Securities Attorney Briefing 28 October 2016

Securities Attorney Tom Krebs

International

Putin’s Chaos Strategy Is Coming Back to Bite Him in the Ass

Back in March, when the U.S. elections still seemed far away — back before anyone had heard the name Fancy Bear and before everyone knew John Podesta’s risotto secrets — I was in Moscow talking to a Russian who had previously worked in the Kremlin. Over the course of a wide-ranging conversation, it became clear that we agreed on one key characteristic of Vladimir Putin. He called it the “Putin Paradox” and defined it thus: The Russian president’s tactical instincts for how to seize an opportunity are so brilliant, and yet the strategic outcomes are almost invariably disastrous. Seven months later, the saga of Russian meddling in America’s presidential election has managed to illustrate the “Putin Paradox” perfectly. There can be little serious debate at this point that Moscow is indeed meddling. Despite Donald Trump’s skepticism, the U.S. intelligence community has collectively blamed Russia for the hack of Hillary Clinton’s campaign emails, which were released by the website WikiLeaks, and the hack of the Democratic National Committee. In addition to this more hands-on interference, Russia’s foreign-language state media, notably the RT television network and Sputnik press agency, consistently push a partisan, anti-Clinton line and spread claims of election rigging and other shenanigans. (This is tame, by the way, in comparison with the over-the-top rhetoric of Russian TV host and propagandist Dmitry Kiselyov, who claimed the U.S. establishment might kill Trump rather than let him become president — but such bombast is intended for domestic consumption and not to influence the U.S. vote.) There are also concerns, still unproven, that Russians could hack electronic voting systems on Election Day. More:

http://foreignpolicy.com/2016/10/26/putins-chaos-strategy-is-coming-back-to-bite-him-in-the-ass/?utm_source=Sailthru&utm_medium=email&utm_campaign=New%20Campaign&utm_term=Flashpoints

Trump’s Right: Mexico Is Eating America’s Lunch

It’s been a fixture of Donald Trump’s campaign rallies: Global trade is a problem for U.S. workers, and the source of their pain can be found in some other country. Most often Mexico and China get the blame, but the culprit might also be Vietnam or South Korea. These countries, the Republican candidate likes to say, are “eating our lunch.” Turns out Trump’s metaphor is, in one sense, objectively true—just not exactly how he would have voters believe. An American browsing the aisles of a Selecto supermarket such as this one just outside Mexico City would find much that is familiar. Mexicans at this upscale grocery in Naucalpan are scooping Cap’n Crunch cereal for breakfast, eating U.S. beef for lunch, and snacking on Oreo cookies after dinner, all brought across Mexico’s northern border. Nabisco, the manufacturer of Oreos and other snacks, has indeed opened a factory in Mexico—something Trump likes to note in his campaign appearances. But that hasn’t stopped discerning Mexican shoppers from buying Oreo, Chips Ahoy!, and another 10 kinds of Nabisco cookies imported from the U.S. In all, Selecto imports up to 15 percent of its inventory, and most of those imports come from the U.S. The chain, owned by a domestic competitor to Wal-Mart known as Grupo Comercial Chedraui, is one of a growing number of stores that have cropped up in the past five years that cater to Mexico’s expanding middle class by offering more variety. A supermarket offers an unusually clear window into the trade partnership between Mexico and the U.S., in which goods from auto parts to oil cross the border several times, creating jobs on both sides before they’re ready for sale. Mexico imports far more from the U.S. than from anywhere else, and those shipments have tripled since the North American Free Trade Agreement took effect in 1994.

https://www.bloomberg.com/features/2016-mexican-groceries/

Al-Qaeda leader U.S. targeted in Afghanistan kept a low profile but worried top spies

When Army Capt. Hugh Miller heard a group of policemen trading stories about a militant called Farouq al-Qahtani at their base in Afghanistan’s Kunar province one day four years ago, he didn’t know what all the fuss was about. “I don’t think I even sent a report up about it,” Miller, who was deployed as a combat adviser at the time, said in a recent interview. “I didn’t know the guy was a big deal.” Farouq, a Saudi native with a Qatari passport whose real name was Nayef Salam Muhammad Ujaym al-Hababi, was targeted Sunday in an airstrike in Kunar’s remote Helgal valley, the Pentagon announced Wednesday. Little-known outside counterterrorism circles, he was indeed a big deal: Though only in his mid-30s, Farouq was believed to be the senior al-Qaeda operative remaining in Afghanistan at a time when many of the group’s bigwigs have decamped for Syria, and U.S. government documents suggest he may have been involved in plotting attacks abroad. Kunar and neighboring Nuristan, which blend together in the jagged 12,000-foot mountains Farouq has frequented for the past six years, have been the scene of some of the costliest and most publicized episodes of the whole American war in Afghanistan: Operation Red Wings, where 19 Special Operations members were killed; the many firefights in the infamous Korengal valley, where the documentary “Restrepo” was filmed; the battles of Wanat and Ganjgal, which led to both acrimonious investigations and high-profile awards for combat heroism. In his memoir “My Share of the Task,” retired Gen. Stanley McChrystal describes how, when he took the reins of the terrorist-hunting Joint Special Operations Command in 2003, he surged hundreds of Army Rangers into Kunar and Nuristan for an operation called Winter Strike. The Rangers were chasing phantoms, it turned out: The mission’s target, al-Qaeda leader Osama bin Laden, was already in Pakistan at the time. More:

https://www.washingtonpost.com/news/checkpoint/wp/2016/10/28/al-qaeda-leader-u-s-targeted-in-afghanistan-kept-a-low-profile-but-worried-top-spies/?hpid=hp_hp-more-top-stories_cp-alqaeda-730a%3Ahomepage%2Fstory

National

Feds charge 56 in fraud scheme that siphoned $300M from 15,000 victims

WASHINGTON — Federal authorities unsealed an indictment Thursday, charging 56 people in a vast scheme in which suspects posed as Internal Revenue Service agents and immigration authorities to siphon more than $300 million from thousands of unwitting victims to clear fictitious deportation warrants and phony tax debts. The scheme, which employed a network of telephone call centers based in India, relied on personal information obtained from data brokers to target at least 15,000 victims with threats of fines, deportation or imprisonment if they did not pay the demanded fees. In the thousands of cases where victims did agree to settle the fictitious accounts, the money allegedly was laundered through groups of U.S. co-conspirators using wire transfers and debit cards. Twenty of the 24 U.S. suspects had been arrested, officials said Thursday.  Thirty-two suspects were believed to be living abroad. The court documents also outlined charges against five call center operations. “This is a transnational problem, and demonstrates that modern criminals target Americans both from inside our borders and from abroad,” Assistant Attorney General Leslie Caldwell said of the alleged activity uncovered during a three-year investigation. The co-conspirators, according to federal authorities, used so-called “hawala transfers” in which money is transferred internationally outside of the formal banking system to direct extorted funds to accounts belonging to U.S.-based individuals. According to the indictment, the conspirators allegedly kept a percentage of the proceeds for themselves for taking part in the transfer. In the case of a San Diego victim, prosecutors allege that a call center extorted $12,300 from the 85-year-old woman after threatening her with arrest if she did not settle phony tax violations. The same day that the payment was made, a U.S.-based suspect allegedly loaded a debit card in the amount of the payment to purchase money orders in Frisco, Texas. Another California victim lost $136,000 to suspects posing as IRS agents demanding payment for fictitious tax charges. The suspects, according to court documents, contacted the victim multiple times during a period of 20 days. The money was then allegedly transferred to multiple debit cards. In some cases, prosecutors allege, the conspirators requested “good-faith deposits” from victims in exchange for the promise of phony grants and loans. “To potential victims, our message today is simple,” said Peter Edge, executive associate director with Immigration and Customs Enforcement. “U.S. government agencies do not make these types of calls. And if you receive one, contact law enforcement … before you make a payment.”

http://www.usatoday.com/story/news/politics/2016/10/27/fraud-charges-justice-department/92825238/?csp=breakingnews

The FCC just passed sweeping new rules to protect your online privacy

Federal regulators have approved unprecedented new rules to ensure broadband providers do not abuse their customers’ app usage and browsing history, mobile location data and other sensitive personal information generated while using the Internet. The rules, passed Thursday in a 3-to-2 vote by the Federal Communications Commission, require Internet providers, such as Comcast and Verizon, to obtain their customers’ explicit consent before using or sharing that behavioral data with third parties, such as marketing firms. Also covered by that requirement are health data, financial information, Social Security numbers and the content of emails and other digital messages. The measure allows the FCC to impose the opt-in rule on other types of information in the future, but certain types of data, such as a customer’s IP address and device identifier, are not subject to the opt-in requirement. The rules also force service providers to tell consumers clearly what data they collect and why, as well as to take steps to notify customers of data breaches. “It’s the consumers’ information,” said FCC Chairman Tom Wheeler. “How it is used should be the consumers’ choice. Not the choice of some corporate algorithm.” In the near term, what consumers see and experience on the Web is unlikely to change as a result of the rules; targeted advertising has become a staple of the Internet economy and will not be going away. But the regulations may lead to new ways in which consumers can control their Internet providers’ business practices. That could mean dialogue boxes, new websites with updated privacy policies or other means of interaction with companies. More:

https://www.washingtonpost.com/news/the-switch/wp/2016/10/27/the-fcc-just-passed-sweeping-new-rules-to-protect-your-online-privacy/?hpid=hp_hp-top-table-main_fcc-11a%3Ahomepage%2Fstory

These Are the Charts That Scare Wall Street

Forget scary clowns. For finance professionals, Corporate America’s credit cycle and the U.S. economic outlook — not to mention Brexit-induced stresses and debt dynamics in Asia — are all spookier than a deranged-looking Bozo. With Halloween just around the corner, we asked top analysts around the world for charts about things that go bump in the night — and we’re not just talking about the daily yuan fix. Here’s what they said scares them. “Wealth to income is near an all-time record high,” LaVorgna points out. “When this has happened in the past — during the late 1990s NASDAQ and mid-2000s housing bubbles — it was an ominous sign for the economy and the asset markets.” “A rise in delinquency rates for commercial and industrial loans has previously preceded recessions,” says Schawel. “Although the recent rise in delinquencies is coming from a historically low base, the credit quality of banks’ loan books continues to bear watching.” “We are investing less than four cents of every dollar we earn back into our nation’s productive capacity,” Feroli notes. “The economic possibilities for future generations will not be promising if we stay on this path.” “With profit growth contracting over the last year, business cash flow concerns have increased,” says Dutta. “This is largely the result of weak global growth, a strong U.S. dollar, and falling commodity prices. The good news is that the drag from these factors have ebbed, which should push profits up. However, should profits continue falling, we would be worried.” See charts and More:

http://www.bloomberg.com/news/articles/2016-10-27/these-are-the-charts-that-scare-wall-street?cmpid=BBD102716_BIZ

Obama grants 98 more commutations, setting single-year clemency record

WASHINGTON — President Obama granted 98 more commutations to federal inmates Thursday, bringing the total for this year to 688 — the most commutations ever granted by a president in a single year. In all, he’s now shortened the sentences of 872 inmates during his presidency, more than any president since Woodrow Wilson. The actions were part of Obama’s extraordinary effort to use his constitutional power to rectify what he sees as unduly harsh sentences imposed during the “War on Drugs.” Through a clemency initiative announced in 2014, he’s effectively re-sentenced hundreds of non-violent drug dealers to the sentences they would have received under today’s more lenient sentencing guidelines. Unlike a full pardon, which represents a full legal forgiveness for a crime, a commutation only shortens the sentence while leaving other consequences — like court-ordered supervision and restrictions on firearms ownership — intact. But while Obama’s commutation grants get most of the attention, he’s also been quietly denying a record number of commutations at the same time — a function of the unprecedented number of applications submitted through the clemency initiative.

On Oct. 6, for example, the White House announced that Obama granted 102 commutations. It wasn’t until a week later that the Justice Department updated its clemency statistics to reveal that he had denied 2,917 commutation petitions on Sept. 30. Some advocates for inmates say there’s not enough transparency about why some get clemency while others wait. “We want answers for the families who are still waiting for their clemency,” said Jessica Jackson Sloan, national director of the pro-clemency group Cut 50. “There needs to be more communication about why people are being denied.” As of Oct. 7, Obama has granted just 5.5% of commutation applications — still more than many of his predecessors. President George W. Bush granted just 0.1% of commutation applications that reached his desk, but was more generous with full pardons at this point in his presidency. “While there has been much attention paid to the number of commutations issued by the president, at the core, we must remember that there are personal stories behind these numbers,” White House Counsel Neil Eggleston wrote on the White House web site. “These are individuals — many of whom made mistakes at a young age — who have diligently worked to rehabilitate themselves while incarcerated.” Eggleston said 42 of the inmates who had received commutations were serving life sentences. An increasing number of Obama’s commutations have come with strings attached — usually a requirement that the clemency recipient undergo drug treatment. At least one prisoner, Arnold Ray Jones of Texas, has refused to accept clemency because of that condition.

http://www.usatoday.com/story/news/politics/2016/10/27/obama-grants-98-more-commutations/92844186/?csp=breakingnews

Leaders of Oregon standoff acquitted of federal charges
PORTLAND, Ore. — The leaders of an armed group who seized a national wildlife refuge in rural Oregon were acquitted Thursday in the 41-day standoff that brought new attention to a long-running dispute over control of federal lands in the U.S. West. A jury found brothers Ammon and Ryan Bundy not guilty of possession of a firearm in a federal facility and conspiring to impede federal workers from their jobs at the Malheur National Wildlife Refuge, 300 miles southeast of Portland where the trial took place. Five co-defendants also were tried one or both of the charges. Despite the acquittal, the Bundys were expected to stand trial in Nevada early next year on charges stemming from another high-profile standoff with federal agents. Authorities rounding up cattle at their father Cliven Bundy’s ranch in 2014 because of unpaid grazing fees released the animals as they faced armed protesters.The brothers are part of a Nevada ranching family embroiled in a lengthy fight over the use of public range, and their occupation drew an international spotlight to a uniquely American West dispute: federal restrictions on ranching, mining and logging to protect the environment. The U.S. government, which controls much of the land in the West, says it tries to balance industry, recreation and wildlife concerns to benefit all. The armed occupiers were allowed to come and go for several weeks as authorities tried to avoid bloodshed seen in past standoffs. The confrontations reignited clashes dating to the so-called Sagebrush Rebellion of the late 1970s, when Western states such as Nevada tried to win more control of vast federal land holdings. More:
http://www.politico.com/story/2016/10/oregon-standoff-leaders-acquitted-230421#ixzz4ONxAGIgB

Air Force One Isn’t the Only 747 With a President Onboard

Boeing Co. received a lifeline for its sales-challenged 747 jumbo jet when United Parcel Service Inc. agreed to buy at least 14 freighter versions. The company has warned that the program could be at risk and halved production this year, to six annually. One bright spot for the 747-8, the newest and largest version, is the U.S. Air Force, which chose it to transport America’s commander-in-chief. The president currently travels aboard two heavily modified Boeing 747-200 aircraft, which are military jets with the designation VC-25. However, when the president steps aboard, the call sign changes to Air Force One.
While the Pentagon plans to replace those planes with two of the newer version in 2024, what many may not know is that the U.S. is hardly the only country to make the famous plane the transport of choice for its head of state. Here are seven other countries with their own version of Air Force One:

http://www.bloomberg.com/news/articles/2016-10-28/air-force-one-isn-t-the-only-747-with-a-president-onboard

This ‘Conservative News Site’ Trended on Facebook, Showed Up on Fox News—and Duped the World

Marco Chacon had only spent about $20 on his conservative news website, RealTrueNews, when he heard his words in prime time on Fox News’ The Kelly File. “Yeah,” Chacon said. “That was an accident.” Just as he’d done for the last few months, Chacon had read the latest explosive conservative news—this time it was Hillary Clinton’s leaked speeches to Wall Street banks—and typed up an imagined transcript of his own. “So in the transcript, she’s explaining Bronies to the Goldman Sachs board of directors,” said Chacon. “Do you know what Bronies are?” Bronies are hard-core, usually adult fans of the cartoon My Little Pony. “In this one, [Bronies] are part of a threat of subalterns who are going to take over the election. And people believe all this,” he said. “And I’m just… I’m telling people, ‘How can you believe this!?’” Somewhere in the middle of that block of text about My Little Pony, Chacon’s transcript contained the phrase “bucket of losers,” attributed, falsely of course, to Clinton, which legitimate conservative news websites picked up as real. Sure enough, by 9 p.m. that day, Trace Gallagher was on Fox News telling viewers that Clinton had “apparently called Bernie Sanders supporters a ‘bucket of losers.’” (Megyn Kelly later apologized after the Clinton campaign vehemently denied Clinton said it.) More:

http://www.thedailybeast.com/articles/2016/10/28/the-man-who-duped-trumpkins-fox-news.html

U-Va. sought to kill alumni magazine article on campus sex assault. The story never ran.

CHARLOTTESVILLE — In the weeks before Rolling Stone magazine published a sensational article about sexual assault at the University of Virginia in November 2014, Dean of Students Allen Groves wrote a message to high-ranking administrators questioning the magazine’s bias. “In my opinion, Rolling Stone has not been objective in recent years,” Groves wrote, noting that it “leads me to believe this is a hatchet job.” Groves testified this week in federal court as part of a $7.5 million defamation lawsuit filed by former U-Va. dean Nicole Eramo against Rolling Stone, claiming that the article portrayed her as callous and indifferent to sexual assaults on campus. The magazine later retracted the article after the Columbia University Journalism School wrote a report outlining its significant flaws. Groves’ inclination that the administration should be cautious dealing with the magazine proved prescient. But Eramo, the dean responsible for overseeing the university’s sexual assault cases, had written messages separately indicating at the time that she was eager to participate in an interview with the Rolling Stone journalist who reported and wrote the story, Sabrina Rubin Erdely. “I’m afraid it may look like we are trying to hide something for me not to speak with her,” Eramo wrote. The U-Va. administration ultimately declined Rolling Stone’s requests to speak to Groves, Eramo and Claire Kaplan, the director of the campus Women’s Center. Rolling Stone did interview U-Va. president Teresa Sullivan, but her answer to several of Erdely’s detailed questions was: “I don’t know.” While Rolling Stone was pursuing its later-discredited story, the U-Va. administration considered an alternative: a proposed article to be published in the university’s alumni magazine about how the school handles sex assaults on campus. The alumni association, which operates the publication independently of the university, commissioned a freelance writer to examine the administration’s sex assault prevention policies and practices. More:

https://www.washingtonpost.com/news/grade-point/wp/2016/10/27/u-va-sought-to-kill-alumni-magazine-article-on-campus-sex-assault-the-story-never-ran/?hpid=hp_hp-more-top-stories-2_gp-uva-710pm%3Ahomepage%2Fstory

Grocers Feel Chill From Millennials

Grocers are struggling to lure e-commerce-loving millennials into their aisles amid what experts say is a permanent shift in shopping patterns among consumers. Baby boomers used to bring long grocery lists to supermarkets and club stores. Now shoppers in their 20s and 30s are visiting supermarkets less frequently than their parents, government records and survey data show. They are spreading purchases across new options, including online grocery services such as AmazonFresh, beefed-up convenience stores and stronger food offerings from omnibus retailers like Wal-Mart Stores Inc. and Target Corp.

“I don’t think we’ve seen shopping change so dramatically ever,” said Marty Siewert, senior vice president for consumer and shopper analytics at Nielsen. “Those things in the past that have been real drivers for grocery in terms of freshness and quality aren’t the key drivers for millennials.” Consumers between 25 and 34 years of age last year spent an average of $3,539 on groceries, about $1,000 less in inflation-adjusted dollars than people that age spent in 1990, federal data shows. On average, consumers overall bought $4,015 in food for their homes last year. The shift away from big grocery bills wasn’t as obvious before the financial crisis saddled millennials with student debt and weak job prospects, and placed a lasting drag on consumer spending. Sales at food and beverage retailers rose 3.7% between 2002 and 2007, an analysis of U.S. Census figures by A.T. Kearney shows, while they grew just 2.4% annually from 2008 to 2013. More:

http://www.wsj.com/articles/grocers-feel-chill-from-millennials-1477579072?mod=e2fb

Why so many Texas small businesses are upset about a potential transgender bathroom law

Do you remember back in March when North Carolina passed a law requiring people to use a bathroom that coincided with the sex they were at birth?  Remember how upset people were about this attack on transgender rights? Remember how huge companies like PayPal and Deutsche Bank reversed their expansion plans in the state?  Remember how not only celebrities from Bruce Springsteen and Maroon 5 cancelled concerts there, but the NCAA pulled seven championship events from the state, including the opening-weekend men’s basketball tournament games next year? Many small businesses in Texas remember – and they don’t want this happening in their state. As reported in My Statesman, more than 200 small businesses sent an open letter to local legislators protesting the state’s plans to regulate bathrooms there. “[W]e oppose any Texas legislation – broad or narrow – that would legalize discrimination against any group,” the letter said. “That kind of legislation doesn’t just go against our values to be welcoming to everyone, it jeopardizes the businesses we’ve worked so hard to create, and it threatens the jobs and livelihoods of everyday Texans.” The pending legislation is being championed by Lt. Gov. Dan Patrick (R) and meant to protect the privacy of women who may feel threatened by a transgender “man” from using their bathrooms and leave them exposed to potential sexual predators.  Patrick and other lawmakers in the state also want to provide protections for people and businesses that refuse to serve or sell to gay couples. One state representative is even seeking to amend the state’s constitution to allow business owners the right to refuse services to people whose lifestyles clash with their religious beliefs. Business people are worried this will cost their state as much as it cost North Carolina (the NCAA is scheduled to bring its tournament there in 2018) which is why the Texas Association of Business called for opposition to those bills that are discriminatory and would hurt the economy.

https://www.washingtonpost.com/news/on-small-business/wp/2016/10/27/why-so-many-texas-small-businesses-are-upset-about-a-potential-transgender-bathroom-law/

Republican women increasingly fear party is alienating female voters

A growing number of prominent Republican women are worried that as members of their male-dominated party step up to defend Donald Trump against accusations of sexual assault, they are causing irreparable damage to the GOP’s deteriorating relationship with female voters. Trump has faced questions throughout his campaign about his crass comments about women, but concern escalated this month following the release of a 2005 video in which Trump boasted that he had sexually assaulted women and subsequent allegations by 11 women that Trump had inappropriately touched or kissed them. A series of mostly male Republicans have come to Trump’s defense — dismissing the accusers as liars and, some worry, further alienating the female voters that the party desperately needs to survive. “For next-generation professional women, the party is going to have to do something very, very drastic to change the course of where this candidate has taken us,” said Katie Packer, a deputy campaign manager for Mitt Romney in 2012. “I think the leaders in our party are going to have to aggressively reject this. Come November 9, they better be prepared to make very strong statements condemning all of Trump’s behavior.” This division within the Republican Party comes as polls suggest the nation is on the verge of electing its first female president even as misogyny remains a part of American life and culture. Ironically, it is Trump’s candidacy rather than Hillary Clinton’s that has brought sexism to the forefront of political debate. More:

https://www.washingtonpost.com/politics/a-new-war-on-women-breaks-out–this-time-inside-the-republican-party/2016/10/26/9c8f8fa4-9b94-11e6-b3c9-f662adaa0048_story.html?hpid=hp_hp-top-table-main_gopwomen-719pm%3Ahomepage%2Fstory

Trump supporter brings effigy of Clinton with noose to rally

An effigy depicting Hillary Clinton with a noose around her neck dangled above the crowd cheering on a Donald Trump rally in North Carolina on Wednesday. Trump supporter Ginger Glover gave the the “Lyin’ Hillary Doll” a personal touch by tying a rope around its neck. The effigy is just the latest example of the violent imagery and anti-Clinton sentiment emerging out of the presidential election. Earlier this week, Trump supporters took a model of Clinton’s head and mounted it on a stake. A separate poster found in the crowd at Virginia Beach depicted a bull’s-eye trained on the Democratic nominee’s face. Glover said the Clinton doll and noose were intended to express her belief that the former secretary of state deserved to be jailed. When asked by a pool reporter whether she wished to see Clinton dead, Glover said no.

“It’s just for effect,” she added.

http://www.aol.com/article/news/2016/10/27/donald-trump-supporter-brings-hillary-clinton-doll-noose-rally/21593034/?icid=maing-grid7%7Cmain5%7Cdl24%7Csec1_lnk3&pLid=751403802_htmlws-main-bb&a_dgi=aolshare_facebook

Was Jared Kushner the Real Evil Genius All Along?

Among the many curiosities surrounding the Trump campaign have been two central mysteries: who is really running the show, and what do they plan to do with Donald Trumponce it’s all over?

Both were answered by Bloomberg Businessweek on Thursday, in a wide-open look at the sprawling digital operation being built by key members of the Trump campaign and how they plan to leverage their massive voter database post-election day. And Jared Kushner, Trump’s reticent son-in-law, appears at the center of it all. Over the past several months, Kushner, a fellow real-estate scion and aspiring media mogul, has emerged as one of Trump’s most trusted advisers. The 35-year-old owner of the New York Observer has taken on an increasingly vital role within the campaign, with reports placing himbehind some of Trump’s only policy speeches, brokering meetings with members of the conservative establishment, and offering advice on debate preparations and hiring decisions at critical moments in the campaign. He is also reportedly the driving force behind efforts to get the much-rumored Trump TV off the ground. According to Businessweek, the original idea for a post-election Trump-branded network was Kushner’s, too. A source claimed that it was born out of a threat to Roger Ailes, a longtime friend of Trump’s and informal adviser to his campaign, who, until he resigned in the midst of sexual-harassment allegations, served as the top brass at Fox News. Not pleased with the coverage the campaign was receiving on the right-leaning cable network, Kushner reportedly hinted that Trump could create his own competitor down the line. The two sides mended fences, but the idea stuck. Trump liked it, Businessweek reports, as did five media networks that reportedly expressed interest in the plan. Kushner recognized early on the potential for digital media to circumvent mainstream news sources. “One thing Jared always tells Donald is that ifThe New York Times and cable news mattered, he would be at 1 percent in the polls,” one person close to the campaign told the magazine. “Trump supporters really don’t have a media outlet where they feel they’re represented. . . . What we found is that our people have organized incredibly well on the Web. Growing the digital footprint has really allowed us to take his message directly to the people.” Kushner exercised his muscle here, too, enlisting talent from Silicon Valley to architect a digital operation that could help win his father-in-law the White House or, if they missed that target, set them up to translate the campaign’s database of millions of Trump supporters into a viable, lucrative Plan B. Nearly a year ago, according to Businessweek, Kushner laid the groundwork for a social-media juggernaut and fundraising operation that could later be mined for all sorts of useful, profitable personal information.

http://www.vanityfair.com/news/2016/10/jared-trump-trump-campaign?mbid=nl_TH_58127b6b258b1c173559e1aa&CNDID=11508510&spMailingID=9772318&spUserID=MTMzMTgyMzQ2NTIzS0&spJobID=1022185345&spReportId=MTAyMjE4NTM0NQS2

Donald Trump hasn’t invested $100 million in White House race – yet

WASHINGTON — Republican presidential nominee Donald Trump has repeatedly declared he’s putting $100 million of his own money into his White House bid. But he still has a long way to go, according to reports his campaign filed Thursday night with the Federal Election Commission. During the first part of October, the real-estate mogul donated $30,681.67 to his presidential campaign, the filings show. That brings his total investment through Oct. 16 to $56.1 million, through a combination of direct contributions and personal loans that he has since forgiven. He has less than two weeks to dump in the remaining $44 million or so to hit his much-touted target.

http://www.usatoday.com/story/news/politics/onpolitics/2016/10/27/donald-trump-has-not-invested-100-million-into-race-yet/92865852/

State/Local

Alabama Saw Second Worst Education Funding Decline Since 2008, Report Says

Montgomery—Of all the 50 states across the US, Alabama’s K-12 education budget saw the nation’s second worst decline in funding per student during the Great Recession and that funding has not yet been restored to pre-2008 levels, according to a new nonpartisan report. Alabama’s K-12 education funding per student in fiscal year 2017, which began Oct.1, is still 14.2 percent less than it was in fiscal year 2008, according to the report published by the Center on Budget and Policy Priorities. The numbers are adjusted for inflations. Only one other state, Oklahoma, had a deeper funding cut at 26.9 percent.

“Alabama needs to invest more in education now to enjoy broad prosperity and thriving communities in the future,” said Kimble Forrister, Arise Citizens’ Policy Project executive director. “Our children and grandchildren deserve the opportunity to succeed in life and be able to compete for highly skilled jobs in a fast-paced economy.” Twenty-four states have seen per student education funding allocation increase since 2008. All of those states — aside from Tennessee, which increased education funding per student 9.9 percent since 2008, Maryland and Delaware — were north of the Mason Dixon Line. “At a time when the nation is trying to produce workers with the skills to master new technologies and adapt to the complexities of a global economy, states should be investing more – not less – so our kids get a strong education,” said Michael Leachman, CBPP’s director of state fiscal research and a co-author of the new report. Large cuts were made in 2008 and 2009 during the depths of the Great Recession in order to balance increasingly large budget shortfalls. Most states, especially states in the South where the budget cuts were most severe, refused to raise taxes. More:

http://www.alreporter.com/alabama-saw-second-worst-education-funding-decline-since-2008-report-says/

Parks amendment language becomes point of contention

The controversy isn’t over the chief goal of the amendment, but what secondary language might do. Amendment 2 on next month’s Alabama ballot – aimed at protecting state park funding – includes language that would alter Amendment 617 to the Alabama Constitution and allow the Alabama Department of Conservation and Natural Resources to contract with private entities to run hotels, golf courses and restaurants at state parks. The dispute is over whether that language might have additional effects, intended or not. Charley Grimsley, a former ADCNR commissioner, says the language would lead to the privatization of the state’s parks. “The enabling legislation would be passed after the fact,” Grimsley said in an interview Wednesday morning. “They’re asking the people to approve the concept of privatizing.” Grimsley aired his concerns in an op-ed circulated around the state earlier this week.

The state parks department and a major conservation group strongly disagree with Grimsley’s reading, saying the language would allow entities that benefited from the 1998 bond money to contract out for concession services. “You can already contract out in state parks,” said Tammy Herrington, executive director of Conservation Alabama, which supports passage of Amendment 2. “The only change in Amendment 2 would be they could hire out concessions for places that already received bond money.”

The dispute adds a new wrinkle to a campaign for the amendment, whose main thrust is to keep money gathered for parks for park uses. The ADCNR does not get General Fund dollars. State parks rely on federal funds and revenue from park visitors – such as admittance fees and rentals – to generate money to keep the facilities open. Facing a budget crunch in 2015, the Legislature approved a General Fund budget that transferred $3 million out of park maintenance funds and toward other services. As a result, the department last fall closed five parks and laid off personnel. Local governments took over some of the parks after they closed. Amendment 2 would prevent the Legislature from using money for state park maintenance for other purposes. The amendment contains a provision saying if money in the state’s Parks Revolving Fund exceeds $50 million, the state can reduce the parks’ share of sales, use and cigarette taxes. The $50 million threshold would rise with inflation. The Parks Revolving Fund should get $37.7 million in this year’s budget. More:

http://www.montgomeryadvertiser.com/story/news/politics/southunionstreet/2016/10/26/parks-amendment-language-becomes-point-contention/92773146/

Alabama receives nearly $500K to improve state unemployment services

Alabama will receive nearly $500,000 from the U.S. Department of Labor to improve initiatives related to its unemployment program. The federal agency announced this week it has awarded about $30.4 million in grants to 39 workforce agencies in the U.S. The funds will enhance unemployment insurance program operations, assist eligible recipients, prevent and detect improper payments and modernize old technology systems. “As America’s economy continues to experience the longest stretch of job creation on record, we also need to rethink how best to administer programs and resources to help people transition into gainful employment,” said Assistant Secretary for Employment and Training Portia Wu. “These grants will help states modernize their UI programs, and ensure system integrity, so that those who qualify are receiving the support and services they need.” Tara Hutchison, spokeswoman for the Alabama Department of Labor in Montgomery, said her organization’s Unemployment Compensation Division will use the grant in a number of ways. One of the goals, she said, is to implement a new two-part improper payment prevention strategy to identify newly-hired employees and to verify that employers are reporting them as required by law. “This should help significantly reduce improper payments related to unreported benefit year earnings,” she said. ADOL will target 20,000 employers to advertise the e-SIDES Response System, which should obtain more accurate and timely information related to separation issues. Hutchison said the agency will also use the funds to continue its Tax Offset Program (TOP) to collect unpaid revenues. Spanish-speaking claimants will benefit from the grant as ADOL works to implement a new Spanish Rights Benefits and Responsibilities Book, Interactive Voice Response system for telephone weekly claims, and an online portal with information provided in Spanish. Hutchison said ADOL will finish a contingency plan to ensure unemployment compensation is functional if a disaster hits. The state will also introduce work search automation into both the Interactive Voice Response and Internet Weekly Claims systems. Work search automation will result in a “significant reduction of improper payments related to work search issues,” Hutchison said.

http://www.al.com/business/index.ssf/2016/10/alabama_receives_nearly_500k_t.html#incart_river_home

HealthSouth CEO Grinney to retire, successor named

HealthSouth President and CEO Jay Grinney will retire at the end of the year, the company announced Thursday. Current Executive Vice President and COO Mark Tarr has been tapped to succeed Grinney, who will stay on as consultant until March 31, 2017. Grinney helped engineer a massive turnaround at HealthSouth in the wake of the company’s accounting scandal in the early 2000s, refocusing the company’s business model and turning it into one of Birmingham’s fastest growing large companies.

“It has been an honor and a privilege to lead HealthSouth over the past 12 years,” Grinney said in a release. “This planned transition comes at a time of strength and growth for HealthSouth: volumes, revenues and earnings in both segments continue to grow at a solid pace; clinical collaboration between the segments continues to strengthen as more of our inpatients are introduced to Encompass’ services and we add home health agencies in non-overlap markets; development pipelines for both segments are as strong as ever, positioning them for future growth; and the company is well-prepared to meet the needs of the evolving delivery system.” After joining HealthSouth in 1993, Tarr served as president of the company’s inpatient division and executive vice president of operations before his promotion to COO in 2011. “I am honored to have this opportunity to lead HealthSouth, the company I have called home for more than 20 years,” Tarr said in a release. “Our objective is to be the nation’s leading provider of post-acute care through the provision of comprehensive, coordinated facility-based and home-based post-acute services. Working alongside our talented workforce and proven executive team, I am confident we will continue to positively impact the lives of the patients we serve.” CFO Doug Coltharp‘s responsibilities will expand in the transition, with Coltharp assuming responsibility for HealthSouth’s IT group and managed care contracting. Barb Jacobsmeyer has been promoted to executive vice president of operations and will oversee the company’s inpatient rehabilitation segment’s regional presidents. HealthSouth is currently considering internal and external candidates to fill Jacobsmeyer’s position as president of the rehabilitation segment’s Central Region.

http://www.bizjournals.com/birmingham/news/2016/10/27/healthsouth-ceo-grinney-to-retire-successor-named.html?ana=e_birm_bn_breakingnews&u=XLAH3ddK7jyD7KQU5SDF0g0672b937&t=1477601466&j=76271731

Birmingham council, mayor in dispute over Water Works lawsuit

The Birmingham City Council plans to hire a law firm to represent the body in a lawsuit seeking to void two state laws that beginning next year that would dilute the city’s control of the Water Works Board.

President Johnathan Austin said the council is against the expansion of the Water Works Board and wants to hire its own lawyers to represent them in the lawsuit filed by the Water Works Board.

The members of the City Council are named as defendants in the lawsuit despite a majority of them supporting the Water Works Board’s position. “The council believes that it is in the best interest of the citizens of Birmingham (for the city) to retain control of those assets of the Water Works,” Austin said.

The council on Tuesday passed a resolution, which they claim, gives Austin the power to sign the contract to retain the law firm of Bainbridge, Mims, Rogers & Smith LLC to provide legal services for up to three years at a cost not to exceed $25,000. During the council meeting, Assistant City Attorney Tracy Roberts said the resolution hadn’t been reviewed by the legal department. He questioned the legality of the document. Austin said the resolution was passed because Mayor William Bell has refused to sign the contract allowing the City Council to hire their own lawyers. He said the city’s law department is representing Bell in the lawsuit and not the interests of the Council. A representative from the mayor’s office didn’t immediately respond to a request for comment.  City documents submitted into the court record show the City Council first passed a resolution seeking to hire lawyers on Aug. 9. Bell later vetoed the resolution, records show. Austin said the Council overrode the mayor’s veto, but the mayor still refused to sign the contract. “Once the veto was overridden, the mayor has a duty under the Mayor Council Act to do whatever the Council has instructed him to do relative to that contract, which was to sign it and engage the law firm,” he said. The Water Works Board of the City of Birmingham filed a lawsuit in June against the city of Birmingham, Mayor Bell, the Birmingham City Council, the Jefferson County Mayors’ Association and the Shelby County and Blount County commissions. The board asked for a judge to void the 2015 and 2016 legislative acts that will add members to the Water Works Board from outside the city and put new restrictions on the board. The suit also seeks preliminary and permanent injunctions against the defendants from taking any actions, including expansion of the board, under those acts. More:

http://www.al.com/news/birmingham/index.ssf/2016/10/birmingham_city_council_to_hir.html

Roy Moore walks out of court before pool of judges chosen for his appeal

MONTGOMERY, Ala. — Alabama Chief Justice Roy Moore, who was suspended from the bench over his actions regarding gay marriage, walked out of the state courthouse Thursday after failing to stop the lottery to pick the judges who will hear his appeal to return to the bench. The names of 50 retired judges were picked from a box during a public proceeding as potential members of the special Supreme Court for Moore’s appeal. The first seven willing judges will hear the case, under a procedure set out by the court in a 5-3 decision. Moore and his attorney asked to delay the selection, but were told there was no court in place to hear the motion since all current justices recused themselves and a replacement court has not yet been named. The selection of the replacement pool began as Moore left the courtroom.

Moore told reporters outside the Alabama Judicial Building that he believed sitting judges — not retired ones — should hear his appeal, arguing retired judges have no accountability to the public. He also said some sitting justices should have recused themselves from establishing the replacement process because of actions they’ve already taken in his case. “This is a charade,” Moore told reporters, adding that he believed it was a “political prosecution.” The process for selecting a replacement court was the same one used when Moore was removed from the bench in 2003 for refusing to obey a federal court order to remove a boulder-sized Ten Commandments monument from the state appellate courthouse.

The list of 50 judges includes some notable names such as former Supreme Court Justice Ralph Cook and former Civil Appeals Judge Sharon Yates.

http://www.al.com/news/index.ssf/2016/10/roy_moore_walks_out_of_court_b.html#incart_river_home

At least $1 million funneled to Nigeria from small Alabama town in big-money scam

You’ve heard of Nigerian scammers? Well police believe some are based right here in small-town Alabama. It’s a complex investigation of a complex set of cons, but Adamsville authorities say a trio of people in that Jefferson County city helped bilk hundreds of thousands of dollars from unsuspecting Americans and wired the cash to criminals – perhaps even terrorists — in Nigeria. Adamsville police first became aware of wrongdoing in September of 2014 when a man in Chippewa County, Minnesota filed a report with sheriff’s deputies there about a potential scam. The victim told investigators he learned he had won a $100,000 lottery, but in order to collect that money he had to fork over $2,462.50. He did so via a Walmart MoneyGram, and the recipient was to a woman named Jacinta Girrado Derby, a 57-year-old Adamsville woman. Sgt. Rick Whitfield said they looked into the case, but there wasn’t immediately anything that could be done. They kept an eye out for any other similar complaints, but there weren’t any. That changed in February 2016. This time, Adamsville police received a call from the Washington County Sheriff’s Office, also in Minnesota. A woman there reported she was selling a piece of furniture on Craigslist, and that a buyer had offered her asking price. The buyer, Whitfield said, deposited the agreed-upon price into a supposed PayPal account and included $950 for shipping costs. He then asked the victim to send him that $950 shipping money back to him, which she did from her own bank account via a MoneyGram picked up by Derby. “Is she the main culprit? At that point we didn’t know,” Whitfield said. But they were determined to find out. They launched an investigation to figure out if there was a crime, and if so, did that crime happen in Adamsville?

http://www.al.com/news/birmingham/index.ssf/2016/10/hundreds_of_thousands_of_dolla.html#incart_river_home

Judge blocks law banning abortion clinics within 2,000 feet of schools

A federal judge blocked two laws today that would have restricted abortions in Alabama, including one that would prevent clinics from operating within 2,000 feet of public schools. The other law would ban dilation and evacuation abortions, which are commonly performed in the second trimester. U.S. District Judge Myron Thompson is hearing a challenge to the laws brought by the ACLU of Alabama. Today’s ruling blocks the implementation of the laws because they will likely be found unconstitutional. In his opinion, Thompson wrote that the state’s efforts to reduce disruption at schools located near two clinics placed an undue burden on women seeking abortion. “The record contains absolutely no evidence of concerns expressed by the school’s students or their parents about the Huntsville clinic or the demonstrations near it,” Thompson wrote. “As to Highlands, the State’s two interests (minimizing disruption and supporting a parent’s right to control their children’s exposure to the subject of abortion) would not in any way be furthered by the closing or relocation of the Huntsville clinic. The closure of two of the state’s five abortion clinics would disproportionately affect low-income women who would have to drive further, even out of state, to get abortions, Thompson wrote. The ACLU of Alabama has challenged seven abortion restrictions passed in Alabama during the last three years. “It’s long past time for our elected officials to stop wasting time and taxpayer money passing laws that violate women’s constitutional rights and start focusing on the needs of women and families in this state,” said Susan Watson, executive director of the ACLU of Alabama, in a statement. “Alabama women deserve to access their rights protected by the Constitution. And our doctors deserve to be able to provide care in clinics, not fight medically unnecessary laws in courthouses.” The law banning abortion clinics within 2,000 feet of K-8 public schools would have shut facilities in Huntsville and Tuscaloosa. Those two clinics performed more than half the abortions in Alabama in 2014, according to the Alabama Department of Public Health.

The location ban is unique to Alabama, but bans on dilation and evacuation have been passed in other states. They have also been blocked by judges in Kansas and Oklahoma. More:

http://www.al.com/news/index.ssf/2016/10/judge_blocks_law_banning_abort.html#incart_river_home

Blogs/Opinions

Who’s paying your politicians? Ethics disclosures don’t disclose

At the heart of the matter is a simple idea — if citizens can see who pays their public officials, then citizens can have some sense of who those officials really serve. As Mark Twain put it, show me where a man gets his corn pone, and I’ll show you where he gets his opinions. In Alabama, all public officials — elected officials and public employees who make $75,000 a year or more — must file annual disclosures called statements of economic interest with the Alabama Ethics Commission. Those forms are supposed to reveal their corn pone trail — how much they make and where it comes from. Or as Deep Throat said to Bob Woodward, “Follow the corn pone.” Simple, at least in theory, but it hardly ever works out that way.

Take state Sen. Jabo Waggoner, R-Vestavia Hills, for example. In 2003, Waggoner left HealthSouth, where he had worked as CEO Richard Scrushy’s vice president of external affairs, and started a consulting business, Birmingham Business Consultants, L.L.C. Since then, he has grown his new company to serve 11 clients. According to his 2015 disclosure, those clients pay him somewhere between $175,000 and $300,000 a year. That’s a lot of corn pone. Trouble is, the Ethics Commission’s disclosure form doesn’t require Waggoner to disclose who those clients are. Instead, it offers a list of general categories like “banks.” That doesn’t really tell you anything. Among his clients is one bank, but Waggoner doesn’t have to disclose which bank. From there, things get only more opaque. The other 10 clients fall under “Miscellaneous.” Looking at the disclosures alone, it’s impossible to tell what kind of businesses these are, much less their names or what kind of consulting work Waggoner did for them. Waggoner says that he’s following the law by making the disclosures the law requires and that he’s never used his office to benefit his other business or himself personally. Waggoner wouldn’t say who his clients were except that most of them were in the health care industry. “The Ethics Commission comes up with that form, and we comply with that form,” Waggoner said by phone this week.” “I feel like I’m complying just like everybody else is.”  But let me take a moment to fact-check the senator. As much as I might like to beat up on the Ethics Commission, Waggoner is wrong. The Commission didn’t create that form. It’s designed and defined by statute, passed by the Alabama Legislature. Waggoner should know that. He’s been in the Alabama Legislature since 1966. Waggoner is far from alone in this. Rep. Oliver Robinson, D-Birmingham, has a contract with a bank that pays him between $100,000 and $150,000 a year, but like with Waggoner, Robinson’s disclosures don’t show which bank. Information like that would be useful for someone like me to know when covering the Alabama House Financial Services Committee, on which Robinson serves. Robinson did not respond to a message left on his cell phone. More:

http://www.al.com/opinion/index.ssf/2016/10/whos_paying_your_politicians_e.html#incart_river_home

Donald Trump: you will not hijack My America

I’ve had enough. I’ve sat idle witnessing Donald Trump become the Republican nominee for president, despite his lack of qualifications and general decency as a human being. He did that, while violating everything this country stands for. Recently he added the straw that broke the camel’s back. (Which hit close to home in my case). “Elections are rigged,” Trump has repeated. Mr. Trump, allow me to tell you about rigged elections. Growing up in Damascus – Syria, my dad never allowed us to go vote. “It’s not safe,” he would say. I used to watch the ‘Elections’ on television. Hafez Al-Assad had been president for years and won every time by an overwhelming majority. One year without him knowing, I went with a friend to satisfy that itch for lofty principles we experience as teenagers – ready to conquer the world.

We entered the library and had to show our ID’s and sign a sheet that said: I will vote for President Hafez Al-Assad. Going into the small booth, I passed two men with machine guns standing outside. I searched for another candidate on the ballot, but there was none. When I contemplated not voting, my friend said there would be ‘dire consequences’. So I filled out the small circle with a number two pencil and granted the dictator four more years. At the door, an official examined the ballot and told the guards to give us our ID’s back. Hafez Al-Assad was president for 29 years, and now his son Bashar has filled the same role since 2000. That my friend, is the epitome of rigged elections. How dare you? How dare you, Donald Trump, cast a shadow of fraud on my America? I know about disfranchisement in our voting system, and I familiar with the Electoral College, where not all voters are created equal. All that said, there are no guards with machine guns outside the booth. Despite the challenges we have, America offers a government of the people, by the people, and for the people. In most countries, you would not even be allowed to complain about elections being rigged. Wait, I forgot . . . we have free speech in my America.

My America: You want to know about My America Donald? My America allowed me at the age of 18 to reap the benefits of a good education, a free economy, and a just social system. My America gave me the chance to raise my three children where they don’t have to dodge bullets and bombs, or spend night after night in a bomb shelter. They live where they may touch a star one day. They are free to participate in a democratic society with rewards based on effort, and not on who you know. One of them could actually become President one day. (I can provide their birth certificate). My America permitted me to vote, in a free and accountable system where my vote counts, and where all nominees are listed on the ballot. This fact still astounds me after living here for 31 years. My vote counts. I, Karim Shamsi-Basha, an American citizen from a Syrian descent, can vote and be heard. My America provided me with a congressman who wrote letters on my behalf to the American Embassy in Lebanon to grant my sister a visa. My country of origin has been ravaged by civil war for the past five years. I met with Congressman Spencer Bachus, and he promised to do everything in his power to get her out of Syria. Did you hear me Donald? I met with my congressman. I was heard by my government representative. You want to ban all Muslims, Mexicans, foreigners, and people that are not ‘Us’ from coming into this vast and gracious land. (Why am I thinking of Hitler?) My America granted me the privilege of working as a journalist for 30 years. I documented events that others take for granted as merely the ‘news’. Fifteen years ago, I covered a protest on the steps of the Jefferson County Court House in Birmingham, except the protesters wore white robes with hoods and shouted racial obscenities. They were the KKK. I watched in disbelief and wondered if this form of ‘Freedom’ was a bit much. To let a despicable group speak their mind in public? (I know about the constitution and Freedom of Speech, but c’mon, really?) Then I saw something that replaced the shivers of infuriation with tears of overwhelming gratification. I saw African-American and white policemen hold hands and form a human fence to push the rowdy crowd back. They protected the racial bigots. As ugly and appalling the KKK was, as beautiful and virtuous the hovering freedom was. My America showed me slices of life that are simple, pure, and telling. I saw children puff their cheeks and blow dandelions in the spring, and old men rake their front yards. I saw business men and women be productive citizens, and neighbors bake cookies for each other over the holidays. I saw smiles of hope, grins on tiny lips, and hugs at airports. I saw flags from all countries and all colors on Southern porches, where iced tea is the drink of choice for people from all over this beautiful and inclusive world, despite your efforts to deny that virtuous fact. My America may not be the most perfect country in the world, but It remains the best place to live on this tiny planet. (In my humble, and yes . . . foreign opinion.) What I do every morning: Do me a small favor Mr. Trump: Get down on the ground right now and kiss it. You may taste justice, you may taste liberty, you may taste beauty, you may taste integrity, and you may taste honesty. Don’t be scared. Those are good things most people try to live by.

http://www.al.com/opinion/index.ssf/2016/10/donald_trump_you_will_not_hija.html

Morning Money

HERE COMES THIRD QUARTER GDP — By quirk of the calendar we get one more jobs report before Election Day (the October reading comes Nov. 4th). But the last really politically meaningful piece of data comes this morning at 8:30 a.m. with the first read on Q3 U.S. growth. Estimates are all over the map from under 2 percent (a welcome headline for Donald Trump) to over 3 percent (a big talking point for Hillary Clinton). The numbers so far this year have been weak with Q1 at just 0.8 percent and Q2 at 1.4 percent.

Those tepid figures have allowed Trump and the GOP to argue for a change of course in economic policy. But partly due to the GOP nominee’s inability to stick to a single clear message (along with the many other distractions surrounding his campaign), the state of the economy has not dominated the 2016 campaign the way it might have. Clinton has also been able to point to a steadily dropping unemployment rate and increasing wages as counter points to the sluggish growth numbers.

HFE’s Jim O’Sullivan on what to expect: “We have raised our estimate for Q3 real GDP growth to 3.0 percent at an annual rate from 2.5 percent. … [W]e held off on making a change until we saw the September durable goods report. … [W]e expect a decline in the business-investment-in-equipment component of GDP in the Q3 report. Other components should be more than offsetting, however — most notably consumer spending, exports and inventories.

Pantheon’s Ian Shepherdson: “Two entirely separate factors point to significant upside risk to the first estimate of third quarter GDP growth, due today. First, we think it likely that farm inventories will not fall far enough to offset the unprecedented surge in exports of soybeans, which will add some 0.9 percentage points to headline GDP growth.

“We suspect our forecasts for the other components of GDP growth aren’t far from the consensus estimates. We look for a 2.7 percent rise in consumption, unchanged fixed investment, excluding housing, and a 1 percent drop in government spending. But if the BEA is very cautious on farm inventories and allows only a partial export offset, and the IVA is in line with the PPI data, then GDP will come in well above the consensus, and it might — might — even reach 4 percent.”

CITI ON INFRASTRUCTURE — Donald Trump on Thursday proposed spending $1 trillion on infrastructure. In a new report, Citi suggests even that huge sum is just a small part of the global need: “[G]lobal infrastructure needs will amount to $58.6 trillion over the next 15 years … Yet challenges continue to prevent this capital from being unlocked, including a lack of transparency and data, and political and regulatory instability.

“Should these challenges be overcome, the benefits are clear: Per Citi analysis, every 1 percent increase in infrastructure spend will lead to a 1.2 percent growth in GDP. For global GDP growth in 2017 to reach the OECD prediction of 3.8 percent, infrastructure spending must increase by 1 percent of global GDP from 3.4 percent of global GDP to 4.4 percent.” Full report.

THE CITY IS STARTING TO BRACE FOR CARNEY’S DEPARTURE — Via POLITICO’s Francesco Guerrera, maestro of the London-based “Morning Exchange” newsletter: “Let me say it at the outset: I don’t know whether Mark Carney will decide to leave the helm of the Bank of England in 2018 as planned, or serve out his eight-year term until 2021. But I’m picking up a growing concern in financial circles that the BoE governor might soon say he is leaving in 2018. Some people claim to actually know, others are reading the tea leaves (and Carney’s recent pronouncements).

Why now? Because Carney has said that he will announce his intentions before the end of the year. And because he has been attacked by Euroskeptic politicians for his alleged siding with the Remain campaign before the referendum. Of late, even Prime Minister Theresa May and Finance Minister Philip Hammond added to the criticism of the BoE’s policies, prompting a visibly nonplussed Carney to tell a town hall meeting in Northern England: ‘We will not take instructions on policy from the politicians.’ Read more.

DON’T FORGET — Send us your economic dream teams for a Clinton or Trump White House. Chief of Staff, Treasury Secretary, NEC Chair and CEA Chair. Some complained that they wanted to add OMB Director. So feel free! Email them to bwhite@politico.com. Answers coming next week.

DRIVING THE DAY — Hillary Clinton campaigns in Cedar Rapids and Des Moines, Iowa. President Obama campaigns for Clinton in Orlando … Donald Trump campaigns in Manchester, N.H., Lisbon, Maine (home of one electoral vote) and Cedar Rapids, Iowa … First look at Q3 GDP at 8:30 a.m. expected to show growth of 2.6 percent … Univ. Of Michigan Consumer Sentiment at 10:00 a.m. expected to rise to 88.5 from 87.9.

TRUMP OCT. CONTRIBUTION: $31K — Tweet via @kenvogel: “Trump boasted he’d reach $100M in self-funding, but he only gave his campaign $31k this mo. Now at $56.1M total.” FEC report.

TOTALS — Trump’s campaign reported $15.9M on hand as of 10/19. Hillary Clinton’s campaign reported $62.4M on hand. Oddly enough, Clinton also apparently gave more to her campaign during the reporting period ($50K) than Trump.

TOP TRUMP QUOTES OF THE DAY — To supporters in Toledo, Ohio: “We should just cancel the election and just give it to Trump, right? What are we even having it for? Her policies are so bad.”

To Fox News’ Bill O’Reilly on polls: “The only one I really like are the ones where I’m winning.”

BIDEN FOR STATE? — POLITICO’s Edward-Isaac Dovere: “Joe Biden is at the top of the internal short list Hillary Clinton’s transition team is preparing for her pick to be secretary of state, a source familiar with the planning tells POLITICO. This would be the first major Cabinet candidate to go public for a campaign that’s insisted its focus remains on winning the election, and perhaps the most central choice for a potential president who was a secretary of state herself.

“Neither Clinton nor her aides have yet told Biden. According to the source, they’re strategizing about how to make the approach to the vice president, who almost ran against her in the Democratic primaries but has since been campaigning for her at a breakneck pace all over the country in these final months” Read more.

DEAL FRENZY DOESN’T PAUSE FOR ELECTION — WSJ’s Dana Cimilluca, Dana Mattioli and David Benoit: “The eve of a presidential election is typically a time when companies put merger plans on hold and wait for clarity on crucial matters like antitrust policy. Not this year. Less than two weeks before voters head to the polls, U.S. companies have unleashed a wave of deals that has made this month the busiest ever for mergers and acquisitions. The deal making culminated inQualcomm Inc.’s agreement Thursday to buy NXP SemiconductorsNV for $39 billion, part of a swirl of consolidation in the semiconductor industry.

“The NXP acquisition counts as the second-largest pure technology deal of all time after Dell Inc.’s recent acquisition of EMC Corp. for about $60 billion. And it comes just days after AT&T Inc. struck the biggest takeover deal of the year, with a pact to buy Time Warner Inc.for $85 billion. A day earlier, British American Tobacco PLC made a $47 billion offer to take full control of Reynolds American Inc. in a move that would create the world’s largest listed tobacco company by revenue and market value” Read more.

FCC CHOOSES PRIVACY — The Washington Post’s Brian Fung and Craig Timberg: “Federal officials delivered a landmark ruling in favor of online privacy Thursday, limiting how Internet providers use and sell customer data, while asserting that customers have a right to control their personal information.

“Under the Federal Communications Commission’s new rules, consumers may forbid Internet providers from sharing sensitive personal information, such as app and browsing histories, mobile location data and other information generated while using the Internet.” Read more.

AMAZON SLIPS — FT’s Hannah Kuchler: “Amazon shares fell 6 per cent in after-hours trading in New York on Thursday when the online retailer significantly missed earnings expectations in the third quarter, and forecast operating income of as little as zero next quarter.

“Investment in distribution warehouses, video content from top tier directors and actors and the engineering teams behind virtual assistant Alexa helped push operating costs up 29 per cent — and look set to continue into the holiday shopping season.” Read more.

DEUTSCHE BOUNCES BACK — NYT’s Chad Bray and Landon Thomas Jr.: “The bank, Germany’s largest, said on Thursday that it had returned to a profit in the third quarter and was making progress in its efforts to turn around the business. Analysts expected a loss for the quarter.

“In addition, Deutsche Bank, which also has big trading operations in New York and London, said that its capital position had improved, with its Tier 1 capital ratio edging up to 11.1 percent, from 10.8 percent.” Read more.

CETA GETS A SECOND LIFE — POLITICO EU’s Christian Oliver and Simon Marks: “Belgium’s regional governments have granted a temporary stay of execution to the European Commission’s trade policy by agreeing at the 11th-hour to support a landmark EU deal with Canada.

“Belgium’s Prime Minister Charles Michel announced on Thursday that days of marathon talks between the federal government and regional leaders had finally paid dividends and that it would be possible to win backing for the Comprehensive Economic and Trade Agreement from the rebel assemblies: Wallonia, Wallonia-Brussels and Brussels.” Read more.

CFPB ALLOWS CREDIT UNION EXPANSION — POLITICO’s Victoria Guida: “The National Credit Union Administration Thursday approved a final rule that would further expand the potential for credit unions to serve a wider population of customers, in a move that is rankling community banks

“While credit unions are cheering the move as long-awaited relief from restrictions on who they can sign on as members, community banks have criticized the rule as outside the scope of the Federal Credit Union Act, which gives credit unions tax-exempt status.” Read more.

TWITTER KILLS VINE — The Washington Post’s Andrea Peterson: “Twitter announced Thursday that it’s shutting down Vine, a social network that lets users create and share short-form videos, ‘in the coming months.’

“The decision to shutter Vine comes as Twitter is in a state of flux after weeks of rumors about a possible sale. On Thursday, the company also announced a restructuring that will cut 9 percent of its workforce. It’s unclear whether members of the Vine team will be included in the layoffs.” Read more.

GE IN TALKS WITH BAKER HUGHES — WSJ’s Dana Mattioli, Kate Linebaugh and Joann S. Lublin: “General Electric Co. is in talks to buy Baker Hughes Inc., according to people familiar with the matter, a transaction that would be the biggest in the history of the industrial giant and extend its bet on the battered oil industry.

“With a market value of $23 billion, Houston-based Baker Hughes could go for more than $30 billion in a takeover, given the typical premium. GE has a market value of $259 billion.” Read more.

ALSO FOR YOUR RADAR

BANK TRADES RIP NCUA — ABA’s Rob Nichols: “We’re deeply concerned about NCUA’s decision to go beyond its statutory authority to move credit unions even further away from the common bonds that define their missions”

ICBA’s Cam Fine emails: “What the NCUA did today was eviscerate the common bond statute by allowing all air breathing mammals to join credit unions. Credit unions are tax-free institutions and were never meant to operate as the functional equivalent of commercial banks.

“They don’t pay one dime in Federal or state taxes. The growth of the credit union industry is on the backs of American taxpayers and thousands of communities across the nation who rely on tax-paying community banks to fund their local schools, fire halls, hospitals, and community infrastructure.”

NAFCU DEFENDS — Executive Vice President of Government Affairs & General Counsel Carrie Hunt: “NAFCU continues to hear from our members that NCUA’s current FOM rules and regulations have unnecessarily inhibited their ability to serve their communities. Additionally, NAFCU members believe that the federal credit union charter must keep pace with changes in state laws, technology, and the progressiveness of the financial services industry”

ADS HIT GOP MEMBERS OVER WALL STREET — Per release: “Today, the Working Families Party launched new 30-second TV ads that slams three Republican members of the House Financial Services Committee for putting Wall Street ahead of working families … The ad takes aim at Reps. Scott Garrett (NJ-05), Sean Duffy (WI-07) and French Hill (AR-02) over a recent vote in the Financial Services Committee for a bill (HR 5983) which would roll back financial regulations”

CARLYLE PIVOTS AWAY FROM HEDGE FUNDS — NYT’s Alexandra Stevenson: “Prominent public pension funds have turned their backs on hedge funds, and so have a few big insurance companies. Now, one of the world’s biggest private equity firms, the Carlyle Group, is walking away, too. Carlyle told investors this week that it was pivoting away from its hedge fund investments, once worth $15 billion.

“Speaking to investors, the Carlyle co-founder William E. Conway Jr. said the firm’s performance in hedge funds did not meet the expectations of its investors. ‘And when our performance falls short, it is critical for both our fund investors and for the firm that we deal with the consequences,’ Mr. Conway said.” Read more.

POTUS Events

10:00 am || Receives the Presidential Daily Briefing
2:35 pm || Departs White House
4:50 pm || Arrives Orlando, Florida
5:50 pm || Delivers remarks at a Hillary for America campaign event; CFE Federal Credit Union Arena, Orlando
8:05 pm || Departs Orlando
10:15 pm || Arrives White House

All times Eastern

Floor Action

Zip, Zero, Nada.