March 18, 2018

Nearly half of Americans will retire broke

The survey, carried out for the third consecutive year, suggests that a lack of planning and savings, along with a longer life expectancy, may shatter people’s retirement dreams. The California-based financial advisor also found out that the percentage of Americans with no savings at all had increased from 2016 through 2017.

Low salaries or lack of opportunities to earn more is identified as the key factor for 40.1 percent of the surveyed, while 24.9 percent told the personal finance site that they were already struggling to pay bills. Adults 65 and older annually spend almost $46,000, according to the Bureau of Labor Statistics. Nearly 10.3 percent do not stash away money, as they don’t need any retirement savings.

The researcher commonly polls American adults, which are roughly divided into three groups: millennials, Generation X and baby boomers. The respondents are required to answer how much money they may save for retirement by their best estimate, choosing one of the suggested answers.

The latest poll reveals that at least 18 percent of millennials aged 18 to 34 have zero savings for retirement. Another 39 percent of respondents in this age group have less than $10,000 put aside.

However, the total number of millennials with nothing or less than $10,000 saved has reportedly dropped to 57 percent this year, from 71 percent in 2017. The percentage of this generation with $300,000 or more saved has increased to nine percent from five percent last year.

Respondents at the age of 55 or over comprise the highest percentage of those who have saved more than $300,000— 23 percent, but about one-third of them have less than $10,000 in savings. At the same time, Gen Xers, aged 35 to 44, are less likely to save, while people over 65 are the most likely to say they don’t have retirement savings because they used the money for an emergency.

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US rating agencies unfairly downgrade developing countries & keep US ratings high

“It is absurd when Russia, a country with the fifth-largest reserves of physical gold, and with gold reserves of $450 billion, had a rating lower than the investment grade and close to the junk status of some Latin American countries with a much less reliable level of protection of the financial system,” analyst at TeleTrade Petr Pushkarev told RT.

SP accused of faking ratings to cultivate business, exacerbating global financial crisis

Another example of unfair ratings is Brazil, according to Pushkarev. “The credit rating of such a huge and rich country like Brazil is BB-, according to two of the ‘big three’ – the same as back in 2001. The country has undergone a lot of development during this time, and the whole BRICS community has become much more united, stronger,” he said. Despite this, Brazil has the same rating as Bangladesh, the analyst notes. 

Not all investors are following the advice of the ‘big three,’ and those who invested in the Russian or Brazilian economy have enjoyed the strengthening of the rouble and Brazilian real, said Pushkarev. However, hedge funds, pension funds and many investors are still looking at the ratings by the ‘big three’ when making investments, and developing countries are losing money.

Pushkarev said that when SP was forced to downgrade America’s rating from AAA to AA+, “the indignation and pressure from the US government was so great that then, despite the growth of public debt and budget deficits, there were no new revisions of US ratings, and the other agencies didn’t downgrade the US.”

Vladimir Rozhankovsky, Global FX Investment analyst, said it is very difficult to prove that the ‘big three’ agencies are biased in their ratings. There have been many trials against these companies, but their bias hasn’t been proved yet.

“The agencies are using internal scoring models, which are their own methods and, for this reason, they are not obliged to disclose information about these,” the analyst told RT. Moreover, the agencies are claiming that if you don’t like their ratings, then don’t use them, he said.

Rozhankovsky said that poor assessment of synthetic collateralized debt obligations (SCDOs) led to the most large-scale global crisis since the Great Depression of 1929.

Despite the accusations of having triggered the crisis, SP, Moody’s, and Fitch have done close to nothing to change their assessment criteria, he added.

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Spain wants in on Russia’s high-speed railway project

“State Secretary for Transport, Infrastructure and Residential Housing of Spain Julio Gomez-Pomar informed Russian Deputy Minister of Transport Alan Lushnikov about Spain’s interest in participating in the Moscow-Kazan project,” the ministry said.

German consortium to invest almost €3bn in Russian high-speed railway

The new 770 kilometers of track between Moscow and Russia’s Tatarstan capital Kazan will stretch through seven regions of Russia. It will have 15 stops, including Vladimir, Nizhny Novgorod, and Cheboksary. The journey from Moscow to Kazan currently takes 12 hours, but will now be reduced to just 3.5 hours.

The new link is part of a network of high-speed lines planned for the football World Cup, which Russia is hosting this year.

Beijing has expressed interest in funding the project, saying it will provide $6 billion. China considers the project not only as an investment, but also as a way of boosting communication and trade with Russia and Europe.

The Sino-Russian joint investment in the railway is around $15 billion. In the future, the Moscow-Kazan route may become a part of a $100-billion high-speed railway between Moscow and Beijing. The railway may also connect to Beijing’s New Silk Road project, which will link China to markets in Europe and the Middle East.

A consortium of major German companies had earlier expressed readiness to provide €2.7 billion for the railroad’s construction. The consortium said that it is ready to manufacture rolling stock for the route. Germany’s Siemens wants to provide an enhanced version of its high-speed Sapsan train for the new line.

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South Africa’s white farmers reportedly being murdered & tortured off their land

Last month, South Africa’s parliament voted to allow white-owned land expropriation without compensation. That followed South Africa’s new President Cyril Ramaphosa’s pledge to return the lands owned by white farmers since the 1600s to the black citizens of the country. He claimed the land was “taken under colonialism and apartheid.”

Australia calls for emergency visas for white farmers facing violent attacks in South Africa

“This is normal in South Africa to be attacked on a farm,” a 39-year old farmer Berdus Henrico told the reporter.

Berdus and his 51-year old partner Estelle Nieuwenhuys have been raided in the Limpopo province. The farmer has three bullet wounds – two through his shoulder and one through his face that came out the back of his neck.

“They took my hunting gun, my shotgun, two cell phones, our DVD player, our TV,” said Berdus, adding that Estelle was praying, out loud, begging them to stop.

“They want money and they want guns. They want the people off the land so as they can go on like they want to. They want it here like it was in Zimbabwe a few years ago when they chased all the whites out and let it go to the ground.”

According to AfriForum, a group that was set up to draw attention to the farmers’ plight, there were a record 404 farm attacks in 2017, four times the number recorded in the country a decade ago. The 2018 figures are expected to easily top last year’s numbers.

AfriForum is trying to work with police and government to raise awareness.

“If we see a white farmer being tortured, being burned with torches or clothing irons, gang-raped, we don’t see any focus on these cruel crimes,” said Ian Cameron, head of AfriForum Community Safety.

New South African president wants to seize land from white farmers without compensation

The organization’s statistics show the number of commercial farmers in South Africa declined from more than 60,000 to 35,000 during the past two decades. More than 60 percent of farm attack victims were over 50 years old.

Cameron explained that the government views farm attacks as “normal” crime.

“The cruelty that goes with farm attacks is disproportionate compared to other crime,” he said. “An urban crime might last 10 minutes, but [on farms] people can be tortured for up to nine hours.”

There is something warlike in the country, according to Cameron. “This country is damaged. We are psychologically damaged,” he said.

South Africa has a population of over 50 million people. According to a 2017 government audit, white people own 72 percent of farmland.

The leader of South Africa’s radical Marxist opposition party (the Economic Freedom Fighters) Julius Malema said recently the mayor of Port Elizabeth should be removed because he is white.

“We are cutting the throat of whiteness,” said Malema.

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Capital returning to Russia as UK threatens to target investments

“There is evidence of reverse capital flight back from the West into Russia,” he said, as quoted by CNBC.

Granville, who is at the helm of EMEA and Global Political Research at Trusted Sources Analysts, also noted “a major book building in a Russian sovereign Eurobond” in the current week with total value of nearly $7 billion. The figure will be “a very good instrument for Russians who are concerned about the safety of their capital, whether it’s held in the UK or elsewhere in Western Europe or North America, to repatriate,” according to the analyst, who specializes in Russian research.

Earlier this week, UK Prime Minister Theresa May announced plans to introduce punitive measures against Russia, having expelled 23 diplomats and canceled Russian Foreign Minister Sergey Lavrov’s visit to the country. London claims a Soviet-era nerve agent was employed to poison the former Russian-UK double agent. The Kremlin has rejected the allegations. Prime Minister May also demanded that Moscow reveal the details of the alleged Skripal plot, as well as limiting diplomatic ties, and freezing Russian state assets in the UK.

Moscow has been trying to stimulate a repatriation of capital held offshore by wealthy Russians. According to experts, UK sanctions could play into the Russian government’s hands in pursuing that goal.

“From this perspective, the sanctions have had a positive effect. Wealthy Russians have placed their assets in the West largely due to fears of expropriation at home. If their assets are at risk of being frozen anyway, this no longer holds,” principal Russia analyst at Verisk Maplecroft Daragh McDowell told the media.

Sergei Skripal and his daughter Yulia were found slumped on a bench in the center of Salisbury on March 3. Skripal worked as a double agent for the UK intelligence agency MI6 and was jailed in Russia in 2006 for spying for Britain, having passed on the names of undercover Russian agents. He was later part of a “spy swap” in which Russia released four spies in exchange for 10 Russian agents.

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Inflation in Russia lower than America’s for first time in history

Inflation in Russia now stands at 2.18 percent, and for the first time ever it is lower than US inflation, which is currently 2.2 percent. This is another record low for Russia. In 2017, consumer prices rose by only 2.5 percent. In 2016, there was 5.4 percent growth. Thus, inflation has more than halved in a matter of a couple of years.

Such low inflation is unprecedented for Russia. For almost a quarter of a century the economy has lived through much higher rates of consumer prices growth. In the 1990s there was hyperinflation typical for the poorest countries: 2,509 percent in 1992, 840 percent in 1993, and 215 percent in 1994.

Agriculture makes much more money for Russia than arms exports – Putin

The situation improved only in 2000, when prices rose by 20 percent. The last time inflation in Russia was double-digit was in 2015 – 12.91 percent. And this year, inflation is approaching just 2 percent, half of the Central Bank of Russia’s target of 4 percent per annum.

Analysts say this is good for the real economy and consumers.

“Low inflation benefits producers: at stable prices, they do not have to reconsider costs, and the cost of production does not change,” said Anna Kokoreva, deputy director of the analytical department of Alpari, as quoted by RIA Novosti.

Low inflation also leads to the cut of the key rate by the central bank, which leads to cheaper mortgage and loans both for business and consumers. Mortgages have been stagnant in Russia because of the economic crisis, but better offers from banks are gradually reviving the ailing sector.

Retail has also won from low inflation. In 2017, it grew 1.2 percent after drops of 5 and 10 percent in the previous two years respectively.

However, when inflation is low, the economy also faces the risk of deflation. Deflation is when the purchasing power of money is growing, and the prices of goods and services are gradually declining. The key risk of deflation is a slowdown in economic growth with subsequent stagnation.

“It’s extremely difficult to get out of the trap. Japan has not been able to overcome deflation, which has significantly impeded its economy for a quarter of a century. Europe is facing the same problem,” Finam analyst Aleksey Korenev told RIA Novosti.

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EU watchdog calls for review of Barroso’s role at Goldman Sachs

Former EU politicians need ‘cooling off period’ before jumping in bed with lobbying groups

According to the Ombudsman, who led a year-long investigation, there are new revelations that Barroso met a senior EU official last October to lobby on behalf of the Wall Street bank, despite having been warned not to lobby his former employers.

“Putting the matter to the ethics committee once more would demonstrate that the Commission has taken very seriously public concern over this affair and the damage done to the image of the EU institutions – despite the hard work and ethical behavior of the vast majority of people who work in them,” Ombudsman Emily O’Reilly said on Thursday.

Barroso tweeted in response: “The European Ombudsman’s recommendations published today do not involve any legal assessment of my duties as she has confirmed in a letter to me made available on her website.”

He added that the independent Ad Hoc Ethical Committee had reviewed his “professional appointment well over a year ago and did not find that it involved any breach of my duties.”

Barroso was Portugal’s prime minister from 2002 to 2004, and later served as President of the European Commission from 2004 to 2014.

In 2016, EU Chief Executive Jean-Claude Juncker launched an ethics investigation into his predecessor, Barroso, to examine whether he had breached a lifetime obligation for ex-commissioners to “behave with integrity.” 

Barroso was cleared by the ethics committee of violating any rules when taking a job at Goldman Sachs, where he was supposed to help “limit the negative effects of Brexit.” However, his decision to join the Wall Street bank has been much criticized, with more than 130,000 people signing a petition for “exemplary measures.” They said he had failed to “behave with integrity and discretion.”

Goldman Sachs, which helped spark the 2008 financial crisis, is also blamed for assisting Greece in hiding its financial situation in order to enter the eurozone in 2000. 

The EU has the power to ask the EU court to cut the pensions of former commissioners who breach treaty obligations to act with integrity, but such a step would be unprecedented.

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UK threat to cut Russian gas supplies politically motivated – Russian energy minister

“Russia is supplying gas to Europe on absolutely competitive terms and will continue to operate in a competitive environment. Such decisions are politically motivated and are not aimed at increasing competition in the European market,” Novak said, as quoted by the TASS news agency.

Russia delivering more gas to Britain to relieve cold-weather shortage

“It’s the right of every commercial organization and country to choose their energy policy,” he added.

Earlier, Theresa May said the United Kingdom would seek alternative gas supplies after blaming Russia for poisoning former spy Sergei Skripal.

Britain buys Russian gas through mainland Europe and has also bought from Russia’s brand-new liquefied natural gas (LNG) plant in Yamal, northern Siberia. Last year, Russia sold $2.85 billion worth of gas to the UK.

Half of Britain’s LNG imports to date in 2018 have come from Russia. An unusually cold winter and pipeline breakdowns forced London to ask for Moscow’s help to cover the national gas shortage.

Trevor Sikorski, chief gas analyst at Energy Aspects in London, told the FT that after the UK closed the Rough storage site, the country could become more dependent on LNG. He added that the share of British imports could surge from the current three percent to five percent.

UK energy union GMB said it questions “how effective the sanctions will be when half of our liquid gas imports this year have come from Russia, and Russian companies provided six percent of our gas consumption in 2017,” as quoted by Bloomberg.

“We need a serious strategy and investment in UK energy to make sure we can stand on our own two feet,” it said.

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Norway’s politically correct Statoil wants to change name to exclude ‘oil’

Norway’s $1 trillion wealth fund looks to dump oil gas stocks

“The world is changing, and so is Statoil. The biggest transition our modern-day energy systems have ever seen is underway, and we aim to be at the forefront of this development,” the company’s chairman, Jon Erik Reinhardsen, said in a statement.

The new name comes from combining “equi” – with a nod to words such as equal, equality and equilibrium – with “nor,” reflecting the Norwegian origin of the corporation, of which 67 percent is controlled by the state.

The decision comes several months after Norway’s trillion-dollar sovereign wealth fund announced plans to dump investment for oil and gas stocks. The step was reportedly aimed at eliminating dependence on oil prices, which have demonstrated high volatility over recent years.

“Our perspective here is to spread the risks for the state’s wealth. We can do that better by not adding oil-price risk,” Egil Matsen, the deputy central bank governor overseeing the world’s biggest fund, told Bloomberg at the time.
Statoil also announced plans to invest up to 20 percent of its funds in “new energy solutions” by 2030 as part of a broader project oriented towards profitable renewable energy. “Statoil is one of the world’s most carbon-efficient producers of oil and gas, and will develop its low carbon advantage further,” a company statement claims.

The new name for the corporation will be proposed to its shareholders in May. The rebranding will cost the company some 250 million kroner ($32.5 million), according to a person familiar with the matter, as quoted by Bloomberg. At the moment, the Equinor name is held by an Oslo-registered veterinarian, but that firm is reportedly changing its name shortly.

However, the energy major has no intention of leaving the oil business, according to CEO Eldar Saetre. “The Norwegian continental shelf will remain the backbone of our company, and we will use our Norwegian heritage in our positioning as we continue growing internationally within both oil, gas and renewable energy,” said the CEO.

Notably, members of the so-called Big Oil group, such as Chevron, ExxonMobil, Royal Dutch Shell, Total, Eni and Phillips 66, do not have anything related to the industry in their names. The UK energy major BP, which also forms part of the group, was known as British Petroleum before 2001. However, the company opted to replace the name with BP, representing a new corporate slogan – “Beyond Petroleum.” The revised name, slogan and logo were supposed to mirror the company’s focus on meeting the growing demand for fossil fuels, manufacturing and delivering more advanced products, and to enable transitioning to a lower carbon footprint.

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Pump & dump? Crypto market crashes in suspiciously delayed reaction

It took more than 24 hours for the crypto market to react to the news, but major cryptocurrencies saw double-digit percent losses on Thursday.

Bitcoin slid 13 percent to $7,950 for the first time this month. The second-largest cryptocurrency ethereum fell below $600 – losing over 57 percent in value since peaking above $1,400 at the beginning of the year.

Cryptocurrency market ruled by lawless code of Wild West – analyst

Ripple and bitcoin cash both tumbled by more than 13 percent. All but two of Coinmarketcap’s top-100 cryptocurrencies were trading lower on Thursday.

On Wednesday, Google announced it would ban all cryptocurrency ads “including but not limited to initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets and cryptocurrency trading advice.” The move followed the same decision by Google’s main advertising rival, Facebook, which had announced the ban in January.

The cryptocurrencies were also probably weighed down by last week’s news that the US Securities and Exchange Commission (SEC) had warned investors that cryptocurrency exchanges were not regulated.

However, the Thursday’s fall in cryptocurrencies has shown that the market reacts on bearish news either belatedly or it acts independently from the news at all. There has been speculation that a small number of big investors are colluding on manipulating prices.

Under the so-called pump-and-dump strategy, a specific asset is pushed hard and investors are promised large returns. After prices peak, the owners and early investors quickly sell as many shares as possible, while the others lose. This is not illegal since the cryptocurrency market is not regulated.

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