Thursday, June 9, 2016

Thursday, June 9, Night Wall Street Roundup: Stocks Snap Winning Streak; Yen Rises On Safe-Haven Bid

By Saqib Iqbal Ahmed
Reuters
June 9, 2016

Bond prices and the yen rallied on Thursday as investors sought the safety of low-risk assets, while crude oil prices and stocks retreated after recent gains.

An index of world equity markets snapped a five-day winning streak. Oil prices dipped as a firmer dollar sparked profit-taking after three sessions of gains.

The yen, which investors prefer in times of market uncertainty, reached a three-year peak against the euro EURJPY= and a five-week high versus the U.S. dollar JPY. But late in the U.S. session, the Japanese currency fell marginally against the dollar.

"It's generally a cautious mood today. You have stocks lower and yields lower," said Eric Viloria, currency strategist at Wells Fargo Securities in New York.

The dollar index, which tracks the greenback against six major currencies .DXY, rebounded from five-week lows set on Wednesday. It was up 0.54 percent at 94.095.

The greenback was supported by an unexpected drop in U.S. jobless claims and a stronger-than-expected rise in wholesale sales in April. The data soothed some concerns about the U.S. economy decelerating in the second quarter.

Oil, which earlier hit a 2016 high on supply worries, was pressured by the firmer dollar. A stronger dollar makes oil more expensive for holders of other currencies.

"So far this looks like a modest technical correction following three days of gains, rather than a major reversal," said Tim Evans, energy futures specialist at Citi Futures in New York.

The MSCI world equity index .MIWD00000PUS of shares in 45 nations, pulled back from a six-week high hit on Wednesday and was down 0.62 percent.

On Wall Street, stocks ended slightly lower after three days of gains, weighed down by financials and energy companies.

The Dow Jones industrial average .DJI fell 19.86 points, or 0.11 percent, to close at 17,985.19, the S&P 500 .SPX lost 3.64 points, or 0.17 percent, to finish at 2,115.48 and the Nasdaq Composite .IXIC was dropped 16.03 points, or 0.32 percent, to end at 4,958.62.

Europe's broad FTSEurofirst 300 index .FTEU3 closed down 0.94 percent at 1,340.20. Stocks were hurt by weaker commodities-related shares and comments from European Central Bank President Mario Draghi that Europe is at risk of suffering lasting economic damage from weak productivity and low growth.

In the bond market, U.S. Treasury yields dipped to 3-1/2 month lows as falling oil and stock prices boosted demand for safe-haven debt.

The Treasury Department sold $12 billion worth of 30-year bonds at a yield of 2.475 percent, the lowest at an auction of this maturity since January 2015.

"It was a very solid auction," said Gennadiy Goldberg, an interest rate strategist at TD Securities in New York.

"It doesn't show any investor hesitation at lower yields, which is really a factor of falling global interest rates."

Benchmark 10-year notes US10YT=RR gained 8/32 in price to yield 1.68 percent, the lowest since Feb. 24.

Brent crude LCOc1 settled down 56 cents, or 1.07 percent, at $51.95 a barrel, while U.S. crude CLc1 settled down 67 cents, or 1.31 percent, at $50.56.

Copper CMCU3 fell 2 percent to near a four-month low of $4,485.50 a tonne, on the firmer dollar.

Spot gold XAU= was up 0.52 percent to $1,268.35 an ounce after hitting a three-week high.


Article Link to Reuters:

Has Turkey Given Up Fighting Corruption?

Turkey's new government shies away from even paying lip service to fighting corruption, as allegations of graft and bribery at the higher echelons of the state reach as far as the United States.


By Sukru Kucuksahin
Al-Monitor
June 9, 2016

Following its creation in 2001, Turkey's ruling Justice and Development Party (AKP) singled out corruption, poverty and restrictions on liberties as the three main areas of its political battle. Using the initials of the Turkish words, it even coined a slogan — “Fighting the 3Y” — which became one of its most popular ones. Today, 14 years on, the AKP is wary of even uttering the expression “fighting corruption.” Most recently, an anti-corruption commission, created by the AKP itself, was tossed into the dustbin of history by the new government of Prime Minister Binali Yildirim.

In a bitter irony, the move came against the backdrop of a deepening US probe into the dealings of Reza Zarrab, an Iranian-Turkish businessman accused of violating sanctions on Iran with the help of Turkish politicians and bureaucrats. Zarrab was a central figure in a huge bribery and graft scandal in December 2013, which Ankara quickly covered up through a massive purge in the police and the judiciary.

President Recep Tayyip Erdogan, the AKP’s founder and omnipotent leader, has spoken volumes about stamping out corruption. In the early years of his political career, he would even show his wedding ring as his only valuable possession, i.e., as his proof of integrity. Shortly after coming to power in 2002, the AKP moved to make good on its promises, sending a number of former ministers, including an ex-premier, to the Supreme Court to answer charges of graft. In its party program, the AKP pledged to wage a “most intensive struggle” against corruption and nepotism, make sure that “full transparency and accountability prevail in every area of public life,” pass legislation to prevent “the pollution of politics” and oblige all elected officials to periodically reveal their wealth.

Any discussion on whether today’s Turkey is the one painted above seems luxurious. Let’s simply recall post-election reports by the Organization for Security and Cooperation in Europe, which highlight a lack of transparency in campaign financing and practices overshadowing the fairness of elections. Let’s also consider how Turkey has fared on the Corruption Perceptions Index of Transparency International; ranking 65th in 2002, the country climbed to 53rd place in 2013 before plunging to 66th place in 2015.

During its 14 years in power, the AKP has made dozens of amendments to the Public Procurement Law, the latest of which parliament passed last week. Thanks to those amendments, countless public procurements have become exempt from the control of the Public Procurement Authority, created in 2000 to curb corruption and nepotism in the public sector. Now, public tenders that remain under its control are the exception.

In a further blow on oversight, the reports of the Court of Accounts, the top public auditor that — by law — works on behalf of parliament, are no longer submitted to parliament itself, meaning the legislature’s means of reviewing and checking public spending is now largely limited.

The list of how accountability has been flouted is long, but the attitude of the new government, which took office May 29, says it all. While presenting his government’s program in parliament, Yildirim went down in history as a prime minister who did not mention “fighting corruption” even once, though he did utter the word “transparency” three times. But it did not end there.

In December, the previous government, led by Ahmet Davutoglu, had created an anti-corruption body, chaired by a deputy prime minister and called the Commission on Increasing Transparency and Enhancing the Fight against Corruption. A month later, Davutoglu unveiled a “transparency package” aimed at tackling corruption. Erdogan, however, slammed the package with a memorable objection. Referring to a proposal that required party officials to reveal their wealth, he said, “If it goes on like this, you can’t find anyone to chair even [the party’s] provincial and district branches.” So, the proposed measures went down the drain. Once in office, the Yildirim government quickly issued a circular dismantling Davutoglu’s anti-corruption commission.

In short, Turkey now has an unprecedented government that does not pledge to fight corruption, not even as lip service.

Last week, the Turkish branch of Transparency International offered a grim assessment of Ankara’s anti-corruption record in the past six years. It noted only “limited progress” on only six out of 28 measures outlined in a 2010 action plan, which, it said, was followed by a second one in April without any public discussion. The new plan, the statement said, is basically “a list of what has not been done in the past six years,” and seems to have been penned only because fighting corruption is one of the European Union’s conditions for a visa-free travel regime for Turkey. It remains unclear whether the new government is committed to the plan, it added.

Speaking to Al-Monitor, the head of the group, lawyer Oya Ozarslan, said they kept in close contact with the relevant authorities, but failed to ensure transparency on how the government worked on the 2010 action plan.

“No one had any idea of what was going on. Certain commissions were set up, but there was no coordination between them, and no information was available on what proposals had been made or what steps had been taken or what has been said [at the meetings]. Despite all our nagging, everything transpired in the world of mystery,” she said.

For Ozarslan, “fighting corruption seems to be no longer an area of real effort” for the government. “Corruption has to be punished in line with the law, but as we’ve seen various times, this is no longer the case in Turkey. The charges of December 2013 were the first major example,” she added.

According to Ozarslan, AKP-linked officials enjoy “bureaucratic immunity” against accountability. “For instance, you never hear about investigations or media reports of corruption concerning AKP-held municipalities … while virtually all opposition-held municipalities, which make one-third of the total, have faced such accusations,” she said.

Another big problem is the deteriorating state of judicial independence, Ozarslan said. Indeed, the alarm of tightening government control of the judiciary grew further last month when the heads of three top-level courts accompanied Erdogan on a trip to his home province, which saw them pluck tea together.

“Fighting corruption requires a strong, independent and impartial judiciary in which everyone trusts. Similarly, the media has to be functioning. Today, corruption has become a no-no word in the mainstream media,” Ozarslan said.

The current state of affairs calls for an all-out mobilization against corruption, she stressed, warning of a long-term social erosion. “The money that is being lost is … money from everyone’s pockets. If we want a clean, decent administration, we all need to fight corruption,” Ozarslan said. “Today you can’t offer people neither a good nor a bad example because corruption trials have become impossible in Turkey. This in turn legitimizes the notion that [the corrupt] get away with it anyway.”


Article Link to Al-Monitor:

Has Turkey Given Up Fighting Corruption?

Just How Angry Are The Voters?

By Noah Rothman
Commentary
June 9, 2016

You’ve heard it before. The voters are “angry.” On both sides of the aisle and across the demographic spectrum, average, tax-paying Americans are furious with the political system. Although the reasons for their outrage vary greatly, their righteous ire is directed uniformly at Washington and is manifest in the insurgent presidential candidacies mounted by Donald Trump and Bernie Sanders. On a superficial level, this seems like a reasonable conclusion to draw from 2016’s unpredictability. Like-thinking commentators on populist media outlets hammer away at the “year of the angry voter” theme daily. Today, the notion that the voters are in a revolutionary mood is bandied about carelessly as though it were a universally accepted presumption. There may, however, be selection bias at work here. Those who are themselves angry rarely have trouble finding things to be angry about. But is the general electorate as incensed as the commentary class contends?

To measure “anger” in terms of participation in electoral politics is inherently flawed. For example, one might expect voter “anger” to manifest itself in a wave of contested primaries in which incumbents are ousted. By that measure, the voters in 2016 are unusually placid. Until last night, only one incumbent federal office holder had lost their primary race, and that was a Democrat – Pennsylvania’s Chaka Fattah, who is facing multiple counts of criminal fraud. That changed last night when a Republican lost her race for reelection in a primary: the Trump-endorsed and Trump-endorsing Congresswoman Renee Ellmers.

The issues that defined the race in North Carolina’s 2nd district congressional primary predate those that have dominated the political landscape in 2016. Redistricting scrambles the calculation – Ellmers was running for reelection against a Tea Party candidate and another incumbent Republican from elsewhere in the state — and the outside groups that committed to this race are in many ways more interesting than the candidates. Still, Ellmers proudly billed herself as an early Trump backer in Congress, and the first woman in the Federal legislature to do so. She was rewarded for her loyalty when Trump cut robocalls in support of her campaign. Ellmers not only lost but she quite nearly came in third place.

This is an interesting development if only because it suggests that there is no movement galvanized by Trump to oppose business-as-usual Republicans so much as there is a movement that supports Trump… and that’s it.

There may have been no angrier election year in recent memory than 2010. This was the original Tea Party election and the first time voters had gone to the polls after having fully absorbed the impact of the Great Recession. A thousand headlines bloomed when incumbents like Senators Arlen Specter and Bob Bennett were ousted by the voters. But of the 25 incumbents who sought reelection, 22 won their primaries. In the House, only four members who sought re-election failed to win the support of their voters.

On Election Day in 2010, 87 percent of House incumbents were retained. That might sound high, but it was actually the lowest retention rate since 1970. In 2014, while Republicans retook the Senate, 95 percent of federal representatives and senators were returned to office. In 2012, despite “a mini-wave of defeated [mostly Democratic] incumbents,” as the New York Times reported – a figure augmented by the results of decennial reapportionment — 90 percent of incumbents were retained.

The point is that an “angry” anti-incumbent wave election year is also distinguished by the retention of the vast majority of elected officials. Even in presidential years that can be considered “status quo” elections on the presidential level, the rate of down-ballot churn is usually roughly equal to that which typifies “angry” years. The truth is that voters who are “angry” are just as likely to drop out of the political process as they are to participate in it. Maybe even more so.

But what about the mood of the country? With only the briefest moment of optimism following Barack Obama’s 2009 inauguration, voters have been sour on the direction of the country since George W. Bush’s first term in office. Today, an average of over 65 percent feel the nation is moving in the wrong direction while just over a quarter of respondents say America is on the “right track.” The static nature of the voters’ assessment of the dire state of affairs in the country suggests that it is not a strong indicator of electoral outcomes. What often is a window into the future, however, is the job approval rating of the sitting president.

After spending almost his entire second term underwater with the public, Barack Obama is enjoying a renaissance. Since March, the president has earned job approval ratings in positive territory – often with more than a majority of respondents expressing approval of his performance in office. Job approval ratings for outgoing incumbents tend to correlate with “in-party” retention rates. “Ah, but what about Bill Clinton?” asks the skeptic. “He left office with a majority of adults approving of the job he did, and his vice president still lost.” True, but despite winning the popular vote, Al Gore lost Florida, Nevada, Missouri, Ohio, New Hampshire, and Virginia. The map and the electorate have changed. George W. Bush’s Electoral College victory in 2000 cannot be duplicated today with his share of the popular vote. At least, not by a Republican candidate.

And what about the economy, which remains voters’ top priority? Despite an embarrassingly weak jobs report last week and persistently anemic GDP growth that hasn’t kept pace with the expanding population, the official unemployment rate is well under 5 percent. Gallup’s adjusted employment rate hit a new six-year low in April at 5.2 percent, and its “good jobs employment rates” metric, which tracks adults working full-time, is up three points since January 2010. Voters remain pessimistic about the economy, as they should. Whether that apprehension manifests in a “change” election in November seems unlikely, given all the mitigating conditions above.

Donald Trump’s nomination to the GOP represents a sea change in American politics, but the lack of an anti-incumbent sentiment on the right indicates that this is not a movement but a moment. Bernie Sanders rise and fall may be more of a commentary on Hillary Clinton than the mood of the Democratic voting base. And if the polls are to be believed, 2016 is much more likely to be a status quo year. At least, for now.


Article Link to Commentary:

Just How Angry Are the Voters?

Republicans’ Delusional Hopes

By Peter Wehner
Commentary 
June 8, 2016

It tells you something about the desperate state of the Republican Party that Donald Trump’s speech last night — an inoffensive (because it was non-racist) and pedestrian set of remarks, which primarily focused on his fiercely protectionist views — would elicit such relief, praise, and hope. Pro-Trump commentators were telling us how it was evidence that he has turned the page, that he was showing he can be “presidential,” and that he will, at last, reassure people. We are seeing the New Trump, and he is leaving his divisive and bigoted ways behind.

This is fanciful.

Republicans have just endured several brutal days in which the news was dominated by Donald Trump’s repeated, racially-tinged attacks on Judge Gonzalo P. Curiel, declaring that the “Mexican” judge — he was actually born in Indiana — had an “inherent conflict of interest” because of his ethnicity. This is, as Speaker Paul Ryan said, a textbook example of racism, and it’s created panic among Republican lawmakers, who see both their prospects and their party being pulled down by Trump.

It’s probably worth putting Trump’s attacks against Judge Curiel in context, which come after he declared that most of the Mexicans coming across the border are drug dealers and rapists; denigrated John McCain’s POW ordeal; mocked a reporter with physical disabilities; obsessively attacked Fox News’s Megyn Kelly and referred to her as a “bimbo”; likened Ben Carson’s “pathology” to that of a child molester; re-tweeted an unflattering picture of Heidi Cruz; suggested that Rafael Cruz was involved in the assassination of President Kennedy; incited violence among his supporters; hesitated in distancing himself from David Duke; and… well, you get the point.

Yet Republicans continue to insist that Trump will change. He’s learned, we’re told. He’s really a pragmatist who will adjust his ways to appeal to a national audience. All of what we’ve seen is a performance, which Trump can turn on and off whenever he wants.

The problem, of course, is that Mr. Trump has shown no ability over the course of the last year to control himself, to check his worst impulses, or to contain his hatred. He has a serious anger management problem, and having won the Republican nomination, he sees no reason to change. In fact, he’s repeatedly told us he won’t. I’ve said before that asking Trump not to lash out is like asking a scorpion not to sting. It’s what they do. It’s what he does.

Yet Republicans continue to hope that Trump will become a dignified, decorous figure. He won’t, and it’s delusional to believe he will. It is akin to believing the alcoholic who says, after a night of binge drinking, he’s taken his last drink and he’s swearing off alcohol. He may want to, but he won’t be able to. In the case of Mr. Trump’s attacks, it’s not even clear he wants to alter his ways. After all, he seems to relish treating people in a cruel and demeaning manner. It certainly comes more natural to him than, say, discussing public policies or articulating a governing agenda.

I’ll add this: Even is Trump were able to change his way, it’s clear it would all be for show. We’ve seen enough over the last 12 months, to say nothing of over his adult life, to know what kind of figure we’re dealing with.

Trump has not yet officially become the Republican nominee. There are still five months to go before the election. So this drama — Trump saying something offensive, Republicans blanching, and then reassuring themselves that the New Trump will emerge — will play itself out again and again between now and November 8th. And each time it does, a little more of the Republican Party will die.


Article Link to Commentary:

Hillary Has More Paths To Victory In General Election Than Trump

By John Podhoretz
The New York Post
June 9, 2016

So now it’s Cersei Lannister going toe-to-toe with Stannis Baratheon — or, for those of you who don’t watch “Game of Thrones,” Hillary vs. Trump. As the general election begins, which of the two major presidential candidates would you want to be?

I’m not talking here about who ought to win, or who should lose or whether Eddard Stark could be brought back from the dead to save us from the choice. I’m talking about who’s most likely to prevail in our real-life Game of Thrones.

If you think about this in a dispassionate fashion, surveying the balance of forces and arrayed threats, you’d want to be Hillary. She has four conceivable paths to the White House. Trump has two.

Hillary Path No. 1: She simply matches the 2012 result, wins the states President Obama won in the most recent election and becomes president with 332 electoral votes.
This static outcome is supported by two pieces of important data.

First: the president’s approval rating. Obama, according to Gallup, has been hovering at or above 50 percent since the beginning of April. Forget whether this is fair or morally appropriate. It just is. And should Obama’s approval rating remain pretty much where it is now, Hillary will almost certainly win.

Over the past 16 elections, we’ve seen a direct correlation between a president’s approval rating within a few months of his re-election or the election of his preferred successor and the percentage of the popular vote in November. If the president is in positive territory, victory is at hand. If the president is in bad odor, he or his party’s nominee is likely to lose.

Second: State polling. The 2012 election map came to center on the so-called “battleground” states Obama eventually won — Pennsylvania, Ohio, Virginia, Wisconsin, New Hampshire, Iowa, Nevada and Florida. Right now, Clinton leads in all of them, albeit by small margins in Ohio and Florida. All she needs to do is maintain her leads here and she wins the election.

Path No. 2: She does far better than the 2012 result. If Path No. 1 appears to be in the bag by September, Hillary can conceivably work to broaden her electoral map. She could focus on North Carolina, which Obama won in 2008 but Romney won in 2012 — and where she won a huge primary victory with a margin far larger than Trump’s. Rock-ribbed Republican strongholds Utah, Arizona, Mississippi and Georgia also might hold surprising promise based on early polling. Should she win these, she would approach 400 electoral votes — a larger victory than Obama’s in 2008.

Path No. 3: She does worse than Obama in 2012 but still wins. Trump could pick off Ohio and Florida, and Hillary would still prevail with 285 electoral votes.

Path No. 4: She wins in a squeaker. She loses Florida and Ohio and Virginia and ends up with 272 — a margin of two Electoral College votes. You can pick a few other configurations in which she wins 271 or 272; terrifyingly close but enough for the White House.

As for Trump, any conventional scenario you can come up with only has him winning very narrowly.

Path No. 1 is a squeaker no matter how you slice it — at the end of the day, given the state of play in the states, he can only manage to pick off three or four Obama states and wins with somewhere between 271 and 286 electoral votes.

Now, there is a Path No. 2 for Trump. It’s the one his partisans openly believe will be the case even though no data support their hope — and it’s the one Hillary partisans and anti-Trumpers fear due to the strange and unprecedented nature of the election thus far.

Simply put, Trump Path No. 2 is no path. It’s just a blowout, a national wave that puts him in the White House owing to the supposedly revolutionary condition of an electorate so eager to see massive change in Washington, DC.

The electorate’s anger will lead to surges in anti-Hillary, anti-establishment voting in the Upper Midwest and Rust Belt states — involving both depressed white males who have never voted and Bernie-bots who want someone to overthrow the existing order, even if it’s Trump.

The reason this scenario is extraordinarily unlikely is simple: that presidential approval rating. If Americans want change so badly, why are they feeling so positively about Obama?

Yes, for this Game of Thrones plotline to play out, Trump is going to need the real-world equivalent of the magic of the Red Witch on his side — and even then, it may not work, since her magic didn’t save Stannis Baratheon from being defeated and beheaded. But without some version of it, we’re going to get Cersei Lannister Clinton — and watch out, everybody, because a Clinton always pays her debts.


Article Link to The New York Post:

Ukraine Is Walmart For Terrorists

Explosives intercepted by Kiev’s security service may have been intended for right-wing terror attacks in France. But are the allegations credible?


By Anna Nemtsova
The Daily Beast
June 9, 2016

KIEV — When the the Ukrainian Security Service, the SBU, announced recently that it had detained a 25-year-old French citizen, GrĂ©goire Moutaux, who was trying to cross the country’s border into Poland in a vehicle full of explosives and weapons, that sounded like a major blow against terrorism.

SBU spokesman Vasyl Hrytsak declared that after two weeks of investigation, which is to say of interrogation, “The Ukrainian Security Service managed to prevent 15 terrorist attacks targeting the territory of France.”

According to the SBU this alleged French criminal attempted to smuggle five Kalashnikov assault rifles, over 50,000 bullets, two RPG-7 anti-tank grenade-launchers, 100 electronic detonators and 125 kilograms of TNT across Ukraine’s frontier.

Perhaps. But in Kiev, the announcement was greeted with deep skepticism. Neither local journalists nor independent observers place much trust in SBU reports these days, and with good reason.

The timing of Hrystak’s Monday press conference was suspect, coming as it did in the midst of scandals discrediting the SBU. Many noted that the spy organization announced the news about its successful operation against Moutaux right after the United Nations condemned it for running secret prisons and torturing prisoners. “It all sounded like a public relations gambit,” television anchor Katerina Sakirianska told The Daily Beast.

“Unfortunately, when both Ukraine and Europe are endangered by terrorism and need professional security services more than ever, there is not much confidence in what the SBU tells us,” independent journalist Saken Aymurzaev told The Daily Beast.

Putting aside for a moment the moral and legal issues, confessions extracted with torture are notoriously unreliable, and whatever the truth of Moutaux’s case, there’s little question the country has become a thriving arms bazaar for just about anyone with money to buy right in the back yard of Europe.

The ideological and ethnic conflict that has torn Ukraine apart over the last two hears has attracted radical nationalists from different countries, some of them involved in weapon smuggling. Among these, notably, were a few French volunteers, ideological supporters of pro-Russian forces who were fighting in eastern Ukraine two years ago.

Poland had to increase security measures last year to try to prevent criminals attempting to transport weapons from Ukraine into its territory. If in 2013 Polish police seized only three firearms smuggled from Ukraine, last year law enforcement arrested smugglers with 53 guns, and there are many, many more where those came from.

“There are over 200,000 people involved in anti-terrorist [anti-rebel] operations in Ukraine; if 10 percent of the militia sold weapons or committed some crime, that would be 20,000 incidents,” Kiev-based Belarusian journalist and dissident Pavel Sheremet told The Daily Beast.

News reports of law enforcement officials discovering underground arsenals have grown commonplace. Former volunteer militia and regular military often smuggle weapons from the war-torn Donbas region to Kiev.

Last week police discovered a big underground arsenal of hand grenades, guns, explosives and other weapons in a garage on the outskirts of Kiev “Most probably these weapons were brought to Kiev from the zone of anti-terrorist operations,” the head of Kiev National police Andriy Krischenko suggested on Saturday.

In July 2014 The Daily Beast interviewed Ukrainian volunteers in eastern Ukraine about the prices for Kalashnikov. At the time one Kalashnikov could be purchased in the combat zone for less than $500 and sold in Kiev for more than $2,000. But not many in eastern Ukraine would dare to report to the SBU about military violations, since people are afraid to end up in one of secret detention centers.

Both Human Rights Watch and Amnesty internationals report that SBU officers systematically break Ukrainian law. “Legally, the SBU is not supposed to have detention facilities and torture people,” says Tatyana Lokshina. senior researcher at Human Rights Watch. “There is evidence that interrogators hang up their victims and torture them by beating them with sticks or giving them electric shocks.”

Human Rights Watch and Amnesty International recently sent a joint request to the SBU asking “about concrete facilities, concrete victims,” as Lokshina told The Daily Beast.

International observers became especially suspicious in May when the SBU did not allow a UN delegation concerned with tortured to have access to particular sites the observers wanted to visit. The delegation chief, Malcolm Evans, said that the team was prevented from visiting “some places where we have heard numerous and serious allegations that people have been detained and where torture or ill-treatment may have occurred.”

At the press conference SBU spokesman Hrystak compared journalists to priests: “Pastors use the Bible and gospel for preaching and journalists use information, which could be served in different ways,” Hrytsak said, apparently trying to build a bridge of trust to the press. But it’s doubtful that will get far.

“All we hear lately is that the SBU is involved in scandals that discredit it,” independent reporter Saken Aymurzaev explained.

Last week UN Assistant Secretary General for Human Rights Ivan Simonovic said that the SBU massively detained and tortured supporters of the militia of the breakaway republics in eastern Ukraine shows entrenched “disregard for human rights.”

One more scandal earlier this month involved the first deputy head of the SBU, Victor Trepak, a close ally of Ukraine’s President Petro Poroshenko. He resigned after leaking materials about so-called “black accounting” to Ukrainian newspapers.

Last month a web site affiliated with SBU leaked a list of names and private information of all journalists covering the conflict in the Donetsk region. Some law enforcement officials blamed reporters for covering both sides of the front lines. But to investigate crimes against humanity, including illegal smuggling of weapons, reporters had to cover both east and west of Ukraine.

The Ukrainian Security Service have been criticized for incompetence and for violating people’s rights for many years.

“Today Ukraine needs professional security services to control the militia who trade Kalashnikovs, hand grenades, RPGS, explosive devices, and TNT that they get out of land mines, a countless number that nobody counts,” says Gennady Gudkov, a former KGB officer now operating out of Moscow as a security consultant.


Article Link to The Daily Beast:

California, A Warning To Republicans

By Francis Wilkinson
The Bloomberg View
June 9, 2016

Is Donald Trump damaging the Republican Party or destroying it? The answer depends on whether the GOP will be able to evolve into a multi-racial majority party after Trump's campaign is finished. Given the scope of his personal foibles -- bigotry, sexism, policy ignorance, political incompetence, habitual dishonesty, etc., etc., etc. -- the question perhaps seems academic right now.

Yet if you happen to be a different Republican politician, one who'd like to be president someday, or to hold office in a state with an emerging nonwhite majority, it might concern you. If Trump's effect proves fatal, after all, those nice things might not happen for you in this lifetime.

Bloggers Keith Humphrey and Kevin Drum both looked recently to California for clues about the GOP's fate. In 1994, Republican Governor Pete Wilson supported the state's Proposition 187, which sought to restrict access by undocumented immigrants to public services, including non-emergency health care and public education.

Wilson's campaign and Prop 187 have since been cited as a crucial factor in turning California into a Democratic bastion. Today, no Republicans hold statewide office there. Republicans have been decimated in the state Legislature and California congressional delegation. And California Asians and Hispanics, the state's -- and nation's -- fastest-growing populations, generally don't have much use for the party.

Drum suggested that the effects of Prop 187, which passed with 59 percent of the vote but was subsequently invalidated by a federal court, have been overblown. He noted that the share of Democratic vote in the state rose roughly in proportion with the increasing share of nonwhite voters overall. He's right. But as the chart below, from the polling firm Latino Decisions, shows, the share of Hispanics voting Democratic also rose, with the biggest bump occurring between 1992 and 1996.

A rise of several percentage points in the Democratic share of the Hispanic vote is hardly insignificant. But the chart doesn't necessarily capture the full extent of the damage to Republicans.

"It's not just a matter of numbers, it's the intensity of Latinos' hostility toward the GOP," said California Democratic consultant Garry South in an e-mail. As of November 2010, South noted, three quarters of the state's Hispanic voters had registered since 1994.

In 2010, nationally the greatest election year for Republicans in decades, California's GOP fielded its most diverse ticket ever, with female nominees for governor and U.S. senator, a Hispanic contender for lieutenant governor and a black candidate for secretary of state. It didn't matter. While Republicans swept to a majority in Congress and gained control of state legislatures across the land, the party was crushed in California.

In the coming five months, Trump, who has targeted for abuse Mexicans in general and a Mexican-American federal judge in particular, has the capacity to galvanize Hispanics into a solid Democratic voting bloc nationwide. President George W. Bush won more than 40 percent of the Hispanic vote in 2004. It's difficult to see how Trump will equal the dismal 27 percent Mitt Romney won in 2012.

Obama's approval rating among Hispanics in an April Pew poll was 65 percent. In another Pew poll released this week, 81 percent of Hispanics said they expected their personal finances to improve in the next year. Confident in their Democratic president and their economic futures, Hispanic voters aren't looking to make Trump's sliver of America great again.

With Trump heading the GOP, Hispanic identification with the Democratic Party is almost certain to intensify.

During the Senate legislative work on comprehensive immigration reform in early 2013, pro-immigration and Hispanic groups projected a jolly bipartisan disposition, cheering on Republican Senator Marco Rubio, who supported the measure.

When House Republicans buried the bill, and then passed legislation tacitly supporting (though, in typical Republican fashion, not funding) mass deportation, the tenor of the activist groups changed. When Republican primary voters this year supported an overtly bigoted opponent of immigrants for their presidential nominee, the stakes rose still higher.

"This has alarmed and mobilized folks throughout our movement," said Frank Sharry, a prominent pro-immigration activist, by e-mail. Sharry said the groups haven't abandoned bipartisanship. But he noted, for example, that Dreamers, the undocumented immigrants who arrived in the U.S. as children, have pretty much stopped attacking President Barack Obama, whose deportations they despised, and focused their ire exclusively on the GOP. "How can they not?" he asked.

If the journey of Hispanic and immigrant voters mimics the arc of the activist groups that champion them, and the Democratic consolidation of black voters before them, discussions of the Republican Party's end -- sooner rather than later --may not seem so academic.


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Don't Be Scared To Squeeze Pakistan

The U.S. toolbox is brimming with $20 billion in carrots but desperately lacking in sticks.


By Jeff M. Smith
The National Interest
June 9, 2016

Pakistan returned to the headlines last month, after a U.S. air strike eliminated Afghan Taliban commander Mullah Mansour inside Pakistani territory. It marked the first ever U.S. strike on an Afghan Taliban leader inside the group’s Pakistani sanctuary of Baluchistan, which had been off-limits to U.S. drones as part of an informal arrangement with Islamabad. Washington has touted the drone strike as an important victory for the U.S. war effort in Afghanistan. However, it will prove symbolic and short-lived unless it prompts more fundamental reform of America’s Pakistan policy. To effect real change, Washington must increase pressure not just on the Taliban residing in Pakistan, but on Pakistan itself.

After a U.S. military drone eliminated commander Mullah Mansour as he traveled by taxi to the Afghan Taliban headquarters in Quetta, the militant group moved swiftly to appoint a successor. The sons of Mullah Omar and Jalaluddin Haqqani, the late leaders of the Afghan Taliban and the Haqqani Network, were considered and quickly dismissed due to their youth and inexperience. A more obscure religious figure, Mullah Haibatullah Akhundzada, arose as the consensus candidate. Analysts have now turned their attention to what Akhundzada’s appointment means for the nascent Afghan peace process, and whether the strike was a “one-off” or the catalyst for an expansion of America’s drone campaign into Baluchistan.

While these are important tactical questions, they’re of limited value if the underlying strategy remains flawed. A more consequential question is why Pakistan’s harboring of yet another terrorist commander has been met with a collective shrug by the United States and the international community. It’s an uncomfortable reminder that Pakistan’s “double game” has become old news. Accepted wisdom. Permitted behavior. In Washington, anger has been dimmed by exhaustion, with many now hoping to reach a modicum of stability in Afghanistan and put the whole messy affair behind them. History, however, has been unkind to great powers that fail to learn from their mistakes.

To be clear, few in Washington are under any illusions about the extent of Pakistan’s perfidy. Hillary Clinton has warned that Pakistan “poses a mortal threat to the security and safety of our country and the world.” In his memoir, Defense Secretary Robert Gates recalled how “in every instance” the United States shared intelligence with Pakistan about a target, “the target was forewarned and fled” or Pakistan launched a botched operation of its own. “I knew they were really no ally at all,” he explained.

America suffers not from a lack of information, but from a lack of resolve. And a lack of perspective. They say the greatest trick the devil ever pulled was convincing the world he didn’t exist. The greatest trick Pakistan ever pulled was convincing America it only had two choices: tolerate and bankroll Pakistan’s double game, or stir an unstable cocktail of Islamist extremism and weapons of mass destruction.

It’s nonsense—a fabricated dichotomy in a fictional reality where the mere specter of U.S. pressure threatens the integrity of the Pakistani state, where the million-man Pakistani army is powerless to protect its nuclear arsenal and where a severing of bilateral relations would prove more costly to the United States than to Pakistan. This narrative has ensured the U.S. toolbox is brimming with $20 billion in carrots but desperately lacking in sticks. What’s worse, the sticks America does possess are only to be wielded in the event Pakistan crosses an existential threshold, such as a successful terrorist attack on U.S. soil planned or perpetrated from its territory.

Arguably the fundamental flaw in America’s Pakistan strategy was withholding its sticks for this single punitive threshold and refusing to apply calculated, escalating pressure in response to repeated bouts of Pakistani malfeasance short of that threshold.

A punitive threshold should have been crossed the first time U.S. intelligence intercepted Pakistan’s notorious intelligence service, the ISI, feeding the Taliban information about U.S. airstrikes, or aided them in organizing attacks in Afghanistan. Or when the Haqqani Network, a known proxy of the ISI, orchestrated the deadliest attack on the CIA in the agency’s history in 2009. Or when the same group orchestrated an attack on the U.S. embassy in Afghanistan two years later. Above all, it should have been crossed when Pakistan’s “game” resulted in the death of American servicemen and women in Afghanistan.

Each flagrant offense should have triggered an escalating wave of pressure, from suspension of aid to economic isolation, and from targeted sanctions on the ISI or Pakistani military to unilateral kinetic operations inside Pakistan against nonstate and, if necessary, state actors. The pressure should have continued until the United States was convinced Pakistan had altered its course. That’s what superpowers do when their interests are threatened and their soldiers are under fire. And that’s what “making no distinctions between terrorism and those who harbor them” means.

Instead, America has responded to each Pakistani provocation with lucrative aid and scholarly lectures about the unethical and counterproductive nature of its support for Islamist militants. Yet from Pakistan’s perspective, its strategy has been anything but counterproductive. For the past decade a formidable coalition of powers has been committed to a secure and stable Afghanistan free from Taliban rule. They include the United States, Russia, Iran, India, the EU, Central Asia and even China. The lone country pursuing a weak and divided Afghanistan under Taliban rule has not only bested this coalition, it’s forced them to bankroll their own defeat. The problem isn’t with them; it’s with us.

The next U.S. president must learn from, and avoid repeating, the mistakes of their predecessors. My advice: trying to alter Islamabad’s cost-benefit calculation without imposing costs is a fool’s errand. Don’t be afraid to use calibrated pressure as a direct response to Pakistani transgressions. And don’t conclude that employing sticks will produce catastrophe before you’ve deployed your first.

Don’t accept the canard that nuclear terrorism is the only alternative to the status quo. And don’t be deluded into thinking America is a hopeless victim at the mercy of the Pakistani military, incapable of imposing unbearable costs on any person, group or institution it deems a threat to national security.

Don’t assume employing sticks with Pakistan will be easy or cost-free. But remember that, like most rational actors, Pakistan’s generals are concerned foremost with self-preservation. They have a great deal more to fear from a fundamental rift in U.S.-Pakistan relations than America does.

Finally, and above all, if showering Pakistan with money has a demonstrated track record of failure, don’t assume throwing more money at the problem will produce a different result. That, they say, is the definition of insanity.


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China And Russia Are No Match For World Order

The G7 showed how provocations in Crimea and the South China Sea won't work.


The National Interest
June 8, 2016

This year’s G7 summit in Ise-shima, Japan was full of spectacles worthy of arresting headlines, including U.S. President Barack Obama’s historic embrace of atomic bomb survivors in Hiroshima on May 27th. Prime Minister Abe as host has enjoyed a considerable boost for his efforts as host and now is confidently heading into an upper house election on July 10th. Like most international summits, however, what lies beyond the headlines are the agreements made among leaders even if not declared in the moment. Much of what the G7 leaders was focused on was the creation of a joint approach to the global rise of revisionism led by China and Russia, who resent not being part of the gathering. The most consequential outcome of the two-day event on Japan’s idyllic island was the emergence of a new phase in the ongoing Sino-Japanese geoeconomic competition. It characterizes a global trend for the world’s leading liberal economies for years to come.

Nationalist-driven and aggressive foreign policy is ubiquitous among authoritarian regimes. China and Russia in particular have been challenging the status quo by displays of military force in Crimea and the South China Sea. Despite regional apprehension and American warnings, the Chinese representative at the recent Shangri-La Dialogue warned that in the South China Sea, “We do not make trouble but we have no fear of trouble.” While divergent objectives guide such self-aggrandizing behavior, Beijing and Moscow make strange bedfellows under one common goal: to create a new geopolitical reality in opposition to the current liberal world order.

This emerging geopolitical trajectory is particularly evident in recent global geoeconomics increasingly dominated by Beijing's $8 trillion One Belt One Road (OBOR) initiative. This grand economic project revolves around major investment projects to purportedly promote global connectivity. In reality, however, OBOR is Beijing’s commercial-military scheme designed to advance its great power status while generating jobs overseas for the country’s surplus labor. Therefore it has a peculiar focus on investment in strategic projects despite questionable feasibility, including the floundering $5.5 billion Jakarta-Bandung high-speed railway traversing Indonesia, a country crucial to China’s geostrategy for staking claims in the South China Sea.

Despite the dubious economic outlook for OBOR, China looks to pursue its global geoeconomic agenda in earnest by attracting multilateral investment in its $100 billion Asian Infrastructure Investment Bank (AIIB). As a result, Beijing has been literally buying up space in the world’s key geostrategic locations from Djibouti to Nicaragua. Paradoxically, the significance of OBOR is not China’s self-aggrandizing expansion of its geopolitical influence under the veneer of economic cooperation. Rather, the significance lies in the absence of a solid response from liberal countries countering Beijing’s geoeconomic agenda.

Future historians will likely remember the G7 summit in Ise-shima last week as marking the revenge of internationalism. The event defied the growing skepticism toward the annual gathering by generating an internationalist consensus among the world’s most advanced economies on today’s most pressing geopolitical issues. Of such issues South China Sea stood out above all else. Given their burgeoning trade relations with China, European countries have historically diverged from the U.S. and Japan over Beijing’s assertiveness. Indeed, all European G7 member states—the United Kingdom, Germany, France, and Italy—signed up for their founding member status in the AIIB in 2015. The latest G7 solidarity over Asian maritime security underscored the member countries’ commitment to the liberal world order transcending geographical distance.

G7 leaders went on to craft a solid strategy to counter China’s OBOR. They endorsed the G7 Ise-shima Principles for Promoting Quality Infrastructure Investment that aims to “bridge the existing global demand-supply gap of infrastructure investment by promoting quality infrastructure investment.” This latest G7 initiative has its origin in Tokyo’s $110 billion Partnership for Quality Infrastructure that seeks to promote Japan’s superior quality as well as multilateral cooperation with various international institutions, such as the World Bank. Japan’s infrastructure agenda has already won various major projects across the Eurasian Heartland in direct competition with China’s OBOR while bolstering Washington’s New Silk Road Initiative, including the much-delayed Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline. During the Ise-shima summit, Japan’s internationalist approach to global infrastructure development allowed the country to enlist G7 support for its agenda, further boosting its financial commitment totaling $200 billion for the next five years.

As a result, Japan’s newfound internationalist drive for global infrastructure stands to reshape the geoeconomic map currently dominated by China’s OBOR. Japan has an established track record for leading multilateral consortiums in major infrastructure projects, such as the Japan-Turkey consortium for developing Turkmenistan’s Galkynish gas field that had been dominated by China until 2015. The latest G7 infrastructure initiative will boost Tokyo’s multilateral cooperation globally, potentially constraining Beijing’s ability to engage with local governments.

Moreover, Beijing’s own undoing may ironically strengthen Japan’s G7 response to China’s geoeconomic challenge. In fact, economic viability has frequently failed to keep up with Beijing’s unbridled ambitions for the OBOR, often leading to local backlash. For example, as Jakarta learned no end was in sight for the Beijing-funded Jakarta-Bandung high-speed railway imbroglio, Indonesian president Joko Widodo met Japanese Prime Minister Shinzo Abe during the G7 in Ise-shima to personally seek Tokyo’s investment in a major seaport project. During the summit, Vietnam also welcomed the Tokyo-led G7 initiative for global infrastructure, a move with significant geopolitical implications given Hanoi’s simmering rivalry with China that was on full display during President Obama’s visit in advance of the event.

The significance of this year’s G7 in Japan in advance of the G20 in China in September will be judged by which summit ultimately sets the tone for either the enduring nature of the liberal international order or sweeping tide of revisionist authoritarianism. Obama’s historic Hiroshima and Vietnam visits were symbolic of the legacy he hopes to leave. Yet, symbolism risks complacency without action. The G7’s latest initiative for global infrastructure development confirmed the member countries’ internationalist commitment but whether they can remain unified in the face of Chinese and Russian revisionist alternatives such as OBOR or the Eurasian Economic Union will have to be seen. As Japan passes the G7 baton to Italy next year, the world anxiously expects the world’s seven most advanced democracies and economies to lead toward the triumph of internationalism over revisionism.


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Thursday, June 9, Morning Global Market Roundup: Japan Stocks Lead Asia Lower, Kiwi Flies As Central Bank Stands Pat

By Shinichi Saoshiro
Reuters
June 9, 2016

Asian stocks turned lower on Thursday, led by sliding Japanese equities, while a weaker dollar buoyed commodities such as gold and crude oil.

Spreadbetters expected a lower open for Britain's FTSE, Germany's DAX and France's CAC with a stronger euro seen weighing on European shares.

The New Zealand dollar soared to a one-year high after the nation's central bank kept interest rates steady as expected, even as some in the market had wagered on a cut.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent after rising by as much as 0.3 percent earlier to a six-week high.

The Nikkei pulled back 1.3 percent, hurt by a stronger yen. Financial markets in Hong Kong and China were closed for holidays.

South Korea's Kospi lost 0.3 percent. The index briefly rose to a 2016 high after the Bank of Korea unexpectedly cut its policy rate to a record low 1.25 percent amid weak inflation and stagnant exports. The BOK may also be looking to cushion the economy as the government drives a major overhaul of the struggling shipping and shipbuilding industries that could see large job losses.

"Many expected the U.S. Federal Reserve to hike rates in June or July but after the May (U.S.) jobs data a June hike now seems impossible. The BOK probably thought taking action before the Fed's rate hike would be safer," said Lee Sur-bee, fixed income analyst at Samsung Securities.

On Wall Street, the Dow gained 0.4 percent overnight, rising above 18,000 for the first time since April as a weaker dollar lifted some commodity-related shares. [.N]

The greenback slipped 0.4 percent to 106.58 yen, nearing a one-month low of 106.35 hit on Monday in the wake of the jobs report.

The euro rose to a one-month peak of $1.1416, with the latest uptick coming after the European Central Bank began buying corporate debt for its bond purchase program in a bid to boost the euro zone economy.

The New Zealand dollar was the region's outperformer, rallying about 1.7 percent to a one-year high of $0.7148 after the Reserve Bank of New Zealand held interest rates steady while retaining an easing bias.

The kiwi surged as not all in the market had expected the central bank to stand pat.

"We were surprised, we were calling for a rate cut. We still see one so the next opportunity is August. A key reason for that is persistent strength in the exchange rate," said Jane Turner, senior economist at ASB Bank.

"The Reserve Bank is relying on a lower New Zealand dollar to achieve their inflation target and based on where the exchange rate is now, they're not going to achieve that without cutting the cash rate further."

In commodities, U.S. crude oil extended overnight gains to reach an 11-month high of $51.67 a barrel. In addition to a weaker dollar, supply worries caused by a sabotage of oil facilities in major producer Nigeria has boosted oil. [O/R]

Brent crude rose as high as $52.86 a barrel, highest since October 2015.

Spot gold advanced to a three-week high of $1,266.01 an ounce, while aluminium climbed to a one-month high of $1,614.50 a tonne. Copper also inched higher.


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Oil Hits Fresh 2016 Highs As U.S. Crude Stocks Fall

By Henning Gloystein
Reuters
June 9, 2016

Oil prices edged up to fresh 2016 highs on Thursday, buoyed by a fall in U.S. crude inventories, a weaker dollar and strong demand, although some analysts warned that the recent rally was starting to look overblown.

International Brent crude oil futures hit a high of $52.86 a barrel, and were up 23 cents at $52.74 a barrel at 0700 GMT. U.S. crude hit a fresh high of $51.67 and was up 33 cents higher at $51.56 a barrel.

Traders said the rises were largely a result of a drop in U.S. crude inventories.

Data from the U.S. Energy Information Administration (EIA) showed U.S. crude stocks last week fell by 3.23 million barrels to 532.5 million barrels, marking their third consecutive weekly fall.

Analysts said that some of the U.S. drawdown was down to disrupted Canadian output due to wildfires.

"Lower than usual Canadian flows have helped fuel the draw in ... stock," consultancy Energy Aspects said.

"We estimate Canadian output losses will total 29 million barrels across May and June, after adjusting for turnaround work that was underway before the wildfires broke out, and assuming a pre wildfire utilisation rate of 85 percent of (the 2015 average)," it added.

A weaker dollar is also supporting oil prices traders said. The dollar is down around 2.4 percent this month against a basket of currencies, making dollar-traded fuel imports for countries using other currencies cheaper.

But some analysts said there were also signs that the recent oil price rise, which saw Brent rally 6 percent this month and prices virtually double since February to one-year highs, may be overblown.

ANZ bank said that price rises were "tempered by an increase in (U.S.) crude production of 10,000 barrels per day to 8.75 million barrels per day and the number of active rigs increasing by 9 to 325".

Traders also warned of an ongoing build in refined product stocks in the United States and Asia.

With fundamentals weighing both for and against higher prices, many traders and analysts say a price tag of $50-60 for a barrel of crude may be fair value for oil. This is reflected in Brent's forward curve, which stays within that range until early 2021.

The recent rise in crude oil prices has put pressure on refining margins. Singapore's overall refinery margins, known as cracks and which include gasoline, jet fuel, gas oil, naphtha and fuel oil, are down over 60 percent this year to $4.50 per barrel, pulled down largely by tumbling cracks for gasoline and naphtha.


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Warren Weighs Potential VP Role, But Sees Hurdles

By Michelle Conlin and Caren Bohan
Reuters
June 9. 2016

U.S. Senator Elizabeth Warren has considered the idea of serving as Hillary Clinton's running mate but sees obstacles to that choice as she prepares to endorse the presumptive Democratic presidential nominee, several people familiar with Warren's thinking told Reuters.

While her thinking could evolve, Warren has concerns about joining a Clinton ticket, including the question of whether running two women would give the Democrats the best shot at defeating Republican Donald Trump, one source said.

Advisers to Warren, a fiery critic of Wall Street and a popular figure among progressive Democrats, have been in close contact with Clinton's campaign team and the conversations have increased in frequency in recent weeks, the sources said. Warren has signaled to people close to her that she is intrigued by the possibility of being Clinton's No. 2 but has not discussed the role with Clinton, 68, or anyone else from her campaign, the people said.

Warren, 66, has been one of the Democrats' most outspoken critics of Trump, 69, and her priority is helping to defeat the presumptive Republican nominee in the Nov. 8 presidential election, the sources said.

Warren is also committed to advancing her own political agenda, which they described as “more progressive” than Clinton’s more centrist positions. Warren fears that as vice president, or in a cabinet position, her voice could be less heard than it is in the U.S. Senate on her priority issues such as addressing income inequality, the sources said.

In the past, Warren has accused Clinton of abandoning her support for stronger bankruptcy legislation to try to appease Wall Street.

'Get Ready Donald'


An endorsement of Clinton could come within a week or two, one of the sources said. Clinton has been appealing for Democratic Party unity. On Twitter over the weekend, Warren echoed that call and emphasized the importance of the party coming together to beat Trump.

“Get ready, Donald,” Warren tweeted. “We're coming.”

Warren, who represents Massachusetts in the U.S. Senate, has stayed neutral in the Democratic primary race, notably remaining the only woman senator not throwing her support behind the first woman presidential nominee of a major U.S. political party.

Were she to join the Clinton ticket, she could help energize progressives and win over supporters of Clinton's rival Bernie Sanders, a democratic socialist U.S. senator from Vermont. Sanders' calls for reining in Wall Street and breaking up big banks dovetail with Warren's views.

An ongoing feud with Trump gained steam on social media with a series of posts in which she labeled the celebrity businessman racist, sexist and xenophobic and said she was going to fight to make sure his “toxic stew of hatred and insecurity never reaches the White House.”

Warren joined Clinton late last month in criticizing Trump for rooting for the 2008 financial crisis and delivered a 10-minute invective on the subject at an annual Washington gala two weeks ago.

“What kind of a man roots for people to get thrown out of their house? I’ll tell you exactly what kind of man does that,” Warren said. “It is a man who cares about no one but himself - a small insecure money-grubber who doesn’t care who gets hurt so long as he makes a profit off it.”

Trump has ridiculed Warren by calling her Pocahontas in a mocking reference to her having said in the past that she had Native American ancestry. Pocahontas was a famous Native American in early colonial Virginia.

Warren is due to speak to the American Constitution Society, a progressive legal group, on Thursday at a time when Democrats and some Republicans have criticized Trump's comments about Mexican-American Judge Gonzalo Curiel.


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