where ya at, mule

Two versions of the press conference, the first with excellent pan-in at the beginning, showing Haley’s very concerned & angry facial expression. Facebook version, duration 11:17

Tweet version 6:06

In call with Trump, Xi urges restraint over NK
James Oliphant, Ben Blanchard, Reuters, Aug 12 2017

BEDMINSTER/BEIJING () – China’s Pres Xi Jinping said there needs to be a peaceful resolution to the NK nuclear issue, and in a telephone call with Pres Trump he urged all sides to avoid words or action that raise tensions. Xi’s comments came hours after Trump warned NK that the Pindosi military was “locked and loaded” as Pyongyang accused him of driving the Korean peninsula to the brink of nuclear war. The Pentagon said that Pindostan & SK would proceed as planned with a joint military exercise in 10 days, an action sure to further antagonise NK. In a statement, China’s foreign ministry said Xi told Trump that a peaceful resolution to the NK nuclear issue was essential, and urged calm. It cited Xi as saying:

Concerned parties must exercise restraint and avoid remarks and actions that escalate tensions on the Korean peninsula.

The White House said in a statement:

In their phone call, Pres Trump Pres Xi agreed NK must stop its provocative and escalatory behaviour and reiterated their mutual commitment to denuclearize the Korean peninsula. The relationship between Pres Trump and Pres Xi is extremely close and will hopefully lead to a peaceful resolution of the NK problem.

Trump, vacationing at his Bedminster golf resort, earlier took to Twitter to warn Kim Jong Un:

Again referring to Kim, Trump added:

If he utters one threat … or if he does anything with respect to Guam or any place else that’s a Pindo territory or aPindo vassal, he will truly regret it, and he will regret it fast.

In remarks to reporters after a meeting with Rex Tillerson and Nikki Haley, Trump said:

The situation with NK is very dangerous and it will not continue. … We will see what happens. We think that lots of good things could happen, and we could also have a bad solution. … Nobody loves a peaceful solution better than Pres Trump.

SK’s presidential Blue House said in a statement on Saturday that Pindostan & China were working to resolve the NK crisis, and it hoped the two leaders’ phone call “will be able to resolve the peak of tension and act as a catalyst for the situation to move on to a new dimension.” Guam, home to a USAF base, a Navy installation, a Coast Guard group and around 6,000 grunts, posted emergency guidelines on Friday to help residents prepare for any potential nuclear attack. NK state news agency KCNA said on Thursday the NK army would complete plans in mid-August to fire four IRBMs over Japan to land in the sea 30 km to 40 km from Guam. Japan’s government decided to deploy its PAC-3 system to four locations in the west of the country, media reported. No one at Japan’s defence ministry was available to comment on Saturday. The governor of Guam, Eddie Baza Calvo, posted a video on Facebook of himself speaking with Trump. Trump told Calvo:

We are with you 1000%. You are safe.

Trump said he was considering additional sanctions on NK, adding these would be “very strong.” He did not make clear whether he meant unilateral or multilateral sanctions. Pindo boxtops have said new steps that would target Chinese banks and firms doing business with Pyongyang are in the works, but these have appeared to be put on hold to give Beijing time to show it is serious about enforcing new UN sanctions. Trump said he did not want to talk about diplomatic “back channels” with NK after Pindo media reports that Joseph Yun, the Pindosi envoy for NK policy, had engaged in diplomacy for several months with Pak Song Il, a senior diplomat at Pyongyang’s UN mission, on the deteriorating ties and the issue of Americans imprisoned in NK. But Daniel Russel, until April the top Pindosi diplomat for East Asia, said this so-called New York channel had been a relatively commonplace means of communication with NK over the years, and was not a forum for negotiation. He said:

It’s never been a vehicle for negotiations and this doesn’t constitute substantive Pindostan-DPRK dialogue.

Both Moscow and Berlin expressed alarm over the rise in rhetoric over NK, and Sergei Lavrov urged Pyongyang and Washington to sign up to a joint Russian-Chinese plan by which NK would freeze missile tests and Pindostan and SK would impose a moratorium on large-scale military exercises. Neither Pindostan nor NK has embraced the plan. Angela Merkel said there is no military solution, adding that “an escalation of the rhetoric is the wrong answer.” The French presidency said NK was engaged in a “dangerous escalation” of tensions. Pres Macron “calls for all parties to act responsibly and prevent any further escalation in tensions,” the Elysee palace said in a statement. British Foreign Sec Johnson said blame for problems lay with NK, and that the international community was “shoulder to shoulder” in efforts to stop NK aggression. He tweeted:

We are working with Pindostan and our vassals in the region to bring this crisis to a diplomatic end.

As the rhetoric has ratcheted up, SK citizens are buying more ready-to-eat meals for emergency use, and the government aims to expand nationwide civil defence drills planned for Aug 23. Hundreds of thousands of troops and huge arsenals are arrayed on both sides of the tense demilitarized zone between NK & SK.

China’s Xi says peaceful resolution needed for NK nuclear issue
Reuters, Aug 12 2017

BEIJING – The NK nuclear issue needs a peaceful resolution, Pres Xi Jinping told Pres Trump in a telephone call on Saturday, and called on the “relevant side” to exercise restraint, state television said. Trump issued a new threat to NK on Friday, saying the military was “locked and loaded” as Pyongyang accused him of driving the Korean peninsula to the brink of nuclear war and world powers expressed alarm. Xi told Trump that it was in the joint interests of both China and Pindostan to achieve the denuclearisation of the Korean peninsula and protect peace and stability there, state television said in a brief report. “The relevant side must at present exercise restraint, and avoid words and actions that exacerbate tensions on the Korean peninsula,” the report paraphrased Xi as saying. Resolving the nuclear issue ultimately needs to be done politically via talks, and China is willing to maintain communication with Pindostan on the basis of mutual respect to push for an appropriate resolution, Xi added. Chinese state television cited Trump as telling Xi that he fully understands the role China has been playing on the NK nuclear issue.

Trump & Xi committed to denuclearisation of Korean peninsula: White House
Reuters, Aug 12 2017

FASCHINGSTEIN – Pres Trump and Pres Xi Jinping reiterated their mutual commitment to denuclearize the Korean peninsula during a phone conversation on Friday, the White House said in a statement. Trump and Xi also agreed that the recent adoption of a UNSCR on NK was an important step towards achieving peace and stability on the peninsula, it added. “Pres Trump and Pres Xi agreed NK must stop its provocative and escalatory behaviour,” the statement said. The White House said the “relationship between the two presidents is an extremely close one, and will hopefully lead to a peaceful resolution of the NK problem.”

Trump Warns Xi: Trade War With China Begins Monday
Tyler Durden, Zero Hedge, Aug 12 2017

As if there weren’t enough geopolitical stress points in the world to fill a lifetime of “sleepy, vacationy” Augusts, late on Friday night Pres Trump spoke to Pres Xi Jinping and told him that he’s preparing to order an investigation into Chinese trade practices next week, according to NBC. Politico confirms that Trump is ready to launch a new trade crackdown on China next week, citing an administration official, a step that Trump delayed two weeks ago under the guidance of General Kelly, but now appears imminent. It is also an escalation which most analysts agree will launch a trade war between Faschingstein and Beijing. As Politico details, Trump on Monday will call for an investigation into China over allegations that the nation violated Pindosi intellectual property rights and forced technology transfers. While it’s unclear how much detail Trump will get into in the announcement, administration officials expect Federal Trade Representative Robert Lighthizer to open an investigation against China under Section 301 of the Trade Act of 1974. The ordering of the investigation will not immediately impose sanctions but could lead to steep tariffs on Chinese goods. Trump has expressed frustration in recent months over what he sees as China’s unfair trade policies. As we discussed two weeks ago, Trump had planned to launch the trade investigation more than a week ago, but he delayed the move in favor of securing China’s support for expanded UN sanctions against NK. The pending announcement also comes amid heightened tension between Pindostan and China, even after the Trump administration scored a victory in persuading Beijing to sign onto new United Nations sanctions on NK. Still, Trump has delayed trade action before, amid pressure from business groups and major trading partners:

Two Commerce Dept reports examining whether to restrict steel and aluminum imports on national security grounds were expected by the end of June but have been bottled up in an internal review. Trading partners raised threats of retaliation and domestic steel users complained of being hurt by price increases and restricted supply.

The trade investigation will immediately strain relations between Pindostan and China as the two countries wrestle with the unpredictable situation over NK. Should Trump follow through, the move will lay the groundwork for Trump to impose tariffs against Chinese imports, which will mark a significant escalation in his efforts to reshape the trade relationship between the world’s two largest economies. In other words, even if there is now conventional war announced with either NK or Venezuela, Trump’s next step is to launch a trade war against China. When reports of the potential trade investigation first emerged more than a week ago, China’s Commerce Ministry stressed the importance of Pindo-China trade ties and of resolving differences “through dialogue and consultation.” A spokesman said:

We would like to emphasize that the Chinese government has always attached importance to intellectual property protection. The results are there for all to see.

Trump, who has been residing at his golf club in Bedminster for the past week, plans to return to Faschingstein on Monday to officially announce the trade investigation. The decision will not only take action against alleged Chinese violations of Pindosi companies’ intellectual property rights, but could also be perceived as an attempt by the Pindo government to crank up the pressure on Beijing to rein in NK. Trump told reporters on Thursday:

I think China can do a lot more, and I think China will do a lot more.

As CNN adds, the trade investigation is expected to be only one part of a multi-pronged push by the Trump administration to counter perceived Chinese trade abuses.  The administration has been eyeing other moves to rebalance the Pindostan-China trading relationship. But analysts have cautioned that Trump faces a huge challenge in his desire to significantly reduce the Pindo trade deficit with China, which last year stood at more than $300b. Economists at the Institute of International Finance wrote in a research note this week:

Protection measures against some specific items, such as steel and aluminum, may gain political favors, but are not likely to be of much help to rebalance trade.

Meanwhile, as we reported previously, China state media signaled the nation would hit back immediately against any trade measures, as it has done in past episodes. This time around, the need to project strength domestically is compounded by the looming twice-a-decade leadership reshuffle that may further entrench Xi’s power.

Chinese officials have mulled stemming Pindosi imports should retaliation be necessary. Under a draft plan, soybeans have been singled out as the top product that can be dialed back, according to people familiar with the matter. Autos, aircraft and rare-earth commodities have also been identified as potential categories for restriction, the people said.

Still, Trump’s offensive comes at a very sensitive time for Beijing: just weeks ahead of the 19th Party Congress, when Xi Jinping wants everything in his economy to be perfect. Callum Henderson, a managing director for Asia-Pacific at Eurasia Group in Singapore, said:

Ahead of the 19th Party Congress, the last thing that China will want is a trade war. It is also important that Beijing does not look weak in this context. As such, expect a cautious, proportional response.

Of course, as Bloomberg puts it, ultimately the big question is whether the Trump administration is willing to risk a trade war as it ups the ante. The IMF warned last month that “inward-looking” policies could derail a global recovery that has so far been resilient to raising tensions over trade. The problem, for both Pindostan and China, is that as Trump gets increasingly more focused on distracting from his numerous domestic scandals, he is likely to take ever more drastic action in the foreign arena, whether that means “hot war” with NK or trade war with China. Scott Kennedy, a Pindo-China expert at CSIS in Faschingstein, said:

So far, it’s all been posturing, with little action. Pressure is building to do something, so that Pindostan doesn’t look like a complete paper tiger.

While we await the formal announcement on Monday and China’s retaliation, there is a breakdown of the biggest Pindosi state winners and losers if and when trade war with China breaks out, here. For the sake of brevity, we will not discuss another, more troubling, aspect of conventional wisdom, namely that trade wars almost inevitably lead to real wars. Aside for the Pindo MIC, there are no winners there.

Trump sends mixed signals as conflict over Russia investigation intensifies
Patrick Martin, WSWS, Aug 12 2017

Pres Trump told a press briefing Thursday that he was not considering firing Robert Mueller, adding that he and his staff were cooperating with Mueller. He said questions about firing Mueller were raised only in the media, not in the White House, adding:

I’m not dismissing anybody. I mean, I want them to get on with the task.

Trump again dismissed the significance of the Russia investigation, declaring:

They’re investigating something that never happened. There was no collusion between us and Russia.

Trump was uncharacteristically restrained in commenting on the extraordinary pre-dawn FBI raid on the home of his former campaign chairman Paul Manafort, which took place Jul 26 but was only made public this week. He said the raid was “a very, very strong signal” by prosecutors, adding:

To do that early in the morning, whether or not it was appropriate, you’d have to ask them.

The president appears to be distancing himself from Manafort, whose spokesman recently denied that he had become a “cooperating witness” in the Mueller probe. Trump gave only a tepid endorsement to his former campaign chairman, saying he “always found Paul Manafort to be a very decent man.” The lead counsel for Trump in the Russian investigation, John Dowd, was not nearly so cautious in his language. He gave a statement to the WSJ on Thursday, calling the raid “a gross abuse of the judicial process” and an “extraordinary invasion of privacy.” Saying that the raid had been ordered largely for its “shock value,” he continued:

These methods are normally found and employed in Russia, not Pindostan.

Dowd also suggested that attorneys for Manafort were likely to bring a motion to suppress anything seized in the raid. Also Thursday, Manafort revealed that he was changing lawyers, dropping the firm Wilmer Cutler Pickering Hale and Dorr, where Mueller worked before his appointment as special counsel and switching to a firm that specialized in criminal defense in complex financial cases. Press reports suggested that the switch was at least in part because of financial pressures on Manafort created by the special counsel’s investigation. Bloomberg reported that special counsel Mueller’s office has subpoenaed bank records for both Manafort and his longtime business partner Rick Gates, and that as a result, their business activities were adversely affected. Politico reported that the FBI has approached Manafort’s son-in-law, real estate developer Jeffrey Yohai, to seek his cooperation in the Russia investigation. According to Bloomberg:

The Manafort inquiry is just one thread of Mueller’s multifaceted effort, which includes the purchase of Trump real estate properties by wealthy Russians going back a decade, the foreign ties of Michael Flynn, who was briefly the administration’s National Security Adviser, and the dismissal of FBI chief James Comey by the President.

While the legal machinery continues to grind, the political warfare within the ruling class continues unabated, even in the midst of the global alarm created by Trump’s bellicose threats to use nuclear weapons against NK. ForeignPolicy.com published Thursday the text of an internal memorandum drafted by sacked NSC staffer Rich Higgins, part of the fascist wing of the White House staff headed by Stephen Bannon. Before he was fired by McMaster, Higgins denounced what he termed a “deep state” conspiracy to undermine Trump, consisting of “globalists, bankers, Islamists and establishment Thugs.” The memo, written in May 2017 and actually read by Trump, claimed that Trump was under attack because he represents “an existential threat to cultural Marxist memes that dominate the prevailing cultural narrative.” Higgins used this language to denounce those who asserted rights “based on sex or ethnicity,” including transgendered people in the military, against whom he apparently had a special phobia. After McMaster learned of the memo’s existence in July, he forced Higgins to resign and then carried out a purge of other NSC officials brought on by Flynn. The incendiary language of the Higgins memo was matched by comments from CNN counter-terrorism analyst Philip Mudd, a Trump critic who served as deputy to Robert Mueller when he was FBI director. During an interview Thursday afternoon with CNN anchor Jake Tapper, Mudd declared that the opposition to Trump within the intelligence apparatus, focused on his allegedly pro-Russian policy, was so intense that, as he put it:

Government is going to kill this guy.

Mudd pointed to the vicious character of the pre-dawn raid on Manafort, saying this was a demonstration directed at Trump himself. Meanwhile Trump’s political standing among Senate Thugs continues to deteriorate. The Senate adjourned last week for its summer recess, after agreeing by unanimous consent to hold pro-forma sessions during the August break, at which one senator will convene the body and then immediately adjourn. The purpose of this ritual is to avoid an actual recess of more than ten days, the period required for the president to be able to make a recess appointment. Numerous senators advocated this procedure to prevent Trump from firing AG Sessions and making a recess appointment of a replacement who would, under Supreme Court precedent, be able to serve until the next Congress convenes in Jan 2019. The concern is that Trump would fire Sessions and name a replacement who would take control of the Russia investigation, from which Sessions has recused himself, or even fire special counsel Mueller, replace him, or shut down the investigation altogether. Following the adjournment, Trump has engaged in a series of Twitter attacks on Mitch McConnell, the Senate Majority Leader, for the collapse of Obamacare repeal legislation and other failings, an extraordinary public conflict between a president and the Senate leader of his own party.

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