Geopolitics of the Balkans: NATO’s Strange Addition of Montenegro – Center for Research on Globalization

Any day now, ArizonaSenator John McCain promises, the U.S. Senate willvote to approvethe incorporation of Montenegro as the 29thmember state in the NATO alliance.

Though few Americans likely know where to find the tiny Balkan nation on a map, Montenegro has become another dubious focal point of the Wests new confrontation with Russia.

Sen. John McCain, R-Arizona, and Sen. Lindsey Graham, R-South Carolina, appearing on CBS Face the Nation.

At first glance, the case for extending NATOs umbrella over a country with fewer than 2,000 troops isnt obvious. Its seven helicopters are unlikely to make America safer. The Obama administration, which championed thislatestin a long line of recent additions to the alliance, actuallyoffered as a rationalethe fact that Montenegro had donated some mortar rounds to the anti-ISIS coalition in Iraq and $1.2 million to NATOs operations in Afghanistan over three years.

That sum isless than a third of what U.S. taxpayers spend in Afghanistanper hour. One criticquipped, if the Wests survival depends on Montenegros inclusion in NATO, we should all be heading for the bunkers.

Maybe thats why hawks are citing the mere fact of Russiaspredictable oppositionas a prime reason to support Montenegros accession. Backing Montenegros membership is not only the right thing for the Senate to do, it would send a clear signal that no third party has a veto over NATO enlargement decisions,arguesthe Heritage Foundation.

And two advocates at the John Hopkins School of Advanced International Studies, writing inForeign Affairs,declaredrecently that Montenegro will be the key test of whether President Trump and Secretary of State Rex Tillerson kowtow to their friend Russian President Vladimir Putin and acquiesce . . . in another Yalta or stand up for core U.S. goals.

Raising the specter of Putin and Yalta diverts attention from troubling questions about Montenegros political suitability as a partner and whether it has anything of military value to offer.

NATO ostensibly conditions its acceptance of new members onstrict criteria, which include demonstrating a commitment to the rule of law and human rights; establishing democratic control of armed forces; and promoting stability and well-being through economic liberty, social justice and environmental responsibility.

Deputy Assistant Secretary of Defense Michael Carpenterassuredthe Senate Foreign Relations Committee last September that Montenegro supported NATOs values of democracy, individual liberty, and the rule of law. He must have missed the report from Freedom House, whichgave the countrya rating of only partly free for both political rights and civil liberties.

The organization cited restrictions on the freedom of peaceful assembly and years of harassment and discrimination against LGBT people. It also noted ongoing concerns . . . about the independence of the judiciary and the public broadcaster, as well as numerous failures to effectively prosecute past attacks against media workers. The country suffers from a lack of trust in the electoral process among voters, it added.

Carpenter must also have missed the State Departmentshuman rights report, which accused Montenegro of numerous violations, including impunity for war crimes, mistreatment by law enforcement officers of persons in their custody, overcrowded and dilapidated prisons and pretrial detention facilities, violations of the right to peaceful assembly, and selective prosecution of political and societal opponents.

A Bastion of Corruption

As for the rule of law, consider that Montenegros ruler for nearly three decades, Milo Djukanovi?, was given the2015 Organized Crime and Corruption Person of the Year Awardby the Organized Crime and Corruption Reporting Project (OCCRP), an organization of several hundred investigative journalists who report on corruption in Europe and Central Asia (and are partly financed by USAID).

NATO headquarters in Brussels, Belgium.

Citing his success in creating an oppressive political atmosphere and an economy choked by corruption and money laundering, the OCCRP said Djukanovi? has built one of the most dedicated kleptocracies and organized crime havens in the world.

The organization pointed to his alleged role in cigarette smuggling with notorious Italian crime syndicates; his familys takeover of a former state bank, which became a money laundry for organized crime; his controversial sale of major stretches of the countrys coastline to shady foreign oligarchs; and his offer of citizenship to a notorious regional drug kingpin.

Djukanovi? knows the money is greener to the west of Montenegro than to the east. Thats why hes an ardent advocate of joining NATO. (Fewer than 40 percent of Montenegrins in arecent pollagreed in part because alliance warplanes bombed the country during NATOs campaign against Serbia in 1999.) President ObamacongratulatedDjukanovi? on his stand during an official reception in September.

Following national elections in October, Djukanovi? finally stepped down as prime minister, but he remains head of the ruling party. Taking his place as the countrys current prime minister was his hand-picked deputy, Dusko Markovic.

Markovic, a former state security chief, is considered one of Djukanovi?s closest confidantes,reported OCCRP. He was publicly accused by a former head of the countrys anti-organized crime police last year of involvement incigarette smuggling, but was never charged. In 2014, Markovic was alsochargedby the head of a government investigative commission with obstructing a probe into the murder of a prominent newspaper editor and critic of Djukanovi?.

Western media have large ignored such troubling facts. Instead, what little coverage there is of Montenegro focuses on the governments sensational claim that Russians plotted to assassinate Djukanovi? at the time of the October election.

Markovic recentlytoldTimemagazinethat his security services at the last minute uncovered a criminal organization formed by two Russian military intelligence agents, who planned on election day to provoke incidents . . . and also possibly an armed conflict as a pretext for taking power.

The prosecutor in charge of the casesaysRussian state authorities backed the plot to prevent Montenegro from joining NATO. He vows to indict two alleged Russian plotters and 22 others, including a group of Serbian nationalists, by April 15. Russias foreign ministercalledthe allegations baseless, but refuses to extradite any suspects. An independent expert, citing numerous anomalies in the official story,arguesthe plot was a rogue operation by Serbian and Russian nationalist freelancers.

Russia, which has long considered the Balkans to be in its sphere of influence, has a history of intruding in Montenegros affairs. But absent persuasive supporting evidence for the governments case, outsiders should bear in mind the cautionary observation by Freedom House that [Montenegros] intelligence service has faced sustained criticism from international observers for a perceived lack of professionalism.

Still, it should come as no surprise that anti-Russia hawks havent let ambiguous evidence deter them from demanding the expansion of NATO.

AWall Street Journaleditorialsaid the alleged coup plot gives a good taste of Russias ambitions and methods in Eastern and Central Europe and concluded with a call for accepting Montenegros bid to join NATO: Western security is best served by supporting democratic governments of any size facing pressure from regional bullies. The alternative is to deliver another country into Moscows grip, and whet its appetite to take another.

Timemagazinecommentedeven more breathlessly that The aborted coup was a reminder that a new battle for Europe has begun. From the Baltics to the Balkans and the Black Sea to Great Britain, Vladimir Putin is seeking to rebuild Russias empire more than 25 years after the fall of the Soviet Union. Trumps past criticism of NATO, the magazine warned, has raised flags that the U.S. might accept Russias territorial grab.

Such inflammatory comments are stoking the political fires burning around Trump, including investigations of his campaign contacts with Russians, assertions of Moscows interference with the election, and questions about business connections or personal indiscretions that make him vulnerable to Putin. Trumps stand on Montenegro still to be determined will signal whether he remains a critic of NATO or is caving to the New Cold Warriors.

Jonathan Marshall is author of many recent articles on arms issues, including Obamas Unkept Promise on Nuclear War, How World War III Could Start,NATOs Provocative Anti-Russian Moves,Escalations in a New Cold War,and Ticking Closer to Midnight.

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Geopolitics of the Balkans: NATO's Strange Addition of Montenegro - Center for Research on Globalization

Panel: NATO Unprepared to Defend Baltics from Russian Attack – USNI News

Estonian army scouts from 1st Battalion practicing their defensive maneuvers during Exercise SIIL/Steadfast Javelin in 2015. NATO Photo

While NATO remains unprepared to defend its most exposed states, positioning three American armored brigades in or near the Baltics would be a good first step in providing more effective deterrence against possible Russian moves, three experts in international security told the House Armed Services Tactical Air and Land subcommittee Wednesday.

David Shlapak, senior international research analyst at RAND Arroyo Center, said its war games show a collapse of NATO defenses in 36 to 60 hours of a Russian invasion of Estonia, Latvia and Lithuania without new steps being taken to deter Moscow.

The war games projected a seven- to 10-day warning of possible attack.

Deterrence would be enhanced if the three armored brigades and four other brigades of lighter forces from a number of NATO countries coupled with necessary artillery and logistics support were equipped and positioned to respond.

Rotational forces and prepositioned equipment are not a credible deterrent against a re-energized Russian threat. Later, in answer to a question, he said, Were still forward postured to defend the Fulda Gap in Germany not the Baltic nations.

The logistics supply link is now 1,000 miles longer than it was when the Soviet Union existed and before NATOs expansion eastward.

That respite, ladies and gentlemen, is over, Shlapak said.

His colleague at RANDs Arroyo Center, Timothy Bonds said even with prepositioned equipment movement of forces takes time and requires air, sea support to a continent engaged in fighting and across a contested Atlantic.

Andrew Hunter, a senior fellow at the Center for Strategic and International Studies, added, The threat is especially potent from Russia now. In recent years, it has built up Anti Access/Area Denial capability that is sophisticated, layered and integrated. Moscows ground combat systems also have been modernized, especially in indirect fires and artillery where it has an edge of the United States.

What the United States and its allies would face in Europe, they soon could be facing in other trouble spots. Russia is likely to export these systems, Hunter said.

If rotational brigades were to be the deterrent, as current plans exist in the European Reassurance Initiative, it hit the ground forces hard, both the Army and the Marine Corps, Bonds said. He said there are now nine armored Brigade Combat Teams in the Army with a 10th about to be fielded. Using the rotational math of the Defense Department that would mean, while that one brigade would be in Europe, a second would have just rotated back to its home station and the third would be training for the deployment.

Bonds said those numbers hold even with the projected growth of the Army to 540,000 soldiers on active duty and 200,000 Marines on active duty. He added it also takes time to train these new soldiers and Marines and requires more funds to ensure the equipment they have is modern and investments are being made in future systems.

Having a heavy armored brigade stationed in Korea and another in Kuwait complicates the Armys rotational problem.

US Soldiers, assigned to Lightning Troop, 3rd Squadron, 2nd Cavalry Regiment, load Stryker Fighting Vehicles on rail cars at Rose Barracks railhead station, Vilseck, Germany, Jan. 7, 2016. US European Command Photo

The Army also has seen the greatest cuts in modernization programs and investments in research and development to field new systems since 2008.

Bonds said some of the shortfalls in deterrence, such as indirect fires and artillery, can be made up by capitalizing on investments European allies and partners have made in niche capabilities.

As for meeting the 2 percent of gross domestic product being spent on security threshold, the allies need to focus on where that money is being spent, he said.

Bonds said investments by the United States and allies to meet possible Russian aggression should be directed into precision long-range fires, sub-munitions that can break up mass assaults and short-range air defenses.

The war games had Russian forces advancing at 5 miles per hour. Shlapak said precision long-range fires are needed to force them to slow down and operate in different ways.

Shlapak also focused on air defenses. American ground forces have not come under air attack since 1950, but would face advanced Russian missile systems and aircraft good enough to stay in the fight even after a NATO response.

When asked how long the seven brigades could hold out against a Russian attack in the war games, he said 28 days, sort of Bastogne-like, referring to the World War II Battle of the Bulge that slowed a German advance until American reinforcements could arrive.

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Panel: NATO Unprepared to Defend Baltics from Russian Attack - USNI News

thebigword Wins Major Contract With NATO – Slator (press release) (subscription)

Provider of translation and interpreting services thebigword has been awarded a major contract with the NATO Support and Procurement Agency.

The large five-year framework contract means thebigword linguists will provide troops language support using a mix of local Afghan and US staff. The unique nature of NATO operations means all linguists are required to be fluent in a variety of language combinations. A challenging requirement that thebigword is uniquely placed to fulfil thanks to their large pool of linguist partners who can deliver services in more than 250 languages across the globe.

The company provides other firms and organisation with language support and has a dedicated Defence Division based in The United Kingdom and Washington, D.C. Other clients include the US Army, Department of Homeland Security, UK-based defence manufacturer BAE Systems and crisis response organisations such as the UN.

Larry Gould CEO of thebigword said:

thebigword is the largest interpreting services provider in Europe and is in the top 15 language companies in the world. It works with a range of major Government departments, including the Ministry of Justice and the NYC Department of Education, as well as blue chip companies and brands on a global scale.

The company has 9 offices around the world, employs 600 staff and has more than 12,000 linguists.

thebigwords innovative technology can identify and connect people to the appropriate interpreter in more than 250 languages in under 30 seconds.

The company handles 1,000,000 minutes of telephone interpreting a month and 17,000 face to face meetings, as well as half a billion words of translation.

For more information about thebigword, visit http://www.thebigword.com/

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thebigword Wins Major Contract With NATO - Slator (press release) (subscription)

Former NSA director: It’s time to trash the federal cybersecurity … – CyberScoop

Former NSA Director Keith Alexander told senators Thursday that the government should undertake a massive reorganization effort that would consolidate some current cybersecurity responsibilities split between the FBI, Homeland Security Department, Defense Department and intelligence community, into a single entity.

When we talk to the agencies they dont understand their roles and responsibilities, said Alexander, who helped author the Commission on Enhancing National Cybersecurity report which was provided to the Trump administration. Yes, I do think it should be brought together I believe there is a way to get around this lack of a strategy by setting up a [new] framework.

Alexander, who now runs a private cybersecurity firm based in Fulton, Maryland, spoke before the Senate Armed Service Committee with other prominent experts about cyber-operations strategy and policy.

Chairman John McCain, R-Ariz., previously criticized the Obama administration for how it responded last year to an expansive Russian hacking campaign aimed at the U.S. presidential election. McCains evaluation, at least in part, revolves around how the government has handled these incidents from an organizational standpoint.

Panel member James Inhofe, R-Okla., in agreement with McCain, described that the federal government is facing a stovepipe scenario in which each of these respective agencies are not collaborating in a manner sufficient to protect the nation from and react to cyberattacks.

Its not working, Alexandersaid. There are four stovepipes and it doesnt make sense. If we were running this like a business we would put them together. The issue now gets to you now have all these different committees in Congress looking at these [cybersecurity issues] and its messed up.

The Obama administration in July attempted to clarify who is responsible for what by publishing a White House directive known as Presidential Policy Directive 41, or PPD-41. In short, the directive was designed to draw jurisdictional lines by assigning roles in the case of a cyberattack for coordination, risk mitigation and communications purposes.

What you have is people acting independently and with these seams we will never defend this country. And more importantly, when private industry looks at our government they are, quite frankly, dismayed. We are all over the map, Alexander said. No one can answer who is responsible.

Alexander said that he and former Defense Secretary Robert Gates had previously spoken about combining DHS and law enforcements cybersecurity responsibilities with that of the Defense Department and intelligence community; all under a single framework.

Others who testified Thursday, however, pushed back on the idea of completely tearing down the existing structure.

The situation is a little more complicated, responded Craig Fields, the chairman of the Defense Science Board. I dont see duplication in efforts, I see gaps, because we do not have an orchestra conductor unless we have the policy, orchestra conductor and strategy we can never go where you want to go.

This role of orchestra conductor, according to Fields and former Undersecretary of Defense For Policy James Miller, should exist outside the scope of the National Security Council.

During the Obama administration, White House cybersecurity adviser Michael Daniel seemingly played this so-called orchestra conductor role. Daniels job often involved managing the vast bureaucracy of government to further both defense and offensive missions.

McCain subsequently asked the panel of speakers to submit a list of recommended individuals for this position. It remains unclear if or when the Trump administration will fill Daniels vacant post, since he left the White House in January.

I am not convinced a mass reorganization is appropriate, certainly at this point in time. I look toward an integrating body, Miller explained.

He added, One option which I believe should be considered is to build out from the so-called CTIIC, or Cyber Threat Intelligence Integration Center [we should] look to build towards the National Counterterrorism Center model if not to the joint interagency task force model.

Founded in 2003 as part of the Office of the Director of National Intelligence, the McLean, Virginia-based National Counterterrorism Terrorism Center brings together specialists from several federal agencies, including the CIA, the FBI, and the Defense Department, to focus and synchronize interagency investigations into suspected terrorists.

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Former NSA director: It's time to trash the federal cybersecurity ... - CyberScoop

Posted in NSA

Ex-NSA head: Cybersecurity agencies don’t share enough … – The Hill – The Hill

A former leader of the National Security Agency (NSA) told lawmakers Thursday that government agencies working on cybersecurity are too stovepiped to safeguard the nation from digital threats.

Retired Gen. Keith Alexander said that the four groups handling cyber issues the Homeland Security and Defense departments, the FBI, and the intelligence community are too stovepiped, meaning they bottle up information instead of sharing it with one another and across the government.

Its not working, Alexander said of the governments organization on cybersecurity. There are four stovepipes and it doesnt make sense. If we were running this like a business, we would put them together.

Alexander suggested that all four groups be brought together under one cybersecurity framework in order to defend the countrys networks and critical infrastructure and respond to cyberattacks.

Before that, he argued, the agencies should participate in exercises with Congress, the Trump administration and the private sector to develop a policy and strategy on cybersecurity.

What you have is people acting independently, and with those seams, we will never defend this country, said Alexander, who now leads a private cybersecurity firm. He added that industry leaders are dismayed about how the government handles cybersecurity.

The senators also heard testimony from two members of the Defense Science Board, a group of roughly 50 retired armed service members, government and industry leaders who give the Pentagon advice on how to solve cybersecurity and technology problems.

Craig Fields, a former Pentagon technology chief, and James Miller, a former undersecretary of defense for policy, pushed back on the notion that the way that the government handles cybersecurity needs to undergo massive reorganization but agreed with Alexander on the need for more integration.

Im not convinced that a massive reorganization is appropriate, Miller said. Id be looking toward an integrating body.

When we talk to the individual agencies, they dont understand their responsibilities, he later observed.

Rewiring is not the solution, Fields, who chairs the Defense Science Board, explained. [That would be] too disruptive, but fundamental change in how it works, absolutely.

Alexander led the NSA and Cyber Command before his resignation in March 2014 amid controversy over Edward Snowden's leaks about the NSA's domestic spying. Current Director Mike Rogers succeeded him.

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Ex-NSA head: Cybersecurity agencies don't share enough ... - The Hill - The Hill

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National Storage Affiliates Trust’s (NSA) CEO Arlen Nordhagen on Q4 2016 Results – Earnings Call Transcript – Seeking Alpha

National Storage Affiliates Trust (NYSE:NSA)

Q4 2016 Earnings Conference Call

February 28, 2017 1:00 PM ET

Executives

Marti Dowling Director-Investor Relations

Arlen Nordhagen Chairman, President and Chief Executive Officer

Tamara Fischer Chief Financial Officer and Executive Vice President

Analysts

Vikram Malhotra Morgan Stanley

RJ Milligan Robert W. Baird

Todd Thomas KeyBanc

David Corak FBR

Ki Bin Kim SunTrust

Barry Oxford DA Davidson

Operator

Greetings and welcome to the National Storage Affiliates Fourth Quarter and Year End 2016 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Marti Dowling, Director of Investor Relations for National Storage Affiliates. Thank you. Miss Dowling, you may now begin.

Marti Dowling

Hello, everyone, we would like to thank you for joining us today for the fourth quarter and full year 2016 earnings conference call of National Storage Affiliates Trust. In addition to the press release distributed yesterday after market close, we have filed an 8-K with the SEC containing our supplemental package with additional details on our results, which may also be found in the Investor Relations section on our website at nationalstorageaffiliates.com.

On today's call management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties. The Company cautions that actual results may differ materially from those projected in any forward-looking statement. For additional detail concerning our forward-looking statements, please refer to our public filings with the SEC.

We encourage listeners to review the definitions and reconciliations of non-GAAP financial measures such as FFO, core FFO and net operating income contained in the supplemental information package available in the Investor Relations section on the companys website and in filings made with the SEC.

Today's conference call is hosted by National Storage Affiliates' Chief Executive Officer, Arlen Nordhagen; Chief Financial Officer, Tamara Fischer; and Senior Vice President of Operations, Steve Treadwell. Following prepared remarks management will accept questions from registered financial analysts. I will now turn the call over to Arlen.

Arlen Nordhagen

Thanks, Marti, and welcome, everyone, to our year-end 2016 earnings conference call. To begin 2016 was a very strong year for NSA on all fronts. We realized robust growth across virtually our entire portfolio driving strong increases in all our operating metrics. We grew same store portfolio average occupancy by 210 basis points, increasing average occupancy to 90% for the year.

Our average rent per square foot increased by 5.3% resulting in same store revenue and NOI increases of 7.7% and 10.2% respectively. It was another year of very strong acquisition growth further demonstrating the depth and quality of our pipeline and our unique ability to source and close accretive acquisitions through our PRO relationships.

During 2016, we acquired and invested in a total of 173 high quality assets primarily in our core growth markets representing total investment of over $1.3 billion including the addition of our seventh PRO hideaway in April and the acquisition of our 66th property, iStorage portfolio through a joint venture with the major state pension fund. As a result, we ended the year with a portfolio of 448 self storage properties located in 23 states.

In total, we have about 28 million rentable square feet, an increase of 75% from one year earlier and over 100% since our initial public offering. In 2016, we materially expanded and improved our balance sheet. We upsized our creditor facility to $725 million, closed on an additional $100 million term loan and issued over $500 million in new equity.

Our equity base grew through two well received common equity offerings issuances under our ATM program and through substantial issuance of new OP and SP equity for property acquisitions. The combination of these transactions maintains the capacity and flexibility we need to fund future growth opportunities.

As a result at the bottom line, we achieved core FFO of $1.12 per share for 2016, up 21.7% from 2015, which meaningfully exceeded our own guidance. In December, our Board announced a 9% increase in our quarterly common dividend to $0.24 per share. This was on top of the 10% increase we announced in May. And we continue to maintain significant AFFO coverage of our dividend payout.

And finally, I'm very pleased to announce that we have recently signed Marc Smith of Personal Mini storage in Orlando, Florida to become our 8th PRO. Through this transaction, Personal Mini is co-investing the SP equity to assume management of four of our recent third-party acquisitions in this market. And we will be having a 5th property to our portfolio very soon.

Beyond that Personal Mini operates a portfolio of over 30 properties, which we will look to acquire over the next several years in addition to other third-party acquisitions. Further Marc is very well known and respected as a major thought leader within the industry and has served on the board of directors of the National Self Storage Association for the last six years including as Chairman in 2016.

His reputation and relationships are a huge plus for us as we continue to recruit additional PROs to join our platform. It was truly an exceptional year for NSA and I'm enormously proud of the hard work, spirit and dedication of the entire NSA and PRO teams. Thank you to all.

Fundamentals in the self storage sector remain good and we remain optimistic about more normalized, but continued growth through 2017. We continue to experience stable demand across our portfolio, driven by positive economic fundamentals in nearly all our core markets including high employment rates and growing consumer spending. Although new supply is certainly creating some pressures in a few markets, such as Oklahoma, we believe this risk is generally concentrated and market specific and we still don't see new supply risk being elevated for NSA's portfolio on a national basis. There continues to be a lot of market chatter about starts but as for now we're not seeing plans translating into supply exceeding demand in a significant way in most of our primary markets.

I'd like to take a moment to update you on our key initiatives. Our portfolio is now operating near what we believe to be our optimum stabilized occupancy levels. So our initiatives to capture revenue upside from rent increases and other sources are vitally important. Our revenue management system is constantly evolving and is more active on our platform than ever.

At this time, virtually all of our properties are configured on the revenue management system. We're now evaluating implementation of new modules to enhance the current system and more effectively drive additional revenue.

In addition, we continue to make upgrades and improvements to our management information systems, our internet marketing platform and our call center operations to allow us to make better decisions and improve the results of our marketing spend.

Turning to the transaction front in the fourth quarter alone we acquired 31 wholly owned self-storage properties for a total investment of approximately 228 million dollars. These fourth quarter acquisitions encompass about 2.1 million rentable square feet with more than 16,600 storage units.

In addition the 66 iStorage joint venture properties added over 4.5 million rentable square feet and over 35,000 storage units to NSA's platform. Our pro network is a key element to our continued ability to grow. First through, our captive pipeline, which includes properties that are PROs manage but NSA does not yet own. Today with the addition of Personal Mini, The captive pipeline consists of over 120 properties and over 8 million square feet, valued at nearly a billion dollars.

Our second channel is third party acquisitions where our PROs act as our boots on the ground. They are market focused and have local knowledge and relationships, which lead to substantial third party off market acquisitions. In total over the last two years through our captive and third party pipelines and our joint venture, we've acquired over 230 properties adding over 15 million rentable square feet.

Equally important this growth has both expanded our geographic reach and deepened our presence within our existing markets providing enhanced local marketing and efficiency gains. Our third channel of growth is adding new PROs and we're always in discussions with a number of high quality operators.

As I mentioned, we're extremely pleased that we've added our eighth PRO Personal Mini Storage to join NSA this month. We are clearly-off to a great start in 2017 and we look forward to working with Marc Smith and his team to continue to grow NSA. We are very proud of NSAs accomplishments to-date, which demonstrate our unique opportunities for continued growth both internally and externally, as well as our ability to deliver strong value for our shareholders.

With our joint venture acquisition, the addition of our eighth PRO, balance sheet flexibility and a healthy pipeline we're excited to continue executing on our stated growth initiatives in 2017. I'll now turn the call over to Tammy.

Tamara Fischer

Thank you Arlen, in my comments today, Ill review our fourth quarter and full-year 2016 results, update you on our balance sheet and liquidity and finally discuss our outlook for 2017, which was provided in detail in our earnings release issued yesterday.

Beginning with our financial results for the fourth quarter 2016, we reported net income of $6.1 million, compared to $5.4 million in the fourth quarter of 2015. And core FFO of $20 million or $0.30 per share an increase of 25% on a per share basis compared to Q4 2015.

For the full-year 2016 our net income was $24.9 million compared to $4.8 million in 2015 and our core FFO was $65.5 million or $1.12 per share, an increase of 21.7% compared to $0.92 per share reported in 2015. The increase in core FFO for both the quarter and the year was due to strong growth within the same store portfolio. As well as our robust acquisition activity in 2016 partially offset by higher financing costs, G&A and an increase of the fully diluted share count.

Turning to our operations for the fourth quarter 2016, we reported a 9.2% increase in same-store NOI compared to Q4 2015. Same store revenue was up 6.3% driven by a 6.7% increase in average rent per square foot, slightly offset by a 30 basis point decrease in average occupancy to 89.1%.

One impact we are seeing of our new revenue management system is that it results in pushing rental rates further. Even if that results in slight occupancy decreases property operating expense increased only a 0.5% compared to the prior year, which was in line with our expectations.

For the full-year 2016 our same-store NOI increased 10.2% compared to 2015. Same-store revenue was up 7.7% driven by a 5.3% increase in average rent per square foot and a 210 basis point increase in average occupancy to 90%. Property operating expenses increased 2.9% year-over-year, again in line with our expectations.

We continue to benefit from our geographically diverse portfolio that is concentrated in states with the above average population and job growth.

Our stores located in Oregon, California, Georgia and Arizona, which represent more than half of our 2016 same-store NOI, continued to outperform, each delivering double-digit same-store NOI growth in 2016. We continued to see softness in the fourth quarter in Oklahoma and West Texas, which has been impacted by both the energy sector and new supply coming online. And our stores in Washington State were impacted in the fourth quarter, by higher property taxes, timing of repair and maintenance projects and increased advertising spend. While we have selectively used increased discounting in promotions to support occupancy gains in some markets, we continue to benefit from a roll up in rental rates for move in versus move out, driven in part by our revenue management system.

We also delivered double-digit growth in tenant insurance revenues during 2016 as our penetration rates continue to grow through high rates of adoption among our new customers, ending the year at over 55% penetration across our portfolio. As we discussed, in October we formed a joint venture with the major state pension fund to acquire the iStorage portfolio. And as they invested roughly $80 million for a 25% ownership stake and the joint venture put in place $320 million of mortgage financing. The investment was immediately accretive to core FFO per share and we expect to generate approximately $7 million to $8 million per year in gross fee income before incremental G&A expense of approximately $3.5 million, allowing us to leverage our total G&A spend.

Our balance sheet remains a strong point for NSA. During 2016 and into the first quarter 2017 we actively worked to expand our capacity and retain financial liquidity and flexibility. During the fourth quarter, we completed our second follow-on equity offering issuing nearly 5.2 million common shares and raising net proceeds of $105 million. We use the proceeds of the offering to pay down our revolving line of credit.

Also in the fourth quarter, we launched an ATM program adding yet another source of capital to enhance our balance sheet and fund growth. During the fourth quarter, we issued approximately 1.7 million shares under the ATM, raising net proceeds of about $34 million and leaving about $165 million of liquidity under the program. In addition we issued over $16 million of OP and SP equity in the fourth quarter to fund acquisitions completed during the quarter.

At year end, our total consolidated debt outstanding was about $873 million of which about 72% was fixed-rate mortgage financing or fixed with swaps. Our weighted average effective interest rate was about 3% and our weighted average maturity was 5.2 years. We have almost no debt maturing before 2020.

Subsequent to year end we completed an expansion of our credit facility, which increased our borrowing capacity by yet another $170 million, resulting in total capacity under our credit facility today of $895 million. As part of this expansion we increased our five-year term loan by $10 million dollars, our six-year term loan by $55 million and added a $105 million seven-year term loan tranche.

We expanded capacity on our revolver from $350 million to $400 million last December. As we have consistently demonstrated, we remain disciplined on the capital front, ensuring a strong and flexible balance sheet to support our growth strategy.

Turning to our guidance, we recognize that 2017 may be a year of transition for the industry with more new supply coming on line, making it a bit more challenging to forecast. While we have not yet seen a material slowdown in our property performance, we are cognizant of the fact that new supply may impact NSA more significantly later in the year. For that reason, we have built into our guidance somewhat lower growth expectations, compared to 2016.

As we announced last evening, we expect 2017 core FFO to be in the range of $1.22 zero to a $1.29 nine per share. Our guidance is based on several factors, including anticipated same-store NOI growth of 6% to 8%, driven by expected revenue growth of 5% to 7% and expense growth of 3% to 4%. As a note, our same-store portfolio in 2017 will include 277 properties. Expected acquisitions in a range of $200 million to $500 million, full-year corporate G&A cash expense including all iStorage G&A is expected to be in the range of 9.5% to 10.5% of revenue, excluding the iStorage property revenue. Plus another 1% to 1.5% in non-cash comp expense.

To put these numbers in context if we included the iStorage property revenue in the total revenue denominator, our total cash plus non-cash G&A and would be 9% to 10% of total revenues as we continue to leverage our G&A capacity.

This concludes our prepared remarks. With that we will now take your questions. Operator?

Question-and-Answer Session

Operator

Thank you we will not be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of Vikram Malhotra with Morgan Stanley, please go ahead with your questions.

Vikram Malhotra

Thank you. Two quick questions, so one, can you maybe just give us a little bit more color on when you talk about supply and not really seeing impacts but you're baking in some impact towards a second half. How are you the sort of the new supply coming online, whats your expectation in terms of how it will impact occupancy, rent growth and how are you factoring that into the guidance?

Arlen Nordhagen

Hi Vikram, this is Arlen. So yes we monitor of course all of our properties on a regular basis to look at where do we see new supply potentially coming in online over the next 12 to 18 months. And particularly as it relates to properties that have some exposure to new supply this year about 12% of our portfolio has the potential that by the end of the year some new supply will be within their trade area.

And so our forecast in our budgeting for this year reflects the fact that we expect those new stores to come online, which will obviously create some additional pressure on discounting some impact on occupancy and therefore slower revenue growth in the few cases even revenue being flat. But generally we reflect that based upon those forecasted openings as the time that they're expected to come into the market.

Vikram Malhotra

Okay, that's helpful. And just to clarify the revenue growth expectation for 2017, the five to seven, can you break that, Arlen between occupancy and rate growth?

Arlen Nordhagen

Yes, we are pretty close to what we would consider optimal occupancy based on the way the revenue management program is directing us to push harder on rate, we might gain another 50 basis points for average occupancy for this year or something like that but we're really forecasting almost all of that to be rate growth.

Vikram Malhotra

All of that to be rate, okay and then just last one to clarify on the supply comment. Just based on what you're seeing and talking to other PROs. Will we peak supply is 2017 sort of the year where we see peak supply your comments around the second half. And just maybe how much lead time are sort of what you need to see to get a sense of how supply would could potentially look like in 2018?

Arlen Nordhagen

Yes. It looks like late 2017 will probably be the peak additions of new supply. Now we do have some visibility into supply coming into 2018 obviously. But we're also starting to see some of the developers canceling projects as they reevaluate the market and they recognize wait a minute, there's too much supply here already on the pipeline. So we are actually starting to see some of that. So I do think late 2017 maybe early 2018 will probably be the peak of when supply additions peak in the overall total National market.

Vikram Malhotra

Okay. Thank you very much.

Arlen Nordhagen

Thanks, Vikram.

Operator

Thank you. Our next question is come from the line of RJ Milligan with Robert W. Baird. Please go ahead with your question.

RJ Milligan

Hey, good afternoon guys. Arlen, I was wondering if you could give some guidance in terms of your expected external growth this year $350 million at the midpoint, can you give us an idea of what buckets those are coming from whether itd be another PRO, within your captive pipeline or just one-off growth?

Arlen Nordhagen

Yes, thanks RJ. We have as I mentioned we have our captive pipeline now is almost $1 billion. And as we look at that of what's maturing in 2017 for debt maturities about 20% of that will be maturing in 2017, now we never project that well get all of that because obviously the decision makers on that are not always are PROs and such. But we know sizable portion of that growth will come through the captive pipeline this year. We also do expect a sizable number of third-party acquisitions, we already have closed on some this year. And we have a number of ongoing discussions underway as well. We as you know we added Marc Smith in Personal Mini as our new PRO, we dont anticipate very much new properties coming from the Personal Mini this year.

But we will have at least one or two acquisitions on that area as well. And then if we ended with another new PRO in late this year that would be more to put as toward the high end of the guidance. But otherwise it's primarily just what we know right now plus the captive pipeline in the third-party acquisitions.

RJ Milligan

Okay. And then Tammy, I wanted to talk about the same-store definition. So does same-store for 2017 include everything that was acquired in 2015?

Tamara Fischer

Its all the stores that we owned for all of 2016.

RJ Milligan

Is it fair to assume, given that you guys have acquired a significant amount in 2016. I think $1.3 billion as you bring those on to your platform and continue to lease those up or maximize revenue in those properties. Could we expect in I guess an added benefit in 2018 same-stores NOIs those properties are brought into the system in the same-store pool?

Arlen Nordhagen

Yes, RJ. This is Arlen. I would say that weve definitely seen that. Particularly as we acquire new properties the first two years of that we see outsized growth. So 2017 obviously, we don't they're not in our 2017 pool but in 2018 we'll see some continuation on that. To be honest, wed like to be able to continue to accelerate the platform adoption programs to try and get those benefits as quickly as possible. But historically, we've seen substantial gains in both year one and year two.

RJ Milligan

So on average the acquisitions in 2015 will be a greater contributor to same-store NOI growth in 2017 versus the legacy portfolio?

Arlen Nordhagen

Yes, that's true. It's probably about a percent or so higher than the legacy portfolio.

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National Storage Affiliates Trust's (NSA) CEO Arlen Nordhagen on Q4 2016 Results - Earnings Call Transcript - Seeking Alpha

Posted in NSA

Trump’s attacks on the NSA are actively harming morale, report … – BGR


BGR
Trump's attacks on the NSA are actively harming morale, report ...
BGR
The intelligence community has come under fire from newly sworn-in President Donald Trump for what he perceives to be attacks on his own credibility. Now ...
US Spy Agency Risks Talent Exodus Amid Morale Slump and Trump ...Jakarta Globe

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Trump's attacks on the NSA are actively harming morale, report ... - BGR

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US Congress to NSA: How many Americans do you illegally spy on? – The Register

If there is one piece of information that would fatally undermine the NSA's argument that it doesn't abuse Section 702 of the Foreign Intelligence Surveillance Act (FISA), it would be the number of American citizens whose personal information it has "incidentally" hoovered up.

And that is why it refuses to provide the figure.

There were two House Judiciary Committee meetings in Congress yesterday over the reauthorization of Section 702 in December. The first was held in secret with members of the security services; the second in public with panelists.

We don't know what happened in the first but in the second, a number of Congressmen made it plain that the NSA had failed to provide an estimate for the number of American citizens it has data on despite the committee asking for it 11 months ago in a formal letter.

John Conyers (D-MI), the lead Democrat on the committee, noted that the lawmakers had repeatedly asked for the estimate but "the intelligence community has not so much as responded to our December letter" a letter that asked for no more than an update on how long it would take to arrive at an estimate.

The intelligence community continues to argue it is difficult to tell the nationality of someone making a call or sending an email without a huge amount of effort or without violating their privacy.

That claim "seems like baloney to me," said Jim Jordan (R-OH), adding: "It's the greatest intelligence service on the planet. You'd think they'd be able to know that."

The truth is that the NSA cannot disclose the true figure if it wishes to retain its extraordinarily broad surveillance powers powers that it has interpreted to include tapping the internet's backbone and big tech companies' server farms.

Section 702 repeatedly and explicitly notes that it only provides authority to gather information on non-US citizens and events occurring outside of the United States. And yet, incredibly, the security services have layered misinterpretation of the law on top of misinterpretation in order to authorize themselves to tap into US companies' systems based in the US.

The moment the scale of the domestic spying this has enabled is laid bare, the NSA's obtuse claim of "incidental" and "accidental" gathering of data on US citizens will be shown to be the faade it is. Which is why it won't release the figure.

In a political climate where up is down and down is up, where the attorney general can answer an explicit question with a No and then claim he was asked a different question when that turns out not to be true, it is perhaps not surprising that some of the other answers asked at the hearing stretched reality to the breaking point.

One of the panelists, assistant professor at the US Naval Academy Jeff Kosseff, argued that the Fourth Amendment (no unreasonable search without a warrant) did not apply to Section 702 because it covered "foreign intelligence."

That is despite the fact that the Snowden documents showed particularly through the PRISM system that the security services were spying on domestic telecommunications.

Equally mind-boggling was the claim by former NSA attorney April Doss, now a partner at Saul Ewing LLP, that Section 702 was only used for "targeted surveillance." While that is certainly the intent of the law, the reality is the opposite we know, again from the Snowden documents, that vast quantities of data are pulled into government databases, retained, and then searched.

Doss also repeated the NSA argument that trying to estimate how many Americans had been included in the broad sweep of communications would lead to a greater intrusion into their privacy.

You suspect that the argument that Congressmen shouldn't consider anything in the Snowden documents because they were leaked illegally is rolling around the back of their heads just waiting to slip out.

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US Congress to NSA: How many Americans do you illegally spy on? - The Register

Posted in NSA

Fmr. NSA Director: Trump’s Military Spending Increase is Needed … – Fox Business

During an interview with Neil Cavuto on the FOX Business Network, former NSA Director Gen. Keith Alexander addressed the recent controversy involving Attorney General Jeff Sessions and allegations he communicated with Russian diplomats during the presidential election, despite stating that he didnt during his confirmation hearing before Congress.

Well, I think the facts are what we need and I think jumping to the conclusion that the Attorney General did something wrong is a big jump, General Alexander said.

He went on to add that he doesnt believe Sessions intended to mislead or do anything wrong.

In a statement to Fox News, the Attorney General denied the accusations, I never met with any Russian officials to discuss issues of the campaign. I have no idea what this allegation is about. It is false," he wrote.

Alexander also noted that the presidents promise to rebuild the military and to increase defense spending by $54 billion is a good thing.

I have tremendous confidence in Secretary Mattis. He is a good person. He will take the money needed; he will come back with a great plan and help get us the military that we need.

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Alexander went on to add that taking care of those who would give their life for this nation is the right thing to do.

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Fmr. NSA Director: Trump's Military Spending Increase is Needed ... - Fox Business

Posted in NSA

Trump’s immigration order and how the Ninth got it wrong – The Keystone Newspaper


The Keystone Newspaper
Trump's immigration order and how the Ninth got it wrong
The Keystone Newspaper
The opinion asserted that under the Fifth Amendment Due Process Clause, the executive order violated the rights of legal residents, citizens and immigrants who wish to return to the United States and travel from the United States. The government, in ...

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Trump's immigration order and how the Ninth got it wrong - The Keystone Newspaper

EFF: Data Collected From Utility Smart Meters Should Be Protected By The Fourth Amendment – Techdirt

For years, electric utilities have increasingly embraced smart meters. Roughly 65 million of the devices have been installed in the United States over the last few years, with 57 million of them in consumer homes. The meters provide innumerable benefits to utility companies, often delivering an ocean of new remote access and monitoring tools to better manage the network and reduce meter reading truck rolls. The benefits to consumers (outside of accuracy) have been less notable, including interference with some home routers, as well as the fact that a number of models have been shown to be relatively easily hacked.

In addition to hackability, the sheer volume of data being gobbed up by utility companies tells an awful lot about you (when you wake, when you sleep, when you're home or away). This has, at times, sparked outrage from locals in places like Naperville, Illinois, where, since 2011, meter opponents have been fighting the intrusive nature of the devices:

"...Opponents say the meters provide so much information that everyone from cops to criminals to marketing departments can learn when people are home and what they do when they're there. Last year, the anti-meter movement fell just short of collecting enough signatures to place a question on the ballot asking residents to decide whether the devices should be removed. They also have a pending federal lawsuit against the city alleging that their constitutional right to due process has been violated."

That was 2013. In 2015, the city of Naperville was forced to settle with one smart meter opponent after she sued the city and four of its police officers for violating her constitutional rights. That same year, another man sued the city over what he claimed was an unwarranted search into his home. But last fall, a federal district court in Illinois declared that Americans can't reasonably expect any privacy in the data collected by these devices, and utility collection of it is completely beyond the protection of the Fourth Amendment.

That case is currently on appeal to the United States Court of Appeals for the Seventh Circuit. And the EFF and Privacy International have asked the Seventh Circuit if they can weigh in on the case. In a blog post, the EFF points out that the court's decision was based on a misunderstanding of how the technology actually works. Basically, the court assumed that these new meters work in exactly the same way as their older counterparts, ignoring the significantly-expanded data collected:

"The court was convinced that data collected from smart meters is no different from data collected from analog meters, in terms of what it reveals about whats going on inside the home. But thats simply not the case. Smart meters not only produce far more data than analog metersthose set at collecting data in 15-minute intervals produce 2,880 meter readings per month compared to just one monthly reading for analog metersbut the data is also far more intimate. A single monthly read of cumulative household energy use does not reveal how energy is being used throughout the course of a day. But smart meter data does. And its time granularity tells a story about what is going on inside the home for anyone who wishes to read it."

As we've seen with cellular location data, once companies collect this information, it's often sold to any number of third parties who may be using this data in ways that aren't always in your best interests. But as Tim Cushing has occassionally noted, getting companies to be forthcoming about what they're collecting and who they may be selling it to is sometimes difficult, with at least one company suing to thwart transparency efforts on the subject in Seattle. And as Glyn Moody has also noted, this collision between privacy rights and utility data collection on the smart meter front isn't just an American phenomenon.

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EFF: Data Collected From Utility Smart Meters Should Be Protected By The Fourth Amendment - Techdirt

Florida Supreme Court Rules the Second Amendment Doesn’t Protect Open Carry – Slate Magazine (blog)

Open carry in action.

Erich Schlegel/Getty Images

On Thursday, the Florida Supreme Court upheld a state law prohibiting the open carry of firearms in public, ruling that the Second Amendment does not protect the practice. The decision is yet another legal setback in gun advocates recent struggle to persuade the courts to strike down a wide range of firearms restrictions as unconstitutional. Like many other state and federal courts throughout the country, the Florida Supreme Court concluded that the Second Amendment cannot be read to bar states from regulating the manner in which firearms are kept and used.

Mark Joseph Stern is a writer for Slate. He covers the law and LGBTQ issues.

As the court noted at the outset, virtually any adult who has no physical impairment or felony record can carry a gun in public in Florida. The weapon, however, must be concealed. After getting arrested and charged for openly carrying a .38 caliber handgun while walking alongside U.S. Highway 1, Dale Lee Norman challenged this concealment requirement, arguing that the Second Amendment protects the right to openly carry firearms. He insisted that the Supreme Courts decisions in D.C. v. Heller and McDonald v. Chicago, which created an individual right to keep a handgun in the home for self-defense, also grant him the right to walk around in public with his firearm in plain view.

To evaluate Normans claim, the court used the analysis deployed by virtually every federal circuit court to consider Second Amendment challenges. First, it asked whether the law burdens conduct protected by the Second Amendment based on a historical understanding of [its] scope, or whether it falls into a historically unprotected category of prohibitions. The court found that the law did not fall into a historically unprotected category and instead implicated the central component of the Second Amendmentthe right to self-defense.

The court then asked whether the open carry ban was so close to the core of this right as to prevent people from defending themselves. (Such laws, it asserted, are unconstitutional under Heller and McDonald.) Because Florida law regulates only how firearms are borne in public and still permits concealed carry as well as home defense, the court held that the open carry ban does not severely burden the right to self-defense.

Thus, the court found that the Florida law was not presumptively constitutional, and instead subjected it to intermediate scrutiny, asking whether it was substantially related to an important governmental objective. From there, the court easily concluded that the law passed constitutional muster. The states interest ensuring public safety by reducing firearm-related crime, the court wrote, is undoubtedly critically important. And the open carry ban substantially relates to this purpose because it helps to prevent deranged persons and criminals from grabbing an openly carried firearm and using it for malign purposes.

To my mind, this analysis is weak, as it overstates the scope of the Second Amendment from the start. The courts answer to the threshold questionwhether the open carry ban burdens historically protected Second Amendment conductis incorrect. There is no deeply rooted history of permissive open carry laws in the United States, and open carry bans should therefore be presumed to be constitutional. The dissenters, who believe open carry laws do have historical support, cite two antebellum state supreme court decisions affirming the right to openly carry in public. But as the majority noted, quoting an influential law review article, [t]he notion of a strong tradition of a right to carry outside of the home rests on a set of historical myths and a highly selective reading of the evidence. The only persuasive evidence for a strong tradition of permissive open carry is limited to the slave South.

Thats a critical caveat, because the tradition that supposedly establishes historical precedent for open carry was, in fact, part of the Southern slavery regime. White Southerners openly carried weapons to subdue, threaten, and punish rebellious or insubordinate slaves, and the law protected their right to do so as part of a legal system designed to suppress nonwhites. Obviously, this regime no longer exists; it was abolished by the 13th and 14th amendments. And in 2010s McDonald decision, the Supreme Court explained that the Reconstruction Congress wrote the 14th Amendment with the intent to apply the Second Amendment against the statesin an effort to protect newly freed slaves right to self-defense against violent white Southerners. It thus stands to reason that pre-14th Amendment case law meant to safeguard the subjugation of slaves has no place in the analysis of modern state gun regulations.

Had the Florida Supreme Court simply found, as a threshold matter, that the states open carry ban did not burden historically protected Second Amendment conduct, it couldve ended its inquiry there. Holding as much wouldve spared the majority from having to engage in a rather unconvincing intermediate scrutiny review. As the U.S. Court of Appeals for the 4th Circuit recently noted, firearm restrictions that fall outside historical protections for the right to bear arms are presumptively constitutional. Open carry has no firm tradition in our legal history, outside of two antebellum decisions designed to perpetuate the slave regime; that should be enough to justify the legality of open carry bans.

Still, in spite of these flaws, Thursdays decision is undoubtedly a major defeat for gun rights activists. It arrives just weeks after a 4th Circuit decision holding that the Second Amendment does not protect assault weapons, and less than a year after the 9th Circuit found that there is no constitutional right to concealed carry, either. (That practice, too, has been widely banned since the nations founding.) Because the Supreme Court clearly has little appetite to expand Heller and McDonald, these decisions will probably stand as the last word on the subject for now. And gun safety advocates can rest easy knowing that whatever few legislative achievements they can eke out in this political environment are unlikely to be toppled by the judiciary.

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Florida Supreme Court Rules the Second Amendment Doesn't Protect Open Carry - Slate Magazine (blog)

In appeal, Lamar calls banner First Amendment right; Pittsburgh … – Tribune-Review

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In appeal, Lamar calls banner First Amendment right; Pittsburgh ... - Tribune-Review

Letter to the editor: 1st Amendment applies to govt – The Bakersfield Californian

I know the paper supplies the headline, but the headline of a Feb. 16 letter, First Amendment only applies to Americans, seems to be an adequate re-statement of the letters point. That point is wrong.

The First Amendment doesnt give anyone rights except as the result of the fact that it forbids the U.S. government from doing certain things; specifically, it provides in part that Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof Congress cant make such law whether it affects Americans or anyone else. It is a limitation on what we want our government to be able to do.

The Constitution was written at a time when European events had demonstrated clearly that getting governments involved in religion had horrible consequences the Thirty Years War, the Inquisition, the English Civil War, etc. Our Forefathers believed in freedom of conscience, freedom of thought, and freedom of speech from government interference. So do I.

Of course the U.S. Constitution cant guarantee the right of a person in another country to believe as he or she chooses, but neither can our government establish one religion or another as the basis for granting or denying immigration or visits. We told it "No!" in the First Amendment.

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Letter to the editor: 1st Amendment applies to govt - The Bakersfield Californian

Rally Round The First Amendment – TV News Check

Speaking at the NAB's State Leadership Conference Tuesday, Senate Minority Whip Dick Durbin (Ill.) went after President Trump and his administration for their "unprecedented series" of attacks on the news media attacks thatculminated Feb. 17 with a tweetfrom the commander in chief calling "FAKE NEWS media" namely theNew York Times, NBC, CBS, ABC and CNN the "enemy of the American people."

"Turning reporters into enemies not just adversaries, but enemies is a strategy that strongmen use to silence critics and maintain power," Durbin said after cataloging the Trump assaults. "Their goal is to discredit the messenger. That way, when there is bad news, or news that contradicts the official line, people wont believe it.

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"Soon enough, people start to lose faith ... not just in the media, but in all of the institutions that hold a society together. They lose faith in the power of debate and elections to change anything. They become cynical and apathetic."

Well said.

The attacks have provoked a predictable public response from the targeted news media. Bring it on, they say. We are simply going to continue to do what we have always done, provide a check on the government by throwing as much light on its doings as we possibly can.

Rather than intimidate the media, the attacks have energized them and engendered waves of public support that can be clearly measured in "Trump bumps"to Nielsen ratings and paid subscriptions.

At the same time, the Trump thumps have provided an impetus for the news media to rally and redouble their collective efforts to preserve and perhaps expand their First Amendment rights. There is nothing like a hostile outside force in forging solidarity among the beleaguered.

On Jan. 17, representatives of more than 50 news organizations met at the Newseum in Washington to plota common strategy for strengthening news media. It was organized by the Reporters Committee for the Freedom of the Press and the American Society of News Editors and hosted by the Democracy Fund.

The journalists, lawyers and other media advocates discussed legal and legislative ways to insure access to government offices and information, protect whistle blowers from government retribution, protect themselves from frivolous libel suits and protect reporters from government harassment.

They also talked about the need to restore trust in the news media and floated ideas about how to do it.

I am happy to report that broadcasters were well represented at the "summit" by the Radio Television Digital News Association in the persons of Executive Director Mike Cavender and General Counsel Kathleen Kirby of the Wiley Rein law firm.

Cavender tells me to expect a full report from the organizers in the next week or two.

Whatever strategy emerges from the summit is just so much talk unless it wins the financial backing of newspapers, the national news networks and, yes, TV station groups. Legal defense funds, legislative initiatives and appeals to the public cost money.

It should go without saying that broadcasters need to support fully the RTDNA. In addition andCavender may hate me for saying this but broadcasters should also consider supporting other worthy organizations like Investigative Reporters and Editors.

I've been arguing that stations should eschew on-air commentary, especially on hot partisan issues, figuring that there is enough opinion out there and that it will only serve to undermine trust in stations' reporting. If a station's commentary is perceived as consistently liberal or conservative, its reporting may be dismissed as such.

However, I'm making an exception to that rule: the First Amendment. Stations should take to the air to defend freedom of speech and the press and argue for expansion of its rights and protections be that access to the dashcam video at the local police station or a federal shield law for whistle blowers.

A CBS affiliate should not allow the president to get away with saying that CBS News is "an enemy of the people." Ditto for NBC and ABC affiliates.

Stations must be careful not to preach or talk down to their viewers. That's how the national media alienated Trump voters. Stations need to listen to their viewers and win them over by convincing them that their interests are aligned, that press freedoms are ultimately their freedoms.

And it would be good to hear from the heads of the station groups, the ones who are always saying what swell jobs they do producing news and serving the public interest.

They can speak out in op-eds and in speeches before civic groups and at universities. They can direct the executives of the NAB and state broadcast associations to do the same.

I fully understand that the No. 1 job and responsibility of the station group executives is to make money, and so they have to be mindful of what they say. They have big issues pending before Congress and the FCC, notably ownership deregulation, the repack and ATSC 3.0. Criticizing the administration is not the way to get your way in Washington.

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Rally Round The First Amendment - TV News Check

13 reasons not to use Chrome – Techworld Australia

OK, were kidding a bit. Chrome is great. Google did a wonderful job with itand continues improving it every day. The marketplace recognizes this, and many surveys show Chrome is the most popular browser by far.

Its not hard to see why. Chrome is stable, in part because its architects made a smart decision to put each web page in a separate process. It has excellent HTML5 standards support, loads of extensions, synchronization across computers, and tight integration with Googles cloud services. All of these reasons and more make Chrome the popular choice.

But Chrome isnt perfect, and its not the only bundle of bits that can fetch a URL. There are plenty of other good options, and you should explore them for all of these 13 reasons and maybe a few more.

Opera was one of the first to stick its own servers in the path between your browser and the larger web. Adding a middleman might slow down some things in life, but not here. Opera designed its Turbo system to cache web pages and compress all of the data into smaller chunks of data. This saves your mobile data and helps the page download faster. Thats why a number of the other browsers offer similar features. Chrome users, for instance, can install the Data Saver extension.

Benchmarks are fickle and dont always represent real browsing performance, but theyre better than nothing. When DigitalTrends pushed seven browsers through three different sets of benchmarks (JetStream, Octane, and Kraken), Chrome didnt win once. It came close occasionally, but Edge, Opera, and Vivaldi are the three main browsers that finished ahead of Chrome, at least on some tests.

Batteries have a finite amount of power. Opera has a feature that lets you use less power by shutting down the activity in background tabs and other corners out of sight. It also turns off eye-catching but functionally worthless animation. All of this adds up. In Operas own tests, it found its browser lasted 35 percent longer than Chrome when visiting the same pages. That translated into an hour of extra browsing on the test machine.

Mac users should check out Safari too. One test reported by the Cult of Mac showed a MacBook lasting 35 percent longer when it ran Safari instead of Chrome.

Security testing group NSS Labs tried out Chrome, Edge, and Firefox for resistance to phishing attempts by trying to load dangerous URLs and measuring when and if the browsers blocked them. Edge blocked the most URLs over time (93 percent vs. 86 percent for Chrome and 85 percent for Firefox) and did it faster (with a total response time of 0.4 hour vs. 1 hour for Chrome and 1.4 hours for Firefox). The tests lasted 12 days in October 2016 and included 991 malicious URLs. Your malicious clicks may vary, but its clear that Microsoft is serious about building a safer browser.

The same NSS Labs report also contained results from tests of the browsers success in stopping social engineering malware, a general term that includes bad software distributed through links that are often sent through hijacked email accounts. NSS Labs began with more than 220,000 URLs and found 5,224 bad URLs. Edge blocked 99.3 percent, while Chrome blocked 95.7 percent and Firefox 81.9 percent.

Operas Turbo services dont simply speed up the web. They can offer privacy and protection too. If you want to enable a VPN, Opera has one built in and ready to go. You dont need to install extensions or subscribe to services. The VPN is ready to protect you whenever youre on public Wi-Fi networks.

Web developers logging the adoption of HTML5 standards have long relied upon HTML5Test scores to track how the browsers are embracing and implementing some of the new ideas, tags, and features. For the longest time, Chrome has received the best scores (507 on my current Chromebox) for offering the most complete set of HTML5 features. But how important are these features? Is a high score better than a not-so-high score? Does any normal human notice the difference?

Safari gets a score of only 380, one of the lowest of the major browsers. Why? It loses points for not implementing many of the new HTML5 form inputs that are customized for collecting special data types like dates or colors. But most pages implement their own date picker anyway. How many people choose a color with a webpage? Most decent web pages that ask for a color have a picker implemented already. Its hard to dwell too much on the FOMO (fear of missing out). But Safari also lacks support for items like a Gamepad controller and offers no way to use new peer-to-peer features like WebRTC. How many times have you noticed? How many times have you said, Gosh, I wish I could hook up a game controller to my Mac and browse the web?

Firefox, Edge, and some of the other browsers are closer to Chromes high score, but its hard to get too upset about what theyre missing. One day well want our browser to implement a native color picker to select a new hue via WebRTC, but until then well be fine without many of the slickest new HTML5 features.

The Tor Browser is a modified version of Firefox that sends your requests bouncing through the Tor network, an encrypted swamp that hides the connection between you and the website. It makes using the Tor network so much easier.

The Epic browser deploys a number of privacy-enhancing features, including blocking the web trackers employed by advertising companies. The developers worked hard to give you more control over the data thats stored and the data thats hidden. You have power over cookies, cache, and the historyif you choose to use it. Power is wonderful, especially over personal data.

These are only two of the more extreme options. The regular browsers like Opera and Firefox also protect their users. Even Chrome can be reconfigured to turn off some of the tracking that Google uses to deliver its services. But as you might expect, Google likes Chrome to support its core business built upon tracking what we do on the web.

Its hard to find the right metaphor for Operas experimental Neon, a new concept browser that melds the web with your desktop and arranges your bookmarks and tabs like objects in space. A built-in physics engine makes these objects bounce, snap, and pop like real objects when you drag or push them. Are you diving into the web? Floating in outer space with web pages? Its a gimmick, perhaps, but they said that about the web itself.

Operas Neon offers a nice feature called snap to gallery, a clever wormhole that lets you grab an image and store it to your disk. Neon also keeps the URL in case you want to return. Its not only saving the IMG SRC, but nurturing the beginning of an image sharing ecology. A picture is more than a collection of pixels.

Apple loves to connect the software in its universe, and Safari is the star in the center of that cosmos. Bookmarks and passwords are a few items synced with iCloud. If youre the type that buys Apple underwear, it makes sense to use Safari for everything too.

Firefox began life long ago as Mozilla, the core of Netscape, the (almost) original browser. The company was one of the first big players to embrace opening up its source code, and it remains one of the leaders of the movement. Using Firefox on your desktop or phone supports the open code base.

Between Google Chrome, Google Wi-Fi, Google DNS, Google Domains, Google Cloud Platform, Chromebooks, and the Pixel, your HTTP request could go from your fingers to the server and back to your eyes through Google Glass lenses on your face without leaving Googles silo. If you love Google, thats not a bad development. But if you believe the rhetoric about competition, monopolies, and an open internet, it has to leave you a bit worried. Using another browser brings ad revenue to another company and keeps the competition alive.

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13 reasons not to use Chrome - Techworld Australia

Dash Becomes Third-Most Valuable Cryptocurrency Based On … – The Dash Times (blog)

The past 48 hours have proven to be quite intriguing for anyone involved in the Dash cryptocurrency. With prices spiking to a new all-time high yesterday afternoon, things got off to a good start. Albeit Dash has seen a small correction ever since, the price per individual coin still hovers around the US$46 mark. Dash is now the third-most valuable cryptocurrency in existence.

People who have been holding onto their Dash for some time were more than happy to see the recent price increase take form. With the value increasing by 450% over the past few days, it is evident the demand for privacy-centric altcoins is bigger than ever before. Dash has been around for several years now, yet never saw such a spectacular price increase up until the past two days.

All of this positive momentum has catapulted Dash to the third rank on Coinmarketcap. To put this into perspective, Dash is now the third-biggest cryptocurrency based on their market cap. At the price of US$46.09 per coin, the total market cap sits at US$328,782 million. That is quite an impressive feat and it allowed Dash to bypass Ripple, which has been the third-largest market cap for quite some time. Dash is still a long way removed from overtaking Ethereum, though, as there is a US$1.5bn gap between the two right now.

It is difficult to explain why the Dash price saw such an impressive price surge all of a sudden. There has been positive news, as Dash has been officially integrated into point-of-sale devices. In doing so, the manufacturers of these devices aim to make cryptocurrency payments more accessible to merchants and more common among consumers all over the world. That news alone would not propel Dash to the third spot on Coinmarketcap, though. It is evident some of the cryptocurrency traders and speculators had a role to play in all of this as well.

One Reddit user explained how the parabolic rise of Dash can be attributed to the Poloniex exchange. On this cryptocurrency exchange platform, users can lend out their Dash balance as a way to generate passive interest once the money is repaid. Using leverage to margin trade has been one of the primary reasons why Poloniex became the number one altcoin exchange in the world today. Users borrow cryptocurrencies from others and bet on which way the market will evolve.

Considering Dash saw a bullish trend, a lot of traders aimed to borrow funds to open long positions on the Dash price. However, some people were betting the Dash price would crash and opened short position, which requires a Dash balance to do so in the first place. With the demand to borrow Dash on the rise a lot of people expected a price crash the number of bitcoin flowing into the market exploded exponentially. It was impossible to open shorts due to lack of Dash, hence the bullish price trend could be maintained without problems.

With shorts no longer being able to match the longs opened on Dash, it was evident something had to give sooner or later. Shorters were forced to buy back into bitcoin at a loss, causing a short squeeze for Dash. A lot of people made good profit and suffered big losses as a result of this unexpected price movement. This is only part of the reason why the Dash price shot up, but it goes to show there was a lot momentum caused by speculators and traders. It is good to see someone explaining the situation in this manner, that much is certain.

In the end, the price momentum for Dahs has somewhat kept its flow going. A lot of people expected a retrace to US$20 per coin or less, yet that has not happened yet. Instead, the price has seemingly found a stable floor for now. Dash remains the third-most valuable cryptocurrency, which will not change anytime soon by the look of things. Whether or not this trend can be turned into long-term momentum for Dash, remains to be seen.

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Dash Becomes Third-Most Valuable Cryptocurrency Based On ... - The Dash Times (blog)

Column: Is the boom of bitcoin a bubble that’s about to burst? – PBS NewsHour

Making Sen$e columnist Vikram Mansharamani assesses whether the recent digital currencys boom is bubble about to bust. Photo by George Frey/Getty Images

The rapidly rising price ofbitcoinis leading many to question if the digital currencys boom is about to bust.Strategist Peter Schiff, for instance, recently warned todays bitcoin could be tomorrows beanie babies. As of this writing, bitcoin is up almost 30 percent in the past month and over 100 percent in the past year.It has been hitting new highs on an almost daily basis and recently crossed the $1,200 mark.So is there a bitcoin bubble about to burst?

As of this writing, bitcoin is up almost 30 percent in the past month and over 100 percent in the past year So is there a bitcoin bubble about to burst?

To try to answer this question, lets apply the framework for spotting bubbles that I articulated in my 2011 book,Boombustology: Spotting Financial Bubbles Before They Burst.The approach is based on the application of five lenses and generates a probabilistic assessment of a forthcoming bust.

Most mainstream economic theories utilize a supply and demand driven price determination model that generally results in pricestendingtoward equilibrium.I say tending because most serious scholars admit that behavioral and informational issues can distort the price at any one point in time, but there exists an overarching belief that such distortions are rapidly ironed out.Markets are, according to this view, basically efficient.Higher prices dampen demand, and lower prices disincentivize supply.

But what if thats not true?What if higher prices increase demand?Such a dynamic might arise for many reasons, but one eloquent explanation is the Theory of Reflexivity, as proposed by George Soros.Although it has many subtleties beyond the self-fulfilling logic that many ascribe to it, the underlying implication is that prices can and do tendawayfrom equilibrium.The result: booms and busts.

READ MORE: In the age of the Panama Papers, is Bitcoin technology the future?

So has the higher bitcoin price been accompanied by higher demand?Its unclear.The evidence is mixed.On the one hand, it sure seems that as news about and interest in bitcoin rises, so does its price. Its been seen as a safe-haven asset during times of elevated geopolitical, financial or regulatory riskand may even attract price-insensitivebuyers at those times.But on the other hand,the volume of trading has not gone up as prices have.And while volume is at best a crude proxy for demand, it tells us about the general activity level.Lens one: half-check.

Another telltale sign of a bubble is the presence of significant leverage supporting lofty prices.And while its unclear if bitcoin prices are bubbly or not, I dont see any evidence that leverage is fueling the potentially elevated prices. There are no futures contracts that enable large exposures with minimal collateral. There are no options that providede factoleverage.Sure, some investors may be utilizing other collateral to secure credit that is in turn used to buy bitcoin, but this is impossible to track.

Another telltale sign of a bubble is the presence of significant leverage supporting lofty prices.

But more importantly, perhaps, we can look at the amount of debt that has been holding up many of the countries that back traditional fiat currencies. (Hint: its not a small number!)In addition, the fact that printing presses around the world continue to print more and more money implies that traditional currencies are being debased at an alarming rate.With a fixed algorithmic release of additional bitcoins into the market and a cap on the total number that will ultimately be issued, the cryptocurrency represents a non-printable currency (similar in this respect to gold).Lens two: blank.

Overconfidence and new-era thinking are the hallmarks of my third lens, psychology. Whenever individuals develop a devout belief that its different this time, buyers beware.It is rarely different, and asset prices have never risen indefinitely.Rather, they generally go up and down, and in this regard, bitcoin prices are no different.

Its also clear that there is increasing agreement that cryptocurrencies are the new new thing and offer the promise of freedom from authoritarian manipulation of monetary instruments.Even investorPeter Thiel noted the promise of bitcoinby highlighting his own failure: Paypal had these goals of starting a new currency.We failed at that, and we just created a new payment system.I think bitcoin has succeeded on the level of new currency.

And like gold bugs, bitcoin believers tend to exhibit religious conviction in the cryptocurrencys ability to store value.They often go further, suggesting the amazing upside potential they exhibit.Internet analyst Henry Blodget has even suggestedbitcoins could be worth $1 millionper coin.In fact,CNBCs Brian Kelly described bitcoin asnot just digital gold it is a once-in-a-generation investment opportunity, similar to the internet, growing just as fast, if not faster its the internet of money.Lens three: check.

My fourth lens is politics, broadly defined to include both regulations and moral hazards.As with any asset, regulations can distort prices by either artificially increasing or dampening supply or demand.

Just think of what happened when political motivations to increase home ownership in the United States nudged more and more people into houses.Without the political incentives, prices may not have risen as handsomely as they did during the housing bubble.Further, the moral hazard endemic in the use of government sponsored mortgage finance enabled lenders to play a game of heads I win, tails you lose.If loans worked out, the lender profited.If it didnt, Fannie Mae or Freddie Mac bore the losses.

When it comes to bitcoin, are there any artificial government interventions that are supporting bitcoin prices?No.On the contrary, regulators are trying to discourage interest in bitcoin.Just look to China, where itsmajor bitcoin exchanges were effectively shut down last month by government officials.Butas noted by Elaine Ou inBloomberg View, even China cant kill bitcoin.Bitcoin prices briefly fell upon the news, but quickly recovered and marched higher.Theyre up more than 25 percent in the three weeks since China tried to control trading.

And when it comes to moral hazard, there are no signs of it in bitcoin land.No one bailed out those who lost millions whenbitcoin exchange Mt. Gox filed for bankruptcy.No regulator prevented or intervened to managethe governance disputes that arose on the bitcoin algorithm.Many bitcoin market participants are transacting with open eyes, fully aware of the risks of doing so.There is no FDIC protection, no Federal Reserve put.Lens four: blank.

Kolin Burges, a self-styled cryptocurrency trader and former software engineer who came from London, holds a placard to protest against Mt. Gox. Tokyo-based Mt. Gox was a founding member and one of the three elected industry representatives on the board of the Bitcoin Foundation. Photo by Toru Hanai/Reuters

An application of epidemic logic to the study of financial bubbles can help gauge the relative maturity of manias.If we analogize an investment hysteria to a fever or flu spreading through a population, the variables of concern to us would include the infection rate, the removal rate, and perhaps most importantly, the percentage of the population not (yet) affected.The last metric can be thought of as the fuel available to keep the fire burning.Once we run out of people to infect, so to say, the partys over.New demand will disappear.Prices will fall.

When it comes to bitcoin, the number of potential buyers (that is, those still vulnerable to infection) is very large indeed.To begin, its not particularly easy to buy bitcoin, and thats deterred institutional investors.Specialized exchanges, online wallets and the need to protect private keys create huge friction in transactions, keeping many potential bitcoin buyers away.There isnt an ETF, at least not yet.Stay tuned, however, asan ETF is in the works.And if approved (well know more later this month), theWall Street Journalnotesit might generate a buying frenzy with up to $300 million of inflows during the first week alone, a volume that dwarfs the currently traded daily value of any bitcoin exchange.

READ MORE: Alleged Bitcoin creator comes forward, but questions remain

And with a current market capitalization of around $20 billion, the bitcoin market is miniscule relative to its potential.Consider that the value of privately held gold is in the trillions of dollarsor that the global remittances (a potential use for cryptocurrencies like bitcoin) currently tally into the hundreds of billions of dollars. The bottom line is that bitcoin just isnt as widely held or used as it could be.There is still an enormous population of potential buyers waiting on the sidelines.Andin a recent Twitter poll conducted by investor Mark Hart, only 22 percent of respondents indicated that they were Max Long bitcoin, with 49 percent Planning to buy/add or Curious.Lens 5: blank.

So on my five-point scale, with five being a virtually certain bubble likely to burst imminently, bitcoin only registers one and half points.On the margin, this means that the stage may be set for it to become a bubble, but it doesnt appear to be one yet.It may one day become a full-blown bubble with high bursting risk, but the evidence doesnt suggest were there yet.Recall that government attempts to contain bitcoin have failed, anointing the cryptocurrency with a forbidden fruit status and driving new demand.Or that the possibility of an ETF or other investment instrument may emerge to ease the frictions of purchasing bitcoin.

While short-term price corrections are always possible, there are compelling reasons to believe the long-term outlook for blockchain-enabled currencies like bitcoin is bright.

And the promise of smart contracts inspires visions of unprecedented demand for digital currencies. In fact, just yesterday, a collection of large companies including Microsoft and JP Morgan announcedthey would be forming the Enterprise Ethereum Alliance.Ethereum is a distributed computing platform based on blockchain technologies that features the ability to design smart contracts.The cryptocurrency native to Ethereum isether, and its beencalledthe hottest new thing in digital currency.As the standard-bearer for cryptocurrencies, bitcoin will benefit from any attention ether generates. (Full disclosure: I own both bitcoin and ether.)

While short-term price corrections are always possible, there are compelling reasons to believe the long-term outlook for blockchain-enabled currencies like bitcoin is bright.If youre looking for beanie babies, you best look elsewhere.

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Column: Is the boom of bitcoin a bubble that's about to burst? - PBS NewsHour

Bitcoin: Can RBI ignore the elephant in the room? – Economic Times

By Arnav Joshi

Virtual currencies like Bitcoin are all the rage in FinTech, and could potentially transform global commerce in the years ahead. Users are adopting them in the thousands each day and the value of trade in these currencies is witnessing unparalleled growth.

The world over, regulators are working out carefully-crafted regulations to foster Bitcoin growth. In India, however, even with the new cashless push by the government and existing Bitcoin trade spiking post-demonetisation, the Reserve Bank of India (RBI) continues to shy away from recognising and regulating virtual currencies.

On February 1, the RBI issued a yet another cautionary press release, on the back of an earlier one issued in December 2013, warning users of a risk they are likely to already be aware of -- that it (the RBI) does not regulate and has not licensed any virtual currencies in India, and anyone using them does so at their own risk.

A month later, on March 1, RBI Deputy Governor R. Gandhi raised concerns over virtual currencies, saying they pose potential financial, legal, customer protection and security-related risks.

While the central bank seems to be insulating itself from the repercussions of these currencies remaining unregulated, their use continues to grow exponentially across the world, including in India.

As of an August 2016 (pre-demonetisation) estimate, the number of Bitcoin (the most prominent of several virtual currencies) users in India stood at 50,000 and growing. India now also has a large number of prominent Bitcoin exchanges such as BTCXIndia, Coinsecure, Unocoin and Zebpay. Globally, by some estimates, Bitcoin users alone could breach five million by 2019.

The latest red flag from the RBI may well have been prompted by the recent surge in the price of Bitcoin on Indian Bitcoin exchanges post-demonetisation. Bitcoin is freely tradable currency, and has its own exchanges (including in India) where users can sign up and speculate, buy and sell Bitcoins for other currencies (such as the rupee).

After the cash ban, Bitcoin was quoted to be inflated 20-25 per cent over cost. As of March 2, Bitcoin was trading at Rs 90,000 to a single Bitcoin. In October 2016, this value was Rs 40,000 to a Bitcoin.

The question that arises then is how long can the RBI afford to adopt a hands-off approach to virtual currencies, when regulators elsewhere are adopting proactive measures?

The RBI's research wing, the Institute for Development & Research in Banking Technology, issued a white paper on the applications for blockchain technology in the banking and financial sectors in India in January 2017, which acknowledges the prominence of virtual currencies, but steers towards the underlying distributed ledger (blockchain) technology, rather than virtual currency regulation.

A large number of countries, not just in the West but in India's own neighbourhood, have either adopted or are close to adopting virtual currency regulation in some form. These include China, Russia, Singapore and the Philippines, which issued guidelines for virtual currency exchanges as recently as January.

Interestingly, the precursor to regulation in a number of these countries were warnings similar to those issued by the RBI. However, these warnings largely came around 2013, at a time when the understanding of the technology and the use of virtual currencies was much lesser than it is today.

In 2017, when users, trading and payments in these currencies are growing and maturing faster than ever, the warn-watch-wait approach simply will not work.

There are a number of downsides to not bringing in regulation when virtual currency use in India is still modest. Prominent among these is that regulation which kicks in when products and technologies have become systemic will invariably cause friction between regulators on the one hand, and businesses and users on the other, requiring stakeholders to make slow and possibly expensive changes to the way they transact.

Another issue is the key role regulation plays in consumer awareness and security. While the RBI may sleep soundly having issued its caveat emptor, given the attractive investment opportunity and ease of use and access virtual currencies offer, users are likely to throw caution to the wind and invest anyway.

The clear downside to this is that investors will likely fall prey to unregulated and unscrupulous Bitcoin exchanges and wallet operators (similar to a Paytm or Mobikwik, but exclusive to storing Bitcoin). Without any oversight, these operators rely on self-regulation. They could have severe gaps in data security, could charge exorbitant interest and transaction fees, and in a worst-case scenario, disappear with investor money altogether.

More importantly, the jury is still out on whether virtual currencies can be used to pseudonymously finance crime, including terrorism, and given the sensitive security scenario in India, it is important for the government to understand, and for the law to control, who can buy them and what they can do with them. As transactions grow, so will the chances and potential for virtual currency-related fraud.

Legal scholars Jack Goldsmith and Timothy Wu have said "government regulation works by cost and bother, not by hermetic seal", which appears to be the line the RBI is taking on virtual currencies.

With emerging technologies, however, especially those as radical as virtual currencies, governments are increasingly learning that the cost and bother of reactive regulation can be substantially greater than proactive regulation.

If the Indian government is serious about its cashless drive, it will have to consider virtual currencies as an integral part of the panacea being touted for our archaic economy.

It is up to the government and the RBI to lead the way by bringing forward-looking regulation for virtual currencies sooner rather than later, because there is already much catching-up to do.

The writer is a Senior Associate at J. Sagar Associates and advises internet and emerging technology clients. Views expressed are personal. He can be contacted at arnav.jo@gmail.com

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Bitcoin: Can RBI ignore the elephant in the room? - Economic Times