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Apr 25, 2018

Financial Service | The Housing Market Is In A Hyper Bubble And When It Pops The Economy Will Collapse Fabian Calvo - April 25, 2018.

The Guardian | North Korea nuclear test site has collapsed and may be out of action – China study | World news

theguardian.com

North Korea nuclear test site has collapsed and may be out of action – China study | World news

Justin McCurry

North Korea’s main nuclear test site has partially collapsed under the stress of multiple explosions, possibly rendering it unsafe for further testing and leaving it vulnerable to radiation leaks, a study by Chinese geologists has shown.
The findings could cast doubt on North Korea’s sincerity in announcing last weekend that it would stop testing nuclear weapons at the site ahead of Friday’s summit between the country’s leader, Kim Jong-un, and the South Korean president, Moon Jae-in.
The test site at Punggye-ri, in a mountainous area in North Korea’s north-east, has been the location for all six of the regime’s nuclear tests since 2006.
The findings, by scientists at the University of Science and Technology of China, suggest the partial collapse of the mountain that contains the testing tunnels, as well as the risk of radiation leaks, have potentially rendered the site unusable.
The study was published soon after Kim said his country would stop testing nuclear weapons and ballistic missiles, and close down Punggye-ri before his meeting with Moon just south of the countries’ heavily armed border.
Nuclear explosions release enormous amounts of heat and energy, and the North’s largest test, in September last year, was believed early on to have rendered the site - a network of tunnels beneath Mount Mantap - unstable.
The Chinese scientists collected collected data for their study following the most powerful of the North’s six nuclear tests, on 3 September.
The controlled explosion, which caused an initial magnitude-6.3 tremor, is believed to have triggered four more earthquakes over the following weeks. The study concluded that eight-and-a-half minutes after the test, there was “a near-vertical on-site collapse towards the nuclear test centre”.
The Chinese university paper, written by Tian Dongdong, Yao Jiawen and Wen Lianxing, said that was followed by an “earthquake swarm” in similar locations.
The yield of the bomb was estimated at more than 100 kilotons of TNT, at least 10 times stronger than anything the North had tested previously. The bomb dropped on Hiroshima in 1945 had a yield of about 15 kilotons.
“In view of the research finding that the North Korea nuclear test site at Mount Mantap has collapsed, it is necessary to continue to monitor any leakage of radioactive materials that may have been caused by the collapse,” the authors said in a summary dated Monday and seen on Wednesday on the university’s website.
The new study is peer-reviewed and has been accepted for publication by the journal Geophysical Research Letters.
The Chinese study made sense and was based on well-understood research, said Rowena Lohman, a seismologist at Cornell University who wasn’t part of the work.
A study published last month by the journal, written by a team led by Liu Junqing at the earthquake bureau in Jilin province along the border with North Korea, found similar results from the September explosion. It described the aftershock that followed seconds later as most likely the “rapid destruction of an explosion-generated cracked rock chimney due to cavity collapse”.
Beijing is particularly concerned about the North’s nuclear tests, since the Punggye-ri site is less than 100km (60 miles) from the border with China.
North Korean nuclear tests have caused seismic events in Chinese border towns and cities, forcing evacuations of schools and offices, sparking fears of wind-borne radiation and leading to a backlash among some Chinese against their country’s unpredictable traditional ally. Chinese authorities have said they’ve detected no radiation risk from the tests.
Kune Yull Suh, a professor of nuclear engineering at Seoul National University, warned last year that further tests could threaten to cause a volcanic eruption at Mount Paektu, which is about 100km away.
On Saturday, Kim announced North Korea would close its nuclear testing facility and suspend nuclear and intercontinental ballistic missile tests – a move welcomed by US president Donald Trump as “big progress” – and which comes ahead of a planned summit between the leaders in late May or early June.
However, Kim stopped short of promising to give up his nuclear weapons, and the missile test ban does not include shorter-range weapons capable of reaching Japan and South Korea.
Associated Press contributed to this report.

The Guardian | Business: Banking Royal Commission on April 26, 2018.

theguardian.com

Banking royal commission: Association of Financial Advisers chief quizzed – live | Australia news

Gareth Hutchens


Orr takes Kewin through another example and a review committee report, and says it seems the board was being asked to make a decision about disciplinary sanctions based on what would make the least reputational risk to the AFA.
Kewin doesn’t believe so.
Orr: “The important thing was to terminate the members, to expel them, wasn’t it?”
Kewin: “In both cases, I believe the essence was also to follow due process.”
Orr: “If an Asic banning order isn’t enough what does it take to get expelled from the AFA?”
Kewin says there was an appeal pending, and rather than undertaking an additional investigation, “if you suspended the member they’re no longer an active member”.
Updated

An AFA member was banned for five years by Asic in 2017 and expelled from the FPA.
An Asic investigation said, among other things, there were several instances of misleading conduct by the adviser designed to get people to switch superannuation. The adviser also engaged in misleading and deceptive conduct by failing to disclose a client’s pre-existing medical condition on an insurance form.
Despite the findings and actions of Asic and the FPA, an AFA recommendation was that to respond to such findings would amount to “hearsay” and the adviser’s membership should only be suspended, not terminated.
Orr asks if the adviser “wasn’t eligible for practitioner membership and had been banned from providing financial services, why would the AFA retain him as a member?”
Kewin: “His membership was suspended.”
Updated

The AFA has discussed with Asic about receiving notifications of compliance concerns about its members, which would be “advantageous”, Kewin says, but the regulator said they couldn’t for confidentiality reasons while investigations were ongoing.
Orr asks if the AFA has asked licensees to notify them of suspensions or terminations of members. Kewin says there is one formal agreement in place, with CBA. It was put in place before Kewin’s tenure.
Orr: “Why do you not have other formal agreements in place with other licensees?”
Kewin: “I don’t know, I can’t answer that.”
Updated

Under questioning, Kewin says the AFA is seeking to gain new members, and while they have members who are also members of other organisations he concedes there is some competition.
Orr: “Can the AFA operate effectively as a co-regulator of the financial advice industry when it is competing with rival bodies for members?”
“I believe so,” says Kewin.
Orr rephrases: “Isn’t there an inherent conflict?”
Kewin: “I don’t think so.”
Asked if it’s more desirable for a regulator to be independent of the industry it regulates, Kewin says he’s looking through the lens of what is known of professional standards and that you can have multiple codes and bodies to monitor them.
Updated

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“There’s not a lot” the AFA could do for regulation that Asic or a licensee couldn’t, admits Kewin.
After several questions, he concedes there could be a tension between being a “co-regulator” and also a promoter of financial advice and advisers.
“We’ve already seen there can be tension in those relationships,” he says.
Updated

We have finished with De Gori now. The next witness is Philip Kewin, chief executive of the Association of Financial Advisers.
He’s being asked whether he sees financial advisers as professionals. He does, and he thinks clients would too. Others perhaps not, based on what’s come out over recent weeks.
The professionalism comes from the way they conduct themselves, and the advice and support they give, he says. He also believes they can be trusted.
The primary function of the AFA is to promote the value of financial advice, says Kewin.
Orr asks about the function noted in Kewin’s statement, which is “to promote ethical practice, exercise oversight over professional standards of members, and to support and protect the character status and interests of the financial advice profession generally, and the professional standing of members”.
That function was only added to the AFA’s constitution in October last year, Kewen says, after a review “to make sure it was satisfying what we believe were the needs of the profession and the customer and general public”.
Another function was added at the same time to get the AFA on the way to becoming a co-regulator of the industry.
Updated

A quick recap of the FPA’s budget:
It relies on membership fees, and it will pull in an expected revenue of $8m in 2017-18.
  • $1m of that is set aside for a “professional standards budget”, which includes supporting the conduct review commission.
  • $1.7m is set aside for marketing and communication, to raise awareness of the financial advice industry.
  • $1m is set aside for the chief executive.
On the last point, De Gori wanted Orr to know that that $1m didn’t all go to him; it went to the “department of the CEO”, which included his staff and a bonus pool.
Orr asked: “Yes. You and your staff. How many?”
De Gori replied: “One staff.”
Updated

The FPA’s disciplinary panel has made only six determinations since January. Self-reporting is a big part of it, as are complaints. The FPA has regular meetings with Asic and may have discussions about individuals “on an informal basis”, but has no formal process of inquiring about its members.
“Wouldn’t you want to know if the regulation is investigation or imposing sanctions on your members?” Orr asks.
“Absolutely, and in some cases where we know there are reports or proceedings ... we have asked Asic,” De Gori replies.
Orr: “So you wait until there’s a public report by Asic and then follow up with a request for information?”
Updated

According to the FPA’s 2017-18 budget, membership revenues bring about $8m a year to the association.
A pool of money is set aside to “discretionally provide” to staff for performance bonues, based on key performance indicators. For some staff a KPI is to bring in new members.
The professional standards budget – of about $1m a year – includes four staff and supporting the conduct review commission of the FPA.
Orr suggests investigating complaints of conducting disciplinary proceedings is not one of the primary objects and purposes of the FPA.
De Gori says it’s “equal” with education, training and providing resources and services to members.
A $1.7m budget for marketing and communication is partly devoted to consumer advocacy and raising awareness of the financial advice industry, De Gori says in answer to questions.
Orr puts to De Gori that it’s difficult to promote advisers while also enacting disciplinary actions. De Gori says it’s a challenge but not a contradiction in aims.
Updated

FPA asked the royal commission to protect anonymity of Henderson

Orr reads a letter from the FPA’s head of professionalism to the royal commission:
In it the FPA reconfirms disciplinary hearings against Henderson hadn’t finished, and asks that the matter be treated confidentially as “any publication by the royal commission identifying Mr Henderson would render the CRC [conduct review commission] process worthless to Mr Henderson and cause significant damage to the reputation of Mr Henderson, undermine the process of the CRC, and damage the FPA’s relationship with other members.”
Orr asks for some clarifaction.
De Gori says he believes the first part of the statement meant that if the disciplinary process was going to have any conclusion “participation by Mr Henderson in that process would obviously not be forthcoming as a result of any publication of his name”.
The FPA was concerned Henderson wouldn’t interact with the process at all if he was named.
Asked about the line about the FPA’s relationship with members, De Gori says he thinks members would expect identities would remain confidential while the process was underway.
Updated

One FPA sanction against Henderson was that he had to pay his outstanding FPA fees.
“It’s nothing to do with Ms McKenna’s complaint, is it Mr De Gori?” asks Orr.
He replies that it’s not, but the FPA can also look at issues outside of the complaint.
Orr reads out from a document that other sanctions included reviewing current practice to ensure he was complying with FPA rules, appointing an independent expert to conduct “certain reviews” and to report to the FPA on his implementation of an action plan.
The FPA “agreed to be restrained from publication of Mr Henderson’s name” in return for compliance with the agreed sanctions, she reads out.
Threat of publication and promise of anonymity is the strongest mechanism to ensure compliance, says De Gori.
Updated

abc | ACTION NEWS: ABC Action News on Demand | April 25, 630PM

WWFC Asia | Noam Chomsky: Capitalism and Democracy on April 25, 2018.

WWFC Asia | Noam Chomsky : Trump Supporters and Current regime on April 25, 2018.