Trump gives ‘final warning’ on North Korea trade. What comes next?

The high-stakes standoff between the U.S., China and North Korea is heating up.

President Trump on Thursday gave the Treasury Department more power than ever to punish people and businesses who trade with North Korea. The big questions are how and when it will be used.

“They certainly have enough evidence to move forward with these kinds of sanctions,” said Anthony Ruggiero, a senior fellow at the Foundation for Defense of Democracies. “It looks like they were interested in providing one little final warning, especially to China.”

Trump has been pushing China to use its deep economic ties with North Korea to pressure Kim Jong Un’s regime to back down from developing nuclear weapons. China is estimated to account for roughly 90% of North Korea’s foreign trade, with money and goods flowing back and forth across a land border that runs for 880 miles.

On Friday, China announced it would limit its exports of refined petroleum products to North Korea beginning in October 1 to comply with U.N. resolutions.

The Chinese Ministry of Commerce said in a statement that exports of condensate oil, liquefied natural gas as well as textile imports from the North are currently prohibited.

Trump’s big ‘experiment’

Even though China has supported a series of tough U.N. resolutions this year targeting a growing portion of North Korea’s economy, many experts are skeptical that Chinese officials and companies are fully applying the sanctions.

That’s where the new powers Trump gave Treasury Secretary Steven Mnuchin come in. They enable him to cut off access to the U.S. financial system and freeze the assets of any company or individual doing business with North Korea, measures known as secondary sanctions.

Those are serious threats for major Chinese banks, which had $142 billion of assets in the U.S. at the end of March, according to the Federal Reserve. U.S. dollars are the lifeblood of the global financial system and banks operating internationally need easy access to them.

“We are about to run the most significant experiment in the use of secondary sanctions on North Korea to date, and perhaps the most significant such experiment with respect to any country ever,” wrote Stephan Haggard, a North Korea expert at the University of California, San Diego.

Alarm bells in banks

The executive order that Trump signed Thursday is likely to have set off alarm bells around the globe.

“Every single big bank in the world has sent or will be sending a memo to their compliance teams,” Haggard said. “Those teams in turn will be scrambling to figure out if they have any North Korea risk.”

But it’s uncertain exactly how Chinese banks will respond.

Earlier this month, China ordered its financial institutions to take a number of steps to comply with past U.N. resolutions, including halting business with sanctioned individuals and companies. And employees at some major Chinese banks told CNNMoney that they were no longer opening new accounts for any North Koreans.

Unprecedented pressure

Those measures did not go far enough for Trump.

The North Korean regime is believed to use a complex network of front companies to do business in China and other countries to dodge sanctions. Trump’s new order has put the onus on banks and other firms to find out whether the businesses they’re dealing with have any kind of North Korean connection.

Banks that may have previously looked the other way now have a strong incentive to pay close attention or risk severe punishment. If they all begin cutting off business with North Korea, the impact would be felt immediately.

“It’s something that the North Koreans have never really faced before,” said Ruggiero, a former official at the State and Treasury departments who specialized in financial sanctions and weapons proliferation issues.

Too big to sanction?

But the new U.S. measures still come with limitations.

Experts say cutting off a major Chinese bank from the U.S. financial system could have unforeseen consequences, such as a chain reaction of defaults that could ripple through the world’s second largest economy and beyond. Beijing, which has strongly opposed sanctions against its companies, could retaliate against U.S. interests.

Ruggiero said there are still less drastic measures available, such as slapping a big fine on a high-profile Chinese bank to deter others.

“I certainly don’t rule out that this administration could decide that a North Korean nuclear weapon on an ICBM is a big enough threat to overrule the concerns that [crippling sanctions on a big Chinese bank] could harm both economies and crack the trade relationship,” he said. “But…there are things that can be done before getting there.”

‘Parallel universe of banks’

Other factors could also blunt the effectiveness of the new U.S. measures.

There may be smaller Chinese banks and firms dealing with Kim’s regime that have little or no exposure to the U.S. financial system, Haggard said. North Korea is also believed to have an array of illicit revenue sources, such as cyberattacks, drugs and weapons.

“If the sanctions don’t have the anticipated effect, it could be because North Korea has a… parallel universe of banks and firms that simply are immune” to the executive order, Haggard wrote.

And other experts point out that North Korea’s nuclear weapons program has developed over decades, surviving periods of famine and economic crisis. Pyongyang can take a lot of pain.

— Stella Ko, Donna Borak, Yuli Yang and Serenitie Wang contributed to this report.

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Florida Keys’ homeless residents ask FEMA for mobile homes

While Key West plans to reopen its port to cruise ships Sunday, many residents in the Lower Keys are dealing with the reality of being homeless. 

The opening of the port is important, because the livelihood of many businesses depends on the regular arrival of cruise ship tourists. 

In Big Pine Key and Marathon, many were hoping to land pre-fabricated housing from the Federal Emergency Management Agency, but the industry was still struggling to meet the demand of Hurricane Harvey in Texas. 

The federal government auctioned off disaster-response trailers at fire-sale prices just before Harvey devastated southeast Texas, reducing an already diminished supply of mobile homes ahead of what could become the nation’s largest-ever housing mission.

More than 100 2017-model Federal Emergency Management Agency trailers were sold over the two days before the Category 4 hurricane landed in the Gulf Coast. The trailers were designated to be sold through Aug. 28, after floodwaters sent thousands of Texans onto rooftops and into shelters.

The auctions — about 300 since the beginning of the year — have left FEMA with a standing fleet of only 1,700 units. The agency has put out bids for another 4,500, but officials could not say when they would be ready to meet needs arising from Harvey, Irma and potentially future storms.

“There’s a vast chasm between what they can supply and what is actually needed,” said Dr. Irwin Redlener, director of the National Center for Disaster Preparedness at Columbia University, adding that he found the trailer auctions an “unfortunate decision.”

FEMA officials said that the units sold had all been used to house survivors of last year’s floods in Southern Louisiana, who returned them with damages that made them unfit for redeployment.

“The ones you will hear about being auctioned are the used models that we’ve determined it’s not cost-effective to refurbish. We’re very rigid and strict about what we’ll refurbish and it’s got to be something that quite frankly any one of us would be comfortable living in and willing to put our families into,” Byrne said.

Yet the 300 trailers sold on the Government Services Agency’s online auction since the beginning of the year 2017 were advertised either without problems, or with only minor damage, such as flat tires, buckling trim or missing furniture, GSA records showed. FEMA said trailers also go to the auction block because of leaks, roach infestations and odor left by cigarette smoke.

FEMA officials said the trailers it had recently ordered will cost the agency around $40,000 for a one-bedroom. By contrast, GSA sold a 2017-model trailer Aug. 23 with damage it described as normal wear and tear and low or flat tires for less than $5,000.

FEMA deployed 144,000 trailers after Hurricanes Katrina and Rita, but started selling off its stock in 2007 when the trailers became symbols of the troubled federal response after lawsuits accused some of those units of being riddled with high levels of cancer-causing formaldehyde.

Sales were halted after tests by the Centers for Disease Control in 2008 showed formaldehyde leaching from the trailers’ pressed-wood products. The auctions resumed after a court order was lifted in 2010, and Katrina-era units resurfaced on Native American reservations, in North Dakota’s oilfields and in Texas, following the Deepwater Horizon oil spill, according to Chemical Heritage Foundation fellow Nicholas Shapiro.

In 2011, FEMA announced that all of its trailers would be built with wood products that met emission standards set by the California Air Resources Board. Units rolled out in 2016 ranged in size from one to three bedrooms and were equipped with smoke detectors, fire sprinklers and central heating and air conditioning, with hookups for washing machines and cable TV.

FEMA has auctioned off trailers during disasters before.

As Superstorm Sandy churned up the Atlantic coast in 2012, dozens of trailers sat idle in a supermarket parking lot in Northeastern Pennsylvania, — about two hours from the New Jersey coast.

The trailers were deployed for a flood the previous year, but many went unused and instead wound up on the government auction block at a fraction of their original cost, landing on the resale market or being refurbished for personal use.

 

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Florida Keys’ homeless residents ask FEMA for mobile homes

While Key West plans to reopen its port to cruise ships Sunday, many residents in the Lower Keys are dealing with the reality of being homeless. 

The opening of the port is important, because the livelihood of many businesses depends on the regular arrival of cruise ship tourists. 

In Big Pine Key and Marathon, many were hoping to land pre-fabricated housing from the Federal Emergency Management Agency, but the industry was still struggling to meet the demand of Hurricane Harvey in Texas. 

The federal government auctioned off disaster-response trailers at fire-sale prices just before Harvey devastated southeast Texas, reducing an already diminished supply of mobile homes ahead of what could become the nation’s largest-ever housing mission.

More than 100 2017-model Federal Emergency Management Agency trailers were sold over the two days before the Category 4 hurricane landed in the Gulf Coast. The trailers were designated to be sold through Aug. 28, after floodwaters sent thousands of Texans onto rooftops and into shelters.

The auctions — about 300 since the beginning of the year — have left FEMA with a standing fleet of only 1,700 units. The agency has put out bids for another 4,500, but officials could not say when they would be ready to meet needs arising from Harvey, Irma and potentially future storms.

“There’s a vast chasm between what they can supply and what is actually needed,” said Dr. Irwin Redlener, director of the National Center for Disaster Preparedness at Columbia University, adding that he found the trailer auctions an “unfortunate decision.”

FEMA officials said that the units sold had all been used to house survivors of last year’s floods in Southern Louisiana, who returned them with damages that made them unfit for redeployment.

“The ones you will hear about being auctioned are the used models that we’ve determined it’s not cost-effective to refurbish. We’re very rigid and strict about what we’ll refurbish and it’s got to be something that quite frankly any one of us would be comfortable living in and willing to put our families into,” Byrne said.

Yet the 300 trailers sold on the Government Services Agency’s online auction since the beginning of the year 2017 were advertised either without problems, or with only minor damage, such as flat tires, buckling trim or missing furniture, GSA records showed. FEMA said trailers also go to the auction block because of leaks, roach infestations and odor left by cigarette smoke.

FEMA officials said the trailers it had recently ordered will cost the agency around $40,000 for a one-bedroom. By contrast, GSA sold a 2017-model trailer Aug. 23 with damage it described as normal wear and tear and low or flat tires for less than $5,000.

FEMA deployed 144,000 trailers after Hurricanes Katrina and Rita, but started selling off its stock in 2007 when the trailers became symbols of the troubled federal response after lawsuits accused some of those units of being riddled with high levels of cancer-causing formaldehyde.

Sales were halted after tests by the Centers for Disease Control in 2008 showed formaldehyde leaching from the trailers’ pressed-wood products. The auctions resumed after a court order was lifted in 2010, and Katrina-era units resurfaced on Native American reservations, in North Dakota’s oilfields and in Texas, following the Deepwater Horizon oil spill, according to Chemical Heritage Foundation fellow Nicholas Shapiro.

In 2011, FEMA announced that all of its trailers would be built with wood products that met emission standards set by the California Air Resources Board. Units rolled out in 2016 ranged in size from one to three bedrooms and were equipped with smoke detectors, fire sprinklers and central heating and air conditioning, with hookups for washing machines and cable TV.

FEMA has auctioned off trailers during disasters before.

As Superstorm Sandy churned up the Atlantic coast in 2012, dozens of trailers sat idle in a supermarket parking lot in Northeastern Pennsylvania, — about two hours from the New Jersey coast.

The trailers were deployed for a flood the previous year, but many went unused and instead wound up on the government auction block at a fraction of their original cost, landing on the resale market or being refurbished for personal use.

 

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Rick Shaw, voice of South Florida rock ‘n roll radio, dies

Before Spotify and iTunes, when vinyl ruled, Rick Shaw introduced South Florida to the Beatles. 

It was a Saturday afternoon in 1964. He played “I Want To Hold Your Hand” and about a minute into the song the phones at the WQAM 560AM studio just wouldn’t stop ringing. He would play that song for decades. 

Rick Shaw, a beloved radio disc jockey born Jim Hummel, died at home Friday morning. He was 78.

“My father was an amazing person down to the final moments,” Sean Hummel, his son, said. “He was my hero.”

Many South Florida families listened to him Rick Shaw for generations and considered him a hero too. 

“My parents when they were kids, they met in high school in North Miami, they used to listen to him on WQAM,” Fred Adler, 51, said. “My mom used to listen to him in the car radio. In the late 70s and 80s, I always used to listen to him when I had a car.  He was a warm kind person. He was like part of the family here in South Florida.”

Rick Shaw was a VJ before VJs existed. Long before YouTube and MTV played music videos, he ran the “Saturday Hop” music show on WLBW-TV Channel 10. 

His son said Shaw’s brush with broadcasting came by accident. In high school, Shaw was asked to fill in for the school’s radio show when the weather forecaster called out sick. The station manager was instantly drawn to Shaw’s inviting personality and unique voice.

Hummel started his career in St. Louis. After working for radio stations in Omaha and Denver, he moved to Miami to work with WCKR 610AM. He joined WQAM 560AM in 1963 and changed his name to Rick Shaw. 

David Scott said he gave him his first on-air job and mentored him over the years. 

“He allowed me creative freedom that few if any would tolerate today, but he encouraged it … He was so much more than a boss, a personality, a legend,” Scott said. “He was my champion, my friend.”

When FM stations began to overtake AM stations, WAXY-FM 106, later known as WAXY 105.9 and WBGG 105.9, hired him as program director. His last on-air job before retiring in 2007 was at WMXJ-FM “Majic 102.7”  He remained involved with the Majic Children’s Fund. 

“I am beyond devastated to learn of Rick Shaw passing away,” Rixys Alfonso wrote on Facebook. ” He was one of the cause movers who helped me get Devin Alvarez the medical treatment he needed when he was a toddler, which led to saving his life.”

Some of Rick Shaw’s friends were sharing his regular sign-off song — “Goodnight My Love” by Ray Peterson — on social media.

Remembering a local icon

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