Early Warning for 10 September 2018

Good morning. Here’s your Early Warning for Monday, 10 September 2018. (All times Eastern.)

Hurricane Watch: There are now three hurricanes in the Atlantic: Florence, Isaac, and Helene. The latest outlook from the National Hurricane Center shows Florence hitting the Carolinas late Thursday night and early Friday morning. Isaac is being predicted to head due west into the southern Caribbean. As of this morning, Helene is predicted to head north and does not appear that it will threaten the East Coast. That said, these models are subject to change every day.

ALSO: Following the trend of rising right wing parties in Europe, there were two significant events over the weekend. The first is that Sweden Democrats took third place in the national elections with 18 percent of the vote, giving the right wing party significant representation. The second event is that Italy’s interior minister and Lega Nord leader has joined Steve Bannon’s Movement organization as a growing coalition of right wing parties strategize how to make major wins in May 2019’s European Union parliamentary elections.

 

White House

The President is scheduled to receive his intelligence briefing and then have lunch with the vice president.


 

State Department

Secretary Pompeo: Nothing significant to report.

Other senior State Department officials are meeting with the Chinese vice foreign minister.


 

Defense Department

Defense Secretary Mattis: Nothing significant to report.

 

The Carl Vinson (CVN-70) was last reported as having returned to port in San Diego.

The Abraham Lincoln (CVN-72) was last reported as having returned to Norfolk.

The John Stennis (CVN-74) was last reported back as participating in an exercise off the coast of southern California.

The Harry S. Truman (CVN-75) was last reported in the Atlantic.

The Ronald Reagan (CVN-76) was last reported in the South China Sea. (Freedom of Navigation patrol)

The George H.W. Bush (CVN-77) was last reported as having returned to port in Norfolk.

Conflict requiring a Carrier Strike Group does not appear imminent.


 

Congress

Significant House Activity:

  • Nothing significant to report.

Significant Senate Activity:

  • Nothing significant to report.

* Reporting will appear in the Strategic Intelligence Summary or National Intelligence Bulletin.


 

Economy/Finance

– First, remain cognizant of how hurricane fears tend to drive up energy prices, especially if a hurricane enters the Gulf and threatens oil platforms, refineries, and shipping lanes. I suggest keeping vehicles topped off in case there’s any disruption to the oil sector.

-The Wall Street Journal is reporting that the Federal Reserve is considering special regulation to deflate bubbles in the U.S. economy. Typically, they decrease the risk of bubbles by raising interest rates, which makes borrowing more expensive and shuts off the valve of cheap money flowing into an asset class or industry. But some at the Fed reportedly want to regulate banking capital, specifically requiring large banks to increase the amount of cash on hand in the event of an financial downturn. Banks historically have a very high ratio of money that’s loaned out versus cash on hand (i.e., they’re highly leveraged), and so a few large loan defaults could mean that a bank goes underwater. My question is, why now? Are some Fed officials proposing this change out of an abundance of caution or because they’re beginning to actively prepare for the next downturn? Right now, my bet is on the latter. [source]

– Additionally, Goldman Sach’s bear market risk indicator just hit a high not seen since 1969. Bloomberg reports this morning that the indicator shows a “reasonable signal for future bear-market risk” but one Goldman strategist warned that, according to Bloomberg, “a long period of relatively low returns from stocks is a more likely alternative”. [source]


 

Weather

There are now three hurricanes in the Atlantic: Florence, Isaac, and Helene. The latest outlook from the National Hurricane Center shows Florence hitting the Carolinas late Thursday night and early Friday morning. Isaac is being predicted to head due west into the southern Caribbean. As of this morning, Helene is predicted to head north and does not appear that it will threaten the East Coast. That said, these models are subject to change every day.

 

REMINDER: This hurricane watch section will remain in this report through the end of the season. I check the latest from the National Hurricane Center each morning and will provide details as necessary.

 

Drought conditions persist across much of the Southwest. This map is updated every Thursday.

 

 


 

What I’m Looking at this Morning

Intelligence Community faces four major challenges

Reflections on the Lehman collapse

Trump declined coup officer from Venezuelan military officers


 

Notable Quotable

“Our mission has to be: to seek the truth and speak the truth, for the world that we view and the liberties we must protect.” – Director of National Intelligence Dan Coats

Samuel Culper is a former military intelligence NCO and contract Intelligence analyst. He spent three years in Iraq and Afghanistan and is now the intelligence and warfare researcher at Forward Observer.

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