Early Warning for 31 January 2019

Good morning. Here’s your Early Warning for Thursday, 31 January 2019.

 

Venezuela: Reporters on the ground in Bogota, Colombia noted an increase in U.S. military aircraft yesterday, which could mean that a U.S. contingent is arriving there, assuming that there actually was an uptick in military flights. U.S. troops are frequently in Colombia, especially special operations forces conducting Foreign Internal Defense missions alongside the Colombian military. U.S. military action in Venezuela is highly unlikely at this point, but de facto President Nicolas Maduro warned that a U.S. military intervention “would lead to a Vietnam worse than they can imagine”. Meanwhile, a Venezuelan lawmaker claimed this week that a Russian aircraft took off from Caracas with 20 tons of gold, likely for ‘safekeeping’.

 

White House

The President is scheduled to meet with American manufacturers, sign the Buy America Executive Order, receive his intelligence briefing, and then meet with the Vice Premier of China.

15: The number of days that the Trump administration and the Congress have to reach a border wall funding agreement before a potential shutdown or national emergency declaration.

IC: President Trump and the Intelligence Community aren’t seeing eye to eye. After Director of National Intelligence Dan Coats testified in front of Congress that North Korea were unlikely to give up nuclear weapons, Trump described the intelligence agencies as “extremely passive and naive”. DNI Coats, however, is likely correct: North Korea’s nuclear weapons are a matter of survival.


 

State Department

Secretary Pompeo is scheduled to meet with the Chinese Vice Premier.


 

Defense Department

Acting Defense Secretary Patrick Shanahan has no publicly scheduled events.

 

These are the last publicly reported locations of deployed carrier groups. Conflict requiring an aircraft carrier/carrier strike group does not appear imminent.

The Abraham Lincoln (CVN-72) is off the coast of Virginia for pre-deployment training. The Lincoln will rejoin the Indo-Pacific Command once it re-bases to San Diego, CA.

The John Stennis (CVN-74) was last reported as in the Indian Ocean.

The Ronald Reagan (CVN-76) is forward deployed to Yokosuka, Japan.


 

Congress

Significant House Activity:

  • Nothing significant to report.

Significant Senate Activity:

  • Nothing significant to report.

* Only events pertinent to national security are listed. Significant reporting will appear in this week’s Strategic and National Intelligence reports


 

Economy/Finance

Yesterday, Federal Reserve chairman Jerome Powell said he didn’t anticipate additional interest rate hikes, likely signalling that further rate hikes from here would actually harm the economy. He vowed to be “patient” on economic and financial conditions. When we get down to it, the markets reacted poorly to the last rate hike and Powell has listened to market makers: don’t rock the boat.

Chinese manufacturing is slowing down, Japanese industrial output slowed for two straight months, Germany’s economy reported to the lowest growth rate in six years, and Italy is officially in a recession. These are the latest signs of a global economic slowdown. Conventional financial analysts do not expect a global recession this year.

As for China’s latest numbers: ouch. There are around 2,400 Chinese companies that have reported 2018 numbers, and 373 of them have reported losses for the year. To rephrase that, 15 percent of reporting Chinese companies have posted losses for 2018, and 86 percent of those were profitable in 2017. “We’re only just seeing the beginning of deterioration in corporate earnings as the economy slows further. Things will continue to go downhill,” said one Chinese investment fund manager.


 

Far Left Daily

“I’m a cisgendered woman, I will never know the trauma of feeling like I’m not born in the right body. That is a privilege I have no matter how poor my family was when I was born.” – Alexandria Ocasio-Cortez, admitting her cisgender privilege

“It’s easy to call what ‘AOC’ (Rep. Alexandria Ocasio-Cortez) is doing as far-lefty, but nothing could be farther from the truth. When you advocate for economic policies that benefit the broad majority of citizens that’s true centrism… [Howard Schultz] is not the centrist, AOC is the centrist.” – Leftist venture capitalist and entrepreneur Nick Hanauer

“I don’t believe what Elizabeth Warren stands for. I don’t believe the country should be heading to socialism… I think she believes in programs that will lead to a level of socialism in America.” – Howard Schultz, maybe a ‘centrist independent’ presidential candidate


 

What I’m Looking at this Morning

‘Medicare for All’ will terrify voters

General Dynamics to invest in upgrading submarine production facilities [China]

U.S. sends B-52s on ‘routine training exercise’ in East China Sea


 

Notable Quotable

“Deepfakes — video of things that were never done with audio of things that were never said — can be tailor-made to drive Americans apart and pour gasoline on just about any culture war fire… Even though this is something that keeps our intelligence community up at night, Washington isn’t really discussing the problem.” – Sen. Ben Sasse (R-NE)

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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