” said one prominent hedge fund manager who has raised millions for Hillary Clinton and Bill Clinton before her. But, the manager added, “The absolute predicate for a vice presidential nominee is they have to understand they are No. 2 both during the campaign and once you take office, and I just don’t think Elizabeth Warren is that type of person.”

The distaste for Warren in the banking industry is not surprising. No American politician in recent history has done more to harness the powerful anti-Wall Street sentiment that continues to rage in the country since the financial crisis of 2008.

Warren created the Consumer Financial Protection Bureau that many bankers dislike, and she continues to push for far stronger regulations including breaking up the nation’s largest financial institutions into smaller, simpler pieces. This is exactly the reason that many on the left, including ardent backers of Sen. Bernie Sanders’ presidential campaign, want to see Warren on the ticket.

“It’s very clear that Wall Street guys don’t like her because she has been a lot more effective than most in communicating an anti-Wall Street message that has been part of the Democratic Party for 80 years, since the 1930s,” said Charles Geisst, a Wall Street historian at Manhattan College. “It’s not so much that Wall Street doesn’t like her personally, most of them don’t even know her, but they don’t like anyone that espouses that particular ideology.”

A Clinton campaign spokesman declined to comment for this story. A representative of Warren did not respond to requests for comment.

Clinton earlier this month said she thinks Warren is “qualified” to be vice president. “I have the highest regard for Sen. Warren,” she said in an interview with Politico. “I think she is an incredible public servant, eminently qualified for any role. I look forward to working with her on behalf of not only the campaign and her very effective critique of [Donald] Trump, but also on the issues that she and I both care about.”

Warren has maintained the typical stance of potential vice presidents, saying she is perfectly happy in her current job. But she has some powerful backers pushing Clinton to pick her for the vice-presidential slot, including outgoing Senate Minority Leader Harry Reid (D-Nev.).

People close to the Clinton campaign say that while Warren might not wind up as the vice-presidential selection, Wall Street executives are dead wrong to think that it couldn’t happen.

They say Warren is very high on the list of possible vice presidential candidates along with Sens. Tim Kaine of Virginia, Sherrod Brown of Ohio and Cory Booker of New Jersey; Labor Secretary Tom Perez; Housing and Urban Development Secretary Julián Castro; and Rep. Xavier Becerra of California, among others. “We are not at the point of ruling anyone in or out,” a person close to the process said.

Picking Warren would be risky for Clinton’s fundraising operation. The presumptive Democratic nominee hopes to raise $1.5 billion for her campaign against Trump, and Wall Street has been a big source of funding for her over the years.

According to the Center for Responsive Politics, Clinton and outside groups supporting her have raised $289 million so far in the 2016 cycle. The securities and investment industry is easily Clinton’s top source of cash, donating over $28 million so far, according to the CRP.

“Things are so volatile now with all of the outside groups that all it can take is pissing off one billionaire on Wall Street to make it difficult,” said Sheila Krumholz, executive director of the CRP. “And you don’t run national campaigns for as many years as Clinton has without some serious support from Wall Street, they are just too much of a heavy hitter.”

The progressive case for Warren holds that she would immediately energize the liberal base and bring Sanders voters into the fold. And Warren backers note that the senator has been an early and enthusiastic basher of Trump and shown a knack for getting under the presumptive GOP presidential nominee’s skin.

“Elizabeth Warren very effectively called out Donald Trump for cheering the Wall Street collapse because it would make him money — and that moment reminded Democrats how powerful Warren’s megaphone can be,” said Stephanie Taylor, co-founder of the Progressive Change Campaign Committee. “Whether it’s as vice president or as co-chair of the presidential transition committee, it’s hard to imagine Hillary Clinton not wanting a very large role for Elizabeth Warren at the table.”

But more moderate Democrats in the financial services industry argue that Sanders voters will come on board anyway and that Clinton does not need to pick Warren to help her win.

“We are going to win this. Trump shouldn’t be president and he isn’t going to be president,” said one senior executive at a Wall Street bank who is close to Clinton. “Picking Warren would indicate weakness and panic for no reason and make them look like they are running scared of Trump. There will be plenty of time to galvanize the left and get them to come out. And Warren would be a nightmare to try and manage.”

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Russia launched its first military icebreaker in almost a half-century

June 17th, 2016  |  Source: The Verge

Capable of smashing through a meter of ice

Last week, Russia launched its first military icebreaker in 45 years, according to the TASS news agency. The vessel, named Ilya Muromets after a Russian folk hero, has a cruising range of 12,000 nautical miles and an endurance run of two full months. It is capable of smashing through up to a meter-thick of ice.

The Ilya Muromets, which launched out at the shipyard in St. Petersburg June 10th, is expected to be inducted into the Russian Navy in 2017, the news agency said. It is the latest addition to a fleet of 40 icebreakers, as Russia seeks to build a dozen more ships over the next several years. Some experts warnthat the US faces the prospect of falling behind Russia, as well as China, when it comes to developing fleets of icebreakers capable of traveling through the resource-rich Arctic region.

Last year, President Obama announced plans to acquire new icebreakers to ensure the US can operate year-round in the Arctic Ocean. Meanwhile, Russia has been stepping up its activities in the Arctic by building transport and energy production infrastructure, as well as installing military facilities and developing sea routes linking Europe and Asia, according to Sputnik News.

VW bets on electric cars, services to recover from crisis

June 16th, 2016  |  Source: Reuters

Volkswagen (VOWG_p.DE) will invest more than 10 billion euros ($11 billion) by 2025 in areas such as electric cars and ride-hailing as it seeks to reshape its business in the wake of its emissions-test cheating scandal, it said on Thursday.

Europe's biggest carmaker said it would fund what it dubbed "the biggest change process in the company's history" with an efficiency drive, including integrating components businesses that currently employ 67,000 people in 26 locations worldwide.

"The Volkswagen Group will be more focused, efficient, innovative, customer-driven and sustainable – and systematically geared to generating profitable growth," CEO Matthias Mueller said, launching a plan called "TOGETHER – Strategy 2025".

Volkswagen is battling to recover from the biggest business crisis in its 79 year history after admitting in September to cheating U.S. diesel emissions tests.

The German company has set aside $18 billion to cover the cost of vehicle refits and a settlement with U.S. authorities, and analysts expect more fines and legal costs.

The scandal has cast a shadow over the entire market for diesel cars, which account for about half of new vehicle sales in Europe, and has ramped up pressure on Volkswagen to cut costs at its namesake brand, which lags the profitability of rivals.

Spelling out a new strategy ahead of its annual shareholder meeting on Wednesday, the company said it planned to launch more than 30 electric vehicles over the next ten years, forecasting they would account for 2-3 million unit sales in 2025, compared with a tiny number currently.

It also said it would build a services business encompassing areas such as ride-hailing and car-sharing that it expects to generate sales in the billions of euros by 2025, as well as developing its own autonomous driving and battery technologies.

Mueller said the transformation would require a "double-digit billion" amount of investment, funded by an efficiency drive across the group aimed at delivering around 8 billion euros a year in savings.

He gave few further details, saying they would be announced by the company's individual brands in due course, but said the Volkswagen brand was counting on a "pact for the future" with unions to be agreed by the autumn, aimed at both boosting competitiveness and preserving jobs.


Critics of the company, including activist investor TCI, have urged it to take more radical action to cut costs despite union protests, particularly at the Volkswagen brand.

Some have also called for Volkswagen to tackle a complex ownership structure, in which the founding families, the German state of Lower Saxony and labor unions all have strong voices.

Investors are braced too for the results of an ongoing investigation into who was responsible for, and who knew about, the emissions test cheating.

"For me, this is not an investible stock. That is really to do with the corporate governance issues, which they still haven't addressed," Kevin Lilley, European equities fund manager at Old Mutual Global Investors, said on Wednesday before the strategy announcement.

He said a "cosy relationship" between key shareholders meant "this company never reaches proper profitability."

However, Evercore ISI analyst Arndt Ellinghorst said on Thursday the new strategy was an encouraging sign.

"Has VW changed? While only time will tell, there is certainly evidence that this is the case," he said, retaining a "buy" rating on Volkswagen shares.

At 1150 GMT (7.50 a.m. ET), the stock was down 1.2 percent at 118.65 euros, within a European blue-chip market .FTEU3 down 0.7 percent.

Volkswagen said its new plan aimed to improve its operating return on sales before one-off items to 7-8 percent by 2025 from 6 percent in 2015, and the return on capital employed in its automotive division to more than 15 percent from 13.8 percent.

Mueller reaffirmed the company's expansion and investment plans for North America and China, adding he expected China would be the main market for its new electric cars.

He also said Volkswagen was in talks with potential partners to bolster its position in China's growing economy-car market, a current weak spot for the business.

IT worker at Panama Papers firm detained in Geneva

June 15th, 2016  |  Source: Reuters

A computer technician at the Geneva office of the Panama Papers law firm was detained several days ago on suspicion of recently removing large amounts of data, the newspaper Le Temps reported on Wednesday, citing a source close to the case.

A spokesman for the Geneva prosecutor's office confirmed to Reuters that it had opened an investigation following a criminal complaint by the company, but he declined to comment further.

Mossack Fonseca, a law firm based in Panama, is at the centre of a massive leak of data related to offshore businesses.

The paper said the suspect had denied any wrongdoing but was accused of theft of data, unauthorised access and breach of trust following a complaint lodged by the firm.

The newspaper said there was no evidence the detained man was responsible for the massive Panama Papers data leak in April, which embarrassed several world leaders and shone a spotlight on the shadowy world of offshore companies.

The paper said the prosecutor had searched the company's office and seized computer equipment, and checks were underway to see if the detained man had stolen data and, if so, how much and when.

The prosecutor's spokesman declined to comment on that information.

Mossack Fonseca, which specialises in setting up offshore companies, has said it broke no laws, destroyed no documents, and all its operations were legal.

The Geneva prosecutor's office began a criminal inquiry in early April, shortly after the leaks that revealed many offshore companies set up by lawyers and institutions in the Swiss financial centre.

Gun Stocks Way Up After Attack in Orlando

June 13th, 2016  |  Source:

In the early hours of yesterday morning, a shooter killed 49 people in a gay nightclub in Orlando, Florida. The reactions were swift, plentiful, and varied. For instance, editors at some newspapers focused on the threat of radical Islamic terrorism while others focused on gun control. Still, others have reacted by buying shares of gun companies.

According to Fox Business, “Smith & Wesson rallied 6.9% to $22.88, and Ruger jumped 7.9% to $61.93. Vista Outdoor (VSTO), which owns Savage Arms and Federal Premium ammunition, rose 2.3% to $48.11.”

Both of those companies manufacture a type of AR-15, which is the model of weapon used by the gunman on Saturday morning.

Obama administration not pursuing executive order to shut Guantanamo

June 13th, 2016  |  Source: Reuters

The Obama administration is not pursuing the use of an executive order to shutter the Guantanamo Bay military prison after officials concluded that it would not be a viable strategy, sources familiar with the deliberations said.

The conclusion, reached by administration officials, narrows the already slim chances that President Barack Obama can fulfill his pledge to close the notorious offshore prison before leaving office in January.

The White House has said repeatedly that Obama has not ruled out any options on the Guantanamo center, which has been used to house terrorism suspects since it was set up in 2001 following the Sept. 11 attacks on New York and Washington.

Obama is eager to fulfill his 2008 campaign pledge to close the prison and could still choose to use his commander-in-chief powers, but the option is not being actively pursued, the sources said.

Without executive action, the chances of closing the prison would hinge on convincing a resistant Congress to overturn a long-standing ban on bringing possibly dozens of remaining prisoners to maximum-security prisons in the United States.

White House lawyers and other officials studied the option of overriding the ban but did not develop a strong legal position or an effective political sales pitch in an election year, a source familiar with the discussions said.

"It was just deemed too difficult to get through all of the hurdles that they would need to get through, and the level of support they were likely to receive on it was thought to be too low to generate such controversy, particularly at a sensitive (time) in an election cycle," the source said.

Republicans in Congress are opposed to bringing Guantanamo detainees to U.S. prisons and have expressed opposition to transfers to other countries over concern that released prisoners will return to militant activities. They have vowed to challenge any potential Obama executive action in court.

At its peak, the prison at the U.S. naval base in Cuba housed nearly 800 prisoners, becoming a symbol of the excesses of the "war on terror” and synonymous with criticism of detention without trial and accusations of torture. Obama has called it a recruitment tool for terrorists.


The number of Guantanamo detainees has fallen to 80 now, the lowest since it was opened.

The administration is focusing on getting the number of detainees at the prison down to such a low number, perhaps 20, that the cost of keeping it open could prove unpalatable to Congress. Republican lawmakers remain unswayed.

The Guantanamo prison and associated military commissions cost $445 million in fiscal year 2015. That works out to more than $5.5 million a year for each of the 80 remaining prisoners.

Thirty of the remaining detainees at Guantanamo have been approved for transfer to foreign countries and the State Department says it will move all of them out this summer. Those who would be left include 10 being prosecuted in military commissions, and other detainees deemed too dangerous to release or transfer.

“The administration's goal is to work with Congress to find a solution to close Guantanamo," said Myles Caggins, a spokesman for the White House National Security Council.

He said the government had made "substantial progress" moving prisoners to foreign countries and was working to identify more countries for additional transfers. Reviews to determine whether certain prisoners need to remain detained to prevent a threat to U.S. security had been accelerated and would be completed in the coming months, he said.

Obama, who issued an order to shut the prison within a year on his first day in office, released his latest plan to close it to Congress in February, but it has not gained traction.

The White House has not publicly ruled out the executive order option in part to keep pressure on the Pentagon to move prisoners who have been cleared for release to other countries, one of the sources said.

"If Congress ... would finally say no to the president's plan and the executive order option wasn't on the table, there was a concern that the wheels could grind to a halt," said the source familiar with discussions at the White House.

Gregory Craig, who served as Obama's first White House counsel, said that without an executive order, Obama would likely need the cooperation of Congress to shut down the prison.

"I think the odds are probably challenging," Craig said.

Studies find 'super bacteria' in Rio's Olympic venues, top beaches

June 11th, 2016  |  Source: Reuters

Scientists have found dangerous drug-resistant "super bacteria" off beaches in Rio de Janeiro that will host Olympic swimming events and in a lagoon where rowing and canoe athletes will compete when the Games start on Aug. 5.

The findings from two unpublished academic studies seen by Reuters concern Rio's most popular spots for tourists and greatly increase the areas known to be infected by the microbes normally found only in hospitals.

They also heighten concerns that Rio's sewage-infested waterways are unsafe.

A study published in late 2014 had shown the presence of the super bacteria - classified by the U.S. Centers for Disease Control and Prevention (CDC) as an urgent public health threat - off one of the beaches in Guanabara Bay, where sailing and wind-surfing events will be held during the Games.

The first of the two new studies, reviewed in September by scientists at the Interscience Conference on Antimicrobial Agents and Chemotherapy in San Diego, showed the presence of the microbes at five of Rio's showcase beaches, including the ocean-front Copacabana, where open-water and triathlon swimming will take place.

The other four were Ipanema, Leblon, Botafogo and Flamengo.

The super bacteria can cause hard-to-treat urinary, gastrointestinal, pulmonary and bloodstream infections, along with meningitis. The CDC says studies show that these bacteria contribute to death in up to half of patients infected.

The second new study, by the Brazilian federal government's Oswaldo Cruz Foundation lab, which will be published next month by the American Society for Microbiology, found the genes of super bacteria in the Rodrigo de Freitas lagoon in the heart of Rio and in a river that empties into Guanabara Bay.

Waste from countless hospitals, in addition to hundreds of thousands of households, pours into storm drains, rivers and streams crisscrossing Rio, allowing the super bacteria to spread outside the city's hospitals in recent years.

Renata Picao, a professor at Rio's federal university and lead researcher of the first study, said the contamination of Rio's famous beaches was the result of a lack of basic sanitation in the metropolitan area of 12 million people.

"These bacteria should not be present in these waters. They should not be present in the sea," said Picao from her lab in northern Rio, itself enveloped by stench from Guanabara Bay.

Cleaning the city's waterways was meant to be one of the Games' greatest legacies and a high-profile promise in the official 2009 bid document Rio used to win the right to host South America's first Olympics.

That goal has instead transformed into an embarrassing failure, with athletes lamenting the stench of sewage and complaining about debris that bangs into and clings to boats in Guanabara Bay, potential hazards for a fair competition.


Picao's study, which has undergone internal reviews at Rio's federal university, analyzed water samples taken between September 2013 and September 2014. Using 10 samples taken at five beach locations, the study found super bacteria were most present at Botafogo beach, where all samples were positive.

Flamengo beach, where spectators will gather to watch Olympic sailors vie for medals, had the super bacteria in 90 percent of samples. Ten percent of Copacabana's samples had the microbes.

Ipanema and Leblon beaches, the most popular with tourists, had samples that tested positive for super bacteria 50 and 60 percent of the time, respectively.

The Oswaldo Cruz study of the Olympic lagoon, which was peer reviewed, is based on water samples taken in 2013. It found that the lake is a potential breeding ground for super bacteria and their spread through the city.

While the studies both use water samples that are from 2013 and 2014, Picao and other experts said they had seen no advances in sewerage infrastructure in Rio to improve the situation.

Valerie Harwood, an expert in recreational water contamination and antibiotic-resistant bacteria at the University of South Florida who was not involved in the studies, said that if anything, things were getting worse, as the super bacteria naturally spread by infecting other microbes.

The contamination has prompted federal police and prosecutors to investigate whether Rio's water utility Cedae is committing environmental crimes by lying about how much sewage it treats. Investigators are also looking into where billions of dollars in funds went since the early 1990s, money earmarked to improve sewage services and clean Guanabara Bay.

Cedae has denied any wrongdoing. It said in an emailed statement that any super bacteria found at the beaches or the Olympic lagoon must be the result of illegal dumping into storm drains. Cedae said it carries out sewage treatment and collection in the entire "south zone" of Rio, where the bodies of water are located and where the water samples were taken.


Five scientists consulted by Reuters said the immediate risk to people's health when faced with super bacteria infection depends on the state of their immune systems.

These bacteria are opportunistic microbes that can enter the body, lie dormant, then attack at a later date when a healthy person may fall ill for another reason.

Super bacteria infect not only humans but also otherwise-harmless bacteria present in the waters, turning them into antibiotic-resistant germs.

Harwood said the super bacteria genes discovered in the Olympic lagoon were probably not harmful if swallowed by themselves: they need to be cocooned inside of a bacterium.

"Those genes are like candy. They are organic molecules and they'll be eaten up by other bacteria, other organisms," Harwood said. "That's where the danger is - if a person then ingests that infected organism - because it will make it through their gastrointestinal tract and potentially make someone ill."

The presence of the super bacteria genes in the lagoon indicates the bacteria themselves had recently died or simply were not detected by testing, Harwood said.

Health experts say Rio's poor wastewater management has already created endemic illnesses associated with sewage that disproportionately impact the city's poor, including gastrointestinal and respiratory problems, Hepatitis A and severe heart and brain conditions.

Rio's Olympic organizing committee referred questions on water quality to state authorities.

Rio state's Inea environmental agency said in an emailed statement it follows the World Health Organization's recommendations for testing recreational water safety, and that searching for super bacteria is not included in that. It also said there was a lack of studies about the bacteria in water and health outcomes.  

Wall St. falls sharply on oil drop, global growth worries

June 10th, 2016  |  Source: Reuters

Global growth worries and a sharp drop in oil prices sent jitters through Wall Street, leading the three major U.S. indexes lower for the second straight day on Friday.

Despite higher demand, oil eased as traders booked profits after a three-day winning streak that started Monday and pushed prices to 2016 highs, and as the dollar moved higher.

Financial stocks came under pressure again as global issues, including uncertainty over interest rate hikes and the impending vote on Britain's membership in the European Union, sent investors scurrying to safe haven assets.

The yield on government bonds fell globally, while gold prices held near a three-week high.

"I think its the fear factor (on global issues) that is pushing stocks a little bit," said Peter Cardillo, chief market economist at First Standard Financial in New York.

"The British exit is beginning to become more of a factor now and that's due to the fact that we have crumbling yields throughout the globe."

At 9:43 a.m. ET the Dow Jones Industrial Average .DJI was down 130.36 points, or 0.72 percent, at 17,854.83.

The S&P 500 .SPX was down 18.04 points, or 0.85 percent, at 2,097.44 and the Nasdaq Composite .IXIC was down 53.38 points, or 1.08 percent, at 4,905.24.

The S&P and the Dow are, however, on track to finish the week higher, while the Nasdaq is off 0.7 percent.

All 10 S&P sectors were lower, led by the a 1.2 percent drop in the financials index .SPSY. Goldman Sachs (GS.N) fell 1.3 percent and was the biggest drag on the Dow.

Urban Outfitters (URBN.O) fell 7 percent to $26.02 after the apparel retailer's disappointing sales report.

Mattress Firm (MFRM.O) dropped 17 percent to $27.85 after posting a bigger-than-expected quarterly loss.

Declining issues outnumbered advancing ones on the NYSE by 2,399 to 381. On the Nasdaq, 2,007 issues fell and 340 advanced.

The S&P 500 index showed 23 new 52-week highs and no new lows, while the Nasdaq recorded 6 new highs and 17 new lows.

Migrant smuggling 'general' extradited to Italy

June 8th, 2016  |  Source: AFP

An Eritrean dubbed "the general", suspected of controlling a migrant trafficking network responsible for shipping thousands of people to Europe and sending some to a watery grave, has been extradited to Italy.Medhanie Yehdego Mered, 35, who had been on a wanted list since 2015 for international people smuggling, was arrested in the Sudanese capital Khartoum and flown to Italy late Monday.

He is "the accused ringleader of one of the four largest criminal migrant trafficking organisations", the Sudanese interior ministry said in a joint statement with the country's British and Italian embassies.

Referred to in wiretapped conversations between his subordinate traffickers as "the general" for his control over a large area and number of "troops", Mered is accused of organising the smuggling of up to 8,000 people a year on migrant boats.

Investigators believe his organisation was responsible for packing migrants onto a boat that sank in 2013 off the Italian island of Lampedusa, claiming at least 360 lives in one of the worst disasters in the Mediterranean.

His arrest is "a key turning point in the fight against people trafficking," prosecutor Francesco Lo Voi told a press conference, while Italian Interior Minister Angelino Alfano dubbed it "an extraordinary result" in a bid to stop "merchants of death".

- 'Disregard for lives' -

It is the first time a suspected top smuggler has been arrested in Africa and brought to face justice in Italy, which has been overwhelmed by the arrival of hundreds of thousands of people since the migrant crisis began in 2008.

Mered allegedly directed operations in Africa but also kept fellow operators in Italy up to date on the arrival of boats, so migrants could be picked up and squeezed for more money to continue to their final destinations in Europe.



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