• The Government's War On Free Speech: Protest Laws Undermine The First Amendment
  The Government’s War On Free Speech: Protest Laws Undermine The First Amendment

  Authored by John W. Whitehead & Nisha Whitehead via The Rutherford Institute,

  “If freedom of speech is taken away, then dumb and silent we may be led, like sheep to the slaughter.”— George Washington

  It’s a given that the government is corrupt, unaccountable, and has exceeded its authority.

  So what can we do about it?

  The first remedy involves speech (protest, assembly, speech, prayer, and publicity), and lots of it, in order to speak truth to power.

  The First Amendment, which is the cornerstone of the Bill of Rights, affirms the right of “we the people” to pray freely about our grievances regarding the government. We can gather together peacefully to protest those grievances. We can publicize those grievances. And we can express our displeasure (peacefully) in word and deed.

  Unfortunately, tyrants don’t like people who speak truth to power.

  

  The American Police State has shown itself to be particularly intolerant of free speech activities that challenge its authority, stand up to its power grabs, and force it to operate according to the rules of the Constitution.

  Cue the rise of protest laws, the police state’s go-to methods for muzzling discontent.

  These protest laws, some of which appear to encourage violence against peaceful protesters by providing immunity to individuals who drive their car into protesters impeding traffic and use preemptive deadly force against protesters who might be involved in a riot, take intolerance for speech with which one might disagree to a whole new level.

  Ever since the Capitol protests on Jan. 6, 2021, state legislatures have introduced a broad array of these laws aimed at criminalizing protest activities. Yet while the growing numbers of protest laws cropping up across the country are being marketed as necessary to protect private property, public roads or national security, they are a wolf in sheep’s clothing, a thinly disguised plot to discourage anyone from challenging government authority at the expense of our First Amendment rights.

  It doesn’t matter what the source of that discontent might be (police brutality, election outcomes, COVID-19 mandates, the environment, etc.): protest laws, free speech zones, bubble zones, trespass zones, anti-bullying legislation, zero tolerance policies, hate crime laws, etc., aim to muzzle every last one of us.

  However, as Human Rights Watch points out, these assaults on free speech are nothing new. “Various states have long-tried to curtail the right to protest. They do so by legislating wide definitions of what constitutes an ‘unlawful assembly’ or a ‘riot’ as well as increasing punishments. They also allow police to use catch-all public offenses, such as trespassing, obstructing traffic, or disrupting the peace, as a pretext for ordering dispersals, using force, and making arrests. Finally, they make it easier for corporations and others to bring lawsuits against protest organizers.”

  Make no mistake: while many of these laws claim to be in the interest of “public safety and limiting economic damage,” these legislative attempts to redefine and criminalize speech are a backdoor attempt to rewrite the Constitution and render the First Amendment’s robust safeguards null and void.

  For instance, there are at least 205 proposed laws being considered in 45 states that would curtail the right to peacefully assemble and protest by expanding the definition of rioting, heightening penalties for existing offenses, or creating new crimes associated with assembly.

  No matter how you package these laws, no matter how well-meaning they may sound, no matter how much you may disagree with the protesters or sympathize with the objects of the protest, these proposed laws are aimed at one thing only: discouraging dissent.

  In Alabama, lawmakers are pushing to allow individuals to use deadly force near a riot. Kentucky, Missouri and New Hampshire are also considering similar stand your ground laws to justify the use of lethal force in relation to riots.

  In Arizona, legislators want to classify protests involving seven or more people as felonies punishable by up to two years in jail. Under such a law, traditional, nonviolent forms of civil disobedience—sit-ins, boycotts and marches—would be illegal.

  In Arkansas, peaceful protesters who engage in civil disobedience by occupying any government property after being told to leave could face six months in jail and a $1000 fine.

  In Minnesota, where activists continue to protest the death of George Floyd, who was killed after police knelt on his neck for eight minutes, individuals who are found guilty of any kind of offense in connection with a peaceful protest could be denied a range of benefits, including food assistance, education loans and grants, and unemployment assistance.

  Oregon lawmakers wanted to “require public community colleges and universities to expel any student convicted of participating in a violent riot.” In Illinois, students who twice infringe the rights of others to engage in expressive activities could be suspended for at least a year.

  Proposed laws in at least 25 states, including Oklahoma, Mississippi, and Florida, would give drivers the green light to “accidentally” run over protesters who are preventing them from fleeing a riot. Washington wants to levy steeper penalties against protesters who “swarm” a vehicle, punishing them for a repeat offense with up to 40 years in prison and a $100,000 fine.

  Responding to protests over the Keystone Pipeline, South Dakota enabled its governor and sheriffs to prohibit gatherings of 20 or more people on public land if the gathering might damage the land. At least 15 other states have also adopted or are considering legislation that would levy harsher penalties for environmental protests near oil and gas pipelines.

  In Iowa, all it takes is for one person in a group of three of more people to use force or cause property damage, and the whole group can be punished with up to 5 years in prison and a $7,500 fine.

  Obstruct access to critical infrastructure in Mississippi and you could be facing a $10,000 fine and a seven-year prison sentence.

  A North Carolina law would have made it a crime to heckle state officials. Under this law, shouting at a former governor would constitute a crime.

  In Connecticut, you could be sentenced to five years behind bars and a $5,000 fine for disrupting the state legislature by making noise or using disturbing language.

  Indiana lawmakers wanted to authorize police to use “any means necessary” to breakup mass gatherings that block traffic. Lawmakers have since focused their efforts on expanding the definition of a “riot” and punishing anyone who wears a mask to a peaceful protest, even a medical mask, with 2.5 years in prison and a $10,000 fine.

  Georgia wants to ban all spontaneous, First Amendment-protected assemblies and deny anyone convicted of violating the ban from receiving state or local employment benefits.

  Virginia wants to subject protesters who engage in an “unlawful assembly” after “having been lawfully warned to disperse” with up to a year of jail time and a fine of up to $2,500.

  Missouri made it illegal for public employees to take part in strikes and picketing, only to have the law ruled unconstitutional in its entirety.

  Oklahoma created a sliding scale for protesters whose actions impact or impede critical infrastructure (including a telephone pole). The penalties range from $1,000 and six months in a county jail to $100,000 and up to 10 years in prison. And if you’re part of an organization, that fine goes as high as $1,000,000.

  Talk about intimidation tactics.

  Ask yourself: if there are already laws on the books in all of the states that address criminal or illegal behavior such as blocking public roadways, trespassing on private property or vandalizing property—because such laws are already on the books—then why does the government need to pass laws criminalizing activities that are already outlawed?

  What’s really going on here?

  No matter what the politicians might say, the government doesn’t care about our rights, our welfare or our safety.

  Every despotic measure used to control us and make us cower and comply with the government’s dictates has been packaged as being for our benefit, while in truth benefiting only those who stand to profit, financially or otherwise, from the government’s transformation of the citizenry into a criminal class.

  In this way, the government conspires to corrode our core freedoms purportedly for our own good but really for its own benefit.

  Remember, the USA Patriot Act didn’t make us safer. It simply turned American citizens into suspects and, in the process, gave rise to an entire industry—private and governmental—whose profit depends on its ability to undermine our Fourth Amendment rights.

  In much the same way that the Patriot Act was used as a front to advance the surveillance state, allowing the government to establish a far-reaching domestic spying program that turned every American citizen into a criminal suspect, the government’s anti-extremism program criminalizes otherwise lawful, nonviolent activities such as peaceful protesting.

  Clearly, freedom no longer means what it once did.

  This holds true whether you’re talking about the right to criticize the government in word or deed, the right to be free from government surveillance, the right to not have your person or your property subjected to warrantless searches by government agents, the right to due process, the right to be safe from soldiers invading your home, the right to be innocent until proven guilty and every other right that once reinforced the founders’ belief that this would be “a government of the people, by the people and for the people.”

  Not only do we no longer have dominion over our bodies, our families, our property and our lives, but the government continues to chip away at what few rights we still have to speak freely and think for ourselves.

  Yet the unspoken freedom enshrined in the First Amendment is the right to think freely and openly debate issues without being muzzled or treated like a criminal.

  In other words, if we no longer have the right to voice concerns about COVID-19 mandates, if we no longer have the right to tell a Census Worker to get off our property, if we no longer have the right to tell a police officer to get a search warrant before they dare to walk through our door, if we no longer have the right to stand in front of the Supreme Court wearing a protest sign or approach an elected representative to share our views, if we no longer have the right to protest unjust laws or government policies by voicing our opinions in public or on social media or before a legislative body—no matter how politically incorrect or socially unacceptable those views might be—then we do not have free speech.

  What we have instead is regulated, controlled speech, and that’s what those who founded America called tyranny.

  On paper, we may be technically free.

  In reality, however, we are only as free as a government official may allow.

  As the great George Carlin rightly observed: “Rights aren’t rights if someone can take them away. They’re privileges. That’s all we’ve ever had in this country, is a bill of temporary privileges. And if you read the news even badly, you know that every year the list gets shorter and shorter. Sooner or later, the people in this country are gonna realize the government … doesn’t care about you, or your children, or your rights, or your welfare or your safety… It’s interested in its own power. That’s the only thing. Keeping it and expanding it wherever possible.”

  In other words, we only think we live in a constitutional republic, governed by just laws created for our benefit.

  As I make clear in my book Battlefield America: The War on the American People, we live in a dictatorship disguised as a democracy where all that we own, all that we earn, all that we say and do—our very lives—depends on the benevolence of government agents and corporate shareholders for whom profit and power will always trump principle. And now the government is litigating and legislating its way into a new framework where the dictates of petty bureaucrats carry greater weight than the inalienable rights of the citizenry.

  Remember: if the government can control speech, it can control thought and, in turn, it can control the minds of the citizenry.

  Tyler Durden
  Wed, 03/10/2021 – 23:40

• Mexican President Says Biden Border Policies 'Encouraging Illegal Immigration' And Enriching Cartels
  Mexican President Says Biden Border Policies ‘Encouraging Illegal Immigration’ And Enriching Cartels

  Mexican President Andres Manuel Lopez Obrador says US President Joe Biden’s immigration policy is encouraging illegal immigration, and brings revenue to drug cartels through human trafficking operations at the US border.

  

  According to the Reuters, Mexico has asked the Biden administration to assist by providing developmental help to Central America, where tens of thousands of migrants embark on a journey through Mexico in the hopes of reaching the United States and gaining asylum.

  “They see him as the migrant president, and so many feel they’re going to reach the United States,” said AMLO (via Reuters) following a March 1 virtual meeting with Biden. “We need to work together to regulate the flow, because this business can’t be tackled from one day to the next.”

  Some of Biden’s policies that worry the Mexican government include a fast track to citizenship for migrants living in the US and support for gang violence victims.

  Internal assessments reviewed by Reuters — based on testimony and intelligence gathering — state that Mexican gangs have been growing their clientele and keeping tabs on US measures that would encourage migration. Additionally they have developed a new tracking system to move migrants across the US-Mexico border.

  One anonymous Mexican official told Reuters that cartels have been using sophisticated smuggling techniques “from the day Biden took office,” such as using technology to thwart authorities, making smuggling operations appear as travel agencies, and keeping migrants up to date on the latest immigration rules.

  “Migrants have become a commodity,” the official told Reuters. “But if a packet of drugs is lost in the sea, it’s gone. If migrants are lost, it’s human beings we’re talking about.”

  Tyler Durden
  Wed, 03/10/2021 – 23:20

• Biden Iran Envoy Boasted Of Depriving Civilians Of Food In Sadistic Sanctions Manual
  Biden Iran Envoy Boasted Of Depriving Civilians Of Food In Sadistic Sanctions Manual

  Authored by Max Blumenthal via TheGrayZone.com,

  The Joseph Biden administration has named Richard Nephew as its Deputy Iran Envoy. As the former Principal Deputy Coordinator of Sanctions Policy for Barack Obama’s State Department, Nephew took personal credit for depriving Iranians of food, sabotaging their automobile industry and driving up unemployment rates. He has described the destruction of Iran’s economy as “a tremendous success,” and lamented during a visit to Russia that food was still plentiful in the country’s capital despite mounting US sanctions.

  Nephew’s appointment to a senior diplomatic post suggests that rather than immediately returning to the JCPOA Iran nuclear deal, the Biden administration will finesse sanctions illegally imposed by Trump to pressure Iran into an onerous, reworked agreement that Tehran is unlikely to join.

  

  After coordinating Obama’s sanctions regime against Iran, Nephew left the administration for a position at the energy industry-funded Center on Global Energy Policy at Columbia University. There, he published a book outlining in blunt terms how he honed the craft of economic warfare and applied it against Iran.

  Entitled “The Art of Sanctions: A View From The Field,” the book’s cover image features two Caucasian hands drawing a rope for a noose, presumably to strangle some insufficiently pliant Global South government. Its contents read like a list of criminal confessions, detailing in chillingly clinical terms how the sanctions Nephew conceived from inside an air conditioned office in Washington immiserated average Iranians.

  With his candor, Nephew has shattered the official US rhetoric about “targeted sanctions” that exclusively punish “bad actors” and their business cronies while leaving civilian populations unharmed.

  The application of pain to a country’s civilian population is central to Nephew’s sanctions strategy. As he explains in “The Art of Sanctions,” for the unilateral coercive measures to succeed, they must impose significant pain to a state’s most vulnerable sectors, shatter the state’s political and social resolve, and ultimately force the state to cry uncle in the face of Washington’s demands.

  Nephew detailed how, as JCPOA negotiations got underway in January 2012, he led a process to reduce Iran’s oil revenue and starve its economy. After the administration successfully pushed for a wholesale reduction in oil exports and other unilateral coercive measures, Iran’s economy went from a period of growth to sudden and staggering contraction while the value of its currency tumbled. Nephew pronounced the economic assault he engineered to be “a tremendous success.”

  While discussing his book, “The Art of Sanctions,” @richardmnephew boasted with a wide grin that the economic warfare tactics he devised drove up unemployment rates in Iran.

  Nephew was just appointed as Biden’s deputy Iran envoy.

  My full story here: https://t.co/FWTYO7Ab4G pic.twitter.com/m5431czF8i

  — Max Blumenthal (@MaxBlumenthal) March 8, 2021

  https://platform.twitter.com/widgets.js

  Nephew also patted himself on the the back for tripling the price of chicken “during important Iranian holiday periods,” thereby “contribut[ing] to more popular frustration in one bank shot than years of financial restrictions.”

  Next, he boasted of more sanctions targeting civilians to prevent Iranians from obtaining the assistance they needed to repair their cars. “Iran’s manufacturing jobs and export revenue were the targets of this sanction,” Nephew wrote.

  There were some goods that Nephew wanted Iran to import, however. In hopes of fomenting social unrest, he said Washington “expanded the ability of US and foreign companies to sell Iranians technology used for personal communications” so they could “learn more about the dire straits of their country’s economy…”

  During a December 6, 2017 panel discussion about his book at Columbia University’s Center on Global Energy Policy, Nephew detailed with a chilling smile how he not only sabotaged Iran’s automotive industry, but targeted “things like unemployment, to try to drive that up and make things a little more sticky.”

  In response to online criticism, Nephew has claimed that “the main target” of the sanctions regime he designed was “the oligarchs.” But his book on “The Art of Sanctions” tells another story.

  Nephew fondly recalls how he structured sanctions to sabotage Iranian economic reforms that would have improved the purchasing power of average people. The Obama administration destroyed the economic prospects of Iran’s working class majority while ensuring that “only the wealthy or those in positions of power could take advantage of Iran’s continued connectedness,” he wrote. As “stories began to emerge from Iran of intensified income inequality and inflation,” Nephew pronounced another success.

  Vatan-e Emrooz highlights Richard Nephew’s appointment as deputy special envoy for Iran.
  The outlet highlights the fact that he was one of the designers of the Iran sanctions regime pic.twitter.com/vZHJlJIqU4

  — Omer Carmi (@CarmiOmer) March 2, 2021

  https://platform.twitter.com/widgets.js

  As he made clear, the rising inequality “was a choice” that Washington “made on the basis of helping to drive up the pressure on the Iranian economy from internal sources.” Nephew went on to claim credit for October 2012 protests brought on by the devaluation of Iran’s currency.

  In a fairly stunning admission, Nephew admits at one point that despite providing Iran with supposed humanitarian exceptions on US sanctions, the economic war he helped design caused a catastrophic shortage of medicine and medical devices, largely because average Iranians could not afford them.

  Despite acknowledging the heavy toll of human suffering brought on by the sanctions he personally conceived, suggesting they could have prompted high numbers of excess deaths, Nephew appears to be devoid of contrition. During a December 2016 trip to Moscow, he complained that despite the sanctions imposed on Russia by the US, food was still widely available at local restaurants – “hardly a level of pain” that was necessary to bring the Kremlin to heel.

  He called to “develop a strategy to carefully, methodically, and efficiently increase pain on those areas [of the Russian economy] that are vulnerabilities and avoid those that are not.”

  So who is Richard Nephew? Does he lurk in the shadow world of intelligence intrigues and spook wars, keeping a low profile while he waits to strike the enemy? Or is he a fire-breathing hardliner bellowing threats against America’s adversaries from Beltway think tank panels? The reality is much more banal.

  When he is not snatching chicken from Iranian kids during their winter holiday, Nephew is spending quality time with his own, amusing them with his tattered dad rock t-shirts and flashing arms adorned with tribal tattoos.

  In an administration filled with fun-loving, ethnically diverse characters who moonlight as rock guitarists, decorate the walls of their homes with Haitian art, bob their heads to Tupac and even enjoy an occasional toke, all while keeping the gears of a ferociously violent empire grinding along, the tattooed sanctions artist seems like a perfect fit.

  In Iran, where a leading daily recently portrayed Nephew as Keanu Reeves in The Devil’s Advocate, his elevation to a senior diplomatic role is seen as a sign of more pain to come.

  Tyler Durden
  Wed, 03/10/2021 – 23:00

• "Pure International Cybercrime": Putin Warns Against US 'Retaliation' For SolarWinds Hack
  “Pure International Cybercrime”: Putin Warns Against US ‘Retaliation’ For SolarWinds Hack

  Russian President Vladimir Putin has reacted fiercely to the contents of a report in the The New York Times this week that cited unnamed senior admin officials to say the White House is preparing a series of devastating cyberattacks on Russia as ‘retaliation’ for the SolarWinds hack.

  A spokesman for the Russian presidency, Dmitry Peskov, told reporters on Tuesday that the “alarming information” would constitute a “pure international cybercrime” and is thus condemned under international law.

  “The Russian state has never had anything to do with cybercrimes and cyberterrorism it is being accused of,” Peskov emphasized.

  

  Specifically addressing the NY Times report further, Peskov added, “the fact that the newspaper doesn’t rule out that the American state could be involved in cybercrime, is definitely of great concern to us.”

  Amazingly, the anonymous Biden admin officials revealed to the Times that a “series of clandestine actions across Russian networks” are expected to start within the next three weeks.

  The cyber-operations will by design seek to get Putin and Russian intelligence’s attention while being concealed from the broader public when it occurs, the NYT report said.

  Detailing the Kremlin’s condemnation and warning against any such cyber espionage, US News & World Report writes: 

  He spoke in response to a series of claims from U.S. officials, including Secretary of State Antony Blinken and FBI Director Christopher Wray, that they are considering harsh punishments on Russia for the attack, including overt sanctions and some form of covert salvos in the cyber realm. Wray hinted at the action in testimony before Congress this month, saying the U.S. was preparing cyber “joint sequenced operations.”

  Multiple US intelligence agencies had issued a rare joint statement in the wake of the SolarWinds intrusion, saying it was “likely” Russia behind it, though without offering evidence or specific intelligence verification of the allegation.

  Russian officials have demanded the US categorically rule out acts of ‘cyberterrorism’ against the country, after media reports said Washington was mulling digital “retaliation” for a colossal hack attack it blames on Moscow. Kremlin says it’s ‘alarmed’ https://t.co/hRpNadxCnx

  — Bryan MacDonald (@27khv) March 10, 2021

  https://platform.twitter.com/widgets.js

  However, it’s since been confirmed that SolarWinds has largely faulted its own severe security lapses, including the fact that an update server’s password was literally “solarwinds123” – which had been leaked by an employee online beginning years ago, according to prior Congressional testimony.

  Tyler Durden
  Wed, 03/10/2021 – 22:40

• Resurrecting The Dead… Digitally: One Step Closer To The "Singularity"
  Resurrecting The Dead… Digitally: One Step Closer To The “Singularity”

  Authored by Robert Wheeler via The Organic Prepper blog,

  In 2017, Microsoft revealed it had patented a “chatbot” that could digitally resurrect the dead if actually built.

  The chatbot uses AI and machine learning technology. Essentially, the chatbot would bring our “digital persona” back to life. Friends and relatives could then talk to our “digital persona.” When the media asked Microsoft about the technology, the companies’ representatives did admit that it was “disturbing” and claimed there were no plans to put it into production.

  Believe that if you will.

  

  Personal data? Check. Voice data? Check. Lifelike AI? Check.

  The technical tools and the personal data are already in place to make these digital resurrections possible. AI chatbots have already passed the “Turing Test,” which means that they have been able to fool other humans into thinking that they (the AI bots) are human.

  Globally, most people leave behind enough digital footprints to inform AI programs about their and our conversational idiosyncrasies. Even more convincing chatbots are just around the corner from being released.

  Microsoft’s version of the chatbot would use your electronic messages to create a digitally reincarnated version of you, in your likeness. It would use machine learning to respond to text messages like you would have done when you were alive. If you leave behind especially rich voice data, your vocal likeness could be created, giving your friends and relatives someone to speak with through a phone or even a humanoid robot.

  Chatbots are ALREADY harvesting your information for future use

  Microsoft isn’t alone. The AI company Eternime is also showing interest in AI-enabled chatbots and digital resurrection. Eternime has already built an AI-enabled chatbot that harvests information such as geolocation, activity, motion, Facebook data, and photos, which lets users create an avatar of themselves to live on after they die.

  Eternime’s chatbot ensures it’s just a matter of time before families can reanimate dead relatives using technologies such as these.

  Legalities? What legalities?

  Currently, there aren’t any laws that govern digital reincarnation.

  Researchers have taken a look at the legal question regarding chatbots and digital resurrection. In the absence of specific legislation, it’s unclear who might have the power to bring your digital personality back to life after death.

  Your right to data privacy is questionable in life, but it is far from certain after death. There also isn’t any way for you to opt-out of being digitally resurrected either. There is a lot of legal ambiguity, leaving room for private companies to make chatbots out of your personal data after you die.

  Others researching the emergence of chatbots are also concerned about the legalities. For instance, as The Conversation writes:

  If chatbots and holograms from beyond the grave are set to become commonplace, we’ll need to draw up new laws to govern them. After all, it looks like a violation of the right to privacy to digitally resurrect someone whose body lies beneath a tombstone reading “rest in peace.”

  National laws are inconsistent on how your data is used after your death. In the EU, the law on data privacy only protects the rights of the living. That leaves room for member states to decide how to protect the data of the dead. Some, such as Estonia, France, Italy and Latvia, have legislated on postmortem data. The UK’s data protection laws have not.

  Note: companies like Facebook and Google control much of our data.

  Trending: Reanimated photos of deceased people

  Digital resurrection is a growing trend in other areas as well. For instance, a recent article in The Sun drew attention to a new website that allows users to upload a deceased person’s picture. The online tool “reanimates” that person’s photo.

  As The Sun reports:

  AN EERIE new website lets you bring old photos to life with artificial intelligence.

  Deep Nostalgia is a tool that animates any human portrait photo you upload with the aim of making your family history come alive.

  “Ghost in the Shell” here we come!

  We are quickly heading toward a world like the one presented in The Matrix or Ghost in The Shell.

  In other words, a world where humans have been physically altered and linked with the internet. A world where a “single global consciousness” is linked to “cyberized” humans who have been fully merged into the digital world. The “Singularity” researchers warned of is now on the verge of being deployed against most of humanity.

  What’s the Singularity?

  While futurist Ray Kurzweil predicted 15 years ago that the singularity—the time when the abilities of a computer overtake the abilities of the human brain—will occur in about 2045, Gale and his co-authors believe this event may be much more imminent, especially with the advent of quantum computing…

  ….The authors don’t know when the singularity will come, but come it will. When this occurs, the end of the human race might very well be upon us, they say, citing a 2014 prediction by the late Stephen Hawking. According to Kurzweil, humans may then be fully replaced by AI, or by some hybrid of humans and machines. (source)

  It’s like science is torn between resurrecting us and making us live forever and ending humanity altogether with risky experiments.

  While it would be nice to have one more conversation with lost loved ones, would you actually use chatbots and reanimated photos to do it? Do you think it’s ethical?

  And what about the “Singularity?” Are you for or against the day we find ourselves unable to rely on our own minds? Do you believe the end of humanity will come when we are forced to collaborate with computers to solve life’s every day problems?

  Tyler Durden
  Wed, 03/10/2021 – 22:20

• Happy Days At The Gas Pump Are Over As Prices Soar 
  Happy Days At The Gas Pump Are Over As Prices Soar 

  When the virus pandemic first hit early last year, Americans were locked down in their homes as gasoline demand plunged and prices crashed. Last April, the nationwide average for gasoline was around $2. According to AAA, prices are surging nationwide, up 32 cents in the previous month to $2.796 for regular. 

  

  On Monday, regular gasoline in Los Angeles County rose for the 27th consecutive day and 47th time in 48 days, increasing to $3.81, the highest since Dec. 3, 2019. Average prices for crude products in the metro area have been on a tear, resulting in a price shock for many consumers who are still battling food and housing insecurities, along with job loss as they wait for the next round of stimulus checks. 

  AAA said average gasoline prices in Los Angeles had risen 46.5 cents in the past 48 days.

  Happy times at the pump are over as crude product prices continue to rise. 

  

  GasBuddy analyst Patrick DeHaan told Fox News that one reason for the jump in prices is due to increased demand. Still, more importantly, he said the Organization of the Petroleum Exporting Countries (OPEC) “is not opening the spigot.”

  Last week, OPEC leaders maintained production cuts for all countries except Russia and Khazakstan. The news caused West Texas Intermediate and Brent to surge. 

  OPEC’s decision last week inspired Goldman’s Damien Courvalin to raise his Brent forecast by $5/bbl, to $75/bbl in 2Q and $80/bbl in 3Q21: “This increase in our price forecast reflects stronger time spreads, with our updated inventory path consistent with $5/bbl additional backwardation over the next six months relative to our prior forecast.”

  

  … while this is excellent news for the energy industry, Wall Street, and value investors who’ve plowed into XOM, this is terrible news for consumers where more of their upcoming stimulus checks will go to not only energy costs but also food (as we recently noted, food inflation is off the hook). 

  

  Using the three-month rate of change – one starts to notice the latest surge in prices at the pump should be viewed as a “price shock.” How long until gasoline prices reverse? 

  

  So, where’s the breaking point for consumers already struggling with their finances because of the economic downturn. Now the working-poor, who don’t own assets, are getting crushed even harder in the “K-shaped” recovery as energy and food prices soar. 

  

  Is this Biden’s fault? Hard to say but stirring the pot in the Middle East, closing the Keystone Pipeline, discouraging investment in fossil fuels, and banning fracking on government land probably didn’t help supply (although seasonality and the Texas storm also impacted in the short-term, and of course OPEC+).

  Tyler Durden
  Wed, 03/10/2021 – 22:00

• U.S. Aircraft Carrier Deploys In Mediterranean As Damascus Prepares To Push On The Northwest
  U.S. Aircraft Carrier Deploys In Mediterranean As Damascus Prepares To Push On The Northwest

  Submitted by SouthFront,

  The USS Dwight D. Eisenhower aircraft carrier and its Carrier Strike Group have entered the Mediterranean Sea.

  This makes it, currently, the closest aircraft carrier to the Middle East. It has been quite a while since the US hasn’t had one of its super warships deployed in or near the Persian Gulf.

  Starting in the spring of 2019, the U.S. Navy has been publicly ordered to keep a near-constant presence in the region, as if this were something new.

  US Secretary of Defense Lloyd Austin announced that a global posture review is taking place, and it would be reconsidered whether a carrier was even needed in the region. Still, the Mediterranean Sea is quite nearby, and the removal of the Carrier Strike Group (CSG) from the Persian Gulf was a political move.

  It’s Lloyd Austin’s dream to have a CSG in every hotspot in the world, but resources don’t allow for that.

  Still, the US has the amphibious warship USS Makin Island (LHD-8) in the Persian Gulf with a detachment of F-35B fighter jets, so it still has a hefty presence. Further, it is without a doubt possible for the USS Dwight D. Eisenhower and its CSG to operate without issue in the Middle East, be it Syria, Iraq or elsewhere, from its current place of deployment.

  In Syria itself, as the primary US competitor, alongside Iran, Russian forces are preparing to set up a permanent military base near the city of Palmyra in the Badia Desert. This is not yet confirmed, but according to satellite photos it has a helipad as a runway.

  This base is likely planned to support the Syrian Arab Army (SAA) further in their push against both ISIS and Turkish proxies.

  On March 9th, the SAA carried out heavy shelling on the positions of Turkish proxies in the village of Jabal Al-Zawiya, in southern Idlib.

  Separately, Pro-Turkey opposition factions reportedly thwarted an attempt by the SAA to advance on the Qalaat front in the northern countryside of Latakia. Attacks are frequently repelled in Twitter posts, but nowhere else, demonstrating that the propaganda wing of the Turkish proxies is quite active.

  In the days leading up to this, the SAA has been preparing for a large push in the province of Aleppo.

  This is likely an attempt to form a uniform front, which can exert equal pressure along the frontline and thin the enemy’s forces to provide opportunity for a breach.

  Turkey and its proxies are sure to offer heavy resistance to any advance by the SAA, but so far it appears that this may not be enough.

  Tyler Durden
  Wed, 03/10/2021 – 21:40

• $500 Million LA Mega-Mansion Faces Default 
  $500 Million LA Mega-Mansion Faces Default 

  A famous LA mansion called “The One” that originally had a planned list price of approximately $500 million in 2017 now faces the threat of default, according to LA Times. 

  Movie producer turned real estate developer (of course) Nile Niami is delinquent on an $82.5 million construction loan from Hankey Capital for the 100,000-square-foot mega-mansion in Bel-Air. In the last three years, the property’s debt has surged to as high as $110 million. 

  

  Niami has had some bad luck over the last year. He sold an LA mansion called “Opus” that was once listed for $100 million for a 50% haircut during the virus pandemic. Perhaps the developer has fallen on hard times, or the super-luxury real estate market has stalled. Whatever the issues are, and why Niami can’t service his debt on The One comes at a precarious time for the real estate market as interest rates have violently risen over the past few months. 

  According to a document obtained by The Times, Hankey, the lender, who is well aware of market conditions, wants their money back and recently slapped Niami with a default notice. The developer has just 90 days to repay the loan or restructure the agreement in some way so that Hankey doesn’t force the sale of the home.

  “We felt the owner of ‘The One’ was distracted from the job at hand, which is to bring the biggest and best house in the United States to market for sale,” said Don Hankey, chairman of Hankey Investment Co.

  “We hope our actions will kick off the official listing.”

  Niami began constructing the 100,000-square-foot mega-mansion in 2013 as part of a speculative bet on the LA mansion market. But over the years, economic conditions have morphed from party to pandemic. Bets on housing in metro areas have gone sour in the recent year as people exit cities for rural communities. 

  “Default notices are nothing new for Niami,” said The Times. In 2020 alone, the developer received a default notice for $10 million on a property on 369 Londonderry Place in the Hollywood Hills, and one for a debt of $23.4 million on a mansion at 10701 Bellagio Road. 

  Maybe the speculative nature of Niami’s leveraged bets on the super-luxury real estate market is beginning to unravel. 

  Last summer, he posted a video on his Instagram account saying The One was a couple of months away from completion. 

  “Seven years ago, I had an idea to create the biggest, most expensive house in the urban world: The One Bel-Air. And I did it.”

  

  At the time, maybe Niami was attempting to appease Hankey in a sale of the property was nearing, but that never happened. Now the developer faces notice of default where the lender could force a sale in market conditions that may not be conducive for top dollar. 

  Tyler Durden
  Wed, 03/10/2021 – 21:20

• Escobar: Raging Twenties – Great Power Politics Meets Techno-Feudalism
  Escobar: Raging Twenties – Great Power Politics Meets Techno-Feudalism

  Authored by Pepe Escobar via The Strategic Culture Foundation,

  As a proposal to escape our excess hyper-reality show, this book does not offer recipes, but trails: multiple entryways and multiple possibilities.

  

  I have a new book out, Raging Twenties: Great Power Politics Meets Techno-Feudalism. For those who don’t use Amazon, here is a mini-guide on how to order and buy the book.

  The journey of a book finding its readers is always an idiosyncratic, mysterious and fascinating process. To set the scene, allow me a short presentation, drawn from the book’s introduction.

  The Raging Twenties started with a murder: a missile strike on Gen Soleimani at Baghdad airport on January 3. Almost simultaneously, that geopolitical lethality was amplified when a virus cannibalized virtually the whole planet.

  It’s as if Time has been standing still – or imploded – ever since. We cannot even begin to imagine the consequences of the anthropological rupture caused by SARS-CoV-2.

  Throughout the process, language has been metastasizing, yielding a whole new basket of concepts. Circuit breaker. Biosecurity. Negative feedback loops. State of exception. Necropolitics. New Brutalism. Hybrid Neofascism. New Viral Paradigm.

  This new terminology collates to the lineaments of a new regime, actually a hybrid mode of production: turbo-capitalism re-engineered as Rentier Capitalism 2.0, where Silicon Valley behemoths take the place of estates, and also The State. That is the “techno-feudal” option, as defined by economist Cedric Durand.

  Squeezed and intoxicated by information performing the role of a dominatrix, we have been presented with a new map of Dystopia, packaged as a “new normal”, featuring cognitive dissonance, a bio-security paradigm, the inevitability of virtual work, social distancing as a political program, info-surveillance, and triumphant Trans-humanism.

  A sanitary shock was superimposed over the ongoing economic shock – where financialization always takes precedence over the real economy.

  But then the glimpse of a rosy future was offered towards more “inclusive “capitalism, in the form of a Great Reset, designed by a tiny plutocratic oligarchy duly self-appointed as Saviors.

  All of these themes evolve along the 25 small chapters of this book, interacting with the larger geopolitical chessboard.

  SARS-CoV-2 accelerated what was already a swing of the power center of the world towards Asia.

  Since WWII, a great deal of the planet lived as cogs of a tributary system, with the Hegemon constantly transferring wealth and influence to itself – via what analyst Ray McGovern describes as SS (security state) enforcing the will of the MICIMATT (Military-Industrial-Congressional-Intelligence-Media-Academia-Think-Tank) complex.

  This world-system is irretrievably fading out – especially due to the interpolations of the Russia-China strategic partnership. And that’s the other overarching theme of this book.

  As a proposal to escape our excess hyper-reality show, this book does not offer recipes, but trails: configurations where there’s no masterplan, but multiple entryways and multiple possibilities.

  These trails are networked to the narrative of a possible, emerging new configuration, in the anchoring essay titled Eurasia, The Hegemon and the Three Sovereigns.

  In a running dialogue, you will have Michel Foucault talking to Lao Tzu, Marcus Aurelius talking to Vladimir Putin, philosophy talking to geoeconomics – all the while attempting to defuse the toxic interaction of the New Great Depression and variations of Cold War 2.0.

  With the exception of the anchoring essay, this is a series of columns, arranged chronologically, originally published on Asia Times/Hong Kong, Consortium News/Washington D.C., and Strategic Culture/Moscow, widely republished and translated across the Global South.

  They come from a global nomad. Since the mid 1990s I live and work between (mostly) East and West. With the exception of the first two months of 2020, I spent the bulk of the Raging Twenties in Asia, in Buddhist land.

  So you will feel that the scent of these words is inescapably Buddhist, but in many aspects even more Taoist and Confucianist. In Asia we learn that the Tao transcends everything as it provides serenity. There’s much we can learn from humanism stripped off metaphysics.

  2021 may be even fiercer than 2020. Yet nothing condemns us to be lost in a wilderness of mirrors while, as Pound wrote, a tawdry cheapness / shall reign throughout our days. The hidden “secret” of this book may be actually a yearning – that we’re able to muster our inner strength and choose a Taoist trail to ride the whale.

  *  *  *

  Pepe Escobar’s new book is Raging Twenties: Great Power Politics Meets Techno-Feudalism. Follow him on Telegram.

  Tyler Durden
  Wed, 03/10/2021 – 21:00

• Emails Reveal FBI Excavation For Civil War-Era Gold In Lawsuit Over "Hundreds Of Millions" In Disputed Booty
  Emails Reveal FBI Excavation For Civil War-Era Gold In Lawsuit Over “Hundreds Of Millions” In Disputed Booty

  Did the FBI make off with ‘seven to nine tons’ of Civil War-era gold in a Pennsylvania forest after a treasure hunting duo led them to its long-hidden location?

  A father-son team wants to know, and has successfully sued for access to government emails about the dig.

  

  Here’s what we know, according to the Associated Press. 

  On march 13, 2018, treasure hunters Dennis and Kem Parada, who co-own the treasure-hunting outfit Finders Keepers, led FBI agents to a location in “Dent’s Run,” located approximately 135 miles northeast of Pittsburgh.

  The Paradas had spent years looking for the long-lost booty, an 1863 shipment of Union gold, which was either lost or stolen on its way to the US Mint in Philadelphia.

  The FBI brought in geophysical consulting firm, Enviroscan, to survey the hilltop site, where their gravimeter identified ‘a large metallic mass with the density of gold,” according to Warren Getler, a consultant who worked closely with both the FBI and the Paradas.

  An FBI agent told them the location of the mass was “one or two feet off Denny’s sweet spot,” recalled Getler, author of “Rebel Gold,” a book exploring the possibility of buried Civil War-era caches of gold and silver. “Then I went to ask how big is it. And he said, ‘7 to 9 tons.’ And I literally said, ‘You’ve got to be kidding!’”

  That much gold would be worth hundreds of millions of dollars today — and, assuming it was there, would almost certainly touch off a legal fight over how to divvy up the spoils. -AP

  The FBI says they found nothing at the site, while Enviroscan co-founder Timothy Bechtel said the FBI told him to keep his mouth shut about his findings.

  

  The Paradas, meanwhile, say the FBI struck a deal to let them watch the site excavation – only to confine them to their car for most of the two-day dig, only to escort them to a “large, empty hole” at the end of the second day.

  The emails are quite revealing. In one, an assistant US attorney in Philadelphia, K.T. Newton, wrote in an email marked “Confidential,”: “We believe the cache itself is in the neighborhood of 3x5x8 (feet) to 5x5x8.”

  Since the Elk County site was on state-owned land, the FBI had to secure a federal court order to gain access. The legal maneuvering generated emails between Newton and Audrey Miner, chief lawyer for the Pennsylvania Department of Conservation and Natural Resources.

  On March 13, as FBI agents clambered up a hill to the target, Miner bluntly asked Newton: “Can you please provide the basis upon which the Office of the United States Attorney asserts that the gold, if found, belongs to the federal government?”

  Newton replied that a federal affidavit in the case was sealed. She instead offered to “discuss this generally with you on the phone,” according to email records released by the state under court order. -AP

  Yet, on March 16, 2018 – two days after the dig ended, US Attorney Newton told Audrey Miner, chief lawyer for the Pennsylvania Department of Conservation and Natural Resources: “we are all disappointed and scratching our heads over the several scientific test results.“

  In a subsequent March 28 email, Miner asked Newton for an update on the federal investigation, writing that “the gold story still has legs, and the DCNR is now getting a lot of ‘gold-diggers’ interested in Dent’s Run,” to which Newton replied: “For your knowledge only … we have no other scientific evidence, other than what the excavation had been based on, that any gold is hidden in that area.”

  Miner replied: “I guess you can’t come right out and state there is no gold to be found at Dent’s Run?” to which the prosecutor replied: “Unfortunately, we cannot.“

  On Wednesday, the Paradas plan to hold a news conference, where they will present claims that include residents reportedly hearing a backhoe and jackhammer overnight “when the excavation was supposed to have been paused,” and seeing a  “convoy of FBI vehicles, including large armored trucks.”

  “I gotta find out what happened to all that gold,” Dennis Parada said last week, adding that the FBI’s claim to have found nothing was “a slap in the face.”

  Cluck, meanwhile, is still pursuing government material on the case — nearly 2,400 pages, as well as video files, that the FBI has promised to turn over in response to his Freedom of Information Act request.

  All documents in the federal court case about the dig remain sealed. For that reason, a state appeals judge recently declined to order the Department of Conservation and Natural Resources to give Cluck the federal writ of entry and seizure warrant that the FBI agents relied on to gain access to the site. -AP

  In a curious development which may shed some light on what’s to come, a Commonwealth Court Judge, Kevin Brobson, wrote in a footnote of a Jan. 28 opinion rejecting Cluck’s petition for more information, that the name of the sealed case is: 

  “In the Matter of: Seizure of One or More Tons of United States Gold.”

  Tyler Durden
  Wed, 03/10/2021 – 20:40

• UC-Berkeley Unveils Plan For Racial Quota
  UC-Berkeley Unveils Plan For Racial Quota

  Authored by Ashley Carnahan via Campus Reform,

  The University of California-Berkeley is on its way to becoming a Hispanic-Serving Institution, which means that at least 25 percent of undergraduate students identify as “Chicanx/Latinx.”

  

  UC-Berkeley’s Chancellor Carol Christ announced in August 2018 her “intention to set the UC Berkeley campus on a journey to become an HSI by 2027,” according to the Chancellor’s Task Force on Becoming a Hispanic Serving Institution’s report, published in December 2020.

  A Hispanic-Serving Institution (HSI) is defined as one that “has an enrollment of undergraduate full-time equivalent students that is at least 25 percent Hispanic students at the end of the award year immediately preceding the date of application.”

  The report states that Christ would like to see 25 percent of undergraduate students “self-identify as Chicanx/Latinx” by 2027.

  “[Christ] identified this priority as one of the boldest goals in the campus’ strategic plan—for at least 25 percent of enrolled undergraduate students to self-identify as Chicanx/Latinx, for the University to be a preferred destination for Pell Grant eligible students, and for every student to thrive at Berkeley and to find belonging in all dimensions of the campus towards a true exemplification of comprehensive excellence,” the report said.

  The HSI task force is divided into three implementation phases from 2020-2027. Phase three’s goal (2025-2027) is to apply for HSI Designation.

  Six other UC schools are already HSI designated: UC-Davis, UC-Santa Barbara, UC-Riverside, UC-Merced, UC-Santa Cruz, and UC-Irvine.

  In 2020, UC-Berkeley had a 17.9 percent Latino student population, roughly 7.1 percent away from meeting the enrollment requirement, according to the report overview.

  “Excellence is rooted in diversity — Berkeley’s excellence demands diversity — diversity of thought, perspective, experience, cultural identity. In order to keep Berkeley relevant, we must enhance and strengthen our efforts to attract and retain diverse community members, The Hispanic Serving Institution Initiative is one of several important inclusion programs that will help us achieve this excellence,” reads the report.

  Mia Settles-Tidwell, assistant vice chancellor and chief of staff for the division of equity & inclusion told Campus Reform, “The HSI Task Force was charged in 2018 to bring forth a presentation on the roadmap to becoming an HSI. This effort is more than a reform effort, it is an effort to align ourselves with our UC public service mission for the state of California. The HSI will continue its work and build an HSI Implementation team structure that facilitates the recommendations in the HSI report.”

  UC Berkeley Diversity and Community Fellow Allyson Kohen told Campus Reform she would like to see quotas apply to other racial minorities as well.

  “I think that there should be more research done re the implication on students from other ethnic backgrounds [that] this HSI quota goal is going to have,” she said.

  Tyler Durden
  Wed, 03/10/2021 – 20:20

• Texas Faces Wildfire Threat Amid "Extreme Drought" After Historic Deep Freeze
  Texas Faces Wildfire Threat Amid “Extreme Drought” After Historic Deep Freeze

  No, this is not The Onion…

  Weather-battered Texas can’t catch a break. Last month, the Lone Star State experienced a “historic” plunge in temperatures that nearly collapsed the power grid. Governor Greg Abbott has issued warnings about elevated wildfire risks in several state regions this week, reported CBS Austin. 

  Abbott said Tuesday that the Texas Division of Emergency Management (TDEM), Texas A&M Forest Service, and the Texas Intrastate Fire Mutual Aid System (TIFMAS) are preparing to respond to wildfires if they break out in the Panhandle, Western Plains, Trans Pecos, and the South Texas Plains due to warm, dry, and windy conditions. 

  “As Texans in the Panhandle, Western Plains, South Texas Plains, and Trans Pecos area face a significant threat of wildfires, I urge Texans in these communities to heed the guidance of their local leaders and avoid any outdoor burning that could spark wildfires,” said Abbott. “The State of Texas is working alongside local officials and emergency management leaders on the ground to keep our communities safe and mitigate the threat that wildfires pose.”

  According to the US Drought Monitor, the areas of concern are located in “extreme” to “exceptional” drought areas. Fears are mounting of a Great Depression’s Dust Bowl style drought developing in the Southwest. 

  

  This is the latest weather-related disaster to threaten the state after up to 15 million people were left without power during an Arctic blast when the state’s electric grid nearly collapsed last month. 

  Bloomberg says, “at least 2.1 million people face critical wildfire conditions, including in Amarillo and El Paso, Texas.” 

  Tyler Durden
  Wed, 03/10/2021 – 20:00

• Buchanan: The Emerging Existential Crisis At The Border
  Buchanan: The Emerging Existential Crisis At The Border

  Authored by Pat Buchanan via Buchanan.org,

  During a Democratic debate in 2020, the candidates were asked if their health care plans would cover “undocumented immigrants.”

  Each raised his or her hand, including front-runner Joe Biden.

  From that stage, the message went forth: If the Democrats win this election, then it is amnesty for all and open borders in America.

  The message was reinforced by repeated Democratic praise for sanctuary cities, by calls to “abolish ICE” and end deportations, by pledges to stop work on Donald Trump’s wall, if not to tear it down.

  Message sent to Mexico, Central America and the Third World:

  If the Democrats win and you make it across the border into the United States, under President Joe Biden, you will not be sent back. After only a brief hassle, the economic opportunities and social welfare benefits of the richest country on earth will be open to you and yours.

  

  Hence, when Biden won, a new and potentially historic surge to the Southern border began, and the number of illegal arrivals and crossings are in the growing thousands every day.

  According to a White House domestic policy council document, the number of children who, without a parent or guardian, will arrive at the border in 2021 will be about 117,000 — 50% higher than the record number of children who arrived in the 2019 humanitarian crisis.

  In February, some 100,000 immigrants were apprehended by the Border Patrol for illegal border crossing. “I actually think that’s an undercount,” says Victor Manjarrez Jr., ex-Border Patrol agent who teaches at Texas University.

  The pre-Trump policy of “catch-and-release” has been reinstated.

  Children and families who cross illegally from Mexico cannot now be held for more than 72 hours. They are being released into the U.S. to await a court date — potentially years off — to hear their claim to a right to be here. Most never show up.

  “We are weeks, maybe even days, away from a crisis on the southern border,” says Rep. Henry Cuellar, a Democrat whose Texas district abuts Mexico. “Our country is currently unprepared to handle a surge in migrants in the middle of the pandemic.”

  Congressional Democrats, following Biden’s lead, have proposed a new citizenship act. “Dreamers,” brought here by their parents as children, would be put on a three-year fast-track to U.S. citizenship.

  The 11 million to 22 million illegal migrants already in the country — the exact number is unknown — would be put on an eight-year track to citizenship.

  The Democratic Party is signing on to the largest mass amnesty for illegal immigrants in history — which would produce millions of new voters for the party.

  Among the recent border-crossers, who are transported by bus to detention centers, where they remain for 72 hours and then are released to travel where they wish, many are carrying the coronavirus.

  Thus, what’s shaping up on the border is not only a national security crisis but a national survival crisis. For it is impossible to see, given the Biden administration policies adopted, how the invasion of America can be halted. And if 2 million or 3 million migrants reach the U.S. border and cross over each year, and we do not send them back, what stops the invasion and remaking America?

  What would blanket amnesty and a renewed invasion portend?

  In a decade, Texas, the Southwest and much of the South would take on the political aspect of California where the GOP has become a permanent minority party.

  As many illegal migrants do not read, write or speak English, and do not bring a unique set of skills, their immense and growing presence can only deepen our national disunity.

  Almost all of these folks are poor or working-class people who would have to rely on government subsidies for their health care, food support, housing and the schooling of their children.

  With the unemployment rate rising again in the Black community, which has sustained the heaviest collective hit from the pandemic and economic collapse, the migrants would be competing with them for jobs.

  And as the illegal migrants are disproportionately young and male, they would add to the surging crime rates in America’s major cities.

  America is headed, seemingly inexorably, to a future where a majority in this country traces its ancestry to Asia, Africa and Latin America, a future where this already fractionated nation is even more multiracial, multiethnic, multilingual and multicultural than today.

  With racial conflict as sharp as it has been in decades, with our political parties at swords point, with the culture war raging unabated, as mobs tears down statues and monuments to America’s founders, exactly what national problem will be solved by an unstopping and unrelenting wave of migrants illegally crossing the border into our country year after year?

  One wonders: Is this how the Republic ends?

  Tyler Durden
  Wed, 03/10/2021 – 19:40

• "Mega Squeeze" Revealed As Culprit Of Tuesday's Historic Meltup, As Expected
  “Mega Squeeze” Revealed As Culprit Of Tuesday’s Historic Meltup, As Expected

  On Sunday, when looking at the latest prime brokerage data from Goldman we noted that around mid-week the PB desk saw the “largest global short sales since May” with the GS Prime book net sold driven by short sales outpacing long buys 1.7 to 1.”

  

  … and predicted that a “Mega Squeeze” was Coming as “Last Week Saw Biggest Hedge Fund Shorting Since May“

  “What does all of this mean for markets”. we asked rhetorically and answered that in a week where stocks first spiked then tumbled only to reverse, and where substantial damage was done on HF P&L, immediately after a furious burst of shorting, which has pushed gross short exposure to the highest level since the start of 2020…

  

  … “it is likely that the short squeeze we observed on Friday which started with the post-EU close ramp that pushed the EMini higher by over 100 points in 4 hours is about to spread and force even more forced squeezes especially now that the $1.9 trillion Biden bill has been passed by the Senate.”

  This prediction proved to be painfully spot on (for the shorts) because what happened on Tuesday was an unprecedented 4% meltup in the Nasdaq facilitated by a massive 20% surge in Tesla and various other popular growth and tech stocks.

  But was it a short squeeze, or merely an oversold bounce as some have defined it?

  For the answer we went to the latest Goldman Prime Brokerage Service note which confirmed our previous prediction, observing that Tuesday’s was the result of “risk unwind in Macro Products vs. large net buying in Single Names” led by TMT and Consumer Disc stocks, with the Goldman Prime book net bought for a fifth straight day in which “trading flows were risk-off with short covers outpacing long sales 4 to 1.”

  Just to make sure there is no confusion, Goldman prime notes that “yesterday’s de-grossing activity – short covers and long sales combined – was the largest since late January (-2.0 SDs).“

  And the most remarkable observation, while US equities were (clearly) net bought, “trading flows were risk-off driven by short covers outpacing long sales 2.7 to 1.”

  

  As Bloomberg adds, short covering in unprofitable tech firms helped the group halt seven straight days of selling and score the third-biggest net buying of the year. In fact, over the past two days, Goldman basket of the most-shorted tech stocks has jumped almost 7%, more than double the return of the Russell 3000.

  

  In other words, as paradoxical as it may sound, the surge was in fact a “risk off move”, and didn’t reflect appetite for risk but merely overall book degrossing as shorts have learned their lesson and no longer stay in the way of epic meltup juggernauts such as the one yesterday.

  That said, with the latest iteration of shorts now out of the picture, it’s time for a new cohort of bears to take their place, and we wouldn’t be surprised if we see renewed weakness in the Nasdaq as a flood of new shorts hammers the tech index only to then suffer another massive squeeze and so on, rinse, repeat.

  Commenting on the move, Andrew Brenner, the head of international fixed-income at NatAlliance Securities in New York told Bloomberg that “we see yesterday’s move as short covering without legs.” Ok fine, but tell that to any Nasdaq shorts whose legs – and everything else – was steamrolled in the historic move higher.

  Tyler Durden
  Wed, 03/10/2021 – 19:20

• Here Come Trillions More: Biden Will Unveil "Next Phase" Of COVID Response On Thursday
  Here Come Trillions More: Biden Will Unveil “Next Phase” Of COVID Response On Thursday

  Just hours after the House passed the Democrats’ $1.9 trillion stimulus package (which will unleash another wave of “stimmies” that will inevitably find their way into millions of Robinhood and other discount brokerage accounts), President Joe Biden said Wednesday that he would unveil “the next phase” of the US COVID-19 response on Thursday, which is also the one-year anniversary of the first COVID-inspired lockdowns in the US.

  

  Biden, who made the remarks during a press briefing with the CEO of Johnson & Johnson on Wednesday, will share the details of the plan during a prime-time address Thursday evening.

  “Tomorrow night, I’m going on primetime to address the American people and talk about what we went through as a nation this past year. But more importantly, I’m going to talk about what comes next,” Biden said Wednesday.

  “I’m going to launch the next phase of the Covid response and explain what we will do as a government and what we will ask of the American people,” he said. “There is light at the end of this dark tunnel over the past year. We cannot let our guard down now or assume that victory is inevitable. Together, we’re going to get through this pandemic and usher in a healthier, more hopeful future.”

  Biden also proclaimed Wednesday that, after the COVID pandemic is finally quashed, his administration is planning to pivot to focusing on its next health-care policy goal: eradicating cancer. Note: Biden’s son Beau Biden succumbed to brain cancer a few years ago – cancer that doctors suspected was linked to the younger Biden’s service in Iraq. The administration is also hoping to push through a sweeping infrastructure plan.

  If these plans seem a little too grandiose, especially after the massive blowout in the national debt over the last few years, fear not: Biden and his fellow Dems apparently realized that the federal government can fund all of its policy priorities, no matter how costly, by simply allowing the Fed to monetize all of the debt.

  Up next (after the gigantic “infrastructure” bill): curing cancer. Probably will only cost $100 trillion. But why not, when one has unlimited funds? Just have Jay Powell keep his finger on the money printing button a little longer. https://t.co/uduESJ06HH

  — fred hickey (@htsfhickey) March 10, 2021

  https://platform.twitter.com/widgets.js

  Earlier Wednesday, the White House announced plans to buy 100MM additional doses of J&J’s COVID-19 jab in a deal that would double the nation’s supply of the J&J vaccine as the company already has a deal with the government to provide 100MM doses by the end of June. Merck is helping to make J&J’s Covid vaccine, which is helping to accelerate production.

  “I’m doing this because in this wartime effort, we need maximum flexibility,” Biden said Wednesday on plans to purchase more J&J vaccine doses.

  “There’s always a chance that we’ll encounter unexpected challenges or there will be a new need for a vaccine effort…a lot can happen, a lot can change and we need to be prepared.”

  Thanks to this, Biden said, any American who wants a vaccine can now expect to receive one by May 31. The president also noted that 50MM shots have been distributed since he took office, while also claiming that the US has administered the most shots of any country in the world.

  “In five weeks, America has administered the most shots of any country in the world – any country in the world – with among the highest percentage of population fully vaccinated. That’s progress we promised,” Biden said.

  Of course, that’s not entirely true. According to Bloomberg’s numbers, the US is in the lead, with nearly 96MM jabs administered, compared with 52MM for China. But China has also vaccinated millions with its domestically produced vaccines under “emergency use” authorizations that allowed the CCP to start doling out the experimental jabs much earlier than many medical ethicists would have been comfortable with. Back in November, the head of Sinopharm, one of the biggest Chinese vaccine producers, said his company’s jabs had already been administered to 1MM people before the first US vaccines were even approved for emergency use.

  Tyler Durden
  Wed, 03/10/2021 – 19:00

• Banks Tweak Bond Covenant Language To Protect Against Repeat Of Citi's $500M "Fat Finger" Loss
  Banks Tweak Bond Covenant Language To Protect Against Repeat Of Citi’s $500M “Fat Finger” Loss

  After a court battle that dragged on for more than a year, a New York judge shocked the investment banking community last month when they ruled that a group of Revlon creditors could keep some $500MM that they refused to return to Citi after some $900MM was accidentally transferred in what appeared to be a “fat finger”.

  

  At the time, legal experts posited that the judge’s decision, which was based on quirks in New York State law, would force investment banks to reevaluate the wording of their bond covenants in all future deals, as the ruling created new risks that needed to be addressed.

  It appears America’s biggest lenders have already come up with new legal terminology to be inserted into covenant agreements that would require lenders to return any accidentally transferred funds to the banks.

  The legally binding clauses have been inserted into debt deals for Eagle Materials and pet supply chain Petco, among other deals, the FT reports.

  Building materials manufacturer Eagle Materials, pet supply chain Petco and industrial equipment maker Mesa Laboratories have all included a type of “erroneous payment” term in their US loan deals, according to credit documents assessed by credit analysis company 9fin.

  Analysts who study the leveraged loan market said this is the first time in recent memory that covenant language was evolving in this way, as “erroneous payment” clauses are expected to become standard.

  “This is such a rare thing that has not happened in the US leveraged loan market for a very long time at such a scale,” said Justin Forlenza, senior covenant analyst at credit research company Covenant Review, referring to Citi’s blunder.

  “All the arrangers want to avoid that scenario going forward.” The covenant typically gives banks the discretion to judge whether a payment was mistakenly made and to demand its repayment as well as any interest from the date that the funds were received.

  Banks typically offer administrative services through which they co-ordinate the payment of coupons and other “back office” tasks related to debt deals. JPMorgan was lead arranger for Eagle Materials and Mesa Laboratories while Citi led Petco’s deal. Both banks declined to comment.

  But these new clauses have only been spotted in US deals so far, which is hardly surprising since the ruling was based on precedent and New York State law.

  The accidental payment protection has so far been spotted only in US documents, according to Steven Hunter, chief executive of 9fin, who said it may be because of a quirk of New York’s law which allowed Revlon’s hedge fund investors to keep the accidental transfer.

  US District Judge Jesse Furman said 10 asset managers for the lenders, which include Brigade Capital Management, HPS Investment Partners and Symphony Asset Management, don’t have to return more than $500 million that Citibank said it mistakenly transferred in August while trying to make an interest payment.

  Citi is now seeking to punish these firms and any others who withheld mistakenly transferred money by excluding them from future debt deals, according to Bloomberg.

  Tyler Durden
  Wed, 03/10/2021 – 18:40

• Livid Trump Blasts "Our Country Is Being Destroyed At The Southern Border"
  Livid Trump Blasts “Our Country Is Being Destroyed At The Southern Border”

  Authored by Steve Watson via Summit News,

  A livid President Trump issued a statement Tuesday lamenting that the country is “being destroyed” by the Biden administration’s actions at the border, as the crisis further spirals out of control.

  

  Border crossings have surged after Biden promised mass amnesty, began allowing unaccompanied migrant children into the US again, and reversed Trump’s ‘remain in Mexico’ policy.

  Video is emerging every day of hundreds of migrants walking into the US, while cities in Arizona and Texas warn that they are becoming overwhelmed, and warning of the complete lack of effort to test for or prevent the spread of COVID:

  The tip of the iceberg near Yuma, AZ as immigrants begin to flood into the US responding to @JoeBiden’s open border, catch and release policy. How many have COVID? pic.twitter.com/8Cu3k88etZ

  — Senator Ron Johnson (@SenRonJohnson) March 7, 2021

  Border patrol is reported to have arrested around 100,000 migrants attempting to illegally cross the border in February alone.

  Trump’s statement read “When I was President, our Southern border was in great shape – stronger, safer, and more secure than ever before.”

  “We ended Catch-and-Release, shut down asylum fraud, and crippled the vicious smugglers, drug dealers, and human traffickers,” Trump continued, adding “The Wall, despite horrendous Democratic delays, would have easily been finished by now.”

  Commenting on the current situation, Trump proclaimed “Our country is being destroyed at the Southern border, a terrible thing to see!”

  There are now a record number of migrant children being kept in Border Patrol ‘cages’, which the migrants themselves are calling “dog kennels” and “ice boxes” according to reports.

  CBS News reports that there are more than 3,200 unaccompanied minors in the facilities, with almost half being held beyond the legal three-day limit.

  Less than a month ago there were just NINE children being held, according to CBP documents cited in the CBS report.

  There are a further 8,100 migrant children being held at the Office of Refugee Resettlement.

  This is an unprecedented crisis caused directly by the undoing of Trump’s border policies and the Biden administration refuses to address it. Biden himself has not faced questions from the media for almost 50 days at this time.

  In fact, they are putting out “leaks” that reveal their intentions to continue an open border policy, with the intention to integrate 117,000 migrant youths and children this year alone.

  Meanwhile, Arizona and Montana are taking legal action to block the new immigration regulations, which also limit the ability of ICE to detain illegals.

  Arizona Attorney General Mark Brnovich said in a statement “If asked about the poorest policy choice I’ve ever seen in government, this would be a strong contender.”

  “Blindly releasing thousands of people, including convicted criminals and those who may be spreading COVID-19 into our state, is both unconscionable and a violation of federal law,” Brnovich added, urging “This must be stopped now to avoid a dangerous humanitarian crisis for the immigrants and the people of Arizona.”

  Montana Attorney General Austin Knudsen has also warned that “Meth trafficked into Montana by Mexican drug cartels has wracked our state. The problem will only be made worse if the Biden administration continues to allow criminals to stay in the country.”

  “Enforcing our immigration laws and helping to keep Americans safe is one of the federal government’s most important functions. The Biden administration is failing its basic responsibility to Americans,” Knudsen emphasised.

  Tyler Durden
  Wed, 03/10/2021 – 18:22

• Wind Power Is A Disaster In Texas, No Matter What Paul Krugman Says
  Wind Power Is A Disaster In Texas, No Matter What Paul Krugman Says

  Authored by Robert Murphy via The Mises Institute,

  In the wake of February’s tragic power outages in Texas, during which 4.5 million households suffered service interruptions, partisans on both sides have been quick to interpret the events as confirmation of their preferred energy policies. With news images of helicopters deicing frozen turbines, conservatives lambasted Texas’s increasing reliance on wind power as the villain in the story.

  Trying to temper this knee-jerk reaction, Reason.com columnist Ron Bailey argued that “[m]ost of the shortfall in electric power generation during the current cold snap is the result of natural gas and coal powered plants going offline.” And Paul Krugman for his part declared that it was a “malicious falsehood” to blame wind and solar power for what happened in Texas, as it was primarily a failure of natural gas.

  In this article I’ll lay out the basic facts of which power sources stepped up to the plate during the crisis. Contrary to what you would have known from reading Ron Bailey (let alone Paul Krugman), when the Texas freeze hit, electricity from natural gas skyrocketed while wind output fell off a cliff. The people arguing that wind wasn’t to blame mean it in the same way Jimmy Olson wasn’t to blame when General Zod took over: wind is so useless nobody serious ever thought it might help in a crisis.

  

  Krugman on Texas Electricity

  In his February 18 column titled “Texas, Land of Wind and Lies,” Krugman declared that

  Republican politicians and right-wing media … have coalesced around a malicious falsehood instead: the claim that wind and solar power caused the collapse of the Texas power grid, and that radical environmentalists are somehow responsible for the fact that millions of people are freezing in the dark …

  In contrast to this dirty rotten lie from the right-wingers, Krugman instead explains:

  A power grid poorly prepared to deal with extreme cold suffered multiple points of failure. The biggest problems appear to have come in the delivery of natural gas, which normally supplies most of the state’s winter electricity, as wellheads and pipelines froze.

  A bit later in the article Krugman admits that wind was involved as well, but minimizes its role in this way:

  It’s true that the state generates a lot of electricity from wind, although it’s a small fraction of the total. But that’s not because Texas—Texas!—is run by environmental crazies. It’s because these days wind turbines are a cost-effective energy source wherever there’s a lot of wind, and one thing Texas has is a lot of wind.

  It’s also true that extreme cold forced some of the state’s insufficiently winterized wind turbines to shut down, but this was happening to Texas energy sources across the board, with the worst problems involving natural gas.

  Incidentally, there are literally no numbers in Krugman’s article (except for numerals referring to dates), which is a signal that he’s pulling a fast one on his readers. From his qualitative (not quantitative) description, most people would have assumed that when the unusually cold weather hit Texas last month, electricity generation from various sources was down across the board, but that it mostly fell from natural gas, while the drop in wind was insignificant. As I’ll show in the next section, this is utterly false.

  What Really Happened During Texas’s Power Crisis

  Had I not seen the analysis from my former colleagues at the Institute for Energy Research (see their articles here and here), I might have believed the spin that the Texas crisis was really a failure of fossil fuels rather than renewables. Yet as we’ll see, the actual numbers tell a much different story from what most Americans probably “learned” from the media discussion.

  The simplest way for me to communicate the relevant information is through three infographics, generated from the Energy Information Administration’s handy tool that shows the source mix for daily energy generation by state.

  Before showing the numbers, I need to make an important clarification: the demand for electricity soared to unprecedented levels during the freeze. In particular, on February 14, peak demand on the electric grid surpassed sixty-nine gigawatts, breaking the previous winter record of (almost) sixty-six gigawatts set in 2018. It was in the early hours of the following morning (February 15) that the Electric Reliability Council of Texas (ERCOT) implemented rolling blackouts to prevent the entire grid from collapsing. So to be clear, the issue wasn’t that supply in an absolute sense fell, but rather that demand soared. (Texas typically uses more electricity in the summer to keep things cool, rather than in the winter to keep things warm.)

  With that context in place, here are the stats for electricity output from various sources on February 15, 2021:

  

  Already we see something interesting. Of the total amount of electricity delivered on this first day of blackouts, 65 percent came from natural gas, while only 6 percent came from wind and 2 percent from solar.

  But in fairness, maybe what guys like Krugman meant is that this is much lower than what we normally could expect from natural gas. (Remember Krugman had said that natural gas “normally supplies most of the state’s winter electricity.”)

  To test this possibility, we can look at the situation one year prior, on February 15, 2020:

  

  Now, this is interesting. A year earlier, during a normal mid-February day, natural gas “only” supplied 43 percent of the total electricity, whereas wind accounted for 28 percent and solar was the same at 2 percent. Remember how Krugman said wind was only a “small fraction” of Texas generation? Overall for the year 2020, wind produced 22 percent of Texas’s electricity, a higher share than coal.

  Yet besides the proportions, also look at the absolute quantity of electricity generated: on Feb. 15, 2020, natural gas produced 398,130 megawatt hours (compared to 759,708 MWh during the recent freeze), while wind produced 264,024 MWh (compared to 73,395 MWh during the freeze).

  To sum up, compared with the same date a year earlier, during the first day of the blackouts in Texas, electricity from natural gas was 91 percent higher, while electricity from wind was 72 percent lower.

  To reiterate the clarification I gave earlier, part of the confusion here is that electricity demand in February isn’t normally as high as it was because of the freeze. So to test whether natural gas is the culprit, we can compare the generation from various sources during the freeze to the situation back during the summer. For example, let’s look at how things stood on August 15, 2020:

  

  As our date occurred in the dog days of summer, total electric demand was higher in mid-August 2020 than on February 15, 2021. Furthermore, output from every source was lower during the freeze when compared with their performance the prior August 15. However, it seems odd to single out natural gas as the culprit, when it experienced the lowest percentage drop, and (on all dates) was the single biggest source.

  The following table summarizes electrical output from various sources on the three dates we have analyzed, and shows the change going from the earlier dates to the first day of the recent blackouts:

  

  As the table indicates, on all three dates natural gas was always the leader in electrical generation. During the freeze, it produced 91 percent more than it had the prior year during a more typical winter day. And although natural gas produced less electricity during the freeze than it had during the peak summer demand, it was only a 7 percent drop.

  In contrast, wind power during the freeze was down a whopping 72 percent compared to the previous year, and compared to the summer it was down 47 percent.

  Among all sources, the percentage difference between either the previous year or the previous summer was highest for natural gas. That is, the surge in natural gas output year over year was the biggest by far (with coal coming in second with a 54 percent surge), and compared with the summer load its drop was the smallest at 7 percent.

  Wind, in contrast, was the worst performer in both cases, if we measure in terms of the difference. That is, wind’s 72 percent drop in the year-over-year column was the biggest one, and its 47 percent drop in the column for summer to winter was also the biggest.

  In light of these statistics, it’s a bit odd for commentators to blame the Texas blackouts on natural gas while excusing wind.

  What They Mean: Wind Is the Ted Cruz of Electricity

  Now, in fairness, what the commentators blaming natural gas have in mind is that ERCOT’s emergency planning assumed that natural gas (and the other “thermal” electricity sources, namely coal and nuclear) could be called upon to fill the gap should there be record demand during a winter storm. If we measure in terms of the total capacity that was temporarily knocked out because of the freeze, then the culprits were thermal sources, rather than wind and solar.

  As Jesse Jenkins, an assistant professor at Princeton tweeted out, “Main story continues to be the failure of … natural gas, coal, and nuclear plants … which ERCOT counts on to be there when needed.” He further specified, “Of about 70,000 MW of thermal plants in ERCOT, ~25–30,000 MW have been out since Sunday night. Huge problem.”

  And so we see what people mean when they say the Texas blackouts are the fault of natural gas, rather than wind: since no serious official ever expected wind to be any help during a crisis, it can hardly be blamed for not showing up when disaster struck. In effect, Krugman is arguing that wind power is the Ted Cruz of electricity.

  Conclusion

  When assessing blame for a disaster, it’s hard to know what the relevant counterfactual should be. Yes, had the (relatively) unregulated Texas power providers done a better job in winterizing their natural gas lines, things would have been better last February.

  But by the same token, had the federal government never implemented the wind production tax credit (PTC)—which subsidizes wind so heavily that it sometimes sells for a negative price in the Texas wholesale market—then there would have been more fossil fuel-generated capacity in Texas, which the numbers clearly show did better at providing electricity during the deep freeze. Normally the boosters of renewable energy point with pride to Texas, which has the most wind capacity of any state by far in absolute terms, and even has almost 25 percent of its official generating capacity consisting of wind. Yet when wind collapsed during the deep freeze, suddenly even its biggest fans admit that nobody ever thought it could do the same job as natural gas.

  Tyler Durden
  Wed, 03/10/2021 – 18:20

• Russia Throttles Twitter Speed In Banned Content Standoff, Threatens Blockage
  Russia Throttles Twitter Speed In Banned Content Standoff, Threatens Blockage

  Russia is seeking to retaliate against Twitter for continued violation of Russian obscenity laws which are regulated by its media watchdog — the Federal Communications, Information Technology, and Mass Communications Oversight Service, also known as Roskomnadzor.

  Specifically Russia has said Twitter failed to comply in removing over 3,100 posts displaying banned content including pornography, suicide and production of drugs. In response, Russia announced Wednesday it’s slowing down Twitter upload speeds, impacting 50% of desktops in Russia. 

  Roskomnadzor is now threatening the next step will be to block Twitter completely from the country.

  

  The regulator said in its statement, “With the aim of protecting Russian citizens and forcing the internet service to follow the law on the territory of the Russian Federation, centralized reactive measures have been taken against Twitter starting March 10, 2021 — specifically, the initial throttling of the service’s speeds, in accordance with the regulations.”

  “If the internet service Twitter continues to ignore the demands of the law, measures against it will continue in accordance with the regulations, up to and including blocking it.”

  Twitter has been named as the only social platform that has “openly ignored the Russian authorities’ demand to remove the banned content,” the statement added. 

  Separately the Russian media regulator filed lawsuits targeting Twitter and other US-based social media platforms for spreading ‘disinformation’ related to the officially banned mass protests in support of anti-Kremlin activist Alexei Navalny. A number of media pundits believe it’s the Navalny situation that’s really driving Russia’s retaliation against Twitter.

  Confirmed: Real-time network data show elevated latency to Twitter servers from #Russia with high impact to mobile internet providers and some fixed-line networks, consistent with targeted traffic shaping or throttling; incident ongoing

  📰 https://t.co/Iv1g06ensV pic.twitter.com/ZKktrzfxUX

  — NetBlocks (@netblocks) March 10, 2021

  https://platform.twitter.com/widgets.js

  It’s part of a years-long dispute with major social media companies, as the Associated Press reviews of internet laws going back a half-decade:

  In 2014, the authorities adopted a law requiring online services to store the personal data of Russian users on servers in Russia and have since tried to make Facebook and Twitter to comply with it. Both companies have been repeatedly fined, first small amounts of around $50 and last year the equivalent of $63,000 each, for not complying.

  The government has stopped short of outright bans even though the law allows it, probably fearing the move would elicit too much public outrage. Only the social network LinkedIn, which wasn’t very popular in Russia, has been banned by the authorities for the failure to store user data in Russia.

  Moscow has further accused US big tech of colluding with Western governments to sow destabilization and ‘color revolution’ efforts and information, and further has long been angered over ‘double standards’ and hypocrisy in specially labeling Russian state-backed media while failing to do so in the cases of BBC, NPR, VOA and others. 

  Meanwhile The Guardian and others are reporting that amid the Wednesday move to implement the Twitter slowdown, the government “also appeared to have accidentally shut down the Kremlin’s own website, as well as other government agency sites.”

  Tyler Durden
  Wed, 03/10/2021 – 18:00

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• How France And The US Cooperate
  How France And The US Cooperate

  Authored by Danny Sjursen via ConsortiumNews.com,

  After some hints to the contrary, it turns out French troops in the Sahel aren’t going anywhere anytime soon. So said President Emmanuel Macron in Paris on Feb. 16, even before his virtual summit with France’s former-colonial “partners” – Burkina Faso, Niger, Mali, Mauritania and Chad – comprising the G5 Sahel Joint Force.

  

  Two French Air Force fighter jets operating over Mali after refueling with a KC-135 Stratotanker. (U.S. Air Force, Christopher Mesnard)

  Formed in 2014, it’s described in bureaucratic Paris-speak as “an intergovernmental cooperation framework, in order to put forward a regional response to the various challenges.”

  In reality, the G5 are little more than a misfit crew of problematic proxies doing the bidding of the French generals leading a seven years-running Operation Barkhane – and that of America’s AFRICOM proconsuls propping-up Paris’s pet forever war in the Sahel.

  Uniformed Mercenaries

  This year’s G5 Sahel summit was based – like Operation Barkhane’s headquarters – in the Chadian capital of N’Djamena, though due to Covid-19, European and U.S. participants joined virtually.

  France launched its current military adventure in Mali – originally known as Operation Serval – in 2013, before expanding it across the region under Barkhane’s umbrella. Ironically, as the French mission has continually expanded – and recently floundered – every single metric of insecurity in the Sahel has increased along with it. That includes: civilian deaths (2,000 in 2019-20), internal displacement (well over one million), poverty (30 million people in need of food assistance), and coalition casualties (29 Malian, UN and French troops killed since the New Year). 

  Nevertheless, when it comes to doubling down on failure, France learned from the (American) best, so Macron ruled out immediate troop cuts – despite both rising antiwar sentiment at home and growing anti-French sentiment in the region – and even earned Chad’s commitment to deploy 1,200 more troops to complement Operation Barkhane’s 5,100 French soldiers. Now that’s worth keeping an eye on. The Chadian reinforcement represents a nefarious and long-running quid-pro-quo, whereby Paris scratches N’Djamena’s dictator-of-the-moment’s back in exchange for his fielding France’s favorite hired guns. 

  

  French President Emmanuel Macron in 2017. (Estonian Presidency, CC BY 2.0, Wikimedia Commons)

  Come to think of it, Paris often provides the guns too, so Chadian troops really amount to hired hands and cannon fodder for France’s neo-colonial combat. For example, just three weeks before the summit, the French embassy held a ceremony celebrating the handoff of nine ERC-90 armored vehicles to Chad’s uniformed mercenaries – whilst the country’s civilians starve. One wonders just how many bags of grain, mosquito nets, and vaccines nine of these even dated ERC-90s might’ve bought? No matter, since the embassy asserted that these “rustic, efficient and reliable” vehicles “will perfectly meet the operational needs of the Chadian army in its contributions to the fight against terrorism.” Too bad Chad’s children can’t eat them.

  Unhinged Hired Hands

  How about those hired guns? In other words, just what of substance do N’Djamena’s soldiers of fortune – paid all of $58 a month for their trouble – provide the destabilizing Franco-American Sahel “stabilization” mission? Beyond bullet-sponges, let’s say less than zero! Even according to a rather generous International Crisis Group assessment, “Chad’s army plays a central role in the international counter-terrorism operations in the Sahel, but it is a source of potential instability at home.” 

  Not to say current Chadian strongman Idriss Déby’s troopers don’t stay busy. He’s shipped them to support France’s fight in Central and Northern Mali (1,406 of them, in fact, by March 2017), to the five-country combat mission countering Boko Haram in the Lake Chad region in early 2015 (providing about one-third of troop strength for the Multinational Joint Task Force – which is also headquartered in the Chadian capital N’Djamena), and to the United Nations Multidimensional Integrated Stabilization Mission in the Central African Republic (MINUSCA) – another former French colonial disaster area.

  

  Chad’s President Idriss Deby Itno during the swearing in ceremony of his fifth term on Aug. 8, 2016. (Paul Kagame, Flickr, CC BY-NC-ND 2.0)

  Whether Chad’s “desert warriors” are actually value-added on these adventures is another matter entirely. In April 2014, Chadian forces had to withdraw from the UN mission in the Central African Republic after accusations they’d killed 30 unarmed civilians and offered financial and military support to the country’s Seleka rebels. In Mali, there’ve been numerous allegations of rape and sexual violence perpetrated by Chad’s soldiers.

  Nevertheless, even if Chad’s troops abuse civilians, threaten fledging democracy at home, and haven’t won any real victories abroad, Déby sees subcontracting his soldiers as the gift that keeps on giving (to his regime at least). Having crafted Chad’s image as an indispensable counter-terrorism ally, he’s “played the military diplomacy card” to consolidate Franco-American security partnerships – and thereby, his own political power. 

  The political scientist Marielle Debos even coined a clever slogan for Déby’s mercenary method of misrule – and title of her 2016 book – “Living by the Gun in Chad.”

  

  In 2017, she explained that Chad’s self-styled status as a newfound regional military power “leads France and the US to turn a blind eye to election rigging and human rights violations.” Déby’s even garnered decisive diplomatic clout – like the January 2017 selection of his former Foreign Minister Moussa Faki Mahamat to head of the African Union Commission. He still does.

  Dancing with Monsters, Sowing Disasters

  Naturally, Chad hasn’t much business contributing to anything abroad — given its own rampant instability and unfolding humanitarian crises. The place is a mess. Right on the heels of its hosted summit, 35 people were killed in southeastern Chad during — such a Sahelian ubiquity — communal fighting between farmers and herders.

  Furthermore, amidst rising tensions resulting from the perennial (in power since 1990) strongman’s Idriss constant constitutional goal-post-moving — he’s amended and re-amended it so he can now stay in power until 2033 — this week Chadian security forces raided the opposition presidential candidate’s house, killing five people (including his mother and son). 

  

  Sunset in N’Djamena, Chad, 2014. (kaysha, Flickr, CC BY-NC-ND 2.0)

  This all unfolds ahead of Chad’s scheduled April 11 election, but should hardly surprise even casual observers. Defying a government ban on protests under coronavirus restrictions, Déby’s decision to run prompted several hundred demonstrators to hit N’Djamena’s streets, set fire to tires, and chant “Leave, Déby!”

  They were met with police tear gas and several dozen were arrested. That’s all business as usual in Chad, a country where – according to the 2020 Freedom House report – “Corruption, bribery, and nepotism are endemic.”

  Such pesky details aside, both Paris and Washington view Chad as an essential ally in the regional fight against Islamist groups. In fact, almost two months to the day before the G5 summit’s kickoff, US AFRICOM’s commander, General Stephen Townsend, paid homage at Déby’s tinpot dictatorial court – where he “thanked Chad for its continued leadership in regional security and for hosting US troops.”

  Right after that, Proconsul Townsend dropped by the French Barkhane team and the European Union training detachment (Task Force Takuba), “recognizing their efforts to bring increased security and stability to the Sahel.” That’s the symbiotic relational rub: it’s France – backed by big brother America, and with a clutch EU-assist – that keeps Déby-the-despot in power, thereby fueling the foundational instability driving much of the regional mess.

  I mean that quite literally. As recently as February 2019, the French Air Force spent four days bombing rebel convoys that were en route to overthrow the monster of N’Djamena.

  From Paris’s cynical perspective, Déby is a decidedly useful monster though — as were all the other despots who proceeded him (until they weren’t) — because he provides military bases, including Barkhane’s headquarters, and ample troops to do France’s bidding. Starved and suppressed Chadian citizenry be damned! That populace need not be so put upon by the way. Chad’s humanitarian and human rights disasters are largely manmade and Franco-American accelerated.

  

  N’Djamena, Chad, 2014. (kaysha, Flickr, CC BY-NC-ND 2.0)

  Chad’s been exporting oil since 2003, and from 2004-11 alone earned around €4.5 billion – nothing to sneeze at for a country of just 15 million people. Not that average Chadians ever saw, or see, most of the petro-revenues. Déby mortgaged the nation’s desperately needed energy wealth to the multinational Glencore company in 2014, when his government borrowed more than a billion dollars from the Anglo-Swiss mining conglomerate. The plan was to repay the loan with future oil sales, but after the petro-market collapsed more than 80 percent of oil revenues were needed to service the debt. Talk about kicking it old-school resource-extraction-imperialist-style! 

  What little services-based infrastructure was built with the remaining energy profits tended to be of low-quality — what with cronyist corruption skimming off the top – and limited to the country’s north, where (you guessed it!) Déby’s clan happens to hail from. Most of the rest went (guessed it again!) to international gun-runners.

  According to a 2016 briefing for the World Peace Foundation, “Between 2006 and 2010, Chad became the third-largest importer of arms in sub-Saharan Africa, appearing for the first time in the top ten.” Furthermore, N’Djamena’s military spending increased eight-fold from just 2004 to 2008. 

  The globe’s top merchant of death – you know, the “arsenal of democracy” – America, has gotten plenty into that game. In August 2020, Washington delivered $8.5 million in vehicles and equipment to Chad’s Special Anti-Terrorism Group, as part of a $28 million total support package for N’Djamena’s troop contribution to the G5 Sahel Force. Additionally, many Chadian military officers – including Idriss Déby, who attended the Ecole de guerre – have long trained in France. 

  That the U.S. and (more so) France foster all this indecency — and the hypocrisy inherent in their doing so — is hardly lost on Chadians, or, frankly, other Sahelians. “Many people are saying, one day we’re going to kick France out of Africa,” said the host of a Canadian radio show geared towards fellow Chadian exiles – “France values democracy inside its borders. [But] in Chad they protect one man, the dictator.”

  What’s truly key is that Chad and the despotic Déby are only one anecdotal — but instructive — example of how the Franco-American counter-productivity game operates in the Sahel and Africa-wide. That it unfolds in the shadows, as a largely unreported – and with relatively low casualties (for the U.S.) – abstraction, makes the madness all but invisible. But as America’s new president weighs his foreign policy options, and with Macron seemingly pinning his best hopes on a Biden-bailout for France’s forever war in the Sahel, it’s worth keeping an eye on – and definitely time to talk about – the Chadian formula.

  Preferably before some mourning American soldier’s family is forced to find the damn joint on a map.

  Tyler Durden
  Wed, 03/10/2021 – 02:00

• EU Nations Pull Trigger On Legal Action Against UK Over Brexit Backsliding
  EU Nations Pull Trigger On Legal Action Against UK Over Brexit Backsliding

  It’s no secret that EU officials in Brussels are furious over charges that Britain is backsliding on treaty obligations in its exhaustedly negotiated Brexit withdrawal agreement designed to prevent the reestablishment a hard border between Northern Ireland and the Republic.

  EU nations are now backing legal action against the UK after it was reported the European commission is busy working on “infringement proceedings” against Britain due to its “unilaterally” seeking to ease the impact of Brexit on Northern Irish businesses in contradiction of prior agreements. 

  

  A new FT report cites diplomats who attended a closed door meeting of EU ambassadors in Brussels Tuesday to say “EU nations have supported Brussels’ plan for legal action against the UK over its decision,” and further that, “France and other countries supported the plans by EU Brexit chief Maros Sefcovic” that would include “a twin-track approach” to rebuke and punish the UK.

  “We are currently preparing it and it would be really something coming to our table very soon. The most precise term I can give you is really very soon,” Sefcovic said.

  Specifically the infringement proceeding would by the end lead the UK to the European Court of Justice, and further involving a formal reprimand for London’s “breach of good faith,” according to the report.

  Last week Sefcovic voiced what he described as “the EU’s strong concerns over the UK’s unilateral action, as this amounts to a violation of the relevant substantive provisions of the Protocol on Ireland/Northern Ireland” to UK Brexit representatives. 

  

  To review among the key contentions issues of the Northern Ireland Protocol include:

  As part of its departure from the EU, the U.K. agreed to conduct checks on goods moving across the Irish Sea, going from Scotland, Wales and England to Northern Ireland. The latter has remained part of the EU’s single market for goods to avoid a hard border with the Republic of Ireland in what’s known as the Northern Ireland Protocol.

  The U.K. had until the end of this month to put forward these checks, but it has decided to extend the implementation period until October. A move that the European Commission, the executive arm of the EU, said breaches their agreement and therefore international law.

  In rebuttal to EU anger the UK said it adequately notified the European commission early last week before any public statements that it’s extending a grace period merely as a “temporary” technical step in order “to provide more time for businesses such as supermarkets and parcel operators to adapt to and implement the new requirements.”

  Meanwhile, international delivery specialist ParcelHero put out a study noting that “increased red tape and duties mean UK traders could face a 35% drop in sales of products sourced overseas.” It claimed, “The Government’s Brexit rollout is going to hell in a handcart. The Prime Minister must return to the negotiating table to sort out the escalating issues facing the UK’s beleaguered retailers.”

  Tyler Durden
  Wed, 03/10/2021 – 01:00

• The Weaponization Of The Term "Far Right"
  The Weaponization Of The Term “Far Right”

  Authored by Shane Coules via The Mises Institute,

  Economist Thomas Sowell once said that the word ‘racism’ is like ketchup: it can be put on practically anything. Today, since Robin DiAngelo et al have decided that all white people are racist, it could be argued that the word has lost some of its power; if we’re all racist, then calling us just that isn’t particularly effective. And if we’re all unconsciously racist, perhaps we’re all victims, and thus should be the target of sympathy, not anger. Or not: Ms. DiAngelo’s and her anti-racist disciples’ claptrap has been brilliantly taken apart by the esteemed linguist and author John McWhorter.

  But the term far right hasn’t been watered down nearly as much as the ‘r’ word. And when most people hear far right, they likely think of Nazi flags, white supremacists, ultranationalists, etc. So, if you are eager to wound an individual’s or a group’s reputation, the term is most certainly a useful one.

  Indeed, like its close cousin – the neologism ‘alt right’ – far right has become an effective tool for those in the media and politics, used to discredit and smear people who they consider a threat, or with whom they merely disagree. A recent example of this is the anti-lockdown protests that took place in Dublin, Ireland on February 27, 2021.

  

  Dublin Drama

  Reports have varied, but anywhere from 400 to 4,000 people took to the streets of Dublin to demonstrate against what have been considered the most draconian lockdowns in Europe. This third Irish lockdown has been enforced since late December and may last until June. When one reckless individual at the protest decided to point fireworks at the Irish police (An Garda Síochána, or ‘the Guards’), unfortunately further violence broke out. Predictably, the ugly scenes that followed dominated the news headlines, rather than the core issue: people protesting against their de facto mass incarceration, and the collateral damage caused by continual lockdowns.

  Papers pounced, using loaded language like “anti-lockdown protesters stormed Dublin city centre.” One elected Irish official referred to the protest as a ‘riot’. And the always-effective smear would soon be utilized, too. Extra.ie proclaimed “far right thugs attacked frontline Gardai policing an illegal protest.” The Irish Mirror declared “far right anti-lockdown protesters thronged the city flouting Covid-19 restrictions.”

  How reporters managed to sit down with protesters and learn about their respective political leanings is not only incredibly admirable – it is journalism of the highest standard. Of course, these journalists did no such thing. Were some of those in attendance right wing? Yes. That a) doesn’t necessarily make them far right, and b) doesn’t warrant labelling the protest a ‘far-right demonstration’ like some Irish politicians have. A significant number of Irish citizens decided to stand up and speak out against what is widely considered a cruel lockdown. That doesn’t make all of them extremists. Quite the opposite: it is likely that many are desperate and feel that protesting is their only option.

  Interestingly, in videos posted online, Irish Republican flags can also be seen among the crowds in attendance. Irish Republicans tend to lean left on the political compass, and often describe themselves as socialists, in keeping with the political leanings of the leaders of the Easter Rising. The likely reality is that the people protesting came from different political backgrounds, and many – if not most – were probably apolitical, like the majority of people tend to be. By using the term far right to describe the march, reporters and politicians are smearing the ordinary, non-violent people who have genuine concerns about the latest level-5 lockdown: a 5km travel limit, no guests on private or rented property, no family gatherings in any setting, the forced long-term closure of “non-essential” businesses, and fines and/or jail time for some who break the rules.

  “Far Right” as an Ad-Hominen

  No matter how rational or cogent one’s arguments are, the term formerly reserved for fascists and neo-Nazis will always be on standby, ready to be used by the writer or politician taking aim. Canadian clinical psychologist Jordan Peterson – a man who has lectured on fascist and socialist totalitarianism – has been referred to by critics as “a far-right boogeyman riding the wave of a misogynistic backlash.”

  YouTube has given a platform to progressive, socialist, communist, anarchist, conservative, classically liberal, libertarian, and centrist voices. But according to an academic paper released last year, most YouTubers are far right. The Southern Poverty Law Centre has painted Sam Harris – a self-described liberal – as “a gateway to the alt (far) right.” Conservative political commentator Ben Shapiro has recently been called a “far right gadfly” by the ‘youth culture’ magazine Uproxx. For those who don’t know, Mr. Shapiro is Jewish; Jews and neo-Nazis tend not to get on very well. But that doesn’t really matter, because according to Wikipedia – with its approximately 46 million articles accessed by 1.4 billion unique devices every month – far-right politics includes ideologies or organizations “that feature aspects of chauvinist, xenophobic, theocratic, racist, homophobic, transphobic, or reactionary views.” Good luck finding widespread agreement on what constitutes each of those terms. In any case, with such a wide net, it shouldn’t be difficult to lump people and groups under the undesirable umbrella.

  Given how the term far right is beginning to be spread like ketchup, perhaps it will soon lose its effectiveness in smearing individuals and groups. But as the above example of the Dublin anti-lockdown protest shows, it is still a useful weapon used by the media and political establishment; tarnish aspects of a protest as far right, and you essentially tarnish the entire protest – one that was reasonably justifiable.

  The sooner all of us smell the BS, the better; with such broad, divisive, and potentially damaging terms used so liberally against individuals and groups, rational dialogue between people who disagree may become even more of a rarity.

  Tyler Durden
  Tue, 03/09/2021 – 23:25

• ​​​​​​​China Makes Massive Ethanol Purchases, Surpasses Imports From Last Year
  ​​​​​​​China Makes Massive Ethanol Purchases, Surpasses Imports From Last Year

  Three Reuters sources said Monday that Beijing made massive purchases of US energy products.

  The sources said, “three ships carrying ethanol were heading to China from the US Gulf Coast.” They said it’s a “sign that ethanol exports from the United States to the country are increasing drastically.” 

  

  The purchases are so big that they’re expected to “surpass the total amount of US ethanol that China imported last year,” said Reuters. 

  Each vessel is carrying 30,000 tons or about 240,000 barrels of ethanol, the sources said. It was unclear what port the ships were headed to in China. One source said two of the tankers left at the end of February.

  Searching through US Customs data, we found at least two of the vessels and their International Maritime Organization (IMO) numbers for tracking purposes.

  

  In January alone, China has bought “roughly 200 million gallons” (4.76 million barrels) of the US, said Archer Daniels Midland Co-Chief Financial Officer Ray Young.

  If all three tankers were filled to the brim, the cargo would be equivalent to about 720,000 barrels of ethanol, more than 506,000 barrels of US ethanol shipped to China in all of last year. 

  “While China imported an annual record of 4.72 million barrels of US ethanol in 2016, it has not recently been a large importer. However, tightening supplies of domestic corn used to make the biofuel, coupled with comparatively lower US prices, have spurred the need for imports,” Reuters said. 

  The increase comes months after former President Trump has left the White House and the Biden administration has taken control. Even though the Biden administration has promised to move quickly to restore America’s relations with the rest of the world, it has yet to improve relations with China. 

  From Iran to Russia, Europe to Latin America, the administration is cooling tensions after President Trump ran amuck, inciting trade wars and unleashing sanctions. Now cooler tensions are materializing. 

  We wonder if Beijing’s latest purchase of US ethanol is the beginning of a move to show that it plans to hold up to the trade deal agreement it signed in January 2020 to purchase more of the American farm, energy, and manufactured goods. 

  China miserably failed to meet trade deal requirements under the Trump administration, but maybe all will change under a Biden administration?

  Already, China is on a massive buying spree of US corn. 

  Tyler Durden
  Tue, 03/09/2021 – 23:05

• Michigan Governor Whitmer Faces Possible Criminal Charges For Nursing Home Deaths
  Michigan Governor Whitmer Faces Possible Criminal Charges For Nursing Home Deaths

  Authored by Rick Moran via PJMedia.com,

  The Macomb, Mich., county prosecutor is considering filing criminal charges against Governor Gretchen Whitmer for her actions in placing coronavirus-positive patients in nursing homes after their release from the hospital.

  

  A similar practice in New York State resulted in the deaths of 15,000 elderly patients and staff and prosecutors are looking at charging Governor Andrew Cuomo in the matter.

  New Macomb County Prosecutor Peter Lucido, a Republican, is appealing to people who lost loved ones in nursing homes during the pandemic to file wrongful death complaints with their local police departments to help in his investigation. Lucido says he is barred by law from getting that information.

  Michigan was one of just five states to place COVID patients in nursing homes.

  WXYZ:

  Lucido started looking into this last year as a State Senator. He issued a statement in August that said more than 2,000 residents and 21 staff died in nursing homes, 32% of all deaths.

  Lucido is asking people to go back to the nursing homes and gather the vital information surrounding deaths and take it to local police to file a wrongful death report.

  He will be meeting with Macomb County Police to instruct them on how to process and verify the information and bring it to his office.

  “Why did my mom or why did my dad, brother, sister, or aunt die? Was it because of the policy by bringing in COVID-infected patients that spread to my mom that killed my mother?” Lucido asked.

  Fifteen thousand families in New York are asking the same thing.

  Lucido is running into a lot of flak from the Democratic leadership in the state. He asked them to help him set up a “blue ribbon” investigating panel made up of county prosecutors to investigate whether any charges should be filed.

  They weren’t interested.

  The Attorney General said there was not a proper basis to open a criminal investigation. The U. S. Attorney said they would look into his request.

  “I didn’t receive a very warm welcome. This is not political everyone. This is about people who passed away at the behest of a policy that was created by the Governor,” Lucido tells 7 Action News.+

  Don’t expect the feds to do anything either. National Democrats have rediscovered states’ rights and wouldn’t dream of infringing on local investigations.

  Whitmer’s office issued a self-serving statement that somehow never quite got around to answering the question.

  Our top priority from the start has been protecting Michiganders, especially seniors and our most vulnerable. The administration’s policies carefully tracked CDC guidance on nursing homes, and we prioritized testing of nursing home residents and staff to save lives. Early in the pandemic, the state acted swiftly to create a network of regional hubs with isolation units and adequate PPE to prevent the spread of COVID-19 within a facility. In addition, we have offered 100 percent of nursing home resident priority access to the vaccine.

  I’m sure the families of dead loved ones are overjoyed that nursing home residents have been given priority access to the vaccine. But what about the policy of placing infected patients in with healthy seniors?

  Whitmer’s response to the pandemic has been at times, hysterical and an incompetent mess. She owes those families an explanation and apology for adopting an incomprehensibly stupid policy that cost lives.

  Tyler Durden
  Tue, 03/09/2021 – 22:45

• ​​​​​​​Dollar Bottom? USD At Major Crossroads
  ​​​​​​​Dollar Bottom? USD At Major Crossroads

  The US Dollar faded 3.5-month highs on Tuesday morning as Treasury yields dipped, allowing more riskier currencies to rise. The latest surge in the dollar has put it at an important crossroad after stabilizing in the last three months around the 89-90 level. 

  With dollar shorts under strain, the latest Commodity Futures Trading Commission data ending Mar. 2 shows the short dollar trade is widely overcrowded. The chart below is relatively important but doesn’t cover the real FX market, i.e., FX futures markets but does represent a sizeable short in the dollar.

  

  The dollar’s latest push higher has put bears under pressure, especially since the monthly 200 exponential moving average (91.355) has been breached to the upside with the 23.6-Fib (92.319) in a test. 

  

  Even though the dollar has slumped Tuesday along with Treasury yields, falling to around 1.54% on 10Y, yields could rise further this week as the market will have to digest $120 billion auctions of 3, 10, 30-year treasuries. After last month’s abysmal 7-year note sale that spiked yields and dollar.

  “Stability is likely to remain the theme of the day ahead of the UST auctions and the US inflation release tomorrow, which are the near-term risks for FX markets (given the possible negative spillover into USTs and the risk of a further sell-off),” ING strategists Chris Turner, Francesco Pesole and Petr Krpata wrote in their daily note. 

  The dollar has perhaps attracted short-term traders due to oversold conditions and high net speculative positioning heavily short (hello Robinhood or WSB kids…). Further, the rise in interest rates increases the dollar’s appeal. 

  And should this occur, it would not be welcome for the equity markets due to the negative correlation between the dollar and stocks. Most importantly, a surging dollar, with rising interest rates, could put a severe dent in the “reflation trade.”

  More on dollar strength is JPMorgan who recently warned dollar strength may be driving some of the recent weakness in commodities.

  However, bear in mind that trading the dollar in FX markets is merely betting its the best-looking – or worst – horse in the glu factory of fiat finance…

  

  We suspect ‘alternative currencies’ may be a better longer-term signal for where the dollar ends up, but counter-trend rallies against its currency peers are obviously tradable.

  Tyler Durden
  Tue, 03/09/2021 – 22:25

• Arizona And Montana Take Legal Action Against Biden Admin ICE Arrest Regulations
  Arizona And Montana Take Legal Action Against Biden Admin ICE Arrest Regulations

  Authored by Samuel Allegri via The Epoch Times (emphasis ours),

  Arizona and Montana are taking legal action (pdf) to block new Biden administration immigration regulations, saying that these would cause negative consequences for the states.

  

  The new rules would limit the capability of ICE to detain some illegal immigrants unless they pose a threat to national security, entered through the border after Nov. 1, or committed aggravated felonies.

  The Biden administration says that the rules don’t impair arresting or deporting people, but the officers in the field would need to request permission from their superiors to arrest people outside of the aforementioned cases.

  “If asked about the poorest policy choice I’ve ever seen in government, this would be a strong contender,” Arizona Attorney General Mark Brnovich said in a statement. “Blindly releasing thousands of people, including convicted criminals and those who may be spreading COVID-19 into our state, is both unconscionable and a violation of federal law. This must be stopped now to avoid a dangerous humanitarian crisis for the immigrants and the people of Arizona.”

  

  Montana Attorney General Austin Knudsen joined the Brnovich in the lawsuit. Both filed for a preliminary injunction aiming to block the regulations from going into effect.

  “Meth trafficked into Montana by Mexican drug cartels has wracked our state. The problem will only be made worse if the Biden administration continues to allow criminals to stay in the country,” Knudsen stated. “Enforcing our immigration laws and helping to keep Americans safe is one of the federal government’s most important functions. The Biden administration is failing its basic responsibility to Americans.”

  Last month, Chief Deputy Matthew Thomas told Townhall that the crisis at the border had begun to re-emerge at around the end of 2020 because the human and drug trafficking cartels expected President Joe Biden to have a “hands-off” attitude with regard to the border situation.

  “When [Trump] took office, we saw that this area out here went completely dead. Nobody was moving, nobody was smuggling because [the cartels] knew that Trump was going to put all hands on deck out down here and that they would be intercepted so it came to a screeching halt,” Thomas said.

  “It was a very slow trickle to get back to some kind of normal but it never got back to where it was,” Thomas added.

  

  Thomas said that since Biden has ordered to halt the construction of the southern border wall, it has created more trouble for Pinal County since it doesn’t have physical barriers, promoting the criminals to funnel through, reaching the highway and then transporting drugs or bodies throughout the country.

  He added that once the people or drugs are smuggled in, they can go anywhere inside the United States, sometimes as far as Canada.

  “For us, effectively, I-8 … becomes the new border and even the cartels will tell you that’s their goal line because once they get there, they’re shooting west or they’re shooting east and then they’re on a main interstate right into downtown Phoenix … we become the kickoff point for that,” the Sheriff said.

  “These people and these drugs are not coming here to Pinal County to stay. This is a transport location. This is a spot they get through to get to their final destination and they’re being sent all over the country.”

  Tyler Durden
  Tue, 03/09/2021 – 22:05

• OECD Believes Biden Stimulus Will Boost World GDP 
  OECD Believes Biden Stimulus Will Boost World GDP 

  A global economic recovery is coming in hotter and faster than previously anticipated by the OECD as President Biden’s $1.9 trillion stimulus program will boost not just the domestic economy but the world. 

  The Paris-based organization upgraded its outlook for global growth on Tuesday in a note titled “The need for speed: faster vaccine rollout critical to stronger recovery,” where it explains global output could surge above pre-pandemic levels by the second half of 2021 as vaccine rollouts and stimulus aid the recovery but warned of unevenness. In Europe, measures to boost output will result in slower growth, with the OECD lowering France and Italy’s outlook this year. It also warned accommodative policies should not be prematurely tightened. 

  

  OECD estimates global GDP growth will print around 5.6% this year, an upward revision of more than one percentage point since its December 2020 report.

  Laurence Boone, the OECD’s chief economist, told the Financial Times that the stimulus bill – known as the American Rescue Plan – will add one percentage point to global economic growth in 2021.

  

  There are consequences to governments and monetary authorities across the planet printing like there was no tomorrow – that is – a sharp rise in inflation expectations are putting pressure on central banks to adopt some form of the yield curve control to cap the long end of the curve. It has also added to a violent shift from growth to value, where the once favored tech stocks have lost their luster, such as TSLA, NFLX, and AMZN, as investors pivot to value companies like XOM. 

  Boone doesn’t believe the stimulus package will increase domestic inflation to dangerous levels because “there is a lot of slack in US labor markets,” she said.

  “The amazing fiscal support everywhere means that we have preserved the economic fabric across OECD countries. Even in emerging markets, we’ve seen amazing policy support,” Boone said.

  The upbeat US outlook, only made possible by endless money printing, has side effects. Morgan Stanley’s Mike Wilson pointed out another round of stimulus ontop of vaccine rollouts and reopening increase inflation expectations and “put pressure on valuations, especially for the most expensive stocks that had reached nosebleed valuations.”

  Wilson said, “most portfolios are positioned” and “overexposed to growth stocks and either short or underweight the value areas.” With Biden’s monstrous fiscal stimulus, the new value regime in town will generate a “portfolio disruption” causing a “net negative effect on the major averages, led by the Nasdaq.” 

  

  He notes, “Markets lead the Fed, not the other way around, and we are now at that moment of recognition,” adding that, “the bull market continues to be under the hood, with value and cyclicals leading the way. Growth stocks can rejoin the party once the valuation correction and repositioning is finished.”

  So in an era where MMT, or Magic Money Theory, is being unleashed by the governments and central banks to supercharge the domestic and global economy, perhaps the lesson to be learned is to stay away from the sinking ARKK. 

  Tyler Durden
  Tue, 03/09/2021 – 21:45

• National Guard DC Deployment To Last Two More Months
  National Guard DC Deployment To Last Two More Months

  About half of the National Guardsmen deployed in Washington DC will remain at the US Capitol through May 23, the Pentagon announced Thursday evening.

  At the direction of Defense Secretary and Raytheon board member what’s his face Lloyd Austin, approximately 2,300 troops will remain stationed more than two months beyond their scheduled withdrawal scheduled for this week. There are approximately 5,100 Guardsmen at the Capitol at present.

  

  “This decision was made after a thorough review of the request and after close consideration of its potential impact on readiness,” said Pentagon spox John Kirby in a statement reported by The Hill.

  As part of the protracted deployment, Pentagon officials will “work with the U.S. Capitol Police to incrementally reduce the National Guard footprint as conditions allow,” said Kirby, adding “We thank the National Guard for its support throughout this mission, as well as for its significant efforts across the nation in combating the COVID-19 pandemic.”

  Blue Anon?

  One may wonder why the National Guard and razor-wire fences have become part of Washington’s ambiance. The answer, in part, is due to the belief in a left-wing conspiracy theory that Trump supporters would swarm the Capitol on March 4, when – as the legend has it, Trump would secretly be re-inaugurated on the historical anniversary of pre-1933 inaugurations before it was moved to January 20th.

  Leftists who believe in such theories – such as the Russia Hoax, Jussie Smolett’s 2am footlong craving, or that Justice Brett Kavanaugh was running a gang rape operation in college – are known as “Blue Anons,” who traffic in mainstreamed fantasies about conservatives gone wild.

  WHAT DOES “BlueAnon” MEAN?

  “Who paid Brett Kavanaugh’s debts?”
  “Why did Justice Kennedy resign?”
  “The Capitol riot was planned by Republicans, and Capitol police collaborated.”
  “Detention centers are concentration camps.”

  and, obviously: “Trump is a Russian asset.”

  Any others? https://t.co/lSl9NJTvN9

  — Max Nordau (@MaxNordau) February 2, 2021

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  As the Washington Post noted, March 4 came and went without much fanfare.

  When asked what the new threat is requiring the National Guard’s presence, Kirby demurred – saying “The Guard presence on the Hill, while certainly there to address a requirement that is based on law enforcement’s concerns, is also there to help bolster and support the Capitol Police and their capabilities, which may not be at the level where it needs to be given the fact that we’re in sort of a new environment in this country,” adding “So it’s not just about a threat assessment. It’s about assisting and supporting capabilities that the Capitol Police may now lack and may need to look at improving on their own.”

  Quick reaction force?

  After a Democrat-appointed “task force” was established to assess threats in DC, Army Lt. Gen. (Ret.) Russel L. Honoré told House Speaker Nancy Pelosi that a “quick reaction force” be formed and placed on standby, because the city is “a high-value target for foreign terrorists or domestic extremists, yet it has no dedicated QRF for response to crises.”

  “The USCP relies on augmentation from other civilian law enforcement agencies for emergency support, but we recommend establishment of a robust, dedicated QRF, not only for the USCP, but to serve the nation’s capital writ large,” the recommendation continues.

  Which begs the question; How ever did DC get by all this time without one?

  Tyler Durden
  Tue, 03/09/2021 – 21:25

• "This Was A Bloodbath" – Liberal Journalists Outraged After Huffington Post Fires 1/3rd Of Its Staff
  “This Was A Bloodbath” – Liberal Journalists Outraged After Huffington Post Fires 1/3rd Of Its Staff

  Just months after it was acquired by Buzzfeed in a fire sale, the Huffington Post – the once-pioneering Internet media property – has elicited an outpouring of criticism from the blue-check crowd after abruptly firing nearly 50 reporters, roughly one-third of the site’s staff.

  News of the layoffs first emerged on Twitter, as dozens of newly-fired journos tweeted about their misfortune, but was soon picked up by Defector, the cooperatively-owned media property started by former staff writers from Deadspin.

  

  According to Defector, BuzzFeed founder Jonah Peretti announced Tuesday during an all-hands meeting that 47 HuffPo staffers in the US, including eight managers, would be losing their jobs in order to “drive long-term sustainability.” Rival journos slamed Peretti, accusing him of traumatizing the laid-off journalists by forcing them to repeatedly refresh their inbox to see if they had received one of the dreaded pink slips. Anybody who didn’t receive a notice by 1300ET was said to be “safe”.

  As if this wasn’t undignified enough, Peretti reportedly set the password for the mass-layoff meeting to “spr!ngisH3r3,” an innocuous message that contrasted sharply with the situation as hand. One member of the Buzzfeed union described the firings as a “bloodbath”.

  “This is a bloodbath,” a HuffPost staffer and union member told Defector. “It’s worse than the worst-case scenario for what any of us thought we would see when we got this announcement a couple hours ago. And the fucked-up way that they announced this notwithstanding, this is a just bloodbath for an award-winning international newsroom full of absolutely stellar journalists who didn’t deserve this.” “The initial reaction is I can’t believe what little chance we were given to show what we can do to help this company,” the staffer said.

  Some of the reporters and their allies recounted the firing in terms that one might reasonably describe as “melodramatic.”

  pic.twitter.com/Pc0d5S0Qct

  — Jack Posobiec (@JackPosobiec) March 9, 2021

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  While trying to explain the circumstances surrounding the told staffers that the newly combined company’s losses had exceeded $20MM last year, and that the company was on track to repeat that dismal performance without some kind of intervention.

  Peretti, who laid off nearly 70 percent of BuzzFeed’s furloughed staff last summer in order to keep losses under $20 million, said during today’s meeting that the company’s losses exceeded $20 million.

  “The loss of last year exceeded $20 million and would be similar this year without intervention,” Peretti said. “And BuzzFeed is a profitable company, but we’re not that profitable, and we don’t have the resources to support another two years of losses.”

  Another blue-check reporter published a complete accounting of all the reporters who were laid off, along with the beats they covered.

  A thread of incomparable reporters laid off from HuffPost today who you, an esteemed media organization, should scoop up immediately:

  1/

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

  https://platform.twitter.com/widgets.js

  + @rklein90, education reporter
  + @aedwardslevy, polling editor/reporter/pun expert
  + @gumgumerson, entertainment reporter
  + @quasimado, reporter on violence against women
  + @CarolKuruvilla, religion reporter
  + @EmilyRPeck, business, economics and gender inequality reporter

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  + @RottenInDenmark, new economy reporter
  + @tarantallegra, film reporter
  + @emmaladyrose, culture reporter
  + @RealGirlProject, personals/lifestyle reporter
  + @JeffYoung, health care reporter
  + @lukeobrien, extremism/misinformation reporter
  + @nickrobinsearly, world news reporter

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  Editors/producers you should hire:

  + @blankjess, producer
  + @sarapatt, audio producer
  + @erika_larose, producer
  + @samanthastorey, editor
  + @kewlfocus, photo editor
  + @recordedvoice, editor

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  more HPers I can’t endorse enough:

  + @leighblickley, culture reporter
  + @boyreporter, audience editor
  + @toddvanluling, lifestyle reporter
  + @ClaireEFallon, culture reporter

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  even more:

  + @zblay, culture reporter
  + @zachdcarter, economic policy reporter
  + @Isaachimmelman, producer
  + @IzzyBestNews, producer

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  and more:

  + @hilella, our former powerhouse executive editor
  + @louiseroug, exec editor international
  + @jennkho, strategic innovation
  + @Romblay, producer

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  Our HuffPost Canada comrades were also cut today. Hire them. https://t.co/V1z1v2Pyxm

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  https://t.co/MNo3xH9uFb

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

  https://platform.twitter.com/widgets.js

  https://t.co/xTXbzMb3Sc

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  https://t.co/vfvLTHBYk3

  — Jenna Amatulli (@ohheyjenna) March 9, 2021

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  While these tweets are obviously well-intentioned, another twitter personality pointed out that sad reality that there simply aren’t any media jobs right now – at least, not for reporters who specialize in covering “culture”, “lifestyle”, “entertainment”, “violence against women” and “misinformation”, which were just a handful of the beats that were eliminated at HuffPo.

  i know everyone means well when they tweet “hire these incredible people” but there are no jobs

  — Brandy Jensen (@BrandyLJensen) March 9, 2021

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  Others attacked Peretti and Buzzfeed-HuffPo for failing to be more sensitive to the plight of the laid-off reporters.

  There’s no good way to do mass layoffs but it shouldn’t be that hard to not do it the bad way https://t.co/puikJ8kMbV

  — Tom Gara (@tomgara) March 9, 2021

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  While some couldn’t help but find humor in it all.

  What do you call Huffington Post laying off 1/3rd of their journalists?

  A good start

  — Will Chamberlain (@willchamberlain) March 9, 2021

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  But in all honesty, these reporters should have been able to read the writing on the wall. Although it was once a pioneering media organization, the Huffington Post’s best days are long behind it: the website’s traffic has shriveled in recent years to a mere fraction of what it once was, as round after round of devastating cuts thinned its staff.

  Perhaps now it will get another chance at life by mimicking Buzzfeed’s strategy of having its most popular pieces written by high school students working for free.

  Tyler Durden
  Tue, 03/09/2021 – 21:05

• The V-Shaped Recovery Never Happened
  The V-Shaped Recovery Never Happened

  Authored by Ryan McMaken via The Mises Institute,

  In a display of unconvincing enthusiasm, NBC reported Friday that payroll employment “surged” in February. Specifically, total nonfarm payrolls (seasonally adjusted) grew 379,000, month-over-month which was above the expected increase of 210,000.

  

  That might sound great to some, but a closer look suggests jobs growth is quite a bit more sedate than the media narrative suggests. Moreover, a look at the job growth situation in recent months is a helpful reminder that the “V-shaped recovery” we were promised last spring never happened. 

  Some may remember all that talk about a V-shaped recovery last year. That was back when we were being assured that “two weeks” —or maybe two months— to “slow the spread” of covid-19 would pay countless dividends, because then lockdowns and forced business closures would somehow miraculously “beat back” the disease and then employment and the economy would come roaring back, the Fed could end its stimulus programs, and everything would be fine.

  Back in June, CNBC announced “The recovery from the coronavirus sure looks V-shaped” and pointed to record job growth coming out of the initial collapse in employment that occurred in March and April.

  But then the good news basically stopped, at least as far as employment was concerned.

  For example, while February’s month-over-month job growth might look impressive, the US remains a long, long way from where total employment was this time last year. In February of last year, before the effects of lockdowns were beginning to be felt, total employment topped 152 million in the US. After this February’s “surge” in employment, total employment was at 143 million, or still down 9 million. In other words, total employment is still where it was back in 2015.

  

  Yes, the US has regained 13 million jobs since the bottom of the crisis back in April 2020. But as we can see in the first graph, total employment has gone sideways since last November, and is only up by 200,000 over the past four months. That’s not exactly a “surge” of anything. And it’s definitely not anything resembling a “v-shaped” recovery. It looks more like a very week version of a “check mark-shaped recovery” that some predicted last year. Except the tail end of this check mark has so far been nearly flat.

  And then there is the unemployment insurance totals. New unemployment insurance claims have hovered around between 700,000 and 800,000, every week, for the past five months. There’s no evidence of any downward trend here, and the V-shaped recover turned into a long slog past the initial anemic “recovery” that took place last summer.

  

  Continuing unemployment claims are slowly lessening, however. Since the beginning of the calendar year, continuing claims have fallen from 5.1 million to 4.2 million.

  In both cases, totals remain well within recessionary territory. Back during the Great Recession, for example, continuing claims peaked at 6.6 million. Claims totaled about 1.7 million in 2020 before the recession began.

  Unemployment has also remained stubbornly high among those making claims under the Pandemic Unemployment Assistance program. In early January, total continuing claims under the PUA was at 8.3 million, continuing a long slow trend downward. By early March, continuing claims had only fallen to 7.3 million.

  

  That’s progress, but combined with regular unemployment insurance, it means there are still more than ten million Americans receiving some form of unemployment insurance, which hardly suggests a robust recovery.

  The unemployment rate remains troublingly high as well. The headline unemployment rate for February was reported as falling to 6.2 percent. That’s certainly an improvement from April 2020’s peak rate of 14.8 percent.

  But as is so often the case, the headline rate masks a more complex reality surrounding the unemployment rate.

  Although the official rate is 6.2 percent, the Washington Post’s Heather Long notes that the Minnesota Fed’s Neel Kashkari admitted “the true unemployment rate is around 9.5%”

  Why the gap? It is a result of several factors, including falling response rates to the Labor Department’s employment surveys, the fact many have simply stopped looking for work, and ambiguities in the data over whether or not someone is only temporarily unemployed.

  In other words, the official unemployment calculation excludes a great many people who would like to have jobs, but who gave up and stopped looking for work. Many others are only technically “temporarily” unemployed but in practice are jobless. The official data says many of these people are “on leave.”

  Fed Chairman Jerome Powell has also admitted that the unemployment rate was likely close to 10 percent in January. Not surprisingly, Kashkari predict no “liftoff” for the economy until 2022. 

  Taking all this together, it’s pretty clear the United States is still very much in the midst of a jobs recession. 

  Yet, CNBC tells us that the economy is “on fire” because GDP totals may surge in the upcoming first quarter data.  “Economic growth in the first quarter could hit 10%,” CNBC triumphantly proclaims, claiming the economy has “roared back” and is set to defy even the rosiest expectation.

  But unless something changes big time in the jobs situation, we’ll have to start looking at GDP the way we look at stock prices: something that reflects a lot of optimism and growth in some sectors of the economy but which has very little to do with the personal finances and job prospects of millions of ordinary Americans.  

  Tyler Durden
  Tue, 03/09/2021 – 20:45

• Hackers Infiltrate Thousands Of Security Cameras Inside Jails, Hospitals & Tesla
  Hackers Infiltrate Thousands Of Security Cameras Inside Jails, Hospitals & Tesla

  In the latest embarrassing hacking incident to affect American technology giants, a team of hackers has stolen what Bloomberg described as a “massive trove of security-camera data collected by Silicon Valley startup Verkada” in an effort to make a point about the dangers and drawbacks of mass surveillance.

  

  Using administrator credentials purportedly found on the public Internet, the hackers gained access to live feeds tied to some 150K security cameras located inside hospitals, companies, police departments, prisons, schools and – bizarrely – Tesla HQ. According to the report, footage belonging to Tesla and software company Cloudflare were stolen in the hack. The hackers were also able to steal footage taken from inside women’s health clinics, psychiatric hospitals, along with footage from inside Verkada’s offices.

  The cameras administered by Verkada, which bills itself as an “enterprise security camera” maker, use facial-recognition technology to identify people. And the hackers who stole the trove of data say they have access to “the full video archive” of Verkada’s customers. In theory, this could give the hackers a panopticon-like view of hundreds of thousands – perhaps millions – of people.

  The group behind the breach bills itself as an “international hacker collective” and said it stole the footage to help make a point about the dangers and pervasiveness of video surveillance. Perhaps to help emphasize this point, the group shared some particularly sensitive footage with Bloomberg, including…

  • Footage captured inside Florida hospital Halifax Health, which showed what appeared to be eight hospital staffers tackling a man and pinning him to a bed. Halifax Health is featured on Verkada’s website in a case study entitled: “How a Florida Healthcare Provider Easily Updated and Deployed a Scalable HIPAA Compliant Security System.”

  • Video shot inside a Tesla warehouse in Shanghai showing workers on an assembly line. The hackers said they obtained access to 222 cameras in Tesla factories and warehouses.

  

  • A video showing officers inside a police station in Stoughton, Mass., questioning a man in handcuffs.

  • Security camera footage taken from inside Sandy Hook Elementary School in Newtown, Conn., where gunman Adam Lanza killed more than 20 people in 2012.

  • Also available to the hackers were 330 security cameras inside the Madison County Jail in Huntsville, Alabama.

  • And cameras from multiple locations of the luxury gym chain Equinox.

  • Hackers were able to download the entire list of thousands of Verkada customers, as well as the company’s balance sheet, which lists assets and liabilities. As a closely held company, Verkada does not publish its financial statements.

  Tillie Kottmann, one of the hackers who claimed credit for breaching the San Mateo, California-based Verkada, is acting as a sort of representative for the collective. Kottmann, who uses they/them pronouns, previously claimed credit for hacking chipmaker Intel and carmaker Nissan They reportedly told Bloomberg their reasons for the hack were “lots of curiosity, fighting for freedom of information and against intellectual property, a huge dose of anti-capitalism, a hint of anarchism – and it’s also just too much fun not to do it.”

  Kottmann said the hackers were able to obtain “root” access to the cameras, meaning they could use the cameras to execute their own code. In some instances, this allowed them to pivot and obtain access to the broader corporate network of Verkada’s customers, or hijack the cameras and use them as a platform to launch future hacks. Obtaining this degree of access to the camera didn’t require any additional hacking, as this is a built-in feature. The hackers’ methods were unsophisticated: they gained access to Verkada through a “Super Admin” account, allowing them to peer into the cameras of all of its customers. Kottmann says they found a user name and password for an administrator account publicly exposed on the internet.

  A rep for Verkada said the company had disabled all internal administrator controls to prevent any further unauthorized access. The individual added that “Our internal security team and external security firm are investigating the scale and scope of this potential issue.”

  Another source from inside Verkada told Bloomberg that the company’s chief information security officer, an internal team and an external security firm are investigating the incident. The company is working to notify customers and set up a support line to address questions, said the person, who requested anonymity to discuss an ongoing investigation. This facial-recognition technology is used to track staff and inmates inside prisons in the US, with many of the cameras responsible for this being hidden inside vents and other places.

  Verkada offers its clients a feature called “People Analytics” which allows a customer to “search and filter based on many different attributes, including gender traits, clothing color, and even a person’s face,” according to a Verkada blog post. While hardly a household name, in October 2020, Verkada attracted some press attention after it fired three employees who reportedly used its cameras to take pictures of female colleagues inside the Verkada office and make sexually explicit jokes about them. Verkada CEO Filip Kaliszan said in a statement to Vice at the time that the company had “terminated the three individuals who instigated this incident, engaged in egregious behavior targeting coworkers, or neglected to report the behavior despite their obligations as managers.”

  This is just the latest hack-related news to rattle the US, as the business press has been intensely covering another breach where hackers working for the Chinese government managed to exploit flaws in Microsoft’s outlook email software to gain access to potentially thousands of high-value targets.

  Tyler Durden
  Tue, 03/09/2021 – 20:25

• Scotia Sells COMEX NY Vault In Slow Motion Exit From Gold, Silver Markets
  Scotia Sells COMEX NY Vault In Slow Motion Exit From Gold, Silver Markets

  Submitted by Ronan Manly, BullionStar.com

  On Monday 1 March, CME Group, which runs COMEX, made a short announcement saying that long time COMEX approved gold and silver vault operator, Bank of Nova Scotia was withdrawing its New York vault from being COMEX approved and that the withdrawal was ‘effective immediately’.

  The full text of the release, titled “Withdrawal of Regularity for Gold, Silver, Platinum, and Palladium” is as follows, and can also be seen at this link here:

  “Notice herby is given that the New York Mercantile Exchange, Inc. (“NYMEX”) and Commodity Exchange, Inc. (“COMEX”) (collectively, the “Exchanges”) received a request from The Bank of Nova Scotia to voluntarily withdraw their approved gold, silver, platinum, and palladium regularity at their Jamaica, NY facility. Manfra, Tordella & Brookes, Inc. will assume responsibility for the registered and eligible material at this facility effective immediately.

  This withdrawal is effective immediately.”

  Beside JFK Airport

  For those who don’t know, the Scotia vault, owned by Scotia Mocatta Depository (SMD), is located right beside JFK Airport, at “International Airport Center, 230-59 International Airport Center Boulevard, Building C, Rockaway Blvd, Jamaica, New York 11413”, the same location as the Agility Logistics center, and can be seen here and here.

  

  Scotia moved to this facility beside JFK Airport in 2006 from a vault facility that it had been using since late 2001 under 26 Broadway in Manhattan, an old Rockefeller building. That vault facility under 26 Broadway was the former Iron Mountain Depository Corporation (IMD) vault which Scotia had acquired when The Bank of Nova Scotia took over IMD in 1997.

  However, prior to September 2001, Scotia’s COMEX approved precious metals vault had been in a sub-basement under 4 World Trade Centre, which it had taken over from Swiss Bank Corporation in the 1990s. Prior to the WTC implosions, WTC 4 was the home of the COMEX and NYMEX trading floors, as well as the trading floors of the New York Board of Trade (NYBOT), the Coffee, Sugar and Cocoa Exchange (CSCE) and the New York Cotton Exchange (NYCE)

  After 4 World Trade Centre collapsed on September 11 2001 following the WTC 1 and WTC 2 (and WTC 7) buildings’ explosions and implosions (during which notably COMEX gold was unbelievably being trucked out of tunnels at the same time), Scotia moved its COMEX approved vault back to the 26 Broadway vault in late 2001, and remained there until 2006.

  Manfra, Tordella, and Brookes, also known as MTB, is a New York based bullion dealer which also runs a COMEX approved precious metals vault in Manhattan, in the International Gem Tower building at 50 West 47th Street, in midtown Manhattan. Since 2000, MTB has been part of the Swiss MKS PAMP group.

  On the same day, 1 March 2021, that Scotia Mocatta withdrew its vault from being COMEX approved, MTB, and it parent company, the Swiss based MKS PAMP group, both made announcements on their websites that MTB had:

  “completed the strategic acquisition of a leading North American financial institution’s COMEX (CME) approved depository and logistics center” including a “world class 15,000 square foot secure facility” that will give them “proximity to  major international and domestic logistics hubs [beside JFK airport], additional vaulting capacity [Scotia’s vaults], and experienced staff”.

  The acquisition, said MTB / MKS PAMP, helps offer “enhanced depository and fulfillment services to COMEX warrant holders, financial institutions, industrial, and bullion clients”.

  See the MKS PAMP announcement here, and the identical MTB announcement here.

  In effect, without stating the name of Scotia, MTB / MKS PAMP confirmed that MTB has taken over the Scotia Mocatta COMEX approved vault located in International Airport Center, 230-59, Building C, beside JFK airport.

  Scotia Metal Transfers to MTB

  Anyone who regularly looks at the COMEX daily “Warehouse and Depository Stocks” reports for gold, silver, platinum and palladium on the CME Group (COMEX) website will have also noticed that not only did MTB take over Scotia Mocatta’s New York COMEX approved vault in the first week of March, but, MTB also took over the custody of all the COMEX registered and COMEX eligible gold, silver, platinum and palladium stock and inventory that were being stored in Scotia’s COMEX vault beside JFK.

  This was evident from the COMEX gold, silver and platinum / palladium stock reports for Report Date Wednesday 3 March (Activity Date Tuesday 2 March), where the listing and metal holdings under the “THE BANK OF NOVA SCOTIA” suddenly disappeared, and the listing and metal holdings under “MANFRA, TORDELLA & BROOKES, INC” increased by the amount of metal that had been reported previously under Scotia.

  As a reminder, in COMEX parlance, ‘Registered’ precious metal bars have vault warrants attached and can be used to settle COMEX futures contracts. ‘Eligible’ metal is just any metal that happens to be in a COMEX approved vault which is in the form of a precious metals bar which is acceptable for COMEX delivery. Eligible metal does not have to have anything to do with COMEX trading, and a lot of the time doesn’t have anything to do with COMEX trading.

  The transfers from Scotia to MTB were most pronounced in silver, where a huge 32,301.490.91 ozs (or 1004 tonnes) of silver which had been in the registered category under Scotia came into the registered category of MTB. Prior to the transfer, MTB was reporting only 1,233,649.98 ozs in registered, so the transfer from Scotia gave MTB a new Registered total of 33,535,140.89 ozs, or 27 times more silver than it previously held. This was the highest Registered silver holding of any COMEX approved vault operator, even ahead of JP Morgan’s claimed 32.5 million ozs holding.

  By 3 March, MTB had 668,437 ozs of silver in eligible and 32.26 million ozs of silver in registered for a total of 33.93 millon ozs.

  

  By 4 March MTB received in another 579,290 ozs into eligible, saw a massive 4.48 million move from registered to eligible (someone doesn’t want their silver under warrant), and had a total of 28,782,469 ozs in Registered, and 5,730,255 ozs in eligible, for a total of 34.51 million ozs overall. The Scotia transfers now put the MTB vaults in 2nd position of Registered COMEX silver holdings (just behind JP Morgan) and in 4th position of total COMEX silver holdings behind JP Morgan, Brinks and CNT.

  In gold, prior to the transfers, MTB had about 1.265 million ozs of gold in the registered category, with 20,000 in eligible, while Scotia had about 1.15 million ozs in registered and a small amount in eligible. Following the transfers, MTB now has about 2.4 million ozs in registered and about 60,000 ozs in eligible. So the MTB gold listing on the COMEX gold inventory report has increased by about 87%.

  

  Platinum and palladium in the Scotia vault has also been added to the MTB totals and the latest figures for MTB now have a total of 112,378 ozs of platinum, nearly all of which is in registered, and 9,676 ozs of palladium (all in registered).

  You can see the most recent COMEX inventory gold, silver and platinum / palladium holdings in Excel links on a COMEX webpage here.

  An important point to note here is that the gold, silver, platinum and palladium that were in Scotia’s Queen’s vault beside JFK airport are probably still in the Scotia vault (with the vault now owned by MTB). It would have been logistically illogical to move all the metal in the Scotia vault, to the MTB vault in midtown Manhattan.

  So basically, it looks to be a case of the COMEX reports having just reclassified all metal that was held in the Scotia vault and now reporting it under “Manfra, Tordella, and Brookes” (MTB) along with the metal in MTB’s original vault in Manhattan. This means that it will not be possible to know how much of the reported metal listed under MTB is in Manhattan, and how much is in the vault beside JFK airport.

  Scotia Mocatta – A Slow Motion Car Crash

  For those who may be having déjà vu about Scotia Mocatta previously withdrawing from the precious metals markets, you would be forgiven, as admittedly, Scotia’s withdrawal has been going on for what seems like years now, and can only be described as a slow motion car crash. For financial reporters in Reuters and Bloomberg, Scotia exiting the gold and silver markets is the “gift that keeps on giving”, year after year, because it never seem to end. This is because, like an octopus, Scotia has been intertwined into precious metals markets all around the world for decades and decades, from the London gold and silver markets to New York (COMEX) to Toronto (its Headquarters) and to as far afield as India and Dubai and China.

  As you can see from its vaulting operation, Scotia was one of the key players in COMEX precious metals for a long long time. But even following the New York vault sale, Scotia is still involved with COMEX, with Scotia Capital (USA) Inc still being a clearing firm on COMEX as can be seen on the clearing member firm list here, and also on the COMEX delivery report (Issues and Stops) here.

  But that’s only part of the larger Scotia picture. Because Scotia continues also to be one of the lynchpins in the London gold and silver markets along with the likes of HSBC and JP Morgan, and has a long history of running the LBMA along with HSBC and JP Morgan.

  In London Scotia, was one of the 3 banks that ran the cartel like London Silver Fixing (along with HSBC and Deutsche Bank), and the London Gold Fixing (along with Barclays, HSBC, SocGen and Deutsche Bank). This bullion bank cartel used the private companies London Gold Market Fixing Limited and London Silver Market Fixing Limited to run those daily benchmark auctions. When in 2014 and 2015 the old London Gold and Silver fixes were buried by the London Bullion Market Association (LBMA) and resurrected in the smoke and mirrors replacements of the LBMA Gold Price and the LBMA Silver Price, Scotia was one of the first direct participants in of each of the new fixes.

  The trigger for Scotia’s withdraw from the precious metals markets goes back all the way to early 2015 (or even earlier) when the US Department of Justice (DoJ) announced that it was investigating whether the Bank of Nova Scotia and other investment banks were manipulating gold and silver prices. Spoiler: They were.

  While this isn’t an article about Scotia’s criminal activities in manipulating gold and silver prices, a quick recap is in order so as to give some flavor as to who we are dealing with when we refer to the Scotia on the COMEX and in the LBMA.

  According to Bloomberg in February 2015:

  “At least 10 banks, including Bank of Nova Scotia, Barclays Plc, JPMorgan Chase & Co., and Deutsche Bank AG are being probed by the Justice Department’s antitrust division, said one the people, who asked not to be named because the matter is confidential.”

  Soon after that, investors filed class action suits in New York courts against London Gold Market Fixing Limited and London Silver Market Fixing Limited, of which Scotia was one of the defendants. See a 2016 article by Allan Flynn for some background – “How to Trigger a Silver Avalanche by a Pebble: “Smash(ed) it Good”.

  By June 2018, Reuters was reporting that Scotia was to “scrap half its metals business”.

  “Scotia pulling back from metals financing

  Bank is largest lender to precious metals industry

  Cuts heaviest in Europe, no decision yet on Asian business

  Scotia still trying to sell parts of metals business”  

  “Scotia’s pullback comes after a strategic review of Mocatta began in 2016 following a string of lawsuits related to the manipulation of gold and silver benchmarks and dissatisfaction with performance.

  It also follows a failed attempt to sell the business.”

  By April 2020, that ‘half’ of the Scotia precious metals business had turned into a full 100% sale, with Reuters reporting that “Scotiabank to close its metals business”,

  “’Scotia had a global call with all its metals staff and said it was shutting down its metals business,’ said one of the sources.

  ‘The plan is to unwind the metals business,’ said another.”

  But even then in April 2020, Scotia was still a market making member of the LBMA, and a direct participant in the LBMA Gold Price and LBMA Silver Price auctions, and a member of the  London bullion bank cartel unallocated gold and silver clearing company, the London Precious Metals Clearing Limited (LPMCL).

  Scotia’s Gold and Silver Price Manipulation

  Fast forward to August 2020, and the US Department of Justice announced that Bank of Nova Scotia (Scotiabank) had entered into a resolution with the DoJ: “to resolve criminal charges related to a price manipulation scheme involving thousands of episodes of unlawful trading activity by four traders in the precious metals futures contracts markets”, and to pay more than more than US$ 60 million in criminal fines. A flavor of the illegal activities of Scotia in that case is as follows:

  “’For over eight years, Scotiabank traders placed thousands of orders for precious metals futures contracts in an attempt to manipulate prices for their own and the bank’s benefit and to deceive other market participants,’ said Chief Robert A. Zink of the Justice Department’s Criminal Division, Fraud Section.”

  “’Today, Scotiabank has admitted to their role in a massive price manipulation scheme aimed at falsely manufacturing the prices of precious metals futures contracts to serve the bank’s best interests,’ said Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. ‘The bank’s actions were designed to lead others to trade in ways they never would have without what was believed to be legitimate market activity.’”

  Now fast forward to 1 March 2021, the same day as the COMEX and MTB / MKS PAMP vault announcements, and Wells Fargo announces that “it has expanded its precious metals trading business, filling gaps in the market left by the withdrawal of Bank of Nova Scotia (Scotiabank)”.

  But not so fast. Did anyone tell Wells Fargo that as of 08 March 2021, Scotia is still a market making member of the LBMA in gold and silver, still a member of the fractionally backed paper gold and silver trading engine, the London Precious Metals Clearing Limited (LPMCL), and still involved in LBMA precious metals vaulting in London even though it doesn’t have its own vault:

  “those clearing members without their own vault operations – Scotiabank and UBS – utilise their accounts with one of the LBMA custodians or the Bank of England (BoE)”

  And that’s only gold and silver, In addition, Scotia is still a marketing making member of the London Platinum and Palladium Market (LPPM).

  How’s that for exiting the precious metals markets?

  This will gives the likes of Reuters’ Peter Hobson and Bloomberg’s Eddie van der Walt plenty of future material to write articles such as “Scotia Mocatta still withdrawing from the precious metals markets (Part 6)“.

  It’s as if Scotia hasn’t really exited the precious metals markets at all. Just discreetly sold its precious metals vault in New York to another party and quietly slipped out the COMEX door, while transferring over 30 million ozs of silver to MTB / MKS PAMP, as the #SilverSqueeze intensifies.

  This article was originally published on the BullionStar.com website under the same title “Scotia Sells its COMEX NY Vault, in Slow Motion Exit from Gold and Silver Markets”

  Tyler Durden
  Tue, 03/09/2021 – 20:05

• Twitter Sues Texas AG; Claims He Retaliated Against Company For Banning Trump
  Twitter Sues Texas AG; Claims He Retaliated Against Company For Banning Trump

  Twitter has filed a lawsuit against Texas Attorney General Ken Paxton, claiming that he used his office to retaliate against the social media giant for banning former President Donald Trump following the Jan. 6 riot at the US Capitol, according to the Associated Press.

  

  Following Trump’s banishment by several left-leaning companies, Paxton announced that his office was investigating Twitter, Apple, Google and Amazon for what he called “the seemingly coordinated de-platforming of the President.” He made several document requests related to their content moderation policies, as well as internal communications.

  Twitter demands that the court effectively halt Paxton’s investigation.

  “Paxton made clear that he will use the full weight of his office, including his expansive investigatory powers, to retaliate against Twitter for having made editorial decisions with which he disagrees,” wrote Twitter’s lawyers in the suit filed in a Northern California court.

  Twitter’s counterpunch comes as states, in addition to federal lawmakers and governments outside the U.S., are cracking down on tech companies they see as having amassed too much power in the past decade. This includes antitrust and anti-monopoly regulation, internet privacy laws as well as attempts to regulate how platforms like Twitter, Facebook and others moderate their sites.

  In December, Paxton led 10 Republican attorneys general in suing Google for allegedly running an illegal digital-advertising monopoly in cahoots with Facebook.

  GOP politicians in roughly two dozen states have also introduced bills that would allow for civil lawsuits against platforms for what they call the “censorship” of posts. Almost always, this means what they view as the censorship of conservative or Christian religious viewpoints. –Associated Press

  Paxton cited the First Amendment while launching his investigation, claiming that tech companies’ deplatforming of Trump “chills free speech” and “wholly silences” his detractors.

  Twitter, however, does not have to abide by the First Amendment as they are a private firm with the right to silence users it disagrees with. Trump and other world leaders have been given broad exemptions, however the company said Trump’s tweets leading up to Jan. 6 constituted glorification of violence.

  Tyler Durden
  Tue, 03/09/2021 – 19:45

• Democrat Panel Recommends Permanent Military "Quick Reaction Force" For Capitol
  Democrat Panel Recommends Permanent Military “Quick Reaction Force” For Capitol

  Authored by Steve Watson via Summit News,

  A Democrat appointed ‘task force’ has issued a report recommending a permanent military security force be stationed around Capitol Hill.

  

  The task force, headed up by Army Lt. Gen. (Ret.) Russel L. Honoré, reported back to Nancy Pelosi, suggesting that a “quick reaction force” be formed and put on standby in addition to Capitol police.

  The report notes that DC is “a high-value target for foreign terrorists or domestic extremists, yet it has no dedicated QRF for response to crises.”

  It adds, “The USCP relies on augmentation from other civilian law enforcement agencies for emergency support, but we recommend establishment of a robust, dedicated QRF, not only for the USCP, but to serve the nation’s capital writ large.”

  Elsewhere in the report, it is stressed the the National Guard presence at the Capitol should only be a temporary measure and “not a permanent solution.”

  Specifically, the report suggests three forms of occupation in DC.

  Firstly, “a QRF from existing federal law enforcement entities with appropriate legal authorities and appropriations to staff, train and equip such a force.”

  Secondly, “a QRF under the command of the D.C. National Guard. This could be done by mobilizing military police from Guard elements across the U.S. on rotations of three to six months.”

  Thirdly, “a QRF that permanently resides within the D.C. Guard by reestablishing a military police battalion and staffing it with Active Guard Reserve troops.”

  In all three scenarios, a permanent military style force would reside in the nation’s capitol.

  As conservatives such as Tucker Carlson have warned, the troops are not going away, they are there to “prop up the regime”.

  Watch the latest video at foxnews.com

  Since January 6th, phantom threats, including the likes of “QAnon Inauguration Day”, have been continually touted to maintain the martial law style lockdown of Capitol Hill.

  Tyler Durden
  Tue, 03/09/2021 – 19:25

• Japan's Government To Ban Overseas Spectators From Tokyo Olympics
  Japan’s Government To Ban Overseas Spectators From Tokyo Olympics

  After a week ago it was first revealed that the Tokyo 2020 games organizing committee (to take place this summer, 2021 in late July to August.8) was seriously mulling barring all foreign spectators from attending the games on pandemic fears of a ‘superspreader’ event, Japan has confirmed that it will keep all overseas spectators away in a move expected to cause a hundreds of millions of dollars loss – possibly into billions – in revenue. 

  Reuters reports on Tuesday, “Japan has decided to stage this summer’s Tokyo Olympics and Paralympics without overseas spectators due to public concern about COVID-19, Kyodo news agency said on Tuesday, citing officials with knowledge of the matter.”

  

  The Japanese public has been cited since reports first emerged last week as overwhelmingly in favor of keeping foreign crowds from descending on Tokyo for fear of new COVID-19 outbreaks, and given the new variants that have health officials worried. This despite the global vaccination campaign making great strides across the various populations in countries whose citizens would be likely to travel to the games, especially by the games’ start on July 23.

  Reuters cites recent surveys by a major Japanese publication:

  Most Japanese people do not want international visitors to attend the Games amid fears that a large influx could spark a resurgence of infections, a Yomiuri newspaper poll showed.

  The survey showed 77% of respondents were against allowing foreign fans to attend, versus 18% in favor.

  Some 48% said they were against allowing any spectators into venues and 45% were in favor.

  Kyodo news agency further confirmed that even the opening torch ceremony will be conducted without fans or spectators in the stadium. 

  “The organizing committee has decided it is essential to hold the ceremony in the northeastern prefecture of Fukushima behind closed doors, only permitting participants and invitees to take part in the event, to avoid large crowds forming amid the pandemic,” the report said, quoting the officials.

  Apparently only the final verdict of the Japanese government has been revealed, with the Tokyo 2020 games organizing committee expected to issue its final decision on the matter by the end of March – but it’s something which according to the latest reports looks certain to be on the side of banning spectators. 

  Recently installed president of the Japanese committee Seiko Hashimoto told reporters last week, “We would really like people from around the world to come to a full stadium, but unless we are prepared to accept them and the medical situation in Japan is perfect, it will cause a great deal of trouble also to visitors from overseas.”

  Tyler Durden
  Tue, 03/09/2021 – 19:05

• Biden Years Ago Called It 'Tyranny' For Just One Man To Decide War
  Biden Years Ago Called It ‘Tyranny’ For Just One Man To Decide War

  Authored by Paul W. Lovinger via AntiWar.com,

  Did Joe Biden read the Democratic platform that he ran under? Elect us and we will “move away from military intervention” in the Middle East. Diplomacy will protect Syrians’ human needs and rights and “find a peaceful resolution for this horrific war.” All the “forever wars” will end.

  Instead, Biden and the military men under his command did what the military is supposed to do: kill and destroy – or, as they prefer to put it, drop “precision-guided munitions” on “targets.” Among targets of the February 25^th attack on Syria were at least 22 people.

  

  Congressional reactions did not follow party lines. Several Democrats objected to the President’s violation of the constitutional war power of Congress. Some of their GOP colleagues praised the bombing, but Senator Rand Paul (R-KY) saw no right to attack a sovereign country. His father, ex-Representative Ron Paul (R-TX), called for Biden’s impeachment.

  Few pay much attention to international laws against aggression, particularly three US treaties prohibiting it. Forcible violation of the territorial rights of one state by another has been considered a war crime since the infamous trials following World War II.

  But everything is good, from what administration spokesmen say. Don’t grieve for the 22. They were all “believed” to be members of “Iran-backed militias” accused of recent rocket attacks on US targets in Iraq. (Rest assured that no children, women, or non-militant men are ever harmed by our clever weapons, only “militants,” “insurgents,” and “terrorists.”)

  The media reported that the raid was designed to “send a message” to Iran. Whatever that message said, it was expensive. You can send one far cheaper by e-mail, phone, fax, or airmail letter. You’d think the cost would concern the budget-minded congressional Republicans, if nothing else does.

  As far as relations with Iran were concerned, the Dems’ platform pledged to call off the race to war; reject the goal of regime change in Tehran; emphasize “diplomacy, de-escalation, and regional dialogue”; and restore the nuclear agreement. If any of those things were in that message, you probably wouldn’t need to send it via bomb.

  Our defense establishment tells us that the aggression was “defensive,” yet also “retaliatory”: We attacked Syria because our forces in Iraq had been attacked, though not by Syria. (Needless to say, our forces had a perfect right to be in Iraq. As California’s Senator S. I. Hayakawa once said about Panama, “We stole it fair and square.”)

  What about the president’s decision to commit an act of war, when Article I, Section 8, of the Constitution reserves that power to Congress?

  According to an aide of the National Security Council, “Biden acted under his constitutional authority to defend US and deter the risk of additional attacks.” (I’m quoting a Bloomberg story by eight writers. It said the aide “commented on condition of anonymity.” I would want to be anonymous too, if I had to dispense stuff like that.) Don’t bother searching through your Constitution for such authority; it’s not there.

  Biden did not lose much time before tending to what the platform called “this horrific war.” The five weeks of abstention compare with 11 weeks into Trump’s term before he bombed Syria. Obama, before him, had waited five years before initiating his bombing of Syrians. Of course Trump and Obama did plenty of killing elsewhere throughout their terms. Biden is just getting started.

  Biden (2021) Should Listen to Biden (1991)

  Thirty years ago, President George H. W. Bush was massing US troops in the Saudi desert, preparing for war with Iraq over its seizure of Kuwait. Bush and his yes-men in the Defense and State Departments contended that the president, as commander-in-chief of the military, had the authority to start a war.

  Joseph R. Biden Jr., chairman of the Senate Judiciary Committee, called a hearing on “The Constitutional Roles of the Congress and the President in Declaring and Waging War.” In an introductory speech, Senator Biden found the Bush view of the war power at odds with the Constitution. The Founders, he said, took great pains to ensure that the new government would differ from that of King George III. The chief difference was how the decision to go to war would be made.

  “In England the king alone could decide to take a nation to war.” Here, the legislature would have that power. “The Constitution’s language says that the war power rests in the Congress…. The Constitution’s founders all understood this to be a key principle of our republic…. Yes, the president is the commander-in-chief….”

  Senator Biden thereupon quoted Alexander Hamilton, who wrote about the (then) proposed Constitution in The Federalist, 69. “The president is to be commander-in-chief of the army and navy… It would amount to nothing more than the supreme command and direction of the military and naval forces as first general and admiral….” His authority would be much inferior to that of the British king, which “extends to the declaring of war and the raising and regulating of fleets and armies” – all of which would be the legislature’s functions under the Constitution.

  “In short,” said the senator, “Congress decides whether to make war, and the president decides how to do so…. We have been told that the congressional debate on war could tie the president’s hands or limit his discretion….. Exactly right. Americans once lived under a system where one man had unfettered choice to decide by himself whether we could go to war or not go to war, and we launched a revolution to free ourselves from the tyranny of such a system.”

  Senator Biden noted that President Bush was claiming that his impending war on Iraq would uphold the rule of law by undoing Iraq’s invasion of Kuwait. The former commented, “If the crisis is really about upholding the law of nations abroad, the President must start by upholding the law at home, and our law begins with the Constitution.”

  Bush backed down and submitted to a congressional vote. It supported the war he wanted. Biden voted “nay.”

  Gullible and Contradictory

  Having opposed Bush Senior’s war on Iraq over the Kuwait seizure, Biden avidly supported the second war on Iraq, started by Bush’s son, George W. It was based on “weapons of mass destruction,” which Bush Jr. falsely claimed that Iraq possessed and would likely give to terrorists.

  A mere few years after his 1991 stance in Congress, Biden avidly supported the neocon push for regime change in Iraq…

  Biden fell for those lies and, as chairman of the Senate Foreign Relations Committee, spoke in favor of a resolution (prepared in the White House) to let Bush decide whether war on Iraq would be warranted. The measure would be unconstitutional, for such a decision was up to Congress to make, not the president, as Biden himself had pointed out 11 years earlier.

  Biden has shown similar gullibility in swallowing disputed allegations of Syrian use of poison gas and Russian “bounties” on lives of US servicemen in Afghanistan. Some US intelligence agents doubt that the bounty tale is true.

  In foreign affairs, Biden is full of contradictions. Nine examples follow… Joe Biden –

  • Opposed one Bush attack on Iraq and supported another.
  • Ran for president on a promise of rejoining the nuclear agreement with Iran that Trump renounced, but hesitates to keep the promise, and now comes that “message.”
  • Condemns the bombing of Yemeni civilians and the murder of Jamal Khashoggi, yet – without congressional permission – commits the US to defend the Saudi monarchy that committed those crimes.
  • Talks of having the US, Europe, and Asia “work together to secure the peace,” while confronting China with US warships provocatively close to its coast.
  • Renews the New Strategic Arms Reduction Treaty with the Russian Federation (New START) for five years, but heightens tensions by anti-Russian rhetoric and sanctions
  • Considers the climate crisis a top concern, yet the world’s single biggest producer of climate-changing gases is the US military, and war intensifies their production.
  • Resolves to work with allies on critical issues, but disregards his own country’s Congress.
  • Has repeatedly paid homage to “the rule of law,” contrary to his positions in favor of lawless actions in Syria, Iraq, and Yugoslavia (Bill Clinton’s 1999 war).
  • Conducts an act of war that is incompatible with the platform he ran under and his own comments about the war power, made to fellow senators 30 years ago.

  Tyler Durden
  Tue, 03/09/2021 – 18:45

• Morgan Stanley Expects US To Grow Faster Than China In 2021
  Morgan Stanley Expects US To Grow Faster Than China In 2021

  Last Friday, at the start of its latest Five-Year Plenum, aka National People’s Congress, China’s government surprised markets when it announced a paltry 6% growth target for 2021 (which however did not stop if from also revealing a five-year plan and vision for 2035 that aims to expand China’s global footprint as a major technology power).

  That number is a big problem for several reasons, first and foremost of because as Michael Every explained this morning, it means that China’s credit impulse is about to collapse.Overnight, China’s central bank – the PBOC – announced it would keep growth of both money supply and aggregate financing broadly in line with that of nominal GDP. This, as the Rabo strategist said “is **STAGGERINGLY** contractionary given the last 12-month rolling aggregate financing figure was 35% y/y, the series average back to 2004 is 15%, and the most optimistic nominal GDP print one could expect would be 9% – and even that only for 2021, with something far lower further out.”

  As Every concluded, paraphrasing what we warned back in December, “it seems there is going to be an aggressive crackdown on leverage – and growth will follow. And then so will global growth with a lag. And so will the likes of AUD, etc.” This is another way of saying what we showed in December – namely the upcoming rapid slump in China’s credit impulse – also pointing out that virtually every asset in the world will be impacted the slowdown in China’a credit impulse with a lag anywhere from 1 month to 2 years.

  

  But there is another, even more bizarre, consequence of China’s 6% GDP target: according to the latest, just released US economic forecast from Morgan Stanley, the US will – for the first time ever – grow faster than China in 2021: according to MS chief economist Ellen Zentner, the US “reopening is progressing, the rate of vaccinations is ramping up, and the labor market is gaining momentum.”

  As a result, the investment bank is taking up its 2021 GDP forecast by 0.5% to 8.1% 4Q/4Q (+0.8pp to 7.3%Y).  And while the US may indeed grow faster than China in 2021 as a result of the massive fiscal and monetary stimilus injections, all this will reverse in 2022, when Morgan Stanley lowered its forecast by 0.1% to 2.8% 4Q/4Q (-0.3pp to 4.7% Y).

  

  As Zentner notes, US GDP “is now on track to reach its pre-Covid level by the end of the current quarter, with a positive output gap of 2.7% in 4Q21, and 3.6% in 4Q22.” If one incorporates the bank’s updated expectations for spending and income this year, Zentner expect excess savings in Q1 21 to total $600bn and a further $130bn in Q2 21.This would be added on top of the estimated excess savings of $1.5Tn accumulated in 2020.

  

  Meanwhile, on the labor front, Morgan Stanley expects that a more robust return to work will be offset somewhat by rising labor force participation, “but economic activity is strong enough to still generate a sharp decline in the unemployment rate throughout our forecast horizon.” As a result, the bank expects the unemployment rate to average 4.9% in 4Q21 (vs 5.1%, previously), falling further to 3.9% in 4Q22 (4.0% previously). . On an annual basis, MS sees the underlying unemployment rate falling from 10.5% in December 2020 to 6.1% by December 2021, showing a more substantial improvement, then falling to around 4.0% as it closes in on the as-reported unemployment rate by the end of 2022.

  

  So between blistering economic growth and tumbling unemployment, what does that mean for inflation? According to Zentner, now that  the US is set to surpass China as the world’s fastest growing economy if only for a few quarters, the bank expects significant price adjustments to come this year that sends core PCE to a near-term peak of 2.6%Y in April/May, before backing off to end the year at 2.3%Y (bringing a 2.3% quarterly average).

  Where MS differs from the Fed which sees no cyclical inflation anywhere, the bank expects a more sustainable inflationary impulse to start taking shape in 2021 “led by shelter inflation, healthcare services, and a multi-quarter pass through of dollar weakness into goods.” The sustainable inflation impulse intensifies in 2022 as cyclically sensitive inflation components start to dominate – based on a tightening labor market and still robust levels of demand. Ultimately, the bank sees core PCE ending 2022 at an overheating 2.3%, well above the Fed’s inflation target of 2.0% (which is precisely why the Fed made sure to give itself buffer not to hike with its new average inflation targeting policy).

  

  What is remarkable is that despite clearly admitting the US is set to overheat if only for one year, Morgan Stanley says that “there is nothing in the outlook that changes the Fed’s message of patience on the back of a dismissal of inflationary pressures as transient, and the improvement in the labor market and rising inflation expectations being a good start.”

  So in a world where the US grows faster than China yet where the Fed sees this as perfectly normal, all eyes now turn to the March FOMC were MS expects policymakers “will show an updated Summary of Economic Projections (SEP) with the majority of dots still firmly anchored at the zero lower bound through the end of 2023, alongside higher growth as FOMC participants onboard the stimulus package, and even some acknowledgment of emerging upside risks for near-term inflation. Policymakers will use this new dot plot to double down on dovish guidance, indicating that even after incorporating more fiscal stimulus, vaccine progress, and the latest inflation outlook,policymakers still see interest rates on hold for the foreseeable future.”

  What happens next?

  Well, unless the Fed wants to really teach China’s who’s boss and have the US economy literally explode in a hyperinflationay civil war in a couple of years when the S&P is at 1 trillion, it will have to tighten eventually. First, it will taper, then it will hike rates:

  Tapering: After the March FOMC the Fed’s job this year does not get any easier. As Zentener correctly writes “a sharper turn upward in the data as we move further into the spring coupled with a fresh round of stimulus means financial markets are likely to constantly test the Fed’s patience.” But that won’t happen for a while.

  Outlined in the FOMC statement, the Fed “will continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward the Committee’s maximum employment and price stability Morgan Stanley assumes the Fed will see this substantial further progress over the course of this year, and expects that by the middle of the year the cloud of Covid will have thinned and the recovery will have picked up meaningfully enough that the Fed will see it as appropriate to begin taking its foot off the gas pedal and Chair Powell will indicate tapering could be on the horizon.

  We would take such a message – likely delivered atthe June FOMC meeting – to indicate the start of tapering in January 2022 by reducing the pace of the Fed’s asset purchases by $10 billion Treasury/$5 billion MBS per meeting.

  Translation, brace for a bond market crash some time in the second half as we replay the Taper Tantrum on steroids.

  

  Rate Hikes: While tapering may be about a year off, liftoff remains a long, long way off – some time in Q3 2023 according to Morgan Stanley – which continues to expect a very gradual pace of policy normalization that is indicative of the general dovish shift in the Fed’s reaction function. Look for the June FOMC dot plot to first show a median of one Fed hike before the end of 2023, but it is the September FOMC meeting this year, when the Fed first publishes its 2024 forecasts that it can use the dot plot to redefine gradual in this cycle.

  * * *

  For all those wondering what China will be doing during this self-imposed slowdown when its credit impulse plunges and turns negative, sending its economy on the verge of a recession, stay tuned for a subsequent post in which we analyze what it means for the US to be growing near double digits which China approaches a hard landing.

  Tyler Durden
  Tue, 03/09/2021 – 18:25

• US Preparing Cyberattack Against Russia Over SolarWinds Hack: Report
  US Preparing Cyberattack Against Russia Over SolarWinds Hack: Report

  Authored by Dave DeCamp via AntiWar.com,

  According to a report from The New York Times, the Biden administration is planning cyberattacks against Russia in the coming weeks. The cyber offensive could come with new sanctions and would mark a serious escalation towards Moscow from the new administration.

  Anonymous US officials told the Times that the first “major move” is expected to happen over the next three weeks. It will consist of a “series of clandestine actions across Russian networks that are intended to be evident to President Vladimir Putin and his intelligence services and military but not to the wider world.”

  

  The officials said the cyberattack will come along with new economic sanctions on Russia. Last week, the Biden administration slapped sanctions on Russian officials over the jailing and alleged poisoning of opposition figure Alexei Navalny.

  The planned cyberattack is being framed as retaliation for the hack of the software firm SolarWinds that affected several US government agencies. The SolarWinds hack was discovered late last year. It was immediately blamed on Russia by members of Congress and Western media outlets despite a lack of evidence that showed Moscow was responsible.

  The US formally attributed blame to Russia for the SolarWinds hack in January. The FBI, NSA, the Cybersecurity and Infrastructure Security Agency, and the Office of the DNI released a statement that said the hack was “likely Russian in origin.” Missing from the statement was any evidence for the accusation.

  The reality is, attributing cyberactivity is difficult as hackers have methods to conceal their identity. One reason US officials and media outlets say it could have been Russia is the sophistication of the hack. But testimony from SolarWinds’ former CEO and a cybersecurity expert made it clear that anybody could have accessed SolarWinds’ servers due to a major security lapse.

  After the hack was first discovered, Vinoth Kumar, a cybersecurity expert who advised SolarWinds, said the password for the firm’s update server was “solarwinds123.” Kumar said he warned SolarWinds that anyone could access the server because of this password. “This could have been done by any attacker, easily,” he told Reuters last December.

  Just as it plans to begin retaliating against Russia for the hacking of government agencies and corporations, the Biden administration faces a new cyberattack that raises the question of whether it will have to strike back at another major adversary: China https://t.co/TZsy0Rc1M2

  — Andreas Landwehr (@andreaslandwehr) March 9, 2021

  https://platform.twitter.com/widgets.js

  Kumar’s claim about the password turned out to be true. It was confirmed during congressional hearings in February that not only was “solarwinds123” the password, but it was also leaked and available to the public on the internet for years. Former SolarWinds CEO Kevin Thompson blamed an intern for posting the password on GitHub, a platform programmers use to share software information.

  “They violated our password policies and they posted that password on an internal, on their own private Github account,” Thompson said during a joint hearing by the House Oversight and Homeland Security committees.

  Sudhakar Ramakrishna, the current SolarWinds CEO, said the password was publicly available as early as 2017. “I believe that was a password that an intern used on one of his Github servers back in 2017,” he said. SolarWinds did not correct the issue until November 2019. According to the timeline from SolarWinds, suspicious activity on their server began in September 2019.

  Despite the fact that it is well established that anyone could have accessed SolarWinds’ servers and the best the US intelligence agencies could come up with is that Moscow is “likely responsible,” the US is poised to launch a cyberattack on Russia anyway.

  The Times story that reported the Biden administration’s plans also mentions another recently discovered hack of Microsoft email servers that is being blamed on another US adversary, China. The hack apparently affected servers used by small businesses, local governments, and military contractors.

  So far, it’s just Microsoft making the claim that China was responsible for this cyberattack, and the US has yet to attribute blame. But according to the Times, the Biden administration is already mulling options to go after China for the Microsoft intrusion.

  According to the Times, in August 2018, President Trump signed a secret document giving US Cyber Command more authorities to go on the offensive in the cyber realm. These authorities are reportedly under review by the Biden administration, and any major cyberattacks must be brought to the White House and the National Security Council before being carried out.

  Tyler Durden
  Tue, 03/09/2021 – 18:05

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• Hong Kong's Carrie Lam "Fully Welcomes" Election Overhaul To Ensure City Run By China "Patriots"
  Hong Kong’s Carrie Lam “Fully Welcomes” Election Overhaul To Ensure City Run By China “Patriots”

  Beijing’s proposed major overhaul of Hong Kong’s electoral system has been broadly slammed in the West as but the final cementing of the mainland’s grip over what was set-up since the late 90’s to function as a semi-autonomous city-state according to the “one country, two systems” agreement made with the UK. Following on heels of last year’s draconian and far-reaching national security law which has been used to effectively crush dissent and arrest literally hundreds of pro-democracy activists – many of them also having fled to outside countries – multiple Communist Party officials addressing this weekend’s National People’s Congress (NPC) assembly in Beijing have warned the West not to interfere. 

  Former governor of Hong Kong Lord Chris Patten was cited in BBC as saying that China’s Communist Party had “taken the biggest step so far to obliterate Hong Kong’s freedoms and aspirations for greater democracy under the rule of law”. However, Chinese Foreign Minister Wang Yi in an annual speech touted that “Hong Kong’s shift from chaos to stability fully serves the interests of all parties. It will provide stronger guarantees for safeguarding Hong Kong citizens’ rights and foreign investors’ lawful interests.”

  And pro-Beijing Hong Kong Chief Executive Carrie Lam is “fully welcoming” the China-proposed major changes to the electoral system which will increase the mainland’s influence. “There are loopholes in the electoral systems, there are also flaws in the systems in Hong Kong,” Lam told reporters on Monday, according to The Associated Press.

  

  “I fully understand that this is not a matter that can be addressed entirely by the government. I’m glad that the central authorities have, again, exercised its constitutional powers to help address this problem for Hong Kong,” she said.

  The statement comes days after State Department spokesman Ned Price lambasted the changes as constituting “a direct attack on Hong Kong’s autonomy, Hong Kong’s freedoms, and the democratic processes, limiting participation, reducing democratic representation, and stifling political debate in order to defy the clear will of the people of Hong Kong and to deny their voice in their own government and governance.”

  The AP provides a summary of the overhaul and how it will impact candidate “vetting” and voting as follows: 

  Chinese authorities have said the draft decision before China’s National People’s Congress would mean the largely pro-Beijing committee that elects Hong Kong’s leader would also choose a large part of the legislature to ensure the city is run by “patriots.” The Election Committee would also have the right to vet candidates for the Legislative Council, weeding out any people suspected of being insufficiently loyal to China and the ruling Communist Party.

  Currently, half of Hong Kong’s legislature is directly elected by voters, although the mass resignation of opposition legislators to protest the expulsion of four of their colleagues for being “unpatriotic” means the body is now entirely controlled by Beijing loyalists.

  At other steps of the process too Beijing will further be able to examine whether lawmakers are sufficiently pro-mainland. 

  Lam it should be recalled is the Hong Kong leader whose 2019 proposal to extradite criminal suspects to China sparked many months of fierce anti-China protests that often involved violent clashes with police and the shutting down of who central sections of the city. 

  This led to the sweeping national security law last June which has since resulted in the arrest and sentencing of over 100 protesters. The law enables authorities to easily deem activism and free speech as possible ‘terrorist activity’ if an individual is deemed conspiring with foreign powers or issuing anti-China propaganda and rhetoric. Lately even school textbooks have been purged to only allow for pro-mainland and pro-Communist ‘education’. 

  Tyler Durden
  Tue, 03/09/2021 – 01:00

• The New Normal (Phase 2)
  The New Normal (Phase 2)

  Authored (mostly satirically) by CJ Hopkins via The Consent Factory,

  So, we’re almost a year into the “New Normal” (a/k/a “pathologized totalitarianism”) and things are still looking … well, pretty totalitarian.

  

  Most of Western Europe is still in “lockdown,” or “under curfew,” or in some other state of “health emergency.” Police are fining and arresting people for “being outdoors without a valid reason.” Protest is still banned. Dissent is still censored. The official propaganda is relentless. Governments are ruling by edict, subjecting people to an ever-changing series of increasingly absurd restrictions of the most fundamental aspects of everyday life.

  And now, the campaign to “vaccinate” the entirety of humanity against a virus that causes mild to moderate flu-like symptoms or, more commonly, no symptoms at all, in over 95% of those infected, and that over 99% of the infected survive (and that has no real effect on age-adjusted death rates, and the mortality profile of which is more or less identical to the normal mortality profile) is being waged with literally religious fervor.

  “Vaccine passports” (which are definitely creepy, but which bear no resemblance to Aryan Ancestry Certificates, or any other fascistic apartheid-type documents, so don’t even think about making such a comparison!) are in the pipeline in a number of countries. They have already been rolled out in Israel.

  

  In other words, as predicted by us “conspiracy theorists,” the “temporary emergency public health measures” implemented by GloboCap in March of 2020 are still very much in effect, and then some.

  That said, as you have probably noticed, the tenor of things is shifting a bit, which is unsurprising, as GloboCap is now making the transition from Phase 1 to Phase 2 of the “New Normal” roll-out.

  Phase 1 was pretty much classic “shock and awe.”

  An “apocalyptic virus” was “discovered.” A global “state of emergency” was declared. Constitutional rights were cancelled. Soldiers, police, surveillance cameras, military drones, and robot dogs were deployed to implement the worldwide police state. The masses were bombarded with official propaganda, photos of people dropping dead in the street, unconscious patients dying in agony, bodies being stuffed into makeshift morgue trucks, hospital ships, ICU horror stories, projections of hundreds of millions of deaths, terror-inducing Orwellian slogans, sentimental “war effort” billboards, and so on. The full force of the most formidable Goebbelsian propaganda machine in history was unleashed on the public all at once. (See, e.g., CNN, NPR, CNBC, The New York Times, The Guardian, The Atlantic, Forbes, and other “authoritative” sources like the IMF and the World Bank Group, the WEF, UN, WHO, CDC.)

  But the “shock and awe” phase can’t go on forever, nor is it ever intended to. Its purpose is (a) to terrorize the targeted masses into a state of submission, (b) to irreversibly destabilize their society, so that it can be radically “restructured,” and (c) to convincingly demonstrate an overwhelming superiority of force, so that resistance is rendered inconceivable. This shock and awe (or “rapid dominance”) tactic has been deployed by empires, and aspiring empires, throughout the course of military history. It has just been deployed by GloboCap against … well, against the entire world. And now, that phase is coming to an end.

  The shape of Phase 2 is not entirely clear yet, but one can make a few logical assumptions.

  Typically, this is the phase in which the conquering force (in this case, GloboCap) restores “normality” (i.e., a “new normality”) to the society it has just destabilized and terrorized. It installs a new occupation-friendly government, restarts the economy, and otherwise begins the gradual transition from martial law to something resembling “normal” everyday life. It hands out candy bars to kids, financial aid to businesses, power to generals and police, and “freedom” to the shell-shocked public.

  This appears to be where we are at the moment. As you’ve probably noticed, the corporate media, government leaders, and medical experts have been making noise about “the end of the pandemic,” or at least “the end of the emergency phase” of it. Suddenly, “some level of Covid is tolerable,” “Zero Covid is unlikely,” et cetera. This is happening pretty much right on cue.

  Now that the vaccination push is underway, they are trying to temper the mass paranoia and hatred that they have fomented for over a year with some hope and a vision of a post-crisis future. Governments are carefully relaxing restrictions, making sure we understand that if we don’t obey orders, wear our masks, get our vaccinations, and so, they will crack down on us again without mercy. They want to ease us into the pathologized-totalitarian future gently, so that it feels like we are being liberated, returning to some semblance of normal life, albeit in a new, more terrifying, perpetually-virus-and-extremist-threatened world.

  For example, here in Germany, the government has decided to “return some freedom and trust to the people,” but they are prepared to lock us down “hard” again if they suspect we haven’t “used their trust wisely.” According to the 5-Step Plan, bookshops and florists can reopen this week with a one-person-per-ten-square-meter limit, up to ten people can play non-contact sports, and five people from no more than two households can meet up (and, thus, also play non-contact sports), unless the “incidence rate” of positive PCR tests rises above 100 per thousand, in which case, back to “hard lockdown” we go. Two weeks after that, on March 22, if the “positive-test rate” stays below 50, outdoor restaurant dining can resume, and theaters, cinemas, and opera houses can open. However, if the “positive-test rate” is more than 50 but less than 100, outdoor dining will only be permitted on a strictly pre-booking basis. (One assumes there will be roving goon squads examining restaurants’ booking records and ordering patrons to show their papers.) There are further Kafkaesque conditions in the plan, but I think you get the general idea.

  Meanwhile, in the USA, although DC remains under occupation, the Capitol surrounded by razor-wire fences to protect democracy from an imaginary enemy straight out of George Orwell’s 1984, Texas, Mississippi, and a few other states are joining Florida in open rebellion, and allowing people to go out to eat, get together with their families and friends, walk around in public without medical-looking masks, and otherwise go about living their lives in a totally non-anus-clenched-paranoid fashion.

  Notwithstanding the outrage of the Covidian Cultists, this development is not of great concern to GloboCap, as the coastal power centers are full-blown “New Normal,” and the liberals who predominantly occupy them have been transformed into paranoid, hysterical zealots who now dedicate a considerable amount of time to hunting down alleged “Covid deniers,” “anti-maskers,” “vaccine refusers,” “white-supremacist extremists,” “conspiracy theorists,” “libertarians,” dead “racist cartoonists,” and anyone else who won’t conform to their pathologized-totalitarian ideology, and obsessively trolling them on social media, or reporting their thoughtcrimes to the Reality Police.

  This transformation of the relatively affluent, predominantly liberal, middle/upper classes, and the millions futilely aspiring thereto, into mindlessly-order-following “Good Germans” (or, rather, mindlessly-order-following “New Normals”) has also occurred here in Western Europe, and elsewhere throughout the global capitalist empire, and was one of GloboCap’s main objectives throughout Phase 1 of the “New Normal” roll out. This transformation has been in progress for quite some time, less dramatically and without a virus. It will continue once this virus is gone.

  The “New Normal” isn’t just about a virus. The “New Normal” was never just about a virus. You don’t need a new “normal” because of a virus. You need a new “normal” when your current “normal” has outlived its usefulness to those in power, which, in our case, are the global capitalist ruling classes.

  I’ve been writing about this for … well, most of my life, and publishing these columns for the last five years, so I’m not going to summarize all that here, but, basically, we’re living through one of those historic transformations of the structure of political power that we usually don’t recognize until after it has occurred … not just a “changing of the guard,” a transformation of the nature of power, how it is exercised, the beliefs it is based on, and the “reality” conjured into being by those beliefs.

  This transformation began with the end of the Cold War, when global capitalism became the first globally-hegemonic ideological system in history. The roll-out of the “New Normal” is part of that transformation, not the whole of it, but an essential stage. We are transitioning from an ideological “reality” to a post-ideological, pathologized “reality” … a “reality” in which any and all deviation from official ideology (i.e., “normality”) is no longer a political challenge or threat, but an “illness” or “psychiatric disorder.”

  I’m going to be obnoxious and quote myself, so that I don’t have to try to explain this again. Here’s a passage from a recent column:

  “A globally-hegemonic system (e.g., global capitalism) has no external enemies, as there is no territory ‘outside’ the system. Its only enemies are within the system, and thus, by definition, are insurgents, also known as ‘terrorists’ and ‘extremists.’ These terms are utterly meaningless, obviously. They are purely strategic, deployed against anyone who deviates from GloboCap’s official ideology … which, in case you were wondering, is called ‘normality’ (or, in our case, currently, ‘New Normality’) … [t]he new breed of ‘terrorists’ do not just hate us for our freedom … they hate us because they hate ‘reality.’ They are no longer our political or ideological opponents … they are suffering from a psychiatric disorder. They no longer need to be argued with or listened to … they need to be ‘treated,’ ‘reeducated,’ and ‘deprogrammed,’ until they accept ‘Reality.’”

  As we shift from Phase 1 to Phase 2 of the “New Normal,” the pathologization of political dissent will continue, and intensify, both overtly and subtlely.

  GloboCap and the corporate media will continue to warn of imminent “attacks on democracy” by imaginary “domestic terrorists,” as well as the old “non-domestic terrorists.” They will also continue to warn of imminent threats posed by exotic viruses, and “variants” of exotic viruses, and permanent “conditions” caused by viruses, and other threats to our bodily fluids. Above all, they will continue to warn of the danger of ingesting “misinformation,” “conspiracy theories,” or any other type of unverified, unauthorized, un-fact-checked content. They will thoroughly diagnose the sources of such content, and exhaustively explain the pathological conditions these sources will clearly be suffering from. They will explore a variety of treatments and cures, and recommend prophylactic measures against potential exposure to these sources.

  These multiplicitous “threats to democracy” (i.e., “terrorists,” “viruses,” “misinformation,” “racism,” “sexism,” “homophobia,” “transphobia,” “electoral-system scepticism,” “white-supremacist pancake syrup,” “premeditated pronoun abuse,” “oppositional-defiant-infant masklessness,” “vaccine hesitancy,” “religion,” et cetera) will fuse into a single Goldstein-like enemy which “New Normal” children will be conditioned to reflexively hate and fear, and want to silence, and quarantine off from “normal” society, or “cure” of their “illness” with government-mandated, “safe and effective” pharmaceutical therapies.

  But whatever … I wouldn’t worry about that. I’m probably just getting all worked up over nothing. After all, as a lot of my ex-friends will tell you (through their multiple masks and prophylactic face shields), I’m just a paranoid “conspiracy theorist” spreading “unverified misinformation.”

  Tyler Durden
  Tue, 03/09/2021 – 00:05

• Iran Takes Yet More Action To Blow Past Nuclear Restrictions At Natanz: IAEA
  Iran Takes Yet More Action To Blow Past Nuclear Restrictions At Natanz: IAEA

  At a moment that Israel says it has implemented new plans that will enable it to more effectively launch preemptive attack on Iran’s nuclear facilities should Israeli leaders believe the Islamic Republic is on the cusp of nuclear weapons capability, Tehran announced Monday that it continues blowing past prior uranium enrichment limits in place as part of the 2015 nuclear deal.

  Reuters is reporting it as a “recent acceleration” of restriction violations at a moment Biden’s prior stated intent to rejoin the JCPOA is faltering while US-led sanctions (put into effect by Trump) are still at their max. It appears part of continued efforts at ratcheting the pressure on Biden to provide immediate sanctions relief, which thus far the new Democratic administration has refused to do until Iran comes back into nuclear compliance. 

  But at the same time Iran’s boldness in piling on the pressure in the face of a hesitant Biden administration may inadvertently trigger Israeli retaliation.

  

  “Iran has started enriching uranium with a third set of advanced IR-2m centrifuges at its underground plant at Natanz, the U.N. nuclear watchdog told its member states on Monday,” Reuters writes. Crucially it was this very facility at Natanz that was subject of a major sabotage attack in July 2020, with most analysts believing Israel was likely behind it – possibly via a major cyberattack.

  The UN nuclear watchdog IAEA group issued a statement saying, “On 7 March 2021, the Agency verified at FEP that: Iran had begun feeding natural UF6 into the third cascade of 174 IR-2m centrifuges.”

  “The fourth cascade of 174 IR-2m centrifuges was installed but had yet to be fed with natural UF6; installation of a fifth cascade of IR-2m centrifuges was ongoing; and installation of a sixth cascade of IR-2m centrifuges had yet to begin,” it said further. 

  This means that Iran is inching closer toward the 90% uranium purity needed to develop a nuclear bomb, but the IAEA statement indicated Iran was still far from that marker, but is daily opening up such a path if it chooses to go to those levels. 

  Essentially Iran’s position over the past months has been that it’s free to ramp up enrichment at it’s choosing because the US broke the deal (in May 2018) and is thus not in a position to demand conformity. Iran has complained all along that the European signatories have done little to nothing to salvage the JCPOA in the face of Washington’s belligerence and threats of sanctions enforcement. 

  Tyler Durden
  Mon, 03/08/2021 – 23:45

• Stagflation Subterfuge: The Real Disaster Hidden By The Pandemic
  Stagflation Subterfuge: The Real Disaster Hidden By The Pandemic

  Authored byby Brandon Smith via Birch Gold Group,

  In recent economic news, headlines are being dominated by concerns over rising bond yields. Increased bond yields are a sign of a possible spike in inflation and, logically, they call for the Federal Reserve to raise interest rates in order to prevent that inflation.

  

  Higher bond yields also mean there is a competitive alternative to stocks for investors – both factors that could trigger a plunge in the stock market.

  If one studies the real history behind the stock market crash during the Great Depression, they will find that it was the Federal Reserve’s interest rate hikes that caused and prolonged the disaster after they had created an environment of cheap and easy money throughout the 1920s. Former Chairman Ben Bernanke openly admitted the Fed was responsible back in 2002 in a speech honoring Milton Friedman. He stated:

  “In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn. Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”

  This then raises the question – inflation or deflation? Will the Fed “do it again?”

  Probably not in exactly the same way, but we will see elements of both inflation and deflation soon in the form of stagflation.

  It’s a Catch-22 that the central bank has created, and many (including myself) believe that the Fed has created the conundrum deliberately. All central banks are tied together by the Bank for International Settlements (BIS) and the BIS is a globalist institution through and through. The globalist agenda seeks to trigger what they call the “Great Reset,” a complete reformation of the global economy and capitalism into a single one world socialist system… managed by the globalists themselves, of course.

  In my view the Fed has always been a kind of institutional suicide bomber; its job is to self-destruct at the right moment and take the U.S. economy down with it, all in the name of spreading its cult-like globalist ideology.

  The only unknown at this point is how they will go about their sabotage. Will the central bank continue to allow inflation to explode the cost of living in the U.S., or will they intervene with higher interest rates and allow stock markets to crash?

  Either way, we face a serious economic crisis in the near future.

  Increasing Inflation Means Economic Recovery?

  Mainstream economists will often argue that rising yields and inflation are a “good thing.” They claim this is a sign of rapid economic recovery. I disagree.

  If “inflation” was the same as “recovery,” then there would not have been total economic collapses in Argentina in 2002, in Yugoslavia in 1994, or in Weimar Germany in the early 1920s.

  I do not see recovery. What I see is the rapid devaluation of the dollar’s buying power due to massive fiat printing through stimulus measures. The Fed and the U.S. government are buying a short-term surge in economic activity, but at a hidden cost. This is a condition that the Dollar Index does not even begin to address, but obvious in prices of necessary goods and commodities.

  Keep in mind that all of this is being done in the name of responding to the pandemic. The pandemic is the ultimate excuse for the active destruction of the U.S. economy. Stimulus measures have devolved into helicopter money being thrown about haphazardly as billions are siphoned primarily by major corporations and through fraud. People who are clamoring for a $2,000 relief check from the government have no idea that corporate welfare has been ongoing for the past year along with billions in retroactive tax refunds. All of that money printing is going to cause damage somewhere. It cannot be avoided.

  It’s Not About The Pandemic

  Let’s make something clear first: The pandemic is NOT the reason for the stimulus flood. The pandemic did very little to hurt actual business in the U.S. Rather, it was the lockdowns that did most of the damage.

  Think about that for a moment – federal and state governments crushed the economy through lockdowns, then offered the solution of vast stimulus measures. This in turn is destroying financial stability and generating rapid price inflation.

  Conservative states and counties that refused to shut down are recovering at a much faster pace than leftist states which imposed draconian restrictions on citizens. Yet, the lockdowns did nothing to stop the spread of COVID-19 in blue states. So, the lockdowns accomplished no discernible advantage for the public, but they did give the central bank a perfect rationale to further erode the dollar.

  This resulting price inflation is something that not even the red states can escape.

  For example, home prices are rapidly expanding beyond the market bubble of 2006. This is partially due to millions of people participating in perhaps the largest migration in the U.S. since the Great Depression. Anyone who is able is moving away from major cities into suburban and rural areas. But, home prices also have a historic habit of inflating along with currency devaluation. The cost of maintaining and remodeling an older home, or building a new home, rises as the prices of commodities like lumber inflate.

  And lumber prices are certainly inflating! Softwood lumber prices are up at least 110% from a year ago, and are climbing as much as 10% in a week.

  Home rentals also do not escape inflation, as the rising cost of maintaining properties forces landlords to increase rents. The only places where rents are decreasing are major cities that Americans are seeking to flee, such as New York and San Francisco.

  Inflation In More Than Just Housing

  The majority of commodities continue to see price inflation across the board. Food and energy prices have been creeping higher for the past year. Governments are once again blaming the pandemic and “stresses on the supply chain,” which may have been a believable claim nine months ago, but not today. Anything to hide the fact that all that stimulus has inflationary consequences.

  Dollar devaluation is the most visible in terms of imported goods. In other words, it costs more dollars to buy goods outside the U.S. as the value of the dollar falls. And since the majority of U.S. retail is supplied by foreign producers, this means that average American consumers will suffer the brunt of inflationary consequences. Public stress and anger will be high.

  Pandemic Lockdowns Are Just An Excuse

  This is why the COVID-19 lockdowns must continue and the pandemic fear factory must remain active. The globalists need a cover event for the Reset and they need to keep the citizenry under control, and the pandemic can be blamed for just about anything. I think this is why we are already seeing the media hyping the existence of “COVID mutations.” Do not be surprised if the Biden Administration tries to implement a national lockdown sometime this year in the name of stopping the spread of a “more deadly” COVID-19 variant.

  It won’t matter that the previous lockdowns were useless and all the data shows that keeping the economy open is a superior policy. It might seem like logic is going completely out the window, but there is a very logical reason for what is happening in the minds of globalists.

  Stagflation comes into play through losses in certain sectors of the economy, high unemployment and the inability of wages to keep up with costs.

  There is the continued dismantling of the small business sector, which, again, I believe is being destroyed deliberately. It’s not a mistake that small businesses were predominantly targeted as “non-essential” during the lockdowns. It’s also not a coincidence that the majority of COVID-19 PPP loans went to big box corporations while small businesses received almost nothing. The small business sector is being erased, leaving only the corporate sector to provide for consumers.

  This may be why Democrats are so adamant about raising the federal minimum wage to $15 an hour. Wages are already rising according to market demand and region. The average non-skilled worker in the U.S. is making around $11 an hour. There is no need for the government to interfere, unless they have ulterior motives.

  A $15 minimum wage would likely crush what’s left of small businesses, and only corporations that are receiving the bulk of stimulus dollars will be able to afford to pay workers the higher rate. On top of that, years from now the government could claim they “took action” to front-run stagflation by increasing people’s pay. But a $15 minimum wage is most useful to the establishment in the short term because it muddies the waters on the inflation issue.

  Prices will continue to rise due to dollar devaluation, but the media and government will say that it has nothing to do with the dollar and everything to do with companies raising shelf prices to offset increased labor costs.

  The Biggest Threat In The History Of American Society

  I suspect that the establishment will do everything in its power to distract the public from the biggest threat in the history of American society – the stagflationary time bomb

  If they admit to its existence then the public could prepare for it, and they don’t want that. If Americans were to decentralize their local economies, support local small businesses instead of big box retailers, start producing necessities for themselves, and if they started developing currency alternatives like local scrip backed by commodities… then they would be able to survive a national financial crisis.

  In fact, I guarantee that any community, county or state that takes these steps will immediately be targeted by the federal government, further revealing the truth: The establishment wants the public to suffer.

  They want economic disaster. They do not want people to have the option of taking care of themselves. They need people scared, desperate and malleable, or they will never achieve their Reset agenda.

  *  *  *

  With global tensions spiking, thousands of Americans are moving their IRA or 401(k) into an IRA backed by physical gold. Now, thanks to a little-known IRS Tax Law, you can too. Learn how with a free info kit on gold from Birch Gold Group. It reveals how physical precious metals can protect your savings, and how to open a Gold IRA. Click here to get your free Info Kit on Gold.

  Tyler Durden
  Mon, 03/08/2021 – 23:25

• San Francisco TV Reporter Robbed At Gunpoint While Covering Auto Thefts 
  San Francisco TV Reporter Robbed At Gunpoint While Covering Auto Thefts 

  The effects of the virus pandemic and socio-economic implosion that followed compounded with failed liberal leadership have transformed some parts of San Francisco into high-crime areas. A KPIX 5 reporter investigating a series of car break-ins around Twin Peaks was robbed at gunpoint for his camera, reported KPIX 5. 

  KPIX reporter Don Ford reported at Twin Peaks in San Francisco last Wednesday when a white luxury sedan with four men inside pulled up and put a Glock to his face, demanding his camera. 

  “The car came up here while we were about to do an interview, three guys jumped out,” said Ford. “One had a gun and put in my face and said, ‘We’re taking the camera.'”

  

  “My whole thought at the moment was be calm. Let’s not get this guy excited. He’s got the gun. I don’t. So you take you the camera. It’s yours Buddy,” he said. 

  “I was worried that this is what’s gonna happen, because as thieves get more and more brazen, they do more and more brazenly things. I’m not making that up. We just had that experience today,” a neighbor who asked not to be identified. 

  Ford was preparing to interview a homeowner when the incident unfolded. 

  “I just looked and I said, ‘I’m not going to get shot today,'” the homeowner said. 

  Supervisor Rafael Mandelman, who serves the metro area’s District 8, which includes Twin Peaks, tweeted the incident is “ridiculous & unacceptable but not entirely unexpected in San Francisco in 2021.”

  “We need to adequately resource public safety agencies, adopt better strategies to stop repeat offenders & make clear that San Francisco is not a place that you can commit crimes & put people’s lives at risk with impunity,” Mandelman said.

  Violent crime has increased in the metro area since lawmakers defunded the San Francisco Police Department by $25 million from $692.9 million in 2020 to $667.9 million. 

  Citywide robberies and automobile vehicle thefts are surging; latest crime data shows burglaries jumped 59.4%, and motor vehicle thefts are up 20.8% so far this year.

  San Francisco police could see upwards of 11% or 167 officers laid off due to budget cuts. The possible reduction could significantly impact patrols and result in more crime. 

  Besides surging vehicle thefts and other violent crimes, companies are closing up shops as shoplifting has become a significant problem. 

  On top of this all, there’s an exodus of residents who are leaving San Francisco for rural communities, fed up with the city’s socio-economic implosion. The ability to work-at-home has also accelerated outbound migration. San Fran could one day be a hallowed out town, like Baltimore and or Detroit, if these trends persist. 

  Here’s the full report via KPIX 5 of the reporter who was robbed at gunpoint. 

  Tyler Durden
  Mon, 03/08/2021 – 23:05

• U.S. Flies Two B-52H Bombers Over Middle East To "Reassure Allies"
  U.S. Flies Two B-52H Bombers Over Middle East To “Reassure Allies”

  Via SouthFront.org,

  On March 7th, two US B-52H Stratofortress strategic bombers flew over the Middle East, as a show of strength against Iran.

  

  The US military’s Central Command said the two B-52s flew over the region accompanied by military aircraft from nations including Israel, Saudi Arabia and Qatar. It marked the fourth-such bomber deployment into the Middle East this year and the second under President Joe Biden.

  A pair of U.S. Air Force B-52H “Stratofortresses” flew a multinational patrol mission across the #MiddleEast from @TeamMinot today to deter aggression and reassure partners and allies @USAFCENT @MOD_Qatar @modgovksa #B52
  https://t.co/dAEOYtRbgt pic.twitter.com/yPQEqywrnH

  — U.S. Central Command (@CENTCOM) March 7, 2021

  https://platform.twitter.com/widgets.js

  Flight-tracking data showed the two B-52s flew out of Minot Air Base in North Dakota, something Central Command did not mention in its statement on the flights.

  Iran, as usual, wasn’t directly mentioned by CENTCOM’s statement. According to it, the flight was to “deter aggression and reassure partners and allies of the US military’s commitment to security in the region.”

  This goes directly opposite of US President Joe Biden’s claim that he wants to return to the Iran Nuclear Deal and have a sort of normalization in relations.

  Biden expressed a desire to return to the deal if Iran honors the deal’s limits on its nuclear program. However, tensions remain high after militias in Iraq — likely backed by Iran — continue to target American interests.

  In late February, Biden ordered the launch of an airstrike just over the border into Syria in retaliation, joining every American president from Ronald Reagan onward who has ordered a bombardment of countries in the Middle East.

  On the same day, Beirut-based channel Al-Mayadeen aired footage of the Helios Ray, a Bahamian-flagged roll-on, roll-off vehicle cargo ship hit by the blasts February 26 in the Gulf of Oman.

  The grainy footage included areas blurred out on the video, likely coordinates and other information displayed by the Iranian military drone. The footage at one point showed what appeared to be a hole in the side of the vessel.

  Al-Mayadeen did not say when the footage was shot, nor explain the circumstance by which the Iranian drone was following the ship. The U.S. Navy’s Bahrain-based 5th Fleet, which patrols the Mideast and often has tense encounters with Iran, declined to comment on the footage.

  Off Gaza’s coast, three fishermen were killed in a reported Hamas misfire, according to Israeli media.

  At the same time, Arab-language media reported that it was an Israeli strike that killed the fishermen.

  Tyler Durden
  Mon, 03/08/2021 – 22:45

• How Much Money Do You Need To Join The Top 1%?
  How Much Money Do You Need To Join The Top 1%?

  Knight Frank has released its 15th annual Wealth Report which found that the Covid-19 pandemic has proven good news for the world’s super rich, primarily due to surging asset prices that are being driven by lower interest rates and fiscal stimulus.

  As Statista’s Niall McCarthy notes, the global UHNWI population (an ultra-high-net worth individual has a net worth of $30 million or more) climbed 2.4 percent over the past year with growth strongest in Asia at 12 percent. Growing inequality is increasingly been seen as the greatest threat to future wealth accumulation and support for wealth taxes is rising in many parts of the world with such plans already proposed or in place in Argentina, Canada and South Korea with similar measures likely to be introduced elsewhere.

  Considering the massive and growing gap between the super rich and the rest of the world, how much would someone need to earn to join the exclusive and oft-maligned one percent club? The Wealth Report included an interesting subsection that used the company’s Wealth Sizing Model to compare requirements to gain access to the top 1%.

  

  You will find more infographics at Statista

  They vary considerably between countries and people would need the deepest pockets in Monaco. The tiny principality is well known as a playground for the super rich and it has one of the densest UHNWI populations on the planet. The entry point to the community is the highest on the planet at $7.9 million. Switzerland is known for its affluence and a cool $5.5 million would be needed to be counted among the country’s top one percent. The United States has the world’s largest UHNWI population with around 180,000 people holding a fortune of $30 million or more in 2020. Some $4.4 million would gain entrance to the America’s one percent club.

  

  Elsewhere, the threshold is considerably lower, particularly in developing countries where the super wealthy community remains relatively sparse. While China is expected to see its entry requirements rise significantly in the coming years, $850,000 was enough to be counted among its one percent community in 2020. India has seen its super rich population grow steadily in recent years but its threshold remains extremely low less than one percent of Monaco’s. A mere $60,000 would count someone among India’s highest earners, though the status would not last long. Knight Frank predicts that India’s entry threshold will double within the next five years.

  Tyler Durden
  Mon, 03/08/2021 – 22:25

• China 'National Team' Is Back – Stocks Surge Back After Hitting Correction Territory
  China ‘National Team’ Is Back – Stocks Surge Back After Hitting Correction Territory

  It would appear global equity markets are testing the will of the world’s central bankers… one by one.

  Friday in the US we saw a sudden and mysterious buying-panic occur as the Nasdaq accelerated into correction territory and beyond…

  

  And tonight, after we tweeted the following…

  In theory a continued collapse in the QQQ will crash the S&P, DJIA, and everything else.

  In practice, the Fed will never allow it. We are within 2-3% of the Fed’s red line for QQQs

  — zerohedge (@zerohedge) March 9, 2021

  https://platform.twitter.com/widgets.js

  …Chinese stocks have seen a sudden mysterious buying-panic occur..

  

  …just as the big-cap CSI-300 accelerated beyond a correction…

  

  Bloomberg reports that Chinese state funds intervened to alleviate declines in the stock market as a rout showed no signs of slowing.

  State-related funds are stepping in to ensure market stability during the government’s key policy meeting in Beijing, according to people familiar with the matter. A Hong Kong-based trader said clients linked to mainland funds were actively buying shares through stock links with Hong Kong on Tuesday.

  It has been a few years since the so-called “National Team” has been seen in Chinese markets. In 2016, one analyst noted:

  “The ‘national team’ is very deeply involved, and its main purpose is to prevent the market from moving up or down too extremely. Sometimes when the market looks set to break out and you buy shares to wait for them to rise, the good momentum would suddenly stop.”

  In fact China’s plunge protection team was very active during 2015’s chaos…

  

  

  Will it be The ECB’s turn tomorrow? Or was that what sparked the sheer panic-buying in Europe today also?

  

  Just how much “whatever it takes” are they willing to do?

  Tyler Durden
  Mon, 03/08/2021 – 22:24

• Burger King's 'Woke' Viral Tweet Backfires Horrendously
  Burger King’s ‘Woke’ Viral Tweet Backfires Horrendously

  Authored by Paul Joseph Watson via Summit News,

  A tweet posted by Burger King which said “women belong in the kitchen” that was meant to be a woke virtue signal to mark International Women’s Day backfired horrendously.

  

  The fast food giant followed up the tweet with a second that read:

  “If they want to, of course. Yet only 20% of chefs are women. We’re on a mission to change the gender ratio in the restaurant industry by empowering female employees with the opportunity to pursue a culinary career.”

  However, the fact that the explanatory text was not included in the first tweet just made it look to many as though Burger King was regurgitating a sexist trope.

  [ZH: We note that both tweets have since been deleted]

  Looks like they forgot to delete their Facebook post:

  

  Perhaps forgetting that the woke mob displays ruthless intolerance to humor or nuance, the company faced an immediate backlash before ‘Burger Queen’ began trending, with Twitter users demanding a name change as an apology for causing offense.

  your only way out of this is to change the name to Burger Queen

  — Kelly Bachman (@bellykachman) March 8, 2021

  https://platform.twitter.com/widgets.js

  Others called for a boycott, including this woman whose tweet received over 22,000 likes.

  I won’t be eating at your store again thanks

  — ChildishTalksHipHop🐻 (@childish_santan) March 8, 2021

  https://platform.twitter.com/widgets.js

  “Burger King belongs in a trashcan,” said another verified liberal.

  Burger King belongs in a trashcan.

  — Chelsea Peretti (@chelseaperetti) March 8, 2021

  https://platform.twitter.com/widgets.js

  Others pointed out the irony of women in the kitchen only being acceptable in 2021 if those women are wage slaves for giant transnational corporations, with traditional family gender roles frowned upon.

  “If they want to, of course.” No one on earth would be working in a Burger King kitchen if they didn’t have to pay rent & bills, but Burger King is trying to make it sound like female empowerment lmao pic.twitter.com/56q58dVKIR

  — Charlie Nash (@CharlieNash) March 8, 2021

  https://platform.twitter.com/widgets.js

  *  *  *

  In the age of mass Silicon Valley censorship It is crucial that we stay in touch. I need you to sign up for my free newsletter here. Support my sponsor – Turbo Force – a supercharged boost of clean energy without the comedown. Also, I urgently need your financial support here.

  Tyler Durden
  Mon, 03/08/2021 – 22:05

• "The System Is Compromised" – Baltimore Man Receives 18 Unemployment Debit Cards
  “The System Is Compromised” – Baltimore Man Receives 18 Unemployment Debit Cards

  Maryland’s Department of Labor is investigating a bizarre unemployment insurance scam. A Baltimore-area man claims to have received at least 18 fraudulent unemployment insurance debit cards from “investors,” according to local news station WMAR-2 News. 

  “That’s one, that’s two, three, four. That’s five, that’s six, seven, eight. That’s a total of nine cards,” said Dr. Keenan Cofield, who is a state lobbyist, a taxpayer – he said stuff like this makes him “cringe.” 

  

  He told WMAR-2 News Mallory Sofastaii that a total of 18 unemployment debit cards were mailed to his address. He said the debit cards were individually sent to him but addressed to other people.

  “Each one of them has a Visa card, each one of them has a name,” Cofield said.

  He was communicating with some people inline about the need for investors in a few of his projects. The Baltimore-area man said at least two people through a messenger app offered to invest with him.

  “And things were moving on, and they said that the funding would be coming by cards. So, next thing I know, I see these strange-looking Maryland Department of Labor and Regulation unemployment. [There’s] nobody at this house with these names,” said Cofield.

  Cofield communicated with the investors through Google Hangouts. He shared 30 pages of the conversations with Sofastaii: 

  The sender wrote:

  “Once cards are activated All you have to do is drive to an ATM machine and make withdraw sir”

  The sender instructs Cofield to keep 60 percent of the balance on the various cards and send the other 40 percent back, which will be split between the sender and someone named Bryan.

  Cofield asked whether this was fraud.

  The sender replied:

  “Sir believe me sir. this is not fraud sir ok. … Trust me It not a fraud sir”

  Here’s more of the convo: 

  

  “They have not said which ones were which, but they said the minimum was $500 and at least two or three of those cards are $10,000,” Cofield said.

  Cofield said nobody in his household is unemployed and became suspicious of how the unemployment debit cards, loaded with a lot of taxpayers’ money, and in envelopes under the seal of “Maryland Department of Labor, Licensing and Regulation. 

  What this is, as Cofield discovers, is a “money mule operation.” In an operation like this, Cofield is the “go-between” entity that hands the dirty money then sends a certain portion back to the fraudsters. 

  “When I saw the Department of Labor and Licensing and Regulation unemployment, oh no, this is a scam. This is a big scam and this is a huge problem,” he said.

  Cofield has since contacted law enforcement about the money mule operation. 

  “It’s sad. Nobody knows where to go, so this is why I say guess what, Mallory is on this thing about unemployment, and that’s why I picked up, and that’s why we’re at Channel 2 now,” said Cofield.

  During the pandemic, State Police and the FBI have warned about increasing unemployment scams. The FBI ranks Maryland 5th in the country for “money mules” in 2019 despite being a highly prosperous state. 

  “The system is still messed up. There are people who have still not got their legitimate benefits. This lets you know not only somebody in that pile probably is missing their card, but the system is compromised,” said Cofield.

  Maryland’s Department of Labor expects to eliminate debit cards by April and switch to direct deposits. 

  On a national level, federal officials admitted that tens of billions of dollars in unemployment benefits were disbursed and squandered by fraudsters during the pandemic. 

  One fraudster, who made a million dollars in an elaborate unemployment scam in California, released a rap video about it. 

  As the plot thickens in the search for who the fraudsters are in Cofield’s case – he said one of the “investors” had a family member working at the Tennessee Bank of American Maryland Unemployment debit card processing center, according to Fox 5. 

  Fox 5 reports on the fraud:

  Tyler Durden
  Mon, 03/08/2021 – 21:45

• Gold Vs Bitcoin Part 2: Careful What You Wish For
  Gold Vs Bitcoin Part 2: Careful What You Wish For

  Authored by Mark Jeftovic via BombThrower.com,

  This is the second part of my look at the age old “Gold vs Bitcoin” debate, which I outlined in Part 1: “Gold vs Bitcoin is Fscking Stupid” as being faith-based and pointless.

  

  While it is thoroughly enjoyable to watch it play out between the symbolic archetypes of  near-boomer Peter Schiff and his millennial son, Spencer, I sometimes suspect that to  be a staged, WWE style confrontation….

  Future tweet: “Now that Bitcoin has hit $500,000 I must admit that a move up to $1,000,000 can’t be ruled out. However…”

  — Spencer Schiff (@SpencerKSchiff) February 16, 2021

  https://platform.twitter.com/widgets.js

  However I bring up the elder Schiff for a reason, because part of his core thesis is that after the coming global monetary reset, the world will move back to a gold backed currency.

  A return to a gold-backed standard would be a disaster

  This I find not only unlikely, but undesirable. Anybody paying attention to the way the world works now absolutely shouldn’t want a return to a gold-backed currency, especially people holding their wealth in gold.

  The reason is very simple: if that were to happen, there would occur with that a corresponding global ban on private gold ownership. Anybody who thinks this through can see that is the most likely way it would play out.

  The religious goldbugs think the USD will implode (probably correct), lose it’s global reserve currency status (correct) and then… government will admit defeat, remonetize the world with a gold backed currency. Doing that would instantly make the goldbugs who were outside the system, who were highly critical of it and who reject the legitimacy of much of it, the most wealthy and powerful participants in the new monetary regime.

  Do you really think it would play out like that? Do you really think that governments who double-down on incompetence, who think nothing of changing the rules and moving the goalposts, who stop at nothing to preserve their own position and serve their own interests are going to throw their hands up in the air, shrug their shoulders and walk offstage to clear a path for a next generation of goldbug power elites?

  I don’t think so.

  This is what happens instead:

  1. A new narrative begins to emerge:  gold bugs are damaging the stability of the banking system

  2. Sudden focus on how gold mining accelerates climate change and exacerbates systemic racism

  3. Gold jewelry = white privilege (even in India,  remember, by this point 2 + 2 = 5)

  4.  Private gold hoards are exacerbating wealth inequality

  After a few months of this and then the time is right, a coordinated set of policy initiatives will emanate from some elitist circle jerk like Davos or Jackson Hole:

  • all gold mines nationalized globally, possibly structured into an International Gold Pool™.

  • mandatory buybacks of private holdings at capped prices

  • criminalization of unlicensed private gold ownership

  …and gold jewelry will be the MAGA hats of the future. It’ll end your career.

  I may be off on the details, but that is in essence what I would expect happens if the global monetary reset heralds a return to the gold standard.

  The powers that be will never admit causing the monetary crisis, will never concede that it was their policies over successive decades caused it, and they will never voluntarily allow a tectonic shift to move power and wealth to anybody other than themselves.

  So if you’re a big believer in preserving your wealth through holding gold (as I am), then this is definitely what you don’t want to be wishing for. This is what the Bitcoiners should be hoping happens to the goldbugs.

  As for the Bitcoiners….

  Bitcoin as world reserve currency will never happen

  Some Bitcoin maximalists think that it is destined to become the global world reserve currency because (wait for it)….

  It would essentially force governments to be honest.

  I should be able to rest my case here. Governments are congenitally incapable of honesty. Perhaps there was a point in time when that wasn’t the case, but it certainly isn’t today, and the governments we have today will not voluntarily move to a system that forces them to be honest.

  The only way Bitcoin gets made the world reserve currency is if it’s done in a way that removes any and all advantages from those who own it today. This is how the system works: the elites are in charge, and anything that comes along to challenge their authority is either co-opted or criminalized.

  The system is hardwired to preserve the power and privilege of the people running it, and as I’ve said in the past, the privilege isn’t race based, it’s based on the structure of the monetary system. 

  Both goldbugs and Bitcoiners think government bans are unlikely or unworkable. Just last week on Coindesk’s The Breakdown, NLW’s Long Reads Sunday was Alex Gladstein’s Can The Government Ban Bitcoin?, who wrote about the mechanics of implementing a ban on bitcoin…

  “a military home-by-home raid couldn’t work very well and would constitute a mass set of human rights violations.”

  …possibly overlooking that we are one year into a New Normal where that which is not expressly permitted is forbidden.

  Anybody under-estimating the level of overreach and oppression that all governments globally can undertake, in concert, has to either have been asleep for the last year or is so comfortably cocooned  in one of those “post-physical” lifestyles that they didn’t care.

  To be clear however, I mostly agree with Gladstein’s reasoning on why Bitcoin can’t be banned effectively. Which is also why I think that precludes it from being part of any kind of government sponsored monetary restructuring (that said, some central banks may start buying Bitcoin as a part of their own reserves, the first national central bank to ponder it that I know of was Barbados, back in 2015)

  If Bitcoin were to become the rails of the global monetary system, it would happen in a way where the governments can completely regulate every single aspect of it, including where and how you HODL, whether it’s legal to mine (or stake for other or future cryptos) and whether or not you’re permitted to self-custody.

  So if you’re a big believer in preserving your wealth through migrating into the crypto-currency economy (as I am), then this is definitely what you shouldn’t be betting on. This is what the goldbugs should be hoping happens to the Bitcoiners.

  The true enemy is EvilCoin

  If I can see horrible outcomes as a result of what either camp thinks would be “victory”, what am I doing about it? This is what I said in Part 1,

  “the entire debate pointless because people who invest in either asset class are doing so for the same reasons…If the job at hand is to protect one’s wealth from systemically rigged and disintegrating monetary regime, arguing for one over the other feels like trying to defend against it with only half the available toolkit….The entire gold vs crypto argument goes away when one realizes that there is more overlap in the objectives of each asset than there are differences”

  I’ve never been a Gold vs Bitcoin guy, I’ve always been a Gold and Bitcoin guy. And by “gold” I mean precious metals, and by Bitcoin I mean crypto currencies in general (I also like Ethereum, as described in part 1).

  

  The post-reset toolbox, from Part 1

  Personally I don’t see any danger that either camp will ever see that their preferred monetary asset becomes the global reserve asset. Gold doesn’t allow governments to embezzle wealth from its subject and Bitcoin is off the table. They would never go with an open source project pioneered by an anonymous cypherpunk. They just won’t.

  What is more likely and what I personally am betting on is this:

  There will be some form of global monetary reset involving Central Bank Digital Currencies (CBDCs). China is already a fair way down the runway with their Digital Currency Electronic Payments (DCEP) system and the use of digital cash is far more pervasive there already.

  China is dictatorship. There is zero personal freedom and there are no sovereign individuals. Their social credit system will increasingly regulate every aspect of every citizen’s most minute activities and it will be the envy of technocrats the world over.

  I am betting on The Great Bifurcation playing out in the classical liberal world as follows:

  

  Erstwhile democratic nations will implement CBDCs which will be the rails of MMT, UBI and eventually full social credit systems “with Western characteristics”.  As the middle class gets hollowed out, most people will fall below an impermeable membrane into the new serfdom. The defining characteristic of the underclass:

  • no assets (“The year is 2030, you will own nothing and be happy…”)

  • no income as we understand it today, it’ll be UBI which is more of a digital “scrip” than actual money

  • no job, no career no profession other than side-hustles, gigs and the odd outlier shot at being in influencer

  The people who owe more than they own will basically be screwed and if there is another financial crisis before all this happens, say one in which equities, property values get smashed down while the cost of living skyrockets, then what’s left of the middle class will be quickly sorted into either category.

  I am always surprised at how few people I talk to have ever watched Mr. Robot.  However its explanatory allegory around the two-tiers of digital money after a global financial crash is a compelling one.

  So called “Evilcoin” is the CBDC, run by the establishment and is more like company scrip of yore, redeemable across the company platform. Alongside EvilCoin is Bitcoin, which people prefer and what actually holds value and confers a greater amount of economic freedom.

  

  In short: we’re headed into two-tier society, one where the tier you’re in relies on which form of digital currency economy you’re participating in the most. That’s what we look at specifically in my premium letter The Crypto Capitalist (including which publicly traded companies will be the best ones to own here in the New Normal).

  If there is any single take-away from all this, it is this, as long as “the system” as we know it, stays on the rails, then:

  “Gold vs Bitcoin” is the wrong question.

  “What are the alternatives to EvilCoin?” is the only question.

  *  *  *

  To receive future posts in your mailbox join the Bombthrower mailing list or follow me on Twitter.

  Tyler Durden
  Mon, 03/08/2021 – 21:25

• Royal Caribbean's Newest Ship Stuck At Port After Workers Catch COVID 
  Royal Caribbean’s Newest Ship Stuck At Port After Workers Catch COVID 

  Europe recorded more than one million COVID-19 cases last week, an increase of 9% from the previous week and a reversal in a six-week decline. There are fears of new variants spreading around the continent. So it comes as no surprise that members of Royal Caribbean International’s newest cruise ship, Odyssey of the Seas, recently tested positive for the virus, forcing the vessel to remain docked at Bremerhaven, Germany, reported NDR German news site. 

  Several German newspapers reported that “two employees on the Odyssey of the Seas” tested positive for the virus on Mar. 3 and were confirmed on Mar. 4 via PCR tests. The estimated 500 crew and workers have been quarantined on the ship. 

  

  According to NDR, the port medical service in Bremerhaven has ordered the vessel to remain in Bremerhaven until further notice. 

  The Meyer Werft shipyard already completed initial tests of the vessel in the North Sea. Further sea trials were supposed to be completed later this month, but NDR said it is “unclear when it can take off for the planned test drives.” The shipyard is scheduled to deliver the Odyssey to Royal Caribbean next month ahead of his first sailing from Haifa, a northern Israeli port city, in May. 

  This comes as the so-called U.K. variant has spread across Europe. According to WHO experts, the new variant is 50% more transmissible than the virus that surged early last year. 

  While the global travel and tourism industry is preparing for a banner year as vaccine rollouts and unprecedented fiscal and monetary stimulus has led some economists to believe there is massive “pent up demand,” it appears the virus pandemic continues to cause bottlenecks in the return to normalcy for specific industries.  

  Tyler Durden
  Mon, 03/08/2021 – 21:05

• Taibbi: The Prophet Of The Trump Era
  Taibbi: The Prophet Of The Trump Era

  Authored by Matt Taibbi via TK News,

  I entered Martin Gurri’s world on August 1, 2015. Though I hadn’t read The Revolt of the Public, at the time a little-known book by the former CIA analyst of open news sources, I hit a disorienting moment of a type he’d described in his opening chapter. There are times, he wrote, “when tomorrow no longer resembles yesterday… the compass cracks, by which we navigate existence. We are lost at sea.”

  

  Gurri’s book is about how popular uprisings are triggered by collapses of faith in traditional hierarchies of power. I felt such a collapse that day in Waterloo, Iowa, covering the Republican presidential primary. The first debate was five days away and the man expected to occupy center stage, Donald Trump, held a seemingly inexplicable six-point lead.

  Two weeks before, on July 18th, Trump lashed out against former Republican nominee John McCain. Even McCain’s critics considered his physical and mental scars from years as a Vietnam war prisoner to be unassailable proofs of his patriotic gravitas, but the service-evading Trump was having none of it. “I don’t like losers,” he said, adding, “He’s only a war hero because he was captured.” It was the universal belief among colleagues in campaign journalism that this was an unsurvivable gaffe, a “Dean scream” moment. We expected him to apologize and wash out. Instead, he called McCain a “dummy” and kept a firm grasp on the lead.

  A different candidate, New Jersey governor Chris Christie, was in Waterloo. Two years before, Time all but dubbed Christie the favorite for 2016 with a silhouette cover portrait, over the nastily shallow (but publicity-generating) double-entendre headline, THE ELEPHANT IN THE ROOM. Christie was every Washington consultant’s idea of a “crossover” superstar. I’d describe the concept in Rolling Stone as someone “mean enough for the right-wing, but also knows a gay person or once read a French novel.”

  Christie parked himself in the middle of Waterloo’s annual “Irish fest” street fair, waiting for an Iowan to ask for a souvenir campaign handshake. He had his hand out and thumb stuck upwards, like an Iguanodon. Nobody came. Kids ran around him like he was a shrubbery. Two young women, giggling about something that clearly had nothing to do with him, walked his way, separated just long enough to avoid hitting him, then linked up again a few yards down. He eventually posed with a few passersby, but the rubbernecking that usually attends the arrival of any “famous politician” was conspicuously absent.

  

  Later, I sat in the park discussing Trump’s stubborn grasp on the lead with another reporter, an Iowan. “It’s amazing,” he said, shaking his head. “We’re beating the shit out of the guy, and he just won’t die.” He compared it to a nightmare, where you stab an attacking monster over and over, and nothing happens.

  Elections in the pre-Trump era had been stale rituals. As recently as 2013, Chris Cillizza of the Washington Post called them “remarkably scripted and controlled.” Donors, party chiefs, and pundits could concoct contenders through sheer alchemy, mesmerizing the public with incantations like “electability.” But in Iowa that summer, one “electable” Republican candidate after another — from Jeb Bush to Scott Walker to Marco Rubio — flopped in public appearances, savaged as phonies on social media. Walker, the betting favorite among reporters, saw his campaign deflated when his online strategist, Liz Muir, started tweeting her real feelings about Iowa (including the classic, “#agsubsidies #ethanol #brainless”).

  I’d spent weeks crisscrossing the state in search of even one piece of evidence that conventional wisdom still had predictive power in Republican politics, finding none. Now, here was Christie, reduced from being lionized in a Time cover story as a favorite and a “guy who loves his mother and gets it done,” to being nobody at all, a clown standing alone in a park. The realization that no one was in control of the campaign show anymore was jarring even to me, a critic of the old gatekeeping ritual.

  In the introduction to The Revolt of the Public, Arnold Kling speaks of a different “Gurri moment”: when Dan Rather’s 2004 expose about George W. Bush’s military service was blown up by an amateur blogging under the name “Bucklehead.” In the past, a media titan like CBS could only be second-guessed by another major institutional power. In “Rathergate,” both the network and one of its most iconic celebrities were humiliated by a single individual, a preview of the coming disorientation.

  The thesis of The Revolt of the Public is that traditional centralized powers are losing — have lost — authority, in large part because of the demystifying effect of the Internet. The information explosion undermined the elite monopoly on truth, exposing long-concealed flaws. Many analysts had noted the disruptive power of the Internet, but what made Gurri unique is that he also predicted with depressingly humorous accuracy how traditional hierarchies would respond to this challenge: in a delusional, ham-fisted, authoritarian manner that would only confirm the worst suspicions of the public, accelerating the inevitable throw-the-bums-out campaigns. This assessment of the motive for rising public intransigence was not exactly welcomed, but either way, as Kling wrote, “Martin Gurri saw it coming.”

  

  Gurri also noted that public revolts would likely arrive unattached to coherent plans, pushing society into interminable cycles of zero-sum clashes between myopic authorities and their increasingly furious subjects. He called this a “paralysis of distrust,” where outsiders can “neutralize but not replace the center” and “networks can protest and overthrow, but never govern.” With a nod to Yeats, Gurri summed up: “The center cannot hold, and the border has no clue what to do about it.”

  Read the rest of the report here.

  Tyler Durden
  Mon, 03/08/2021 – 20:45

• Mutant COVID Strains In Florida, New York Threaten To Derail US Recovery, BofA Warns
  Mutant COVID Strains In Florida, New York Threaten To Derail US Recovery, BofA Warns

  Dr. Fauci and other health experts are warning about the prospect of a “4th wave” of COVID infections as mutated strains of the virus comprise a growing share of new COVID infections in the US, even as the JNJ one-shot vaccine promises to accelerate the pace of vaccinations. Worries about spreading mutant strains are being amplified by research showing that B.1.1.7 (first identified in the UK, also known as the “Kent” strain, after where it was first isolated and identified) might be on the cusp of becoming the most prevalent strain in the US.

  

  According to research cited in a note published Monday by a team of researchers at BofA, Florida is on the cusp of seeing the UK variant become the “dominant” strain in the state. And although hospitalizations, new cases and deaths have slowed in the Sunshine State, researchers are concerned that the variants are slowing the ebb of the pandemic in the state – and could possibly supercharge it. Cases and hospitalizations are still slowing in the state, just not as quickly as they were in January.

  

  The team of analysts at  BofA said these trends have raised concerns about Florida becoming a bellwether state for the spread of the new variants, which many fear could surge as states from Texas to Connecticut move to loosen at least some (or in Texas’s case, practically all) virus-related restrictions. The fact that the state’s positivity ratio has declined since the start of the year suggests that the virus truly is receding (in other words, the lower case numbers aren’t due to solely to a pullback in testing).

  Perhaps counterintuitively, the analysts at BofA are worried that the UK variant might not be as dominant in Florida as they believe. They also gamed out two additional scenarios that they said would lead to a greater outlook.

  We see three possible explanations for Florida’s continued improvement. First, the spread of the new variant might not be as far along as estimated. So the old variant might still be contracting off a much larger base, while the new variant is growing off a small base. This would not be good news as it would suggest an imminent increase in cases as the new variant continues to spread.

  Second, vaccines might be more effective at containing the virus than we thought, by making both vaccinated people and their close contacts less vulnerable. This would be good news because the cumulative effect of vaccines should increase quickly as the roll-out gains momentum. The third explanation, which is least likely in our view, is that the B.1.1.7 variant is significantly less contagious than widely estimated. This would probably be the best news of all.

  But Florida isn’t the only state struggling with COVID mutations: The B.1.526 variant that is believed to have originated in New York State is also raising concerns, according to BofA. New York cases have dropped more slowly than in the rest of the country, and have flat-lined in the last ten days. Hospitalizations are still falling, but, as the analysts remind us, they are a lagging indicator.

  

  Thanks to these trends, the Empire State now has the second-highest number of confirmed cases per capita in the country, after New Jersey (both are higher than California, which leads in total cases, though it’s massive population makes for a lower ratio).

  However, because the testing rate in New York is about 3x the national average, the positivity ratio – measuring number of positive cases vs. total tests – in the state has been steady at around 3.2% for about a week, compared with the national average of nearly 5%. So, while New York might be feeling the impact of the new variant, the team at BofA doesn’t see reason for alarm until the positivity rate moves significantly higher.

  Looking at the US in total, the analysts at BofA believe new COVID cases could climb in the coming weeks due to the growing presence of the new mutant “variant” strains. Fortunately, they only expect a modest rise through the end of April, after which, they believe, case numbers will move lower again.

  Of course, all of this depends on how effective the first generation of vaccines is in offering protection to patients from the growing number of mutant strains.

  Tyler Durden
  Mon, 03/08/2021 – 20:25

• Repo Chaos Continues: "Market Just Doesn't Know Where To Price The 10-Year"
  Repo Chaos Continues: “Market Just Doesn’t Know Where To Price The 10-Year”

  The Federal Reserve and Jay Powell want to pretend that all is well with the repo market, but nothing could be further from the truth.

  Last Thursday, we presented to our readers the latest repo market data showing just how broken and inverted the traditional fund flows surrounding the world’s “most liquid” and important security had become in “Historic Repo Market Insanity: 10Y Treasury Trades At -4% In Repo Ahead Of Monster Short Squeeze.” One day later, the chaos got even worse as discussed in “10Y Treasury Hits A Stunning -4.25% In Repo As Yields Blow Out.” Very simply, this meant that an investor in the repo market lending money so others could short the 10Y would end up paying rather than getting paid. As we explained said “this is a clear breach of one of the most fundamental relationships in the repo market, where lenders of cash always get paid – however little – in order to make a more liquid and efficient market.”

  The repo rate sliding far below the “fails charge” of 3.00% which is viewed as the lowest theoretical level where dealers are punished for not delivering a 10Y Treasury i.e., there is a delivery “fail”, was striking but what was even more striking is that the recent repo crunch has been surpassed just once in history: when the 10Y hit a record low repo print of -5.75% during the fear and loathing of the covid crash chaos on 3/13/20, when the Treasury bond market essentially broke down for several hours.

  

  And even though the self-proclaimed “repo experts” and various assorted Fed cheerleaders were certain that this historic repo inversion – which as we explained was the result of unprecedented, record shorting of the 10Y Note – would normalize as soon as today following last week’s announcement of Wednesday’s $38BN 10Y auction, this has not happened. In fact, the situation has only gotten worse, with the 10Y opening at -2.65% and trading as low as -3.75% – below the fails charge for the 4th straight day…

  

  … before closing at -2.90% according to Curvature Securities.

  Commenting on today’s action, Curvature’s Scott Skyrm repeats what we already knew, that there is such a massive short out there that there are simply not enough securities for all shorts to be covered, meanwhile continued shorting piles on leading to even more negative repo rates:

  “the market took $8.5 billion (out of  $8.5 billion available) today from the Fed and took $9.9 billion out of $9.9 billion on Friday. The Street needs the SOMA securities lending supply to cover the shorts, and not all shorts are getting covered!”

  So desperate are shorts that they are covering with Off-the-Runs: “There’s no doubt that some shorts rolled back into the Old 10 Year, because there’s more interest in the Old 10 Year over the past two days”, Skyrm writes with Bloomberg echoing what we said last week, namely that “when the interest rate on overnight cash loans backed by the newest 10-year note goes below -3%, it’s cheaper to pay the regulatory fine for failing to return the collateral on time than it is to renew the loan — a sign that short selling is intense” and that there simply isn’t enough underlying paper available to cover all shorts.

  But the most interesting observations is the repo guru’s comparison between the O/N average repo an the March 15 term (when the 10Y settles): as Skyrm notes, “one thing that’s really interesting is how the 3/15 term market follows the overnight average. Basically, that means the market doesn’t know where to price the 10 Year.”

  
  The convergence of the two series means that “there’s no expectation of [the price] loosening or tightening this week” and while Skyrm admits he has no idea what happens next, he adds that “the market just doesn’t know” either. However, “whichever direction it goes, it will be volatile!”

  Finally, Bloomberg once again ends on an optimistic note, inferring from past examples of superspecial repo tightness that the repo market “may remain tight until this week’s $38BN reopening auction settles on March 15.” Of course, if that doesn’t happen, and if the repo chaos persists all the way into the March 17 FOMC, then all bets are off. 

  Tyler Durden
  Mon, 03/08/2021 – 20:05

• Assad & Syrian First Lady Test Positive For Coronavirus
  Assad & Syrian First Lady Test Positive For Coronavirus

  Syria’s President Bashar al-Assad and his wife Asma have confirmed they have coronavirus according to a Monday statement from the president’s office and are said to be experiencing minor symptoms. 

  The statement said they were in “good health and in stable condition” and are continuing to work in isolation at home. The 55-year old leader of Syria and his wife – the latter who recently survived breast cancer, took PCR tests after feeling minor symptoms that were consistent with the virus. 

  

  The news comes on the heels of the war-torn country announcing last week that it’s initiated a vaccination campaign; however, few details have been made public. It’s unclear whether or not the president or first lady have received an initial dose of vaccine. 

  According to ABC News, “The health minister said the government procured the vaccines from a friendly country, which he declined to name.” Likely Russia is providing its Sputnik V vaccine.

  The official recorded case numbers in Syria are nearly 16,000 infections so far, including 1,063 deaths, but the true numbers are believed to be far higher for lack of testing throughout the beginning months of the pandemic. 

  Recently a storm of controversy erupted after international reports claimed that Damascus secretly did a deal with Israel to procure vaccines – something which has been batted down by both sides.

  “The New York Times reported last month that Israel secretly agreed to send Syria some vaccine doses as part of a prisoner swap,” Axios observed. “Both countries deny the report.”

  Next week will mark ten years since the start of the war in Syria, which almost immediately became internationalized into a proxy war pushing for regime change, and later a struggle between the US and Russia for dominance in the Middle East. 

  Tyler Durden
  Mon, 03/08/2021 – 19:45

• Ron Paul: The Fed Is Enabling Biden And Congress' Destructive Agenda
  Ron Paul: The Fed Is Enabling Biden And Congress’ Destructive Agenda

  Authored by Ron Paul via The Ron Paul Institute for Peace & Prosperity,

  According to the Congressional Budget Office (CBO), 2021 will be the second year in a row in which the federal debt exceeds Gross Domestic Product (GDP). CBO also projected that this year’s federal deficit will be 2.3 trillion dollars, which is 900 billion dollars less than last year. However, CBO’s projections do not include the 1.9 trillion dollars “stimulus” bill Congress is likely to pass.

  

  The CBO’s report was largely ignored by Congress and the media. One reason the report did not get the attention it deserves is Federal Reserve Chairman Jerome Powell’s continued commitment to making sure Fed policies enable Congress to spend as much as Congress deems necessary to address the economic fallout from the coronavirus panic.

  As financial analyst Peter Schiff points out, the Fed’s commitment to ensuring the government can run up massive debt means the Fed will not allow interest rates to increase to anywhere near what they would be in a free market. This is because increasing interest rates would cause the federal government’s debt payments to rise to unsustainable levels. Yet, the Fed cannot admit it is going to keep rates near, or even below, zero indefinitely without unsettling the markets. So, the Fed continues to promise interest rate hikes in the future and the markets pretend to believe the Fed. When (or if) the lockdowns end, the Fed will find a new crisis justifying “temporarily” keeping interest rates low.

  The Federal Reserve has not just endorsed massive federal spending, Fed Chairman Powell has also endorsed masks, vaccines, and social distancing to defeat the coronavirus and restore the economy. It is disappointing, but not surprising, to see the Fed go full Fauci.

  The overreaction to coronavirus is a cause of the explosion in federal spending and debt we have witnessed over the last year. However, federal spending already greatly increased from January 2017 until the lockdowns. This spending growth occurred under a Republican president, a Republican Senate, and, from 2017 to 2019, a Republican House. One bright spot in Democratic control of the presidency and both houses of Congress is more Republicans will fight excessive spending and claim to be “deficit hawks.”

  Republican hypocrisy in claiming to care about spending and debt only when a Democrat sits in the Oval Office is one reason why Democrats can so easily disregard debt. Another reason is the left’s embrace of Modern Monetary Theory. Modern Monetary Theory is the latest version of the fairy tale that politicians need not worry about debt and deficits as long as the central bank can monetize the federal debt.

  Unless the government changes course, America will experience a crisis greater than the Great Depression. The crisis will include a final rejection of the dollar’s world reserve currency status. There will also be much increased price inflation. At that point Congress will have no choice but to limit spending, although it will try to hide cuts in popular entitlement programs by “adjusting” government measures of inflation. Congress could then blame the Fed for the reduction in value of government benefits.

  Those who know the truth have two responsibilities. First, ensure they and their families are protected when the crash comes. Second, redouble efforts to spread the ideas of liberty and grow the liberty movement so politicians are pressured to cut spending and debt and to end the Fed.

  Tyler Durden
  Mon, 03/08/2021 – 19:25

• China FM Demands Biden Reverse "Dangerous" Taiwan Stance, Otherwise "World Will Be Far From Tranquil"
  China FM Demands Biden Reverse “Dangerous” Taiwan Stance, Otherwise “World Will Be Far From Tranquil”

  Chinese Foreign Minister Wang Yi gave his annual news briefing on Sunday and as expected he hammered away at America’s presence and increasing attempts to insert itself politically in the South China Sea region.  

  In particular he demanded that the US stop “crossing lines and playing with fire” on Taiwan in a stark message to Biden, underscoring that Beijing sees “no room for compromise or concessions” when it comes to Chinese sovereignty over the democratically ruled island. Biden’s doubling down on many Trump policies when it comes to ‘confronting’ China was described by Wang as a “dangerous practice” that must be immediately reversed. 

  And what sounds like both a warning to other global powers and a threat to the US in particular, Wang continued: “It is important that the United States recognizes this as soon as possible,” adding that, “Otherwise, the world will remain far from tranquil.”

  

  He emphasized a litany of instances of US “bullying” and “interference” in China’s own affairs, describing Washington’s “willfully interfering in other countries’ internal affairs in the name of democracy and human rights.” One example given was the US calling out human rights abuses against the minority Uighur Muslim population. “The claim that there is genocide in Xinjiang couldn’t be more preposterous. It is just a rumor fabricated with ulterior motives and a lie through and through,” he said.

  Wang’s remarks were issued on the sidelines of the National People’s Congress in Beijing. The major parliamentary session to kick off the year occurs every Spring. This year the NPC is set to initiate a far-reaching overhaul of Hong Kong’s electoral system, intent on further cementing its power following last year’s draconian national security law which has effectively crushed anti-mainland dissent.

  Former governor of Hong Kong Lord Chris Patten was cited in BBC as saying that China’s Communist Party had “taken the biggest step so far to obliterate Hong Kong’s freedoms and aspirations for greater democracy under the rule of law”.

  Wang, however, touted in his remarks that, “Hong Kong’s shift from chaos to stability fully serves the interests of all parties. It will provide stronger guarantees for safeguarding Hong Kong citizens’ rights and foreign investors’ lawful interests.”

  The one-China principle is a “red line” that must not be crossed in China-U.S. relations, State Councilor and Foreign Minister Wang Yi said Sunday, adding that the Chinese government will never compromise on the Taiwan question. pic.twitter.com/btorhWohY3

  — Chinese Embassy in CZ (@ChineseEmbinCZ) March 7, 2021

  https://platform.twitter.com/widgets.js

  The US and European countries have condemned these moves to ensure only “patriots” can run in Hong Kong elections. Wang had this and other examples in mind when in his address he touted Beijing’s recent ‘successes’ in battling “hegemony, high-handedness and bullying” and “outright interference in China’s domestic affairs” out of Washington.

  Another example offered was concerning recent US and Western allied naval maneuvers: “The US and other Western countries frequently stir up troubles in the region, trying to drive a wedge using the South China Sea issue. They have only one purpose: to sabotage peace and disturb regional stability,” Wang said.

  Interestingly enough Wang offered one starting point for US cooperation as potentially happening on the climate front. “I hope China and the U.S. restarting cooperation on climate change can also bring a positive change of climate to bilateral ties,” Wang said.

  * * *

  Additionally Wang’s briefing reviewed China’s relations with other major world powers and how Beijing is handling pressing crises like the pandemic as follows, according to a Bloomberg review:

  • Europe relations: “China and Europe are two important players in this multipolar world. The relationship is equal. It is open. It is not targeting any third party or controlled by anyone else.”
  • Vaccine diplomacy: “We’re also ready to work with the International Olympic Committee to provide vaccines to Olympians.”
  • Trade: “The answer is not to retreating to protectionism, isolation or decoupling, but to work together to make globalization open, inclusive, balanced and beneficial for all.”
  • Japan tensions: “I hope that Japanese society will embrace a more objective and rational conception of China, and solidify public support for long-term steady progress in China-Japan relations.”
  • Indian border: “The rights and wrongs of what happened in the border area last year are clear, so are the gains and losses. The facts once again prove that unilaterally creating confrontation will not solve the problem.”
  • Russia cooperation: “We will set the example of strategic mutual trust by firmly supporting each other in upholding core and major interests, jointly opposing color revolutions, countering disinformation, and safeguarding national sovereignty and political security.”

  Tyler Durden
  Mon, 03/08/2021 – 19:05

• By One Gauge, Inflation Fears Are The Highest This Century
  By One Gauge, Inflation Fears Are The Highest This Century

  By Ven Ram, Bloomberg macro commentator

  What do you get when you combine potent fiscal and monetary stimulus with a U.S. economy on the cusp of a rebound amid surging oil prices? The answer: fears that medium-term inflation relative to the longer term running at the fastest clip since nearly the turn of the century.

  The spread between U.S. five- and 10-year inflation breakevens is now the most positive it’s ever been in Bloomberg data going back to the start of 2002. The differential, which may be thought of as the market’s evolution of inflation over the medium term versus the longer term, went briefly above zero following the financial crisis as well, but wasn’t so pronounced.

  

  The differential is a sign of the market’s collective thinking that the $1.9-trillion fiscal relief ready for endorsement by the House will stoke price pressures over the medium term without necessarily impinging on the evolution of inflation over the longer term. In other words, secular inflation may still be elusive, which is another reason why the Fed may decide to look past price pressures in the here and now (and witness how prescient last year’s virtual Jackson Hole conference seems in hindsight in the context of average inflation targeting, though I would call it serendipity).

  The surge in non-farm payrolls for February and the progress on vaccination show a strong economic rebound may be on the cards. As if on cue, Brent crude prices are hovering around $70 a barrel. All these mean that the breakeven spread is likely to stay elevated for now.

  Tyler Durden
  Mon, 03/08/2021 – 18:45

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• Welcome To The Inversion
  Welcome To The Inversion

  Authored by Robert Gore via Straight Line Logic blog,

  Getting along by going along with the patently absurd…

  

  A seamless web, they all believe because they all believe.

  – The Gordian Knot, Robert Gore, 2000

  If it seems like the world has turned upside down it’s because it has. Right is wrong and wrong is right. Truth is lies and lies are truth. Knowledge is ignorance and ignorance is knowledge. Success is failure and failure is success. Reality is illusion and illusion is reality.

  It would be comforting to say that this inversion is a plot by nefarious others. Comforting, but not true, in the pre-inversion meaning of the word true. Rather it stems from answers to questions that confront everyone. To think for yourself or believe with the group? To stand alone or cower with the crowd? It’s the conflict between the individual and the collective, and between what’s true and what’s believed.

  We live in an age of fear. It’s not fear of germs, war, poverty or any other tangible threat that most besets humanity. It’s the fear of being disliked and ostracized by the group.

  If every age has its emblematic technology, ours is social media, with its cloying likes and thumbs up and its vicious cancellations, doxing, and deplatforming. No longer must you wander through life plagued by that nagging insecurity—am I liked? Now you can keep virtual score: you not only know if you’re liked or disliked, you know how much and by whom. Unfortunately, that knowledge doesn’t seem to help; the scoreboards only amplify the insecurity. What was once an occasionally troubling question, privately asked of one’s self, has become a widely held, public obsession.

  The official Covid-19 response is the apotheosis of inversion and probably the one that runs it off the rails. There’s a model that has repeatedly erred predicting infection and death rates by orders of magnitude. Use it! Politicians and bureaucrats, the two most power-hungry groups on the planet, are clamoring for unlimited powers to destroy jobs, businesses, economies, lives, and liberty. Give it to ’em, no questions asked! Sunshine, Vitamin D, fresh air, and exercise prevent diseases and lessen their symptoms’ severity. Lock ’em up! Lockdowns aren’t working. Lock ’em up harder! Masks don’t prevent or hinder viral transmission, their packaging says so. Double, triple, or better yet, quadruple mask! At high cycle thresholds, the PCR test throws off many false positives, inflating case counts. Crank up the cycle thresholds until Biden gets in office! Cheap medicines hydroxychloroquine, and ivermectin both prevent and cure the disease, provided it’s not too far advanced. Discourage their use! They work better than expensive vaccines. Make vaccinations mandatory! Scores of reputable and eminent doctors and scientists are questioning and criticizing the protocols. Censor them and follow our shapeshifting science! Death counts are inflated because hospitals have a financial incentive to attribute deaths to Covid-19 and anybody who has tested positive and subsequently dies of whatever cause is labeled a Covid-19 death. If they scare people into saving just one life…. The cure is far worse than the disease. Shut up or we’ll shut you up! There’s always germs out there and they constantly mutate, this horseshit could last forever. New Normal, Great Reset. It will last forever, and it will get worse, won’t it? We’ll circle back on that.

  Peer pressure is the fundamental force of the social universe. Anyone who’s part of a collective will be pressured to accept its consensus on matters trivial and important. Congruence between what a collective believes and truth is happenstance. The larger the group, the higher the chance of incongruence.

  Groups don’t think, they perpetuate and enforce belief. Collectives collectivize what passes for thought, none more so than governments. There’s always the danger that someone might ask why those who rule get to club everyone else into submission. Rulers either suppress that question or try to provide a nominal justification. If they have the clubs, what are they worried about?

  The ruling caste is always small compared to the ruled. No matter how many clubs it has and how overmatched the subjects may be, the ruling caste knows its position is more secure if their subjects believe their propaganda and consent to their rule. The underpinnings of frightened compliance with, “Do as you’re told or else!” are rickety compared to a chorus chanting in unison “We’re all in this together!” or some such rot.

  None are so enslaved as those chained to group belief. Truth is irrelevant, group acceptance paramount. Belief is unquestioned and unchallenged, truth the shunned and hated enemy. Governments have promoted this inversion for centuries, always telling the same lies. Faith in government may be the strongest and longest-lived secular religion, and it’s certainly the one most resistant to questions, investigation, or contrary evidence.

  The script never varies. We’re good, they’re bad, exterminate them. Conquest, domination, and empire are our nation’s greatness. Need not greed: those who earn it are selfish for trying to keep it; we’re virtuous for taking it away. Our pieces of paper are good as gold. Your squalor has nothing to do with our opulent lifestyles; be grateful for your bread and circuses. Dissidence must be suppressed; opposition is traitorous. Ruination and death are everyone’s fault but ours. You just weren’t good enough to live up to our ideals.

  Inversions can only last so long. People consciously or unconsciously reject them, and reality doesn’t invert. A small coterie in Washington may believe they run a global empire, but Russia and China refuse to kowtow, even nominal allies are backing away, and the costs of maintaining its crumbling empire are helping drive the US into bankruptcy. What US cheerleaders call the best military in the world hasn’t won a significant war since World War II and its fighting forces are being ideologically culled or indoctrinated in wokesterism, systematically rendering it even less fit to fight.

  The censors no longer hide their censorship. There are stories that cannot be reported, questions that cannot not be asked, investigations that cannot be launched, platforms that cannot be allowed, and issues that cannot be discussed within the captured media. It cried foul when Donald Trump made “fake news” a catch phrase, but it caught on because it confirmed what millions know: much of today’s “news” is fraudulent propaganda.

  After a month-and-a-half of one-party rule it’s clear that suppression is only going to get worse. Among those who intellectually stand outside the collective, suppression neither decreases belief in what is suppressed nor increases belief in the party line. They know the truth lies in what’s being kept from them.

  Subconsciously, even adherents to the party line never completely believe it. Fully “woke,” you may “know” that Western civilization is a discredited product of the white male patriarchy. However, do you throw yourself from the top of a tall building because the properties of gravity were first described by white English patriarch Isaac Newton?

  Psychological dissonance plagues true believers. What are they going to believe: dogma or their own senses and thought processes, such as they are? It’s the root cause of their psychic brittleness: the inability to answer questions or engage in debate, the insistence on ostensible agreement, and the need to suppress anyone who doesn’t go along.

  The fragility that tries to adjust reality to belief runs head-on into the desire among those whose behaviors are to be adjusted to live their own lives as they see fit, not to mention reality itself. America’s divide is between those who want to be left alone and those who want to tell them what to do. It’s so much easier for the latter if they can impose at least the appearance of consent on the former through suppression, fraud, or force.

  Reality doesn’t invert, no matter how many people believe otherwise. Governments and central banks will debase their fiat debt instruments until the illusion that they’re worth something is discarded. They have every incentive to do so and it’s happening now as governments go broke. Empires crumble because they require more energy and resources to maintain than they generate. The American empire will be no exception. The more production is taxed. regulated, and otherwise penalized, the less production you get. The more indolence is rewarded, the more indolence you get. As government’s power expands, people’s freedom shrinks. You can make people engineers or brain surgeons based on their race, ethnicity, gender, sexual preference or any other irrelevant factor, but it increases the likelihood that the bridge collapses and the patient dies on the operating table.

  A society that corrupts science, the basis for discovering, describing, and employing reality, is doomed. Honest science requires free inquiry and debate. It is a never-ending process of proposing, testing, evaluating, revising and discarding hypotheses for new ones with more explanatory and predictive power. There is no such thing as settled science. The claims that there is with regards to climate, coronaviruses, or any other scientific issue are nothing more than admissions that the purported science is propaganda. Unchallenged science is a contradiction in terms; challenge is the lifeblood of science.

  So add science that isn’t science to the long list of inversions that collectively could spell humanity’s doom. Consequences don’t recognize wishful thinking or political diktat. Climate and coronavirus dogma masquerading as science is the Trojan horse ushering in the great reset of a new world order. Global governance, state-approved science, political and cultural canons enforced with jihadist zeal, top down economic command and control, the eradication of any vestiges of liberty, and billions of unthinking adherents will destroy rather than build, compounding today’s inversions and creating new ones.

  The danger to all this is individuals who think and act for themselves, those who are woke to the woke, so to speak. The key to standing on the outside, critically examining what’s within, is to abandon any desire to be on the inside. The docile dreck and their puppet-masters within are usually sufficient inducement to stay outside. Once that decision is made, independence of thought is almost assured. (Those who see the inside for what it is and still want in are corrupt beyond redemption.)

  Challenge dogma and propaganda and you’re a dissident. Not always a comfortable position, but the dissidents will have the best shot at surviving the coming collapse. The insiders will suffer shattering disillusionment as reality obliterates cherished belief…and the insiders.

  The historically unprecedented scale of present inversions guarantees upheaval and change beyond reckoning when reality’s full force can no longer be denied or subverted. Even those who see things as they are and regard themselves as fully prepared will be shocked by what’s to come. At least they will retain the existential essentials of observational power and logic as they sort through the smoldering intellectual landscape, discard the inversions, and get on with the rebuilding.

  Tyler Durden
  Mon, 03/08/2021 – 00:00

• China's 7,500-Mile Undersea 'Peace Pipe' To Connect Belt And Road Countries 
  China’s 7,500-Mile Undersea ‘Peace Pipe’ To Connect Belt And Road Countries 

  The Trump administration spent the last several years bashing China’s Belt and Road Initiative (BRI) and called it a ‘debt trap’, and urged countries worldwide to resist allowing China to build infrastructure projects in their respected countries. With the Biden administration now in power, there has yet to be a visible protest from the White House of Beijing’s new plan to construct a 7,500-mile submarine communications cable from Pakistan to Africa to Europe.

  The high-speed, 7,500-mile Pakistan and East Africa Connecting Europe (PEACE) subsea communication cable system will offer high-capacity, low-latency routes connecting China, Europe, and Africa. In addition to France, the cable will land in Malta, Cyprus, Egypt, Djibouti, Kenya, Pakistan, and other countries with ultimate connectivity to China. 

  Some of the countries listed above are part of the BRI. China’s motive behind the new undersea project is to provide high-speed internet connectivity to Chinese companies doing business in Europe and Africa.

  “This is a plan to project power beyond China toward Europe and Africa,” Jean-Luc Vuillemin, the head of international networks at Orange SA, the French telecommunications that will operate the PEACE cable landing station in Marseille, France, told Bloomberg. 

  More interesting, Huawei Technologies Co. is the third-largest investor in Hengtong Optic-Electric Co., the company building the PEACE pipe. Huawei is expected to provide critical telecommunications equipment for the project – some of Huawei telecommunications equipment has been cited as a national security risk by the US. 

  

  Despite the Trump administration’s hard stance against the BRI and Huawei and other Chinese companies – the Biden administration has yet to visibly criticize China’s new ambitions to construct a global undersea cable network. Much of the internet around the world is transmitted in 400 undersea cables stretching worldwide, controlled mostly by US companies. Chinese encroachment on the US’ dominance would likely usher in a response from the White House. 

  Bloomberg sources said the French government is prepared to take flak from US officials over the PEACE cable. 

  “It could look to mollify the US by keeping certain types of traffic off the cable,” another source said. 

  French President Emmanuel Macron told the Atlantic Council in February that France doesn’t want to isolate itself from China. German Chancellor Angela Merkel also had similar remarks last month. 

  Some European leaders objected to requests by the past administration to “decouple” from China despite security risks. According to security experts, risks are brewing that China could create backdoors into the PEACE pipe to siphon data. 

  “Any time that you have your data traveling over their switches, their cables—these are the source of redirecting traffic and eavesdropping,” said Robert Spalding, a senior fellow at the Hudson Institute policy group in Washington. “It’s just common sense.”

  China’s attempt to control the world’s internet could be realized in the next couple of decades. The Institute of Peace and Conflict Studies and the Netherlands-based Leiden Asia Center estimates China could be the owner of at least 20% of undersea communication cables worldwide by the end of the decade. 

  The great power competition between the world’s two largest economies is now spilling into the internet’s physical layers. 

  Tyler Durden
  Sun, 03/07/2021 – 23:30

• So Much For A 'National Healing'
  So Much For A ‘National Healing’

  Authored by Peter R. Quinones via The Libertarian Institute,

  We were told the nation was in desperate need of “healing” because a large portion of the population wanted Donald Trump to “lead” the country. And if you believe that the “national healing would begin” because the “adults” are in the White House…well, you’re a dupe. The response by the corporate press and their supporters to the first freeze to happen in Texas in decades should put to rest any thoughts that the elites, especially the journalists, desire unity. Mass power outages were experienced throughout Texas and the establishment didn’t even attempt to hide their joy.

  The situation many Texans faced over that week couldn’t be because freezes like this are so rare in Texas that the grid is not designed to handle the overload in demand or the freezing of its physical infrastructure. No, that can’t be it. The only reason millions of “bumbling hicks” were forced to endure power outages is because so many of them believe CNN and MSNBC are “fake news” and this belief caused them to vote for Trump. It’s amazing to me that a segment of the population that is so anti-religion adopts such a “wrath of God” or “Karma’s a bitch” stance so often when it comes to their adversaries.

  

  I know many people who live in Texas and have been in constant contact with them. Thankfully they’re fine. But, was I shocked by this incident? As someone who lived through “Snowmageddon” in Atlanta in 2014, the answer to that is…hardly. In that year Atlanta was shut down by two inches of snow. Seriously, look it up. The snow started in the middle of the work day – roughly 11:30 AM EST – at which time school buses were loaded to take kids home and everyone left work. If you are at all familiar with Atlanta traffic, on a normal day we do not need multiple accidents to experience the second worst commute in the United States. It’s just every day congestion.

  Now, imagine everyone within the city limits and surrounding areas leaving work at the same time. Add in two inches of snow which many people are not used to driving in and it was like a scene from The Walking Dead. People slept in their cars on the freeways and side streets, with many not able to get home for 24 hours. And guess what? The coastal elites went to social media and their news outlets to talk about what a bunch of hicks we were.

  Why did Snowmageddon happen? It was a perfect storm of events that all occurred at once. If the storm had occurred at 3 AM, the majority of people would’ve been peacefully sleeping and the number of people trapped in cars would’ve been minimal. Atlanta wasn’t prepared because what happened during Snowmageddon had never before occurred. Apply that “not the norm” occurrence to the freeze in Texas and you have your answer to the state’s recent problems. Atlanta now has snow plows, but more importantly, schools close and businesses are asked to not open if there’s a threat of a midday snow storm.

  I expect the freeze in Texas will cause the local and state governments there to have similar plans in place so that the power outages, with all the associated impacts, will not occur in the future. Or they’ll devise some scheme that will mitigate how widespread the outages will be.

  Even if they don’t construct a plan for the future, the fact that the “enemy class” is using the freeze as an opportunity for ad hominem attacks against Texans should tell you everything you need to know about their so-called plans to “heal the divides.” If anything, I expect the attacks to escalate and hope they do. Popcorn futures are booming!

  Tyler Durden
  Sun, 03/07/2021 – 23:00

• Robo-Waiters Prove To Be A Necessity For Contactless Portland-Area Bistro
  Robo-Waiters Prove To Be A Necessity For Contactless Portland-Area Bistro

  About one-year into the virus pandemic, the return to normalcy for the restaurant industry is unlikely. More than 100,000 restaurants have already failed, revenues remain collapsed, and millions of workers are laid off. There was a glimmer of hope on Friday when some 75% of all US job gains in February were waiters and bartenders; besides that, COVID-19 has cleared the way for restaurant automation. 

  Automated kiosks, robotic bartenders, flippy the hamburger robot, automated pizza kitchens, and the list go on and on how restaurant operators who survived lockdowns are finding digital solutions for ordering, food preparations, delivery, and even serving. 

  While health experts are suggesting people stay at least 6 feet from others, one restaurant in Portland, Oregon, has found an innovative way to serve food without face-to-face interactions with patrons. 

  At Bistro Royale in Beaverton, the restaurant uses autonomous robots to minimize customer interaction between staff and customers while serving food. 

  

  Kalvin Myint, a co-owner of Bistro Royal, told the local newspaper Mail Tribune that he began using the robot last August. 

  “I love to actually play with all these new technologies,” said Myint. “So, when we were looking for a solution, in terms of providing a safer dining experience, my tendency is actually to lean towards technology and see what’s available out there.”

  Myint and his wife, Poe, opened Bistro Royale during the pandemic last year. The couple owns another restaurant and divided staff between both to minimize layoffs during lockdowns. 

  “It was challenging, no doubt about it, but at the same time, it was also exciting in a way,” he said of opening a restaurant during a pandemic. “We love problem-solving, and it gives you a sort of motivation or push to try harder.”

  Myint said: “We have to keep evolving and changing and coming up with new things to sort of forge ahead of everybody.”

  That’s when he decided to employ three robots (Milo, Navi, and the Beast). The serving robots use mapping software to navigate between customers and obstacles in the restaurant. 

  Myint clarifies that he does not believe robots can — or should — fully replace human servers.

  “In the robotic industry, there’s a lot of worry about robots taking jobs away,” he explained. “They’re like a cellphone, right? You have your cellphone as a tool. So, we’re using them as a tool to sort of amplify what they do best.”

  The robots are “celebrities,” he said. “We have families just come here for Milo. I guess he’s getting more popular than the restaurant.”

  Robotic servers, Kiosks and apps, and all other sorts of automation introduced to restaurants to maintain social distancing are job killers. While last month’s surge in restaurant jobs was inevitable, don’t get too excited that a “V-shape” recovery in bartenders and servers will be seen anytime soon – due to the deep scarring caused by the pandemic. 

  The ushering in of automation and artificial intelligence into the industry will eventually result in entire restaurants controlled without humans – that could happen as early as the end part of this decade. 

  What does this all mean? Well, technological unemployment will continue to rise for years to come. 

  Tyler Durden
  Sun, 03/07/2021 – 22:30

• Money And Statistical Delusions
  Money And Statistical Delusions

  Authored by Alasdair Macleod via GoldMoney.com,

  “I can prove anything with statistics, except the truth”

  — Lord Canning, c. 1819

  Does Canning’s aphorism still hold true, given that data collection and statistical analysis have progressed beyond all recognition in the last two hundred years? This article tests that proposition.

  It is still true, because of the interests for which statistics are deployed. We know, or should know, that CPI indexation of prices fails to reflect the true rate of decline in the purchasing power of fiat currencies. That is at least a simple case of governments saving money on indexation. But being economical with the statistical truth is a far wider practice encompassing input suppression, misleading deployment, and their use to support beliefs and preferred outcomes instead of backing up properly reasoned economic and monetary a priori theory.

  This article finds that the application of all these methods corrupt monetary statistics, including the three principal components of the equation of exchange. This analysis is sparked by recent changes to the definition of M1 money supply in the US.

  Introduction

  Monetarists have long held that there is a relationship between changes in the quantity of circulating currency and the general level of prices. It is not the only factor governing the relation, but it has been generally established to be true. So persuasive is the theoretical case, that no one — not even modern monetary theorists — deny it. We generally assume that the monetary statistics, the sheet anchor to the equation of exchange that emerged over a century ago, are reliable. But even monetary statistics whose components drop out of accounting identities end up being sliced and diced at the behest of the authorities, raising the question as to what we should regard as money at a time of unprecedented peacetime global monetary expansion. And the monetary policy planners moving the goal posts question by their actions the macroeconomic habit of relying solely on statistical evidence for predicting outcomes.

  In February, the Fed changed the definition of M1 to include “Savings deposits” and “Other checkable deposits”. They are now combined and reported as “Other liquid deposits”. The effect is to increase M1 but to leave M2 unchanged, as illustrated in Figure 1.

  

  The change accepts the reality, long recognised in the Austrian school’s definition of money supply (AMS), that depositors and banks assume savings accounts are just another form of money available for spending on day-to-day transactions. Monetary policy planners generally circumvent such considerations, looking at monetary definitions from their policy viewpoint instead of the perspective of money’s users.

  For statistics junkies, there is a disadvantage in that the new M1 is only readily available as a retrospective monthly average instead of a more current weekly average. This has the effect of under recording the increase of M1 in this statistic at times of rapidly rising monetary inflation. And importantly, M1 is so much modified by these changes as to be rendered useless as a statistical record of monetary inflation.

  This raises other questions, such as should we regard broad money or narrow money as the primary indicator of changes in the money supply? And, more deeply, should we ignore the statistical detail and try to understand money from an a priori analysis of the theory of exchange? This is the key difference in the approach of establishment monetarists compared with the Austrian school. Monetarists today, in common with other macroeconomic schools, test propositions by statistical correlation, thereby avoiding the necessity of sound theoretical analysis. Consequently, the definition of money rarely progresses beyond simplistic propositions. And its true use value, which is defined by less predictable human action, is ignored.

  The Austrian school generally disregarded the statistical approach to money, until Murray Rothbard attempted to define circulating currency solely in the context of US monetary statistics, work that was consolidated by Joseph Salerno.[i] But slotting different monetary statistics into any combination has never been standardised, so what applies in America, which cannot be precisely defined anyway, doesn’t apply elsewhere. Nor does it when the makeup of a monetary component is altered, excluded or included, such as the current modifications to M1.

  Therefore, whatever statistical evidence there is can only be used to corroborate a theoretical analysis, and not be accepted as prima facie evidence. As Lord Canning put it two centuries ago, you can prove anything with statistics but the truth.

  Defining money

  A theoretical approach to understanding money must start by defining it. This definition is taken from the glossary to von Mises’s Human Action:“The most commonly used medium of exchange in society. A community’s most marketable economic good, which people seek primarily for the purpose of later exchanging units of it for the goods or services they prefer. The circulating media most readily accepted for the payment for goods, services and outstanding debts. Money is an indispensable factor in the development of the division of labour and the resulting indirect exchanges upon which modern civilisation is based.”In other words, money is the medium that links production with consumption through the division of labour. It must be immediately available for that purpose. That certainly includes cash in circulation and money in the bank. Correctly, it is now argued by the Fed that because in practice savings are instantly available to bank depositors, that they are cash equivalents. But there are other important aspects of money, such as unspent government balances. Because that can be drawn down at any time, it is money as well, just as if it were money due to an ordinary depositor. But that is not included in the Fed’s definition of M1 (renamed M1 SL), which is an important omission given recent balances on the government’s general account of as much as $1.7 trillion. If, as well as savings deposits, unspent government balances had been included, M1 SL money supply would have looked more like Rothbard’s Austrian money supply (AMS) in Figure 2.

  

  There are good theoretical grounds behind the Austrian money supply calculation, but the absence of the government’s general account in the official M1 calculation disqualifies it from being a true reflection of cash and cash alternatives available for spending. Consequently, official M1 has not yet caught up with AMS, having risen from $3,977bn in January 2020 to $18,105 exactly a year later, an increase of 355%. Over the same timescale AMS rose from $14,082 to $20,614, an increase of 46% — less dramatic perhaps, but genuine.

  When it comes to managing expectations, a genuine increase in narrow money of 46% is of greater concern than a far larger increase due to changes in the statistic. This appears to be the reason for the Fed’s part-conversion to Austrian money supply. But they chose a halfway house, which signals perhaps less of a comprehension about what money represents to the wider public and more of a desire to conceal the true state of monetary affairs. And by suppressing interest rates, monetary policy attempts to increase the circulation of money which, the planners appear to believe, would otherwise sit in bank deposits unutilised. The fact that bank deposits are the backing for bank credit whose expansion is also desired escapes this line of reasoning, but that does not stop planners trying to increase the circulation of money.

  The velocity myth

  Even with M1 money supply at a lower figure that AMS, velocity of circulation is close to unity. Velocity is a widely accepted concept, used as a statistic to promote macroeconomic discourse. The St Louis Fed defines it as follows:

  The velocity of money is the frequency at which one unit of currency is used to purchase domestically produced goods and services within a given time period. In other words, it is the number of times one dollar is spent to buy goods and services per unit of time. If the velocity of money is increasing, then more transactions are occurring between individuals in an economy.

  This is patently untrue. For it to be correct there would be no relation between production and consumption, and consumers would somehow end up with money to spend without earning it. Money-printing might appear to satisfy this condition, because some money is produced out of thin air instead of being genuinely earned by economic actors. It does not excuse this calumny. What makes this statistical approach acceptable to neo-Keynesians is the denial of Say’s law, which describes the rationale behind the division of labour and points out that money is the most marketable intermediate good whose primary function permits production to be turned into consumption.

  If there is one concept that illustrates the difference between a top-down macro-economic approach and the reality of everyday life it is concepts such as the velocity of circulation of money.

  Compare the following statements:

  “Whenever the interest rate on financial assets is low, the desire to hold money falls as people try to exchange it for other goods or financial assets. As a result, the velocity of circulation rises. Hence, when the money demand is low, the velocity will be high. Conversely, when the opportunity cost/alternate cost is low, money demand is high, and the velocity of circulation is low”.

  – Corporate Finance Institute – What is velocity of circulation?

  This is in line with monetary planners’ policy of interest rate suppression. They suppress the interest rate to encourage monetary circulation. But if this is valid, then the opposite cannot be true. Yet today, falling velocity to approximately unity with GDP has been accompanied by falling interest rates, even to the zero bound, disproving macroeconomic assumptions.

  The next statement is from an economist in the classical, Austrian tradition:

  “The mathematical economists refuse to start from the various individuals’ demand for and supply of money. They introduce instead the spurious notion of velocity of circulation according to the pattern of mechanics.”

  – Ludwig von Mises, Human Action.

  In effect, von Mises is saying it is free markets that decide how money is used, not state management of interest rates.

  The mathematical economist might attempt to argue that interest rates affect the relationship between consumption and savings, with higher rates reducing immediate consumption. But that is a red herring, because GDP includes business investment and government spending financed by savings and therefore money not spent on direct consumption. To further understand the errors in the velocity concept we must delve into its origins.

  The notion of velocity of circulation arose from the quantity theory of money, which links changes in the quantity of money to changes in the general level of prices. This is set out in the equation of exchange. The basic elements are money, velocity and total spending, represented by GDP. The following is the simplest of a number of ways it has been expressed:

  Money x Velocity = Total Spending (or GDP)

  Assuming we can measure both the quantity of money and total spending, we end up with velocity. But this does not tell us why velocity might vary: all we know is that it must vary in order to balance the equation. You could equally state that two completely unrelated metrics can be put into a mathematical equation, so long as a variable is included whose only function is to always make the equation balance. In other words, velocity is not a valid expression of the relationship between money and prices; it is merely there to balance an equation that otherwise does not exist.

  Von Mises’s criticism is based on the philosopher’s logic that economics is a social and not a physical science. Therefore, mathematical relationships must be strictly confined to accounting and not be confused with resolving economic issues. Unfortunately, economists and commentators have the concept of velocity so ingrained in their thinking that this vital point escapes them.

  The only apparent certainty in the equation of exchange is the quantity of money, assuming it is all recorded. No one seems to allow for unrecorded money or assets that can be assumed to be held as readily accessible cash alternatives. Furthermore, if the money is sound, as it was when the quantity theory of money was devised, one could deduce that after a time lag to allow it to fully circulate, an increase in its quantity would more directly tend to raise prices, because changes in the general level of personal liquidity in a population whose money is sound tend to be more stable than that under a fiat money regime.

  Today we no longer have sound money, whose purchasing power was regulated by human preferences across national boundaries without impediment. Instead, we have fiat currencies whose purchasing power is formalised in foreign exchanges and corrupted by state intervention. An illustrative example of the consequences is given to us from the Icelandic krona, which on 8th October 2008 suddenly halved in value, which had nothing to do with changes in the quantity of money, its velocity of circulation or Iceland’s GDP.

  In economic history, Iceland’s currency collapse was not an isolated event. The purchasing power of a fiat currency varies continually, even to the point of losing it altogether irrespective of changes in its quantity. The truth of the matter is that the utility of a fiat currency in the short-term is entirely dependent on the subjective opinions of individuals expressed through markets and has little to do with a mechanical quantity relationship. In this respect, merely the potential for unlimited currency issuance or a change in perceptions of the issuer’s financial stability, as Iceland discovered, can be enough to destabilise it.

  According to the equation of exchange, this is not how things should work. The order of events is first you have an increase in the quantity of money and then prices rise, because monetarist logic states that prices rise as a result of the extra money being spent, not as a result of money yet to be spent. With a mechanical theory there can be no room for subjectivity.

  It is therefore nonsense to conclude that velocity is a vital signal of some sort. Linking the relationship between changes in the quantity of money to the effect on prices is certainly more justified in the case of sound money, backed by and freely exchangeable into gold coin. But no material changes to the original concept have allowed for the different characteristics between sound and fiat moneys.

  Monetarist theory in its current form is at the very least still a red herring until monetarists finally discover velocity is no more than a factor to make their equation balance. It is indicative of the false mechanisation of human behaviour by modern macro-economists. However, it should also be noted that it is impossible to square the concept of velocity of circulation with one simple fact of everyday life: we earn our salaries and make our profits once and we dispose of them. That’s a constant velocity of exactly one, assuming no change in cash levels over the period under consideration.

  This is the irrefutable conclusion of Say’s law. But it was dismissed by Keynes in his General Theory to make way for his macroeconomic fallacies.

  The implications of monetary expansion

  Following Rothbard’s logic, that money and its immediately encashable equivalents in the mind’s eye of the individual are together the true money supply, we can see from Figure 2 above that in an economy whose annualised GDP is estimated at $21.5 trillion and with Austrian money supply standing at $20.6 trillion, it is 95% of all transactions, suggesting that the average economic actor holds almost a year’s worth of cash liquidity. Clearly, as a result of continual monetary expansion, the US economy is awash with money that hardly, on average, circulates.

  In addition to AMS, there is credit money, which is rightly excluded, because being on the other side of a bank’s balance sheet from deposits it is not necessarily available for immediate payments — the bank can always restrict issues of undrawn credit. In this category we can also include shadow banking balances. And payments by credit card are not instantaneous, the payment for goods being deferred by up to a month, so these and similar credit facilities must be excluded as well.

  Obviously, there is a link between bank credit expansion and the growth of deposits, raising the question of whether deposits so created should be included in AMS. The answer is no distinction should be made between deposits and those that result from credit expansion, because for the user all bank deposits are regarded as money, whatever their origin.

  Left to free markets and sound money, money would undoubtedly be scarce, but plentiful enough to act as the medium of exchange between production and consumption. Therefore, fiat dollar money existing in the quantity that it does is the consequence of easy money policies. Rather than assuming that negative rates will stimulate the population to use it, which is undoubtedly behind official thinking, efforts should be put into considering how to reduce the danger of excess money being unexpectedly mobilised for goods.

  The inconvenience of the current position is explained by von Mises’s description of money’s role as “a community’s most marketable economic good, which people seek primarily for the purpose of later exchanging units of it for the goods or services they prefer”. The risk is that substantial quantities of money will be mobilised for that function if people decide to reduce their relationship between owning money in reserve and owning goods which they do not immediately need.

  But with covid lockdowns knocking out swathes of industrial production, the goods and services are not available to satisfy this potential demand. Consequently, prices can only rise significantly until the money relationship rebalances. In other words, nominal GDP, being no more than a money total, which we discuss below, will appear to rise dramatically. And with official estimates of price inflation blatantly suppressed, officially recorded “real” GDP will be declared as evidence of the success of monetary policy in rescuing the economy. But remember Canning’s aphorism: I can prove anything with statistics, except the truth…

  GDP fallacies

  So far, we have shown the errors in official monetary statistics and explained why velocity of circulation is meaningless. Ignorance over velocity of circulation can perhaps be understood because the reasoning behind the equation of exchange predates macroeconomics and is a belief only partially backed by reasoning. We now turn our attention to the third and final component of the equation of exchange. Ignorance cannot so easily be justified about GDP, which was invented in the 1930s, and whose only practical use is to indicate to the state the potential for tax revenues. Its role in the equation of exchange as a substitute for prices is misleading.

  GDP is no more than a money total of recorded transactions during a period, usually over a year or annualised. It does not reveal the quality of transactions and economic progress as commonly supposed. It is consistent with what von Mises described as an evenly rotating economy. Again, we can refer to the glossary in his Human Action:

  “An imaginary economy in which all transactions and physical conditions are repeated without change in each similar cycle of time. Everything is imagined to continue exactly as before, including all human ideas and goals. Under such fictitious constant repetitive conditions, there can be no net change in any supply or demand and therefore there cannot be any change in prices.”

  By deflating it for officially recorded price inflation, GDP appears to meet all the conditions of an evenly rotating economy. Plainly, it does not accord with reality. Furthermore, if the quantity of money was constant and the balance of trade meant it was contained within a community, then that community’s GDP would also remain constant. The logic of this statement is unchallengeable.

  Therefore, numerical increases in an evenly rotating economy must come from the money side. In other words, if the quantity of money and credit in an economy is increased, so will GDP. And none of its increase can be attributed to an improvement in economic conditions, because it is modelled on a constantly rotating economy. This is clearly illustrated by removing monetary expansion from the GDP statistic, as illustrated in Figure 3.

  

  Deflating nominal GDP by broad money tells us that US GDP is indeed evenly rotating and has been doing so with not much variation for over four decades. The only notable exceptions were following the Lehman crisis when the US economy entered a brief downturn greater than the expansion of broad money, and in 2020. The latter reflects a large increase in unemployed and underemployed individuals who are still receiving direct payments from the government while locked down due to the coronavirus.

  The severity of economic contraction last year was thereby concealed by the expansion of broad money. And its further expansion since the last data point (Q3 2020) will continue to mask the true depth of the economic slump. And for further confirmation, Figure 4 shows the same relationship between GDP and money supply for the UK, where similar factors are at play.

  

  Establishment economists make no differentiation between the real economy and GDP. One never hears or reads any distinction between the two, and Mises’s evenly rotating economy is almost exclusively confined to a few unread pre-Keynesian texts. But its expansion being linked entirely to increases in the money supply reveals that its increase is completely meaningless. But then, monetary and economic policies need to deliver something to justify their existence, not to mention the livings of all the government economists and statisticians and of their opposite numbers in financial and banking institutions.

  But with all the inflation money being funnelled into economies today, there can be little doubt that GDP will increase accordingly. But as the charts in Figures 3 and 4 show, with productive capacity cut, the US and UK economies are in a depression.

  Canning calls out to us. Forget the statistics, just look around you.

  Tyler Durden
  Sun, 03/07/2021 – 22:00

• Ted Cruz Rage-Tweets 'Fact-Check' Of "Lefty Press" & Sen. Durbin's "Lies" About Stimmies For Illegal Immigrants
  Ted Cruz Rage-Tweets ‘Fact-Check’ Of “Lefty Press” & Sen. Durbin’s “Lies” About Stimmies For Illegal Immigrants

  The passing, by The Senate, of the Biden admin’s $1.9 trillion package of pork and payoffs has apparently triggered Senator Ted Cruz. Having attempted to insert an amendment that would disallow the $1400 handouts to illegal immigrants (paid for by legal US taxpaying residents), he was attacked as a “liar” by Senator Dick Durbin

  Cruz had asked, “The question for the American people to answer is, should your money, should taxpayer money, be sent, $1,400, to every illegal alien in America?”

  Durbin said, “Undocumented immigrants do not have social security numbers. And they do not qualify for stimulus relief checks, period. And just in case you didn’t notice, they didn’t qualify in December… To stand up there and say the opposite is just to rile people up.”

  As is clear by the Twitter thread below – Cruz was none too happy about Durbin’s lies (which were dutifully repeated by the mainstream media)…

  

  Cruz begins by asking (rhetorically): “Want to understand why we’re so divided? Why each side seems to live in alternate universes?”

  Take a moment & examine the misinformation here (both deliberate & inadvertent)…

  FACT 1: Dem spending bill sends $1400 to each adult in US.

  FACT 2: Dems voted against my amendment to prohibit sending those $$ to criminals (murderers, rapists, child molesters) currently IN PRISON. EVERY Dem voted to send criminals the $$.

  FACT 3: I then called up my amendment to prohibit illegal aliens from getting the $1400 checks.

  FACT 4: Durbin then screamed “liar!” and insisted no illegal immigrants would get $$ because the bill requires social security numbers.

  FACT 5: Lefty “press” outlets, like Daily Beast, dutifully repeated Durbin’s charge. They did ZERO fact checking of their own, just said that my claim that illegal immigrants would get the $$ was “false.”

  FACT 6: Lefty pundits & celebrities like Morgan Fairchild happily repeat the charge that I “lied.” They know none of the facts, but in this politically charged world, the other side must always be wrong.

  Sen. Durbin Blasts Sen. Ted Cruz Over False Claims About Immigrants and Stimulus Checks https://t.co/WSZajbWzyU via @thedailybeast

  — Morgan Fairchild (@morgfair) March 7, 2021

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  FACT 7: As it so happens, it was Durbin who was lying, and he knew it. Why?

  FACT 8: There are 12mm or more illegal immigrants. 60% of them are from visa overstays. Many (if not most) of them have social security numbers.

  FACT 9: When Durbin said “illegal immigrants don’t have social security numbers,” he was deliberately saying something false, knowing it would be repeated.

  FACT 10: Under the bill’s language, MILLIONS OF ILLEGAL IMMIGRANTS will get the $1400 checks.

  FACT 11: My amendment required that recipients would be “lawfully present,” i.e., legal.

  FACT 12: When Durbin falsely said ZERO illegal immigrants would get $$, I asked if he would yield for a question. Schumer, sitting next to him, bellowed “no!!”

  FACT 13: If Durbin had taken my Q, I would have asked, “if you’re right that no illegal aliens will get $$ under this bill…WHY ARE YOU AND EVERY DEM OPPOSING MY AMENDMENT TO DO JUST THAT?”

  The answer is that Durbin was lying, and he knew that Lefty partisans would reflexively believe his gals charge that I was the one lying.

  FACT 14: When the checks go out, millions of illegal immigrants WILL GET $1400 checks.

  PREDICTION: the Lefty press & pundits won’t cover it, and won’t care.

  Cruz ended by rather ominously – but accurately – pointing out that:

  “Sadly, that’s why we’re so divided. Facts don’t matter.

  Journalists don’t care about truth.

  Everyone is a partisan warrior.

  And we only believe news from our own side.”

  Unity?

  For America to come together, this must change.

  Tyler Durden
  Sun, 03/07/2021 – 21:30

• PIMCO Rings The Alarm Over China's Sliding Credit Impulse
  PIMCO Rings The Alarm Over China’s Sliding Credit Impulse

  Three months after Zero Hedge subscribers were first made aware of the biggest risk for the global economy, Pimco has finally caught up and is ringing the alarm as noted in the latest observations from Bloomberg macro commentator Ye Xie titled “Pimco Warns of Risks From Beijing’s Credit Curtail.”

  1. Beijing sounds less sanguine about 2021.

  The government set the growth target this year at “above 6%,” well below economists’ forecasts of 8%. A 6% year-on-year GDP expansion implies zero growth from Q4 2020. Meanwhile, the budget deficit is pegged at 3.2% of GDP, lower than the record 3.6% last year, but higher than the 3% consensus. Taken together, the government seems less upbeat than most economists.

  Granted, 6% is the floor, not the ceiling for growth. Beijing may have intentionally set a low bar this year so that it could target a similar growth rate in 2022 to project the image of stability. The economy may turn out to be stronger.

  In any case, even if the government ensures it won’t yank stimulus abruptly, gradual tapering in credit growth is already well under way. As first discussed in December in “In Historic Reversal, China’s Credit Impulse Just Peaked: What This Means For Global Markets“, China’s credit impulse, or the change of new credit as a percentage of GDP, peaked in October and is following the similar downward path of the previous two credit cycles in 2013 and 2016. At this rate, the gauge could turn negative in the second half of the year.

  

  In a note on Friday, Pimco estimated that the credit impulse will fall to -3.5% of GDP by year-end, from a peak above 9% in 2020. All else equal, it may slow China’s economy to below-trend levels by late 2022, the firm’s Gene Frieda and Carol Liao wrote.

  What does this mean? Tighter liquidity is likely to lead to stress in China’s corporate debt market, they wrote (echoing what Zero Hedge wrote in December). While a soft-landing is achievable and the yuan remains attractive, the drag from China’s economy next year suggests that “developed economies may require stimulus for longer than currently appreciated.”

  2. The path of least resistance is for bond yields to move higher.

  Jerome Powell reiterated that the Fed is in no rush to reduce stimulus, but declined to say that rising bond yields are inconsistent with the central bank’s objective. That essentially gives the market a free rein to push yields higher, keeping Treasuries as the potential source of volatility for other markets.

  Chinese bonds remain insulated from the global bond rout, given they have largely priced in economic normalization.

  3. The trade-weighted yuan rose amid a stronger dollar.

  While rising yields lifted the dollar, the yuan managed to outperform other currencies, sending the trade-weighted yuan close to the highest since 2018. The foreign bond inflows continue to be supportive. “Real money” investors, such as pension funds, have boosted their overweight on the yuan to the highest level since JPMorgan included Chinese bond in its benchmarks in February 2020, according to Bank of America.

  

  Tyler Durden
  Sun, 03/07/2021 – 21:00

• "We'll Level Tel Aviv": Iran Responds To Israel 'Preparing' Strike Plans Against Nuclear Sites
  “We’ll Level Tel Aviv”: Iran Responds To Israel ‘Preparing’ Strike Plans Against Nuclear Sites

  Iran has responded to a Fox News interview from late last week wherein Israeli Defense Minister Benny Gantz said that Israel is currently updating its plans to strike Iran’s nuclear program and is prepared to act independently if the United States is not willing. The interview was unusually blunt even for Israel in terms of the defense chief openly stating war plans.

  Iranian Defense Minister Amir Hatami promptly fired back with a counterthreat on Sunday. He said Iran’s military will level Tel Aviv and Haifa should Israel do anything “out of desperation”.

  

  “Sometimes, the Zionist regime [Israel] out of desperation makes big claims against the Islamic Republic of Iran to allegedly threaten it,” Hatami said as cited in The Times of Israel via Iranian state media.

  “It must know that if it does a damn thing, we will raze Tel Aviv and Haifa to the ground,” he followed up with according to an English translation. Hatami was addressing a military ceremony.

  He further assured that Iran possesses all the power it needs to “maintain the stability of the country” and said the Islamic Republic can strike close to Israel also via “resistance groups” – which is no doubt a reference to Lebanese Hezbollah and militia groups that have been fighting in Syria.

  During Gantz’s Fox News statements two days ago, the defense chief had spelled out to the American correspondent that “If the world stops them [Iran] before, it’s much the better. But if not, we must stand independently and we must defend ourselves by ourselves.”

  “The Iranian nuclear aspiration must be stopped… We must defend ourselves by ourselves,” Gantz had asserted.

  NEW: Israel is improving plans to strike Iranian nuclear targets, Defense Minister Benny Gantz tells mehttps://t.co/19GiARhYoy

  — Trey Yingst (@TreyYingst) March 4, 2021

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  Prime Minister Netanyahu has also issued similar warnings recently, however, Gantz’s words were the most specific and forceful thus far. He had even handed the Fox reporter what was purported to be a classified target list against Iranian assets that Israel prepared.

  Gantz had also touted that Israel stands ready to attack Hezbollah positions throughout Lebanon and Syria – the latter country has been on the receiving end of Israeli airstrikes on a near weekly basis for much of the past year. The defense minister claimed that Hezbollah has “hundreds of thousands” of missiles aimed at Israel and is bent on the Jewish state’s destruction.

  Tyler Durden
  Sun, 03/07/2021 – 20:30

• Hedge Fund CIO: The 1929 Crash Sparked A Chain Reaction That Led To WWII In 1939
  Hedge Fund CIO: The 1929 Crash Sparked A Chain Reaction That Led To WWII In 1939

  By Eric Peters, CIO of One River Asset Management

  Lost Arks

  “Illiquidity is creeping into credit markets,” said Indiana, the industry’s leading archaeologist, explorer. “Credit risks of the type Minsky identified have migrated from the banking system into capital markets.”

  Corporate borrowings through bond issuance, in turn captured in exchange traded funds, are an important part of that risk migration. “Even with the stability of credit spreads, this rate rise battered credit funds.” LQD is -6% YTD. “Fund outflows are $6.8bln YTD – the pandemic outflow from mid-Feb to mid-Mar 2020 was just $4.5bln.”

  “This week saw the return of credit ETFs trading at a discount to net asset values,” continued Indiana. “Small for now, averaging less than 20 basis points in the past three days.” As liquidity in underlying assets lessens, so too does the ability of participants to provide that liquidity through ETFs. “The discounts are capturing a marginal fray in liquidity conditions, an early warning,” said Indy.

  “And the crown jewels of global financial markets – Treasuries – saw a surge in the cost of borrowing securities this week. Illiquidity in Treasuries rose sharply.”

  

  Rapid Unplanned Disassembly (RUD)

  The 1929 market crash sparked a chain reaction that lasted a decade, a rapid unplanned disassembly, leading humanity to WWII in 1939. US unemployment averaged 18.2% in the 1930s, CPI averaged -2.0%. The S&P 500 lost 42% in the decade (real return was -29%). The 1970s RUD produced two brutal recessions, US unemployment averaged 6.4% and CPI averaged +7.25%. The S&P 500 gave the illusion of health with a 17% gain. The real return was worse than the 1930s, with a 42% decline.
   

  • In 1930, the US CPI was -2.7%, the S&P 500 inflation-adjusted return was -23% (the inflation adjusted 10yr Treasury note return was +7.4%). In 1931, CPI was -8.9%, S&P 500 real return -38%, 10yr note real return 7.0%. In 1932 (CPI -10.3%, S&P 2%, 10yr 21.3%). 1933 (CPI -5.2%, S&P 58%, 10yr 7.4%). 1934 (CPI 3.5%, S&P -5%, 10yr 4.3%). 1935 (CPI 2.6%, S&P 43%, 10yr 1.9%). 1936 (CPI 1.0%, S&P 31%, 10yr 3.9%). 1937 (CPI 3.7%, S&P -38%, 10yr -2.3). 1938 (CPI -2.0%, S&P 32%, 10yr 6.4%). 1939 (CPI -1.3%, S&P flat, 10yr 5.8%).
  •  In 1970, the US CPI was +5.8%, the S&P 500 inflation-adjusted return was -2% (the inflation adjusted 10yr Treasury note return was +10.3%). In 1971, CPI was 4.3%, S&P 500 real return 10%, 10yr note real return 5.3%. In 1972 (CPI 3.3%, S&P 15%, 10yr -0.4%). 1973 (CPI 6.8%, S&P -19%, 10y -2.4%). 1974 (CPI 11.1%, S&P -33%, 10yr -8.2%). 1975 (CPI 9.1%, S&P 25%, 10yr -5.0%). 1976 (CPI 5.7%, S&P 17%, 10yr 9.7%). 1977 (CPI 6.5%, S&P -13%, 10yr -4.9). 1978 (CPI 7.6%, S&P -1%, 10yr -7.8%). 1979 (CPI 11.3%, S&P +6.5, 10yr -9.5%).

  In both the 1940s and 1980s, investors who had emerged from the preceding decade with their capital intact made vast fortunes, equity markets boomed.

  Anecdote

  “The 19th century was defined by the formation of nation states. The US had just emerged from its UK ties, the treaty of Vienna created countries such as the Netherlands, France just had its revolution and rid itself of Napoleon, Germany unified and Italy became a nation state,” said the Dutchman, a private investor, his fortune built in the markets, trade, finance.

  “The 20th century was the era of the establishment of institutions, alliances, internal, global, the US Federal Reserve, the United Nations, many others in between.” International Monetary Fund, World Bank, World Health Organization, NATO, the list goes on. Programs too: Social security, Medicare, Medicaid, state pensions. Countless agencies: CIA, FBI, NSA, NASA, EPA, FDA and so on.

  “A number of those institutions have come under siege in recent times and the level of trust embedded in them has eroded,” said the Dutchman, images of America’s horned Shaman seared in the global consciousness.

  History moves slowly, then fast, all at once. We read books, watch movies, and they compress years, even decades, into tight chapters, creating the illusion that periods of great change are apparent as they unfold, obvious to those living through them. And this then allows us to ignore today’s seismic shifts even as the ground beneath our feet trembles.

  “This erosion of trust can also be said about the Fed at a time when the need for credibility is perhaps greater than it has ever been, which makes the trajectory for financial markets going forward particularly difficult and potentially very volatile,” he said.

  “And it appears that forces are now in motion that will redistribute wealth, shifting it from capitalists to the workers,” said the Dutchman, taking a moment to consider it all.

  “There tend to be couple decades each century when it is a victory to have preserved your real wealth. This looks to be one of them.”

  Tyler Durden
  Sun, 03/07/2021 – 20:00

• Outrage Mob Goes After Cartoon Skunk Pepe Le Pew For "Normalizing Rape Culture" 
  Outrage Mob Goes After Cartoon Skunk Pepe Le Pew For “Normalizing Rape Culture” 

  The woke cancel culture mob continues trucking along with their crusade against free speech, targeting popular Dr. Seuss books last week as they said some of these beloved children’s books contain racist imagery. As the mob continues to look for stuff to burn figuratively, cartoon characters like Pepé Le Pew, a character from the Warner Bros. Looney Tunes and Merrie Melodies series of cartoons from the 1940s, is the next target. 

  

  New York Times liberal columnist Charles Blow recently argued in an op-ed and in a series of tweets how Pepé Le Pew “normalized rape culture.” He tweeted Saturday a scene from the cartoon: “Let’s see, he grabs/kisses a girl/stranger repeatedly, without consent and against her will. She struggles mightily to get away from him, but he won’t release her. He locks a door to prevent her from escaping.”

  RW blogs are mad bc I said Pepe Le Pew added to rape culture. Let’s see.
  1. He grabs/kisses a girl/stranger, repeatedly, w/o consent and against her will.
  2. She struggles mightily to get away from him, but he won’t release her
  3. He locks a door to prevent her from escaping. pic.twitter.com/CbLCldLwvR

  — Charles M. Blow (@CharlesMBlow) March 6, 2021

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  In a separate tweet, Blow continued: “This helped teach boys that “no” didn’t really mean no, that it was a part of “the game,” the starting line of a power struggle. It taught overcoming a woman’s strenuous, even physical objections was normal, adorable, funny. They didn’t even give the woman the ability to SPEAK.” 

  This helped teach boys that “no” didn’t really mean no, that it was a part of “the game”, the starting line of a power struggle. It taught overcoming a woman’s strenuous, even physical objections, was normal, adorable, funny. They didn’t even give the woman the ability to SPEAK.

  — Charles M. Blow (@CharlesMBlow) March 6, 2021

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  The Media Research Center, a top media watchdog, responded to Blow’s op-ed following the recent cancel mob’s assault on Dr. Seuss, who said: 

  “Congrats to anyone who had “liberals try to cancel Looney Tunes” on their 2021 bingo card.” 

  In his op-ed, Blow said, “racism must be exorcised from culture, including, or maybe especially, from children’s culture. Teaching a child to hate or be ashamed of themselves is a sin against their innocence and weight against their possibilities.” He wrote that he “cheered” when he heard the news six of Dr. Seuss’ books were discontinued by its publisher because of “racist and insensitive imagery.” 

  Some social media users were not thrilled with Bow’s op-ed and tweets:

  One Twitter user said: 1. “It’s…a…f**king…cartoon. 2. It was made in the 1950s, when this society’s values and mores were a wee bit different. 3. Pepe always gets clowned by the cat in the end…every time. 4. It’s a fucking cartoon. 5. For those of you unclear on the point, see #1 and #4 above.”

  “I’ve never gotten relationship advice from a cartoon. Not now, and for damned sure, not when I was six. Jesus H. Christ,” someone said. 

  “Wait until people realize that Frosty The Snowman is naked and smokes a pipe in front of children. This never ends. Cancel culture is internet cancer,” another user said. 

  … and there’s this. 

  5. He doesn’t even know WTF he’s talking about. They’ve been multiple times in which Penolope the cat Loves Him. But He smelled Like what he was. A skunk. pic.twitter.com/hXI0KShYsQ

  — ScarletEmber (@Nightdragonx1) March 6, 2021

  https://platform.twitter.com/widgets.js

  This Twitter user makes an interesting point:

  “Yeah, this was on TV. it was normal to show it to children in an ‘evolving society’ it’s easy (for most of us) to see how messed up and wrong a cartoon from 80 years ago feels today, but few of us will imagine how what we are doing TODAY may look like 80 years from now.” 

  Perhaps, what the future will show is today’s mob-canceling crowd as “the digital equivalent of the medieval mob roaming the streets looking for someone to burn,” said Rowan Atkinson, famous for portraying the characters Mr. Bean and Blackadder. 

  The former secretary of Housing and Urban Development, Ben Carson, calls the left’s attempt to cancel culture a “poison.” 

  So every week, the left will cancel a book, cartoon, or anything that displeases them? 

  How about for a change, the left does something constructive – such as – cancel violent video games. Today’s youth are playing games such as “Grand Theft Auto” and or “Call of Duty” – teaching them murder and destruction is okay. While on the streets of America, millennial anarchists, for almost a year, have been destroying tens of millions of dollars in property through destructive riots. 

  Focus on today not what happened decades ago… 

  Tyler Durden
  Sun, 03/07/2021 – 19:30

• Sen. Blackburn Wants NBA To "Come Clean" On Its Deal With Chinese State Television
  Sen. Blackburn Wants NBA To “Come Clean” On Its Deal With Chinese State Television

  Authored by Cathy He via The Epoch Times,

  Sen. Marsha Blackburn (R-Tenn.) is questioning the National Basketball Association’s (NBA) reported new deal with Chinese state television, the latest official to raise concerns over the league’s relationship with the Chinese regime.

  

  The NBA famously drew the wrath of the Chinese communist regime in late 2019 after then-Houston Rockets General Manager Daryl Morey tweeted in support of the pro-democracy protesters in Hong Kong. Chinese businesses cut ties with the league, and state broadcaster CCTV stopped airing games.

  But Chinese media recently reported that CCTV will resume regular broadcast of the NBA starting with the All-Star Game on March 7.

  “Commissioner Silver cut a deal to air NBA games on the same station that regularly broadcasts Communist propaganda and forced prisoner confessions,” Blackburn told The Epoch Times in an email, referring to NBA Commissioner Adam Silver.

  “Commissioner Silver needs to come clean – did he agree to censor players’ free speech to return to Chinese state-run airwaves?”

  Silver said last year that the league faced hundreds of millions in losses from the Chinese backlash.

  Blackburn wrote to Silver on March 4, signaling concern over the league’s alleged television deal with CCTV at a time when the Chinese regime faces increasing scrutiny over its coverup of the COVID-19 pandemic and rampant human rights abuses.

  “While investigations into the origin of COVID-19 continue in Wuhan, the NBA seems solely focused on mending its relationship with CCTV even though it’s clear Communist China will distort, censor or terminate any CCTV broadcast that is seen as a threat to the Chinese Communist Party (CCP),” the senator wrote in her letter (pdf).

  Last October, CCTV temporarily resumed its broadcast for the last two games of the NBA finals, a result of the “goodwill” expressed by the NBA for some time, a spokesperson for CCTV said at the time. “The NBA has made active efforts to support the Chinese people in their fight against COVID-19,” the spokesperson said.

  “It is safe to assume that ‘goodwill’ included the $1 million in medical supplies the NBA sent to the CCP,” Blackburn said in the letter.

  “China dominates PPE production worldwide, so it is deeply troubling that the NBA would send this aid, especially after witnessing the lack of transparency shown by the CCP throughout the entire pandemic and their continued grave human rights violations.”

  Blackburn asked Silver to provide details about the CCTV deal by March 30, including whether the agreement bars the NBA from speaking on topics deemed unacceptable to the Chinese regime such as Tibet, Hong Kong, Taiwan, and Xinjiang, and the financial impact of the CCTV’s broadcast ban.

  Last May, the NBA announced a new head of its China operations, Michael Ma, whose father, Ma Guoli, is a co-founder of CCTV Sports. Blackburn also asked the NBA to detail what roles Ma and his father played in the negotiations.

  The NBA did not immediately respond to a request for comment.

  The league also sparked controversy in July 2020, when an ESPN investigation revealed that Chinese coaches at the NBA youth training academy in the region of Xinjiang physically abused players. The NBA later confirmed that it had terminated its relationship with the academy.

  Tyler Durden
  Sun, 03/07/2021 – 19:05

• Another Market Paradox: Wall Street Struggles To Explain Record Equity Inflows Amid Stock Turmoil
  Another Market Paradox: Wall Street Struggles To Explain Record Equity Inflows Amid Stock Turmoil

  Something bizarre is happening in the stock market: for the past three weeks stocks – and especially tech – has gotten hammered, with the Nasdaq briefly sliding into a 10% correction while the S&P has also been hard hit (although one can’t say the same for reflation stocks such as energy which have soared in recent weeks). Some other notable casualties: Apple has tumbled 15% since late January. Tesla has lost more than a quarter-trillion dollars in market value in three weeks, and more than $1.5 trillion has been wiped off the Nasdaq in less than a month.

  And yet, despite this hit to risk assets on the back of the recent in surge in interest rates, accompanied by a parallel spike in both the VIX, and its bond market equivalent, the MOVE index…

  

  … on Friday we reported that according to the latest EPFR fund flow data, $22.2Bn in new money flowed into equities last week, following the previous week’s massive $46.2Bn inflow which was the 3rd biggest on record, bringing the total 16 week inflow to $436BN, a stunning burst of inflows as shown in the chart below.

  

  So bizarre has been this divergence – historically, investors have always pulled money during times of stress and heightened volatility, instead they are plowing record amounts of cash into stocks now – that Goldman’s David Kostin dedicated his Weekly Kickstart report to the topic. In a note titled “Rising rate anxiety roils share prices but also supports outlook for strong equity inflows”, the Goldman chief equity strategist writes that as “rates rose, and equities fell, long-duration growth stocks plummeted, but equity funds continued to see large net inflows.”

  Equity mutual fund and ETF inflows have totaled $163 billion since the start of February, the largest five-week inflow on record in absolute dollar terms and third largest in a decade relative to assets. Even though the recent backup in rates has weighed on equity prices broadly, the pace of inflows into equity funds during the last few weeks has accelerated compared with the start of the year.

  

  In contrast, weekly flows into bond funds averaged roughly $10 billion in February, 50% less than weekly inflows in January. In addition, money market funds have seen net outflows of $34 billion during the past month.

  It is worth noting that retail investors are not indiscriminately plowing cash into all stocks, and instead the rotation into equity funds has most favored strategies that benefit from accelerating economic growth, in other words there has been a rotation of new money from growth and to value. Indeed, when looking in absolute dollar terms, while US equity funds have seen large inflows during the past month (+$62 billion), relative to assets, EM, Value, small-cap, and Materials equity funds have seen the largest inflows, consistent with the outperformance of economic growth-sensitive equities.

  And here Kostin makes a curious observation in trying to explain this flood of new capital just as stocks – well, mostly tech and growth stocks – get hammered – according to the Goldman strategist, “history shows that equity funds generally experience inflows when real rates are rising. During the past 10 years, the most favorable backdrop for equity fund inflows has been when both real rates and breakeven inflation were rising (Exhibit 2).”

  

  This, Kostin adds, is intuitive given that the dynamic typically occurs when growth expectations are improving. However, equity funds usually experienced inflows when real rates rose and breakeven inflation fell. In short, equity fund flows have been more clearly delineated by the trajectory of real yields than by inflation during the past decade.

  This certainly appears to be confirmed by the data: in his latest “Investor Positioning and Flows” report (available to pro subs), Deutsche Bank’s Parag Thatte also picks up on this divergence and writes that “bond fund flows slowed sharply this week as rates rose, but equity inflows continue to roll in” and like Kostin, concludes that “the rising rates environment continues to propel large inflows into equity funds (+$22.2bn this week)” although as one would expects, “equity inflows this week went heavily towards cyclical sectors and styles, while Growth funds saw outflows”

  

  Whether or not the chart above ends in tears will ultimately depend on just how much capital investors have to throw at reflation assets, oblivious of how painful the high duration crash in growth/tech stocks could be (and since FAAMGs still account for about 25% of the S&P500, it could be very painful indeed).

  Alternatively, it may well be that yields, inflation or growth concerns have nothing to do with the massive retail inflows we are observing, and it is all due to tidal wave of Robinhood/Reddit investors who have now habituated to buying every single dip. Indeed, as Bloomberg points out over the weekend, no amount of market turmoil has been enough to rattle retail investors who are now so habituated to Fed bailouts, they have yet to find a dip they won’t buy.

  According to Bloomberg, even though the market peaked almost a month ago, retail traders have plowed cash into U.S. stocks at a rate 40% higher than they did in 2020, which was a record year. Yet one way retail capital allocation differs from the charts above, is that “they’re opting for parts of the market that have suffered the most, doubling down in arguably risky ways with triple-leveraged tech funds and options galore.”

  Could it be that nothing but sheer stupidity and/or certainty in yet another Fed bailout is behind the record inflows? And is Powell to blame?

  Retail traders, many of them newbie investors, have consistently held strong, buying virtually every dip during what’s been the best start to a bull market in nine decades. But now the world is wondering how much it’ll take for them to call it quits, especially after a year in which retail traders were right way more often than wrong.

  “Historically it’s been a bad signal that retail investors are piling into the market and a signal of a top,” said Art Hogan, chief market strategist at National Securities Corp. And yet, as he admits in the very next sentence, “every time we tried to call a top in 2020 because of retail participation, it was wrong.”

  Just how aggressive has retail buying been? According to data from VandaTrack, which monitors retail flows in the U.S. market, retail investors snapped up an average of $6.6 billion in U.S. equities each week, up from an average $4.7 billion in net weekly purchases in 2020 even as stocks swooned over the last three weeks.

  They’ve doubled down on areas of the market that have been hit the hardest. Apple, which has plunged 15% since late January, was the most-popular retail buy this past week. NIO Inc., the electric-vehicle maker down almost 40% since Feb. 9, was the second-most popular. Next up were exchange-traded funds tied to the Nasdaq 100, the Invesco QQQ Trust Series 1 (ticker QQQ) and a triple leveraged version (ticker TQQQ).

  Because in a centrally-planned “market” where the Fed guarantees no losses ever, why not buy any and every dip? Sure enough, that’s what they did and boy did they buy the dip:

  On Thursday, when the Nasdaq 100 fell as much as 2.9%, almost 32 million bullish call options traded across U.S. exchanges, the fifth-most on record. The other four have all occurred within the last four months.

  There is one fundamental reason why retail investors are buying: the just passed $1.9TN Biden stimulus ensures lots and lots and lots of stimmy checks are about be deposited to daytraders’ checking accounts:

  “There’s a lot of excess liquidity and we just had this $600 check going to many families in January,” said Jimmy Chang, chief investment officer of Rockefeller Global Family Office. “We’re going to get an additional liquidity injection in the $1,400 check and part of that money is going into risk assets.”

  Incidentally, the question of how much of Biden’s $1.9TN stimulus  will end up in the market is one we discussed last week in the context of a recent Deutsche Bank survey:

  “Given stimulus checks are currently penciled in at c.$405bn in Biden’s plan, that gives us a maximum of around $150bn that could go into US equities based on our survey.

  

  Obviously only a proportion of recipients have trading accounts, though. If we estimate this at around 20% (based on some historical assumptions), that would still provide around c.$30bn of firepower – and that’s before we talk about any possible boosts to 401k plans outside of trading accounts.”

  Clearly, frontrunning that number is enough to get retail daytraders to flood the market with yet another round of dip buying for the likes of Karim Alammuri, a 31-year-old marketing strategy manager, who is one of many retail investors who’s been snapping up stocks. In recent days, he bought shares of fuboTV Inc. and SPAC Churchill Capital Corp IV. Fubo TV has plunged more than 50% since a December peak. Churchill Capital has lost almost 60% of its value in 11 trading sessions. He is not giving up however:

  “I plan on sticking around because I don’t want to take a loss,” he said by phone from New York. “A lot of very attractive stocks are on crazy discount right now, so I’m just looking to see how I can re-shuffle things to be able to buy them.”

  Naturally, with an army of retail investors standing ready to buy any dip, those declines have grown shallower and shallower. As shown in the chart below, the S&P 500 has gone without a 5% pullback since early November, or 83 straight days, the longest streak in a year. The end result of this persistent dip buying, as Bloomberg notes, “is a market with little downside. At its lowest closing level of 2021, the S&P 500 was only down 1.5% year-to-date. That’s the smallest drawdown at this time of a year since 2017.”

  

  So is this time different?

  Well, as we reported earlier today, Morgan Stanley’s Michael Wilson believes that the selloff has more room to go before it’s over. Bloomberg agrees and notes that “if past is precedent, that could mean the sell-off has more room to run. Retail investors tend to buy the initial dips, and it’s not until they capitulate and sell that markets ultimately bottom, according to Eric Liu, co-founder and head of research at Vanda Research. The firm’s data show that was the case in both selloffs in 2018, as well as roughly a year ago during the Covid crash.”

  To Victoria Fernandez, chief market strategist for Crossmark Global Investments, their continued presence in the markets likely means elevated volatility will persist. Still, that doesn’t mean retail investors’ efforts are misguided.

  “Is there some dumb money in retail trades? Yes. But not all of it,” she said. “Some of these people are doing their homework, looking for opportunities and trying to take advantage of it. Some win, some lose — it’s really not that different than what professionals do on an institutional basis.”

  Maybe there is dumb money in retail, but that’s hardly what matters. What does matter – in our view – is what we reported earlier today, namely that last week we saw the biggest shorting among hedge funds since last May. And with the squeeze having started on Friday and clearly continuing on Sunday, the upcoming “mega squeeze” (which we predicted earlier today) is all that matters.

  As such while Wall Street ruminates about the cause (and reflexive effect) of the current record capital inflows into equity stocks amid growing market turmoil, the only thing that matters for this broken, illiquid market is positioning and right now the “max pain” is higher. A lot higher, especially since the Fed will have no choice but to step in if stocks continue to fall as all the careful centrally-planned work of the past 12 years would implode with a massive bang if it does not.

  Tyler Durden
  Sun, 03/07/2021 – 18:40

• Stocks, Crude, & Crypto Explode Higher As Asia Opens
  Stocks, Crude, & Crypto Explode Higher As Asia Opens

  Just as we warned, US equity markets (massive short squeeze) and oil (Saudi bombing) are exploding higher at the Sunday futures open.

  Brent crude futures are above $70…

  

  …and WTI is above $67…

  

  And Small Caps are leading the surge in equity futures – now up a stunning 6% from the European close on Friday…

  

  Bonds are being sold…

  

  And the dollar is weaker against the JPY and EUR, helping to send Gold futures back above $1700…

  

  Elsewhere, Ethereum is also bid (EIP-1599 approval) back up near $1700…

  

  And Bitcoin is bid, likely helped by the $1.9 trillion malarkey that is just about to hit the US markets/economy…

  

  Cryptos are also helped by the fact that – much to the chagrin of JPMorgan who didn’t expect any other firms to follow TSLA and MSTR in adding crypto their reserves – Hong Kong-listed Meitu Inc., which makes image and video processing software, said it had purchased $22 million in ether and $17.9 million of bitcoin, making it the first time a firm has disclosed a major purchase of ETH for its treasury.

  While the company said that while buying crypto helps diversify its holdings away from cash, “More importantly, the Board considers this a demonstration to investors and stakeholders that the Group has the vision and determination to embrace technological evolution, and hence preparing its foray into the blockchain industry.”

  The question is – will any of this hold until the cash open tomorrow?

  Tyler Durden
  Sun, 03/07/2021 – 18:18

• Betting The Farm On Moonshots
  Betting The Farm On Moonshots

  Authored by MN Gordon via EconomicPrism.com,

  Ashley Revell of London had a mad itch he needed to scratch.

  The year was 2004.  The initial tickle came from a casual drinking conversation with a friend.  Revell couldn’t let it go.

  The idea, in short, required Revell to liquidate all his possessions, travel to Las Vegas, and ‘bet it all’ on one spin of the roulette wheel.  The idea was sheer lunacy.  Yet Revell was just crazy enough to go through with it.

  Revell sold off all his possessions over a six month period and traveled to the Plaza Hotel and Casino in Las Vegas.  Then, one Sunday morning in April 2004, with his mom and dad standing behind him, along with a film crew, Revell placed $135,300 on red.

  What happened next?  Here’s Revell’s account:

  “That spin was the most amazing moment of my life.  It is a cliché but time did stand still.  It was just complete calm because I had done all the hard work.

  “Everything had all been sold.  I had no possessions.  I had decided whether to go red or black.  There were no more decisions to make – it was a complete feeling of freedom.

  “The ball sort of bobbled around and then landed in what I thought was red but it disappeared slightly from view.  I looked around and, as the wheel spun back into view, there it was resting in number seven.  Red.

  “There were a few people watching and they erupted.  They cheered and I just cheered.  Somebody ran on with a bottle of champagne and everyone was celebrating.  My friends and family were there going wild.  I had won £153,680 [$270,600].  It was just a crazy time of complete happiness.”

  Revell, no doubt, was extraordinarily lucky.  He could just have easily lost it all on this high stakes wager.  Then what would he have been?

  He would have been an instant fool without a dollar to his name.

  Art Fart

  Speculative manias always gain momentum through the expansion of money and credit.  A look back at past manias tells this story with familiar rhythm.

  For example, the mania for tulips in Holland in 1636 and 1637 was intensified by personal credit.  At the peak, sellers had no bulbs…yet buyers, lacking cash, made down payments in personal possessions or commodities.

  John Law’s Mississippi Bubble from 1718 to 1720 was puffed up by paper notes issued by his Banque Générale, later the Banque Royale.  The mania for residential real estate from 2003 to 2007, much like today, was made possible by low interest rates and the expansion of credit through mortgage backed securities.

  Objects of speculation – from canals, to railroads, to IPOs, to electric vehicles – may change.  But the mania follows a similar boom to bust trajectory.  One perennial object of speculation, which produces some of the more entertaining episodes, is art.

  In 2006, for instance, at a time when cheap credit was abundant, there was the “$40 million elbow” incident.  That was the approximate cost incurred by casino magnet Steve Wynn when he inadvertently stuck his elbow through the canvas of Picasso’s “Le Rêve.”  After the distinct ripping sound Wynn muttered, “I can’t believe I just did that.”

  Now cheap credit has delivered something called digital NFT art.  The NFT, pronounced ‘nifty’, stands for non-fungible token.  And they’re all the rage.

  The “WarNymph” NFT collection by Grimes, of Elon Musk fame, recently sold for $5.8 million.  And a group of crypto evangelists just live streamed the burning of a print of Banksy’s “Morons”.  Then they created a NFT, called “Burnt Banksy”, to represent the artwork – the recorded burning – on the Ethereum-based OpenSea market place.

  The individual who delivered the flame explained the rationale:

  “The reason behind this is because if we had the NFT and the physical piece, the value would be primarily in the physical piece.  By removing the physical piece from existence and only having the NFT, it makes sure the NFT due to the smart contract on the blockchain will ensure that no one can alter the piece, and it is the true piece that exists in the world.

  “By doing this the value of the physical piece will be moved onto the NFT and being the only way you can have this piece anymore.  The goal here is to inspire, we want to inspire technology enthusiasts and we want to inspire artists.  We want to explore a new medium of artistic expression.”

  Are you inspired?

  At the time of this writing, the auction for “Burnt Banksy” is still open.  We put the over/under at a million bucks.  What side of the wager do you take?

  Betting The Farm On Moonshots

  Betting your life savings on the turn of a roulette wheel – or digital NFT art – is remarkably dumb.  Yet after a decade long bull market that has now inflated into a real McCoy bubble, anything is possible.

  Millions of Americans are taking similar risks to what Revell took.  Only they’re using their retirement savings.  Moreover, they’re betting they can do much better than just double their money.  And they don’t even have to go to Las Vegas.

  

  Presently, thanks to a seemingly endless supply of cheap credit courtesy of the Federal Reserve, speculation is rampant. What’s more, there are countless vehicles for speculation that one can access from the comfort of their own home.

  Technology stocks, small-cap stocks, bitcoin, special purpose acquisition companies (SPAC), digital NFT art – you name it.  Indeed, the late stages of a credit expansion compels people to do insane things.

  The current spirit of the moment is not to just double your money.  A mere double is weak.  Today’s speculators expect much bigger returns.  They’re after moonshots.  They’re after overnight 10x and even 100x returns.

  People have watched their friends and neighbors quickly 10x their money in cryptos and technology stock moonshots – like Tesla.  They want moonshots too.

  But what’s this?  After hitting $900 on January 25, shares of Tesla have dropped over 30 percent.

  Is this just a short bear market for Tesla before Congress’s new stimmy checks inflate shares to new highs?

  Time will tell.  But we wouldn’t bet the farm on it.

  Tyler Durden
  Sun, 03/07/2021 – 18:00

• Mega Squeeze Coming: Last Week Saw Biggest Hedge Fund Shorting Since May
  Mega Squeeze Coming: Last Week Saw Biggest Hedge Fund Shorting Since May

  Last week was an emotional and P&L rollercoaster for every trader, and even though stocks closed almost unchanged from where they opened, what happened in the past five days was anything but smooth sailing…

  

  …. as the following daily wrap from Goldman’s Prime Service desk reveals.

  Starting Monday, when stocks soared in a relief rally from previous Friday’s tumble as yields stabilized, Goldman prime reported that the GS Prime book “was net bought for a second straight day (+2.1 SDs vs. the average daily net flow of the past year), driven by risk-on flows as long buys outpaced short sales 8 to 1.” Furthermore, “on a cumulative basis, the $ net buying from the past two days (Fri and Mon) was larger than any other two-day period since early November. While Friday’s net buying was driven by short covers in Macro Products, yesterday’s net buying was driven by long buys in Single Names.”

  Remarkably, according to Goldman’s hedge fund facing division, “all regions were net bought led in $ terms by North America and Asia. Asia saw the largest $ net buying in more than two years (+3.8 SDs), driven by long buys in Japan and to a lesser extent short covers in Hong Kong. Meanwhile, just in the US, Goldman says buying outpacing short sales 5 to 1.

  

  All of this changed the very next day when stocks stumbled amid renewed rising rate pressures and just a day after Goldman Prime saw a dramatic surge in buying, whiplash set in with Goldman reporting the “largest global short sales since May” with the GS Prime book was net sold yesterday (-0.9 SDs vs. the average daily net flow of the past year), driven by short sales outpacing long buys 1.7 to 1.” In fact, the mid-week puke wasn’t so much selling as short-selling, as “modest net selling (-0.5 SDs) was driven by short sales outpacing long buys 1.5 to 1.”

  

  The next day was one of confusion, with Goldman Prime reporting that its prime book was modestly net bought “driven by long buys outpacing short sales 1.2 to 1”, although North American markets were not on the buying agenda as “with the exception of North America, all regions were net bought led in $ terms by Europe and Asia.“

  Which brings us to the end of the week, when shortly after the biggest shorting in almost one year by some hedge funds, other hedge funds have decided to go all WallStreetBets on their ass, and start a squeeze, with GS prime reporting that “hedge funds bought the US Mega Caps and Non-Tech Single Names yesterday” as “the GS Prime book was modestly net bought for a second day (+0.5 SDs vs. the average daily net flow of the past year), driven by moderate risk-off flows as short covers outpaced long sales roughly 3 to 1.”

  As GS prime details, the end of the week saw “the first net buying in 3 days (+0.9 SDs) driven by short covers in Macro Products and long buys in Single Names” even as “ETF shorts decreased -0.8% (-1.4% week/week; +24% YTD), driven by covers in Small Cap and Health Care ETFs which outweighed continued shorting in Corporate Bond ETFs. 8 of 11 sectors were net bought – Health Care (long buys > short covers), Real Estate (long buys > short covers), Consumer Disc (long buys > short sales), Consumer Staples (short covers), and Energy (long buys + short covers) were among the most net bought. On the other hand, Info Tech (short sales > long buys), Materials (long-and-short sales), and Industrials (long-and-short sales) were the only net sold sectors.” Curiously, Info Tech stocks – i.e., the biggest winners of 2020 – were net sold for a third straight day. That said, in $ terms the net selling in the sector was ~75% of Wed’s activity and driven by short sales outpacing long buys (i.e., there was no significant long liquidation).

  As a result of the whiplash, Goldman Prime calculates that “fundamental LS managers experienced another worst alpha day since Jan 27th, driven by sell-off in Momentum and Info Tech, and have lost 1.8% of alpha over the past three days.“

  

  What does all of this mean for markets?

  Well, in a week where stocks first spiked then tumbled only to reverse, and where substantial damage was done on HF P&L, immediately after a furious burst of shorting, which has pushed gross short exposure to the highest level since the start of 2020…

  

  … it is likely that the short squeeze we observed on Friday which started with the post-EU close ramp that pushed the EMini higher by over 100 points in 4 hours…

  

  … is about to spread and force even more forced squeezes on Monday especially now that the $1.9 trillion Biden bill has been passed by the Senate. The only thing that could prevent a sharp spike in stocks in the overnight/tomorrow session is another burst higher in yields and bond volatility (MOVE). So keep a close eye on both but absent fireworks, prepare for a continuation of Friday’s meltup as hedge funds – especially Fundamental L/S funds – scramble to close their latest round of shorts, and catch up to their sharplt outperforming systematic peers.

  

  In short…

  Tyler Durden
  Sun, 03/07/2021 – 17:45

• Ethereum Set To Soar As "London" Hard-Fork Gets Approval
  Ethereum Set To Soar As “London” Hard-Fork Gets Approval

  A hotly awaited upgrade to the Ethereum network that lowers the volatility of transaction fees has been scheduled for Ethereum’s next major hard fork.

  

  As Decrypt reports, the upgrade, called EIP-1559 (EIP stands for Ethereum Improvement Proposal), is scheduled to go live in Ethereum’s “London” hard fork this July, and crucially for investors, may result in ETH becoming a deflationary asset.

  EIP-1559 was proposed by Ethereum co-creator Vitalik Buterin and Ethhub co-founder Eric Conner in April 2019 and seeks to implement a fee market and burn mechanism to bring Ethereum’s often-skyrocketing gas fees under control. In December, Buterin again urged Ethereum to adopt EIP-1559.

  

  What is EIP-1559? Decrypt explains…

  EIP-1559 overhauls the way users pay Ethereum’s transaction fees. Currently, fees are paid to miners for processing transactions. 

  The cost of those fees depends on the supply of miners and users’ demand for them. If there’s a bottleneck on the network, miners can charge usurious rates of over $20 per transaction.

  EIP-1559 would replace the supply/demand auction-style system in place today with a standard rate across the network. The fee, called “BASEFEE,” would rise when the market is busy and fall when it’s quiet. 

  The crucial difference is that the fee is set by the network and altered by burning ETH. EIP-1559 means that miners don’t set the rates; the network does.

  And the transaction fees don’t go to miners; they’re burned.

  As Institutional crypto fund manager Grayscale recently noted:

  Some analysis has noted that it may not be necessary to pay fees in Ether, but rather fees could be paid in any digital currency of one’s choosing (or even credit cards). This is known as economic abstraction, and has been used to challenge the value of Ether. Similarly, some have argued that Ether suffers from a working capital or infinite velocity problem — as simply a medium of exchange asset, investors may look to minimize their holdings to only what is necessary to pay for a service, i.e., Ether would be treated as working capital.6 Because investors might look to minimize their working capital, the velocity of Ether would increase and its value according to the equation of exchange, M=PQ/V, would decrease.7 In other words, constant selling would drive down the price of the Ether.

  However, Ethereum plans to implement a proposal known as EIP-1559. Among other things, this proposal would burn (or destroy) Ether that is used to pay for transactions. This is important because it would transform Ether from a medium of exchange asset to a consumable commodity. Ether would become more like combustible gas than money. If this proposal is implemented, it would also ensure that Ether is the native economic unit on Ethereum – protocol rules would dictate that only Ether could be burned. This would reduce the possibility of economic abstraction – the ability to pay fees in an asset besides Ether.

  This burning method may also serve as a deflationary mechanism if the Ether consumed as fuel outpaces the issuance schedule.

  If activity increases and the supply of Ether decreases due to burning, a supply and demand curve would indicate an increase in the unit price of Ether because each unit would need to satisfy a greater proportion of economic activity. If EIP-1559 is implemented, it would institute a consumption mechanism that should serve as a positive feedback loop for Ether’s price.

  As Decrypt reports, Tim Ogilvie, CEO of Ethereum infrastructure firm Staked, told Decrypt that it’s likely to be “positive on the long term price of Ethereum.” Lower and more predictable gas fees, he said, means that Ethereum isn’t just for the rich, encouraging people to build and use the network.

  The upgrade is not without its critics.

  Two of the three largest Ethereum miners are angry that it would dig into their fees, and a further 10 have announced their discontent with the upgrade. 

  “I don’t think miners are going to be long-term winners here. I think they’re gonna fight. But I think there are going to be long term losers,” said Ogilvie. Ethereum 2.0, the long-awaited Ethereum upgrade, transitions the blockchain from a proof-of-work consensus mechanism to a proof-of-stake one. The former rewards miners for processing transactions, the latter rewards people who hold lots of Ethereum. 

  “I think this is close to existential for a mining business,” said Ogilvie. “And so I think they’re going to take the strongest actions they can. How far are they willing to go? I can’t really predict. But I think I think you’re gonna see them fight extremely hard,” he said.

  Ultimately, as CoinTelegraph reports, the proposal is now going forward, putting an end to “selfish” mining practices.

  EIP 1559 “fixes a bug in the economics of Ethereum we’ve known about from the start,” said Tim Beiko, a senior product manager at ConsenSys who’s leading the protocol team implementing EIP 1559, and it’s approval Friday seems to have sparked some relative strength.

  

  “This is probably one of the biggest milestones we’ve seen recently,” Eric Turner, director of research at Messari, a cryptocurrency analytics firm, told Bloomberg.

  Until EIP 1559 goes into effect after being approved Friday, the supply of Ether was theoretically infinite, leading to criticism that its underlying monetary policy was weak and inflationary.

  “Now, they’re actually controlling inflation on Ethereum” and “in some cases you’re looking at negative inflation so it’s definitely important,” Turner added.

  

  As Grayscale concludes, between the enormous amount of activity on Ethereum, the economic improvements to Ether, and the promise of increased scalability with Ethereum 2.0, there is a lot for the Ethereum community to be excited about.

  Tyler Durden
  Sun, 03/07/2021 – 17:30

• Morgan Stanley: 3 Reasons Why The Correction Has Further To Go Before It’s Over
  Morgan Stanley: 3 Reasons Why The Correction Has Further To Go Before It’s Over

  By Michael Wilson, Morgan Stanley chief US equity strategist

  The Moment of Recognition

  It’s hard to believe a year has passed since the lockdowns first began. The good news is there appears to be light at the end of the tunnel, with case counts and hospitalizations plummeting. At the current pace of vaccinations and with spring weather right around the corner, several health experts are talking about herd immunity by April.

  Meanwhile, Congress is putting the finishing touches on another fiscal stimulus which may top US$1.5 trillion. When combined with the progress on the virus, it’s hard not to imagine an economy that’s on fire later this year. Finally, earnings results for 4Q proved to be spectacular, with the median company in the S&P 500 reporting double-digit year-on-year EPS growth. In short, the recession is effectively over.

  With all this good news, why have equity markets struggled for the past few weeks? In my view, it’s really not that complicated, or surprising.

  • First, with all the good news noted above, 10-year yields finally caught up to other asset markets. This is putting pressure on valuations, especially for the most expensive stocks that had reached nosebleed valuations.
  • Second, value-oriented stocks in the sectors that are not egregiously priced, and most levered to the economic rebound, are holding up just fine, or rising.
  • Third, this is not how most portfolios are positioned. Instead, most are overexposed to growth stocks and either short or underweight the value areas. Such portfolio disruption is causing some repositioning, which is having a net negative effect on the major averages, led by the Nasdaq.

  

  I thought the correction at the end of January was the beginning of something more meaningful. Instead, most indices roared back one last time before this more sustainable correction ensued. It’s likely a continuation as many high-flyers never made a new high in February and are now leading on the downside.

  Three things tell me this correction has further to go before it’s over:

  1) The non-linear move in 10-year yields has awoken investors to a risk they thought was unlikely, if not impossible. So, while the Equity Risk Premium (ERP) held constant during this rate move as we expected, it may now move higher in anticipation of the next 50bp jump in rates. In other words, the equity market now knows the 10-year yield is a “fake” rate that either can’t or won’t be defended. To that end, the Fed did expand its balance sheet by US$180 billion in February, 50% greater than its target. Yet, rates surged higher. Markets lead the Fed, not the other way around, and we are now at that moment of recognition.

  2) March represents the anniversary of the market crash last year. This means there will be a big shift in the top and bottom quintiles of 12-month price momentum by the end of this month. Most of the stocks going into the top momentum quintile are value and cyclical stocks like banks, energy and materials – areas we like. Conversely, many of the stocks moving out of the top quintile are tech and other high-growth stocks – areas we don’t like at current prices. We started writing about this coming momentum composition change back in December as a potential risk and opportunity (Exhibit 1). Part of the rotation from growth to value has been due to better relative fundamentals, as the economy recovers, and cheaper valuations. However, as these value stocks move into the top quintile of price momentum and growth stocks move out, the rotation might accelerate even further. This could be quite disruptive to portfolios and lead to another round of deleveraging like in January.

  

  3) Based on the technical damage to date, the Nasdaq 100 appears to have completed a head and shoulders top and should test its 200-day moving average (-8%).

  Finally, everything that’s going on now should be expected at this stage of a recovery from recession. After the big initial surge, the stock market tends to consolidate as interest rates rise and P/Es compress. This is why our year-end target of 3900 for the S&P 500 is toward the lower end of most sell-side strategists.

  The bull market continues to be under the hood, with value and cyclicals leading the way. Growth stocks can rejoin the party once the valuation correction and repositioning is finished.

  Tyler Durden
  Sun, 03/07/2021 – 17:00

• Brace For Oil Surge: Saudi Oil Tank In Ras Tanura Port Hit In Houthi Drone Attack
  Brace For Oil Surge: Saudi Oil Tank In Ras Tanura Port Hit In Houthi Drone Attack

  It’s not as if oil – the best performing class of 2021 – behind bitcoin of course – needed any more reasons to surge higher (for the latest tally please read “Saudis + Commodity Funds = Energy Stock Explosion“), but it got it moments ago when Saudi Arabia said that it had intercepted missiles and a barrage of drones launched from neighboring Yemen and which targeted Dhahran, where Saudi Aramco, the world’s biggest oil company, is headquartered, which eyewitnesses said was rocked by an explosion.

  According to Bloomberg which quotes witnesses on the ground, the blast shook windows in Dhahran, which hosts a large compound for Aramco employees.

  

  While Bloomberg was cautious with reporting of what had happened, Saudi journalist Ahmed al Omaran who previously worked with the FT, said that “Saudi oil tanks in Ras Tanura Port hit in drone attack and Aramco facilities targeted with ballistic missile” quoting an energy ministry statement“

  Saudi oil tanks in Ras Tanura Port hit in drone attack and Aramco facilities targeted with ballistic missile —energy ministry statement https://t.co/KttTG8DHc1

  — Ahmed Al Omran (@ahmed) March 7, 2021

  https://platform.twitter.com/widgets.js

  An official spokesman at the Ministry of Energy said that “one of the petroleum tank farms at the Ras Tanura Port in the Eastern Region, one of the largest oil shipping ports in the world, was attacked this morning by a drone, coming from the sea”

  Yemen’s Houthis claimed a series of attacks on Sunday including on a Saudi Aramco facility at Ras Tanura in the east of the kingdom. The group launched eight ballistic missiles and 14 bomb-laden drones at Saudi Arabia, a spokesman for the Houthis, Yahya Saree, said in a statement to Houthi-run Al Masirah television.

  “There are reports of possible missile attacks and explosions this evening, March 7, in the tri-city area of Dhahran, Dammam, and Khobar in Saudi Arabia’s Eastern Province,” the U.S. consulate general in Dhahran said in a statement.

  According to a statement from a spokesman at the Saudi Energy ministry, “the attacks did not result in any injury or loss of life or property.” In his statement, the spokesman stressed that “the Kingdom condemns and criminalizes such repeated acts of sabotage and hostility. The Kingdom calls on nations and organizations of the world to stand together against these attacks, which are aimed at civilian objects and vital installations”

  As Bloomberg reports further:

  The Houthis have stepped up assaults on Saudi Arabia and last week claimed it hit a Saudi Aramco fuel depot in Jeddah with a cruise missile. It wasn’t clear how much damage had been caused. While such assaults rarely result in extensive damage, their frequency has created unease in the Gulf, a region key to global oil production.

  Earlier on Sunday the Saudi-led coalition said the Iran-backed Houthis had fired projectiles at the kingdom and said a U.S. decision to revoke their terrorist designation had fueled rising attacks. It said had carried out retaliatory air strikes on Yemen’s capital, Sana’a, targeting the Houthis it has been battling for six years.

  Needless to say, ignore the diplomatic BS, and keep in mind that everything the Houthis do when it comes to “attacks” on Saudi territory and especially Aramco facilities is known well in advance by Riyadh.

  And since today’s attack will likely send Brent surging once it reopens for trade in a few hours, our only observation on the matter is that shortly after shocking the world by extending production limits in last week’s OPEC+ meeting, it now appears that Saudi Arabia is indeed hell bent on getting the black gold to hit triple digits as fast as possible…

  Saudis really want 100 oil.

  — zerohedge (@zerohedge) March 7, 2021

  https://platform.twitter.com/widgets.js

  … especially since Saudi Arabia knows mothballed US shale production will take months if not longer to get back online and renew downward pressure on oil prices.

  Tyler Durden
  Sun, 03/07/2021 – 16:55

• Urban Dictionary Bans "Blue Anon" Entry Defining Liberal Conspiracy Theorists; Google Censors Search
  Urban Dictionary Bans “Blue Anon” Entry Defining Liberal Conspiracy Theorists; Google Censors Search

  The Urban Dictionary, which allows users to submit virtually any phrase with any definition, has removed a reference to “Blue Anon” – a new phrase mocking leftists for their belief in right-wing conspiracy theories, “such as the Russia Hoax, Jussie Smollett hoax, Ukraine hoax, Covington Kids hoax, and Brett Kavanaugh hoax.“

  

  The move comes just 24 hours after journalist Jack Posobiec pointed out the Blue Anon entry to his more than 1 million Twitter followers:

  Ladies and gentlemen, we did it pic.twitter.com/AFzdDbKXlV

  — Neanderthal Scholar Poso (@JackPosobiec) March 6, 2021

  https://platform.twitter.com/widgets.js

  And now:

  I have never even heard of a word being banned from @UrbanDictionary before they banned Blue Anon pic.twitter.com/MdwhTzXeGA

  — Neanderthal Scholar Poso (@JackPosobiec) March 7, 2021

  https://platform.twitter.com/widgets.js

  As the Post Millennial writes of Blue Anon:

  The definition of “Blue Anon” is “a loosely organized network of Democrat [v]oters, politicians and media personalities who spread left-wing conspiracy theories.”

  It goes on to say, “Blue Anon adherents fervently believe that right-wing extremists are going to storm Capitol Hill any day now and “remove” lawmakers from office, hence the need for the deployment of thousands of National Guard stationed at the US Capitol.”

  Blue ANON exists.

  Q doesn’t.

  — Kurt Schlichter (@KurtSchlichter) March 6, 2021

  https://platform.twitter.com/widgets.js

  And as journalist Ian Miles Cheong notes – as did we while researching for this report, Google appears to be censoring searches for Blue Anon.

  Google censored searches for Blue Anon.

  — Ian Miles Cheong (@stillgray) March 7, 2021

  Quite a difference between searching Google and DuckDuckGo for “Blue Anon” #blueanon pic.twitter.com/zWorxETbnV

  — RyeLibertarian (@RyeLibertarian) March 7, 2021

  https://platform.twitter.com/widgets.jshttps://platform.twitter.com/widgets.jsHere’s a thread defining “Blue Anon” beliefs:

  “Brett Kavanaugh is a gang rapist”https://t.co/a7pzG8Vuok

  — Max Nordau (@MaxNordau) February 2, 2021

  https://platform.twitter.com/widgets.js

  “Trump committed felony obstruction 10 times to hide his collusion with Russia”

  Another good suggestion, though this is just a corollary to the “Trump is a Russian asset” conspiracy theory.https://t.co/AvTJCV80D2

  — Max Nordau (@MaxNordau) February 2, 2021

  https://platform.twitter.com/widgets.js

  The entire Steele Dossier!

  There are people who still believe that the Pee Tape is real.https://t.co/aVjvc0b8Ed

  — Max Nordau (@MaxNordau) February 2, 2021

  https://platform.twitter.com/widgets.js

  Russian bounties, forgot about that one. Still never actually confirmed, even though @JeffreyGoldberg promised that sources would come forward soon.https://t.co/IwVPPvfIoO

  — Max Nordau (@MaxNordau) February 2, 2021

  https://platform.twitter.com/widgets.js

  The pivot from “Mueller’s got him” to “Of course Mueller didn’t get him; he couldn’t” was very fast.https://t.co/LXDLaDsark

  — Max Nordau (@MaxNordau) February 2, 2021

  Click into @MaxNordau’s thread to read more.

  https://platform.twitter.com/widgets.js

  Tyler Durden
  Sun, 03/07/2021 – 16:30

Digest powered by RSS Digest

• Kissinger: Biden Must Uphold Trump Administration's "Brilliant" Policy In The Middle East
  Kissinger: Biden Must Uphold Trump Administration’s “Brilliant” Policy In The Middle East

  Authored by Katabella Roberts via The Epoch Times,

  Former secretary of state Henry Kissinger has advised President Joe Biden’s administration to continue to uphold the “brilliant” policy in Middle Eastern politics achieved under the Trump administration.

  

  Kissinger, who was secretary of state under the Nixon and Ford administrations, made the remarks during a seminar from the Richard Nixon Foundation focused on national security and foreign policy on March 3.

  Former secretary of state Mike Pompeo, former national security adviser Robert O’Brien, Rep. Mike Gallagher (R-Wis.), and former deputy national security adviser Matt Pottinger also participated in the seminar.

  Kissinger likened Donald Trump’s diplomatic achievements in the Middle East to Nixon’s opening of China in 1972, and warned that the Biden administration should continue the tough Trump policy on Iran.

  He also called the Trump administration’s Abraham Accords a breakthrough in Arab-Israeli relations.

  “I think that one of the great successes of the previous administration was that they had lined up, that they had achieved two things in the Middle East,” Kissinger said.

  “One, to separate the Palestinian problem from all of the other problems so that it did not become a veto over everything else.

  He added:

  “Secondly, of lining up the Sunni states in actual or potential combination against the Shiite states, which is Iran, that was developing a capacity to threaten them. I think that this was a brilliant concept. We were just at the beginning of it.”

  The Abraham Accords, brokered by former President Donald Trump, established new cooperation and normalization between the United States, Israel, and Arab countries such as the United Arab Emirates (UAE), Sudan, and Morocco.

  

  (L-R) Bahrain Foreign Minister Abdullatif al-Zayani, Israeli Prime Minister Benjamin Netanyahu, U.S. President Donald Trump, and UAE Foreign Minister Abdullah bin Zayed Al-Nahyan hold up documents after participating in the signing of the Abraham Accords where the countries of Bahrain and the United Arab Emirates recognize Israel, at the White House in Washington on Sept. 15, 2020. (Saul Loeb/AFP via Getty Images)

  It also opened up economic, social, and cultural ties between the Arab world and the Jewish state and strengthened the Gulf states’ and Israel’s defenses against Iran, earning the former president Nobel Peace Prize nominations.

  “This was a brilliant concept. We were just at the beginning of it. It was like the beginning of the China opening. The evolution of it was just beginning,” Kissinger said.

  Kissinger urged the Biden administration to uphold the current policy in the Middle East cemented by Trump.

  “We should not give up the pressures that exist on Iran until we know where they are heading,” Kissinger said.

  “If we break out the Iranian issue from the overall Middle Eastern issue, we run the risk of losing the two achievements, namely of separating the Palestinian issue, which removes it as a veto over everything else, and the Sunni cooperation with Israel, which is unique in its openness.”

  Elsewhere during Wednesday’s seminar, Former secretary of state Mike Pompeo likened Trump’s “unique” approach to international affairs and foreign policy to President Nixon’s.

  

  Former Secretary of State Mike Pompeo addresses the Conservative Political Action Conference held in the Hyatt Regency in Orlando, Fla., on Feb. 27, 2021. (Joe Raedle/Getty Images)

  “This was a president that came at foreign policy problems in a unique way,” he said of Trump.

  “I wanted to make sure the senior people, at least I brought around to the team, understood the environment which we were going to be working in and how we were going to effectively deliver operationally President Trump’s foreign policy. So, I wanted to make sure—while we know Washington is occupied by a lot of folks and a lot of big egos—there were people who were prepared to make sure they were working as part of the team that President Trump wanted to deliver on foreign policy he had put forward to the American people.”

  The United States on Feb. 25 launched airstrikes against militants in eastern Syria, targeting sites connected to Shia militias groups backed by the Iranian regime believed to be involved in recent attacks against U.S. targets in Iraq.

  Biden has also announced that the United States is rejoining or moving to rejoin the pact with Iran, the Paris climate accords, and the United Nations’ Human Rights Council, among other international agreements or entities.

  Tyler Durden
  Sat, 03/06/2021 – 23:30

• Robocop? Las Vegas Apartment Complex Deploys Human-Sized Robot To Fight Crime 
  Robocop? Las Vegas Apartment Complex Deploys Human-Sized Robot To Fight Crime 

  It was inevitable that security robots would one-day patrol low-income neighborhoods around the clock to ensure everyone was abiding by the rules. This dystopic future is becoming a reality for one apartment complex in Las Vegas. 

  Robotics maker Knightscope deployed a human-sized autonomous robot to a noisy northeast Las Vegas Valley apartment, said the Las Vegas Review-Journal. “Westy” has been patrolling Liberty Village Apartments near Craig Road and Lamb Boulevard since October 2020. 

  

  Westy employs an array of cameras, four in total, along with facial recognition technology, license plate reading, verbal warnings, and internet connectivity to human security officers if an incident occurs. 

  “It’s been very useful in several ways,” said complex manager Carmen Batiz.

  “It can advise people when they are out past the 10 p.m. curfew, and the four video cameras tend to make people avoid it. When we have vandalism reports, we can go through the video and get a time frame of when it happened. It has a button so people can get human help quick in an emergency.

  “People don’t want to get caught on the cameras so they will avoid it,” Batiz said.

  Liberty Village Apartments was one of the top three northeast Las Vegas residential living areas for 911 calls. Many of the folks are working-poor Americans, situated in an area known for crime and vandalism. 

  Westy has had some success over the last several months as 911 calls have dropped and crime is lower. Batiz said, “We have eight other properties, and we’re going to bring on more robots, and even the Wynn had people come check it out.”

  “Every resident has the right to live in a crime-free, safe and clean environment, and Westy helps contribute to that,” said Batiz.

  Here’s KSNV News 3 Las Vegas’s report on ‘robocop’ as it patrols the apartment complex 

  More or less, private companies who manage residential multi-family complexes are resorting to automation and artificial intelligence to deter violence, theft, and murders as the post-pandemic world become a more dangerous place. 

  Changes are coming to metro areas as well. The working-poor will feel more oppressed as big brother will continue to monitor their every move through innovative ways such as human-sized autonomous robots. 

  It’s only a matter of time before local governments and municipalities, and even state governments employ fleets of human-sized autonomous robots to maintain law and order. 

  We should remind readers NYPD’s Boston Dynamics robot dog for ground surveillance of low-income neighborhoods is already underway… 

  What’s next is the unveiling of predictive policing via artificial intelligence that will monitor low-income neighborhoods if there’s a potential flare-up in a crime or social disobedience. Maybe by that time, the Federal Reserve could instantly reload people’s bank accounts in those troubled areas with Fedcoin (digital US dollars) to keep the impoverished at bay. 

  Tyler Durden
  Sat, 03/06/2021 – 23:00

• When IBM Was The Center Of Gravity
  When IBM Was The Center Of Gravity

  By Byrne Hobart of The Diff substack

  When IBM Was The Center Of Gravity

  Learning about IBM in the context of the early history of the computer industry has the same shock value as watching Star Wars: A New Hope for the first time: “That’s no moon. It’s a space station.”

  Consider:

  • In 1953, UNIVAC was basically the only company selling computers commercially. By 1956, IBM’s market share in computers was 85%.

  • In the late 70s and early 80s, after several industry transitions, the entry of smaller and more agile competitors like DEC and Control Data as well as larger and more resourceful ones like GE and Exxon, IBM’s market share was still 70%.

  • IBM “bet the company” on one product in the 1960s, with a total budget that exceeded twice the cost of the Manhattan Project. In this time, they didn’t report a loss, and they didn’t even report a sequential decline in annual earnings.

  • In fact, IBM reported positive annual earnings growth every year from 1952 through 1979.

  In “Adam Smith”‘s wonderful book, The Money Game, the concept of a growth stock is illustrated with a five-year table of some high growth companies’ earnings per share; IBM is at the top of the list. More interesting is an earlier section on investor psychology, which has a bit called “IBM as Religion: Don’t Touch, Don’t Touch.” It’s a story about someone who invests in IBM’s predecessor, Computing-Tabulating-Recording Company, and holds the stock for his entire life. His $20,000 becomes millions of dollars, and he insists that his heirs never sell the stock. They don’t, and they make the same stipulation to their heirs. One reason for the company’s marvelous performance is, of course, that it retains most of its earnings and pays low dividends. When he dies, the stock is split up between his heirs, who also hold and never sell, and who also end up as millionaires, as do their heirs. But the dividends remain modest:

  In short, for three generations the Smiths have worked as hard as their friends who had no money at all, and they have lived just as if they had no money at all, even though the various branches of the Smith family all put together are very wealthy indeed. And the IBM is there, nursed and watered and fed, the Genii of the House, growing away in the early hours of the morning when everyone is asleep.. It is a parable of pure capitalism, never jam today and a case of jam tomorrow; but as any of the Smiths will tell you, anyone who has ever sold IBM has regretted it.

  How did IBM get so dominant? How did “Nobody ever got fired for buying IBM,” become a catchphrase among corporate IT buyers and investors? And what changed?

  Origins: Promoters and Punch-cards

  In 2021’s SPAC-saturated financial universe (and in light of the last few weeks’ SPAC drawdowns), it’s interesting to note that IBM was born as an act of financial engineering. In the early 1900s, the market was enamored by trusts, and promoters realized that merging a few semi-related companies together could create a combined entity that was a) big enough to issue stock, and b) could tell a plausible story that it would monopolize its industry. (Monopolies were technically illegal, but in practice weren’t heavily prosecuted. The existence of the Sherman Antitrust Act told investors that a monopolist could charge exploitative prices; its lax enforcement told them that it wouldn’t be shut down for this reason.)

  Charles Flint was one of many stock promoters who merged together small companies and took them public. In 1911, he cobbled together a new firm called Computing-Tabulating-Recording Company. CTR was an odd mix, including an industrial scale manufacturer, a company that made timecards for hourly workers, and The Tabulating Machine Company. The last was a quirky niche product: founded by a German inventor, Herman Hollerith, it built mechanical devices that could tabulate information if it was encoded on punched cards. The company had only a handful of customers; railroads, for example, could save money and better track their business using punched cards. The company’s most important client was the US Census, but one big contract every ten years did not indicate much business potential.

  As it turns out, the company made one other key acquisition: hiring Thomas J. Watson as President. Watson had a somewhat mixed reputation: he’d worked for National Cash Register, a company that was famous for rapid growth, technical sophistication, and an excellent sales organization. On the other hand, he’d been recently convicted of antitrust violations for some of his work at NCR, and faced jail time. Flint, perhaps operating on the assumption that he’d sell out of the stock before the case was fully resolved, hired Watson anyway.

  Watson had a natural flair for sales and strategy, and had developed his sales technique at NCR. NCR deployed armies of salespeople, held them all to strict personal standards (good grooming, no alcohol consumption whatsoever), and used this standardized approach to scale fast. Watson’s CTR adopted the same model, and even borrowed some of the same mottos:

  

  One realization Watson came to was that CTR was a clunky name, and, as trusts went out of fashion, was sending the wrong signal to the market (and to the FTC). So, in 1924, he renamed the company International Business Machines. Watson also insisted on reinvesting in the business, even though other executives like board chairman George W. Fairchild were more concerned with maintaining dividends.

  He came to another important realization about one of those business machines in particular: Hollerith’s punched-card tabulators were more exciting than they looked, especially for an organization that specialized in sales. The machines themselves had unimpressive margins, but making stacks of perforated cardboard and selling them to a captive market was a very high-margin business indeed. And this sticky, high-margin revenue source grew with usage, not just the unit volume of tabulators. If IBM could embed its salespeople in companies, and have them relentlessly THINK about ways to replace clerks with cards (or about new functions that could be economically performed by cards but that wouldn’t be worth an employee’s time), they could continuously grow sales.

  By the 1930s, cards routinely represented a third of sales, and presumably a much larger share of profits. IBM’s sales were flat early in the depression, as cuts in corporate spending were offset by growth in government use. During the Second World War, IBM continued to grow its top line—profits were compressed by higher taxes—but it also reinforced a virtuous cycle. More tabulated data meant more legible data; the Social Security Administration was a big client, but also a client whose existence gave every American a unique numerical identifier, and whose implementation meant that their employers had to track who them employed and how much each one was paid. Heavy war spending required more data tracking, and this meant that manufacturers also needed to invest in business machines to meet their end of the bargain.

  Even later, when IBM was less dependent on cards, it liked the model of having a long tail of revenue. As IBM evolved, it preferred to lease its products rather than sell them, and to offer peripherals that would increase revenue per customer. Even after cards were irrelevant, a card-like model was a core part of IBM: each year, they started with a baseline of high-margin recurring revenue from existing clients. New sales would just add to that sum.

  Dominance

  IBM was not the first company to build computers, although Thomas Watson Jr., who took over from his father in 1952, was certainly interested in them. Sperry-Rand’s subsidiary UNIVAC (which survives today as Unisys) introduced the first commercially successful computers in the early 50s.

  IBM had the largest R&D department of the business machines industry in the 40s and 50s, and Watson had read Norbert Wiener’s Cybernetics. IBM quickly caught up, and had dominant market share in computers by the late 1950s. Some of this was because of their research—they were able to introduce cost-competitive computers a few years after UNIVAC. And a lot of it was because of their sales organization: IBM sales reps didn’t have to introduce themselves to potential corporate customers, who had been buying other IBM products for years or possibly decades.

  IBM added another tactic around this time, which would be called “paper machines” then and “vaporware” today: if a competitor’s product was selling well because it reached a price or market segment that IBM didn’t touch, the company wouldn’t hesitate to announce a competing product (and start taking orders for it) long before it was available. Meanwhile, IBM kept news about upgrades to its existing products well-hidden.

  This sort of behavior led to one of what would be a long series of unpleasant interactions with the Justice Department, leading to a decree in 1956 that required IBM to divest some of its punched-card business and start selling as well as leasing computers. This is an early case study of a common phenomenon: antitrust cases take so long—in part because the companies being sued are not especially cooperative—that by the time they’re resolved, the industry has changed, and the remedies don’t have much of an impact. IBM had to divest a rapidly-shrinking segment that was quickly being rendered obsolete by the company’s other products.

  It’s hard to overstate how powerful IBM was in the computer industry by this time. A big order from IBM revived Texas Instruments’ fortunes in the late 50s, for example, and every computer company worried that if their product worked too well for too long, it was only a matter of time before an army in a uniform of starched white shirts, blue suits, clean shaves, and high quotas was marching on their customers and offering a more expensive, but much more defensible, choice.

  Both IBM and its competitors acknowledged that the company excelled at sales. As the CEO of UNIVAC’s parent company put it:

  It doesn’t do much good to build a better mousetrap if the other guy selling mousetraps had five times as many salesmen.

  And in a revealing comment from Watson, Jr., he once explained that the company’s release cadence was dictated in part by the needs of its sales team:

  You have to keep feeding them new things to keep their morale up.

  One of the biggest New Things IBM fed to its salesmen in the 60s was the 360. This product, announced in 1964 and first sold the next year, was IBM’s most intensive development project in history, costing, according to one estimate, twice as much as the Manhattan Project. The 360 was a series of machines that had compatible code, so customers could easily upgrade from one to the next as they scaled without needing to rewrite their software. It was, in other words, another way for IBM to replicate the negative dollar churn model of the punched card business. IBM needed the 360 in part because its sales team was entirely too good: the people responsible for selling IBM’s low-end machines were cannibalizing the sales of high-end ones by convincing buyers that the more affordable option could handle all of their needs. While the 360 represented a technological advance, it was partly an organizational one—a way to give the company a strict hierarchy of products and use cases so it could charge what the market would bear. IBM had to repeatedly turn to the capital markets to fund this, although the company kept reporting growing profits throughout the development process.

  The launch of the 360 represents Peak IBM in terms of influence and ability to shape markets, although their financial peak was a long way off. IBM’s computers were so successful that they spawned two separate ecosystems: the first “IBM compatible” devices were produced in the 1950s, when smaller manufacturers sold peripherals that functioned alongside IBM machines.

  More worrisome for the company was the trend of computer leasing companies, whose business model was straightforward: IBM depreciated its computers over five years, and priced them accordingly. Leasing companies depreciated computers over ten years, and were able to undercut IBM and report (accounting) profits doing it. These leasing companies would have slightly worse cash flows than IBM, since their higher reported profits entailed a higher tax burden. But they were able to show good profits, and as long as they grew fast enough, any misguided optimism about the useful life of a computer would be hidden. (If a leasing company grows its assets 50% each year, and the IBM depreciation number is correct, then the computers they start to write down in year six are just a fifth of assets, and they’ve had five years of profitable growth before then.) Paradoxically, the leasing companies (some of which were much hotter stocks than IBM in the 60s) were a bet on growth but against technology. An investor buying IBM instead of Leasco was betting that the 360 was not the last word in computing (and that whatever the last word was, it would be spoken in the vicinity of Armonk, New York). A buyer of Leasco was implicitly claiming that the computer trend had been an interesting one, and had fully run its course by the mid-60s, with deployment rather than new technology as the main source of growth.

  In a sense, the company painted itself into a corner: by creating a new standard, and ensuring that future releases would be backwards-compatible, IBM plausibly did increase the useful life of its computers. The company could either cut leasing rates (which would cut into revenue) or accept that its model was shifting from leasing computers to customers over to selling them to middlemen.

  IBM did adjust its pricing, but this entailed still more problems.

  Decline

  In 1968, Control Data accused IBM of assorted antitrust violations, which the US government followed up on the next year. IBM spent over a decade in litigation, hiring armies of lawyers and producing millions of documents. (The joke at the time was that the real winner of the case was Xerox.) The case ran on long enough that IBM could accurately argue that more than half of the companies that accused it of anticompetitive behavior had been founded after the original lawsuit was filed. Some companies bet their future on IBM in yet another way; the CEO of one company, Calcomp, joked that his company’s most valuable asset wasn’t patents, equipment, or employees, but their ongoing lawsuit against IBM.

  The suit was ultimately dropped, but IBM’s defense was all too accurate: the computer business was getting too competitive, and other companies were adapting faster than IBM itself was. Over the course of the 70s, IBM’s annual profits still tripled, but by the end of the decade, the stock hadn’t gone up at all.

  The story of IBM’s long-term collapse was not the result of any one decision; if there was one bad decision, it was the way they structured their MS-DOS deal, which allowed Microsoft to license it to other PC manufacturers. But that choice was more symptomatic. IBM’s sales centric approach naturally assumed a slower industry cadence than the one that developed in the 80s. Rapid growth in low-end computers reduced the relevance of their competitive advantage in large-scale, long-term deals, and as those computers got more powerful, software started to matter more. A pure software company has higher margins, and thus more ability to take risky bets, than a software-and-hardware company, particularly one that’s constantly adjusting its overhead in light of lower and lower market share.

  IBM was the most profitable company in America in 1985, but by the early 90s, IBM was losing money. It reported what was then a record annual loss for any US corporation in 1992. The company eventually stabilized, by divesting some money-losing businesses and focusing more on corporate clients. (It also started to focus more on buybacks, even though an early buyback program in the 80s was one reason IBM was somewhat capital-constrained at the dawn of the PC era.)

  It’s exceptionally hard for a company to adjust to no longer dominating its industry. That’s especially difficult when the nature of the industry changes; caring about PCs was low-status relative to worrying about mainframes until the growth of the PC market was impossible to ignore.

  Relative to the other stories of compounders-gone-bad, IBM ends up being the most impressive of the lot. It had an incredible stretch of nonstop growth, and that stretch started after the company pivoted from one sector it was influential in, punched-card machines, to a completely new one it had to catch up in. IBM’s ability to keep growing while disrupting itself, and juggling antitrust restrictions, is simply astounding. While it’s not nearly as influential as it once was, there was indeed a good reason that, for a very long time, nobody got fired for buying IBM.

  Tyler Durden
  Sat, 03/06/2021 – 22:30

• New York Exodus Sparks Buying Frenzy For Greenwich Mansions
  New York Exodus Sparks Buying Frenzy For Greenwich Mansions

  What happens when thousands of New York millionaires suddenly realize their hometown has gone back in time to the 1970s in terms of both crime and taxes, and it is finally time to get the hell out? Why neighboring Greenwich, long an enclave for the ultra rich, throws a party.

  After years of stagnant demand growth for its multi-million dollar mansions as a result of the secular decline of in “active” asset management, the hedge fund capital of the world is having a real estate renaissance. And it only took a pandemic.

  According to a new report from Miller Samuel and brokerage Douglas Elliman, In February, 14 contracts were signed to buy single-family houses priced at $5 million to $9.99 million, a 600% jump from just two a year earlier, before Covid-19 swept across the U.S., Bloomberg reports. It wasn’t just the ultra luxury segment enjoying the influx: the report found that across all price points, single-family contracts in the posh Connecticut town soared 157% to 108..

  

  Those with a taste for the ultra-luxury have turned their attention to Greenwich’s older estates outside the town center, which had fallen out of favor in recent years. Two homes listed at $20 million or more found buyers last month, compared with none in February 2020.

  With most people still working from home, “the location of the office is not holding you back,” Scott Durkin, president of Douglas Elliman, said in an interview. “The whole family can live there, work there, play there, educate there.”

  One reason prices are soaring is the plunge in supply: new listings for single-family houses dropped 23% from a year earlier as Greenwich’s homeowners stay put.

  “They’re not selling,” Durkin said. “They have an apartment in Manhattan, they have a home in Greenwich and they have a home in South Florida.”

  The suddenly tight inventory of single-family houses in Greenwich has forced buyers to move fast and often pay above list price.

  As Bloomberg notes, this is yet “another sign that well-off New Yorkers tired of being confined to tight quarters during the pandemic are seeking relief among the backyards and spacious homes of the city’s nearby suburbs.”

  Of course, all those millions who would also like to flee the Big Apple but don’t have the funds to do so are stuck, ensuring that New York’s descent into socialist paradise started by mayor Bill de Blasio is only just starting.

  Tyler Durden
  Sat, 03/06/2021 – 22:00

• Iranian Militia Group Claims to Have Active Cells in Washington DC: Report
  Iranian Militia Group Claims to Have Active Cells in Washington DC: Report

  By the Epoch Times

  A Telegram channel affiliated with Iran-backed militia groups in Iraq posted in English claiming to have a resistance cell with the capacity to target American troops inside the United States, according to a report.

  “The axis of resistance today is stronger than before. Resistance cells are rooted even in America and its capital,” read the alleged social media post, according to the Middle East Media Research Institute, which posted a screenshot of the message.

  The post, which included a casket containing American soldiers, was made by the Kawtheryoon Electronic Team, a Telegram network that is said to be used by Iranian militia groups and supporters.

  

  The Epoch Times has reached out to the Department of Defense regarding the post’s claims.

  The Telegram channel post also claimed that terror factions associated with Iran are growing ever stronger and gaining more support, while it called on U.S. forces to withdraw from not only Iraq, but the Middle East entirely.

  The group also appeared to threaten Israel, referring to it as the “Zionist enemy,” saying “I will summarize for you in words only the horror of the south, which is stronger than before, and we have thousands of men like Imad Mughniyeh.” Mughniyeh is believed to have been the Iran-aligned Hezbollah chief of staff in Lebanon.

  “Do not think that you and the Americans, by killing Qassem Soleimani and Abu Mahdi al-Muhandis, will survive the torment of the resistance,” the post added, referring to the Iranian commander and the Iraqi militia commander who were killed in an airstrike last year. “We lie in wait for you evil (sic) and the next thing is worse.”

  Last week, President Joe Biden warned that Iran cannot act with impunity and warned the state to “be careful” when asked what message he was sending the country with the U.S. airstrikes in Syria.

  “You can’t act with impunity. Be careful,” Biden told reporters in Texas.

  The United States carried out airstrikes authorized by Biden against facilities belonging to Iranian-backed militia in eastern Syria on Thursday, in response to rocket attacks against U.S. targets in Iraq.

  Tehran has denied being behind recent attacks, whether those in Iraq, against shipping in the Gulf, or on Saudi installations by Yemen’s Iran-backed Houthis.

  On Wednesday, rockets were again fired at an Iraqi base that holds U.S. troops, according to U.S. and Iraqi officials. The Pentagon stated the missile defense system at the Al Asad airbase “engaged in defense of our forces” before adding: “We extend our deepest condolences to the loved ones of the individual who died.”

  Tyler Durden
  Sat, 03/06/2021 – 21:30

• "Profiteering Off Poverty" – The Side Of Baltimore The Media Won't Show You
  “Profiteering Off Poverty” – The Side Of Baltimore The Media Won’t Show You

  Before President Trump and Republicans focused their energy on Baltimore City, showing how decades of liberal-run leadership transformed the once-thriving metro area into a “hell-hole,” readers may recall our reporting (see: here & here & here) showed a side of Baltimore that many hardly knew, except if they watched the crime series “The Wire.” 

  From the opioid epidemic to homicides to gang warfare to violent crime to failing infrastructure to abandon rowhomes to massive wealth inequality – we were some of the first to shed light on the side of Baltimore traditional media never wanted you to see. 

  Picking up the torch is Daily Caller’s Caity McDuffee, who walked the streets of Baltimore with former congressional Republican nominee (MD-District 7) Kimberly Klacik. 

  Klacik famously said during the 2020 election season: 

  “Democrats don’t want you to see this. They’re scared that I’m exposing what life is like in Democrat-run cities. That’s why I’m running for Congress Because All Black Lives Matter Baltimore Matters And black people don’t have to vote Democrat.”

  McDuffee spoke with Klacik and her campaign manager, Markus Trend Anderson, both explained how “all around Baltimore” there are thousands of vacant homes. He said most of the federal money designated for these neighborhoods never hits the streets. 

  

  The reporter then spoke with a local paster by the name of Rodney Hudson, who said the whole system is corrupt. He said it’s not just the school system that is broken, it’s families, the economy – and “the entire community” – it’s all broken.

  Around the 3 minute mark, Klacik points out that balloons tied to things on the city street usually mean someone was murdered at that spot. On a per-capita basis, Baltimore is one of the most dangerous metros areas in the country. 

  At the 5 minute mark, Hudson told McDuffee that people are “profiteering off the poverty” across the city. 

  Klacik’s campaign manager ends with the notion that many people on the streets “don’t want to sell drugs,” but when there are “no career-based opportunities,” – then their only option is to sell drugs. 

  None of this should be surprising to readers who have followed our commentary over the years. Actually, we’ve provided some of the best insight into the chaos unfolding in Baltimore after the 2015 riots.  

  After listening to us chatter about the Baltimore subject – some questions should be swirling around your head on how to fix this mess. Well, it sure as hell won’t be universal basic income checks – the city needs a plan to start from scratch – start with rebuilding infrastructure, schools, supporting families, and most importantly, provide value-added careers – not service sector jobs like bartending. Baltimore was once an industrial powerhouse – perhaps, the city can thrive again but will take more than a decade to turn around. 

  And one more thing, where is Kevin Plank and his ambitions to transform Baltimore? Maybe he is hiding out at his multi-million dollar horse farm? 

  Watch The Full Video Here:

  Tyler Durden
  Sat, 03/06/2021 – 21:00

• There Is No Such Thing As "White" Math
  There Is No Such Thing As “White” Math

  Via Common Sense with Bari Weiss substack,

  I am not at all qualified to introduce today’s guest writer, Sergiu Klainerman.

  I barely eked out a C+ in high school calculus, while Sergiu is a professor of mathematics at Princeton who specializes in the mathematical theory of black holes. He’s been a MacArthur fellow, a Guggenheim fellow and is a member of the National Academy of Sciences 

  Mathematics allowed a young Sergiu, who came of age in Ceausescu’s Romania, to escape to a world where right and wrong couldn’t be fudged, and, ultimately, to a life of freedom in the United States. Without math, his life quite literally would not have been possible.

  In the piece below he explains how activists are destroying his discipline in the name of progress. Worse, they are robbing poor children of the opportunity to raise themselves up by mastering it — with untold effects on all of us.

  Math, with its seemingly unbiased tools — 2 + 2 always equals 4 — has presented a problem for an ideological movement that sees any inequality of outcome as evidence of systemic bias. The problem cannot be that some kids are better at math, or that some teachers are better at teaching it. Like so much else, the basic woke argument against math is that it is inherently racist and needs to be made antiracist. That is accomplished by undermining the notion of right and wrong answers, by getting rid of the expectation that students show their work, by referring to mathematical testing tools as racist, and by doing away with accelerated math classes.

  If that sounds like a caricature, I urge you to read this whole document, funded by the Bill and Melinda Gates Foundation, which Sergiu writes about below. As the linguist John McWhorter put it in a powerful piece published yesterday: “to distrust this document is not to be against social justice, but against racism.”

  Sergiu wrote me in an email that the situation in his field reminds him of this line from Thomas Sowell:

  “Ours may become the first civilization destroyed, not by the power of enemies, but by the ignorance of our teachers and the dangerous nonsense they are teaching our children. In an age of artificial intelligence, they are creating artificial stupidity.”

  This week, as promised, is education week. Like Shark Week! But dorkier. And, I hope, far more important. This is our first installment.

  

  I’m pleased to publish Sergiu Klainerman:

  In my position as a professor of mathematics at Princeton, I have witnessed the decline of universities and cultural institutions as they have embraced political ideology at the expense of rigorous scholarship. Until recently — this past summer, really — I had naively thought that the STEM disciplines would be spared from this ideological takeover.

  I was wrong. Attempts to “deconstruct” mathematics, deny its objectivity, accuse it of racial bias, and infuse it with political ideology have become more and more common — perhaps, even, at your child’s elementary school.

  This phenomenon is part of what has been dubbed “The Great Awokening.” As others have explained powerfully, the ideology incubated in academia, where it indoctrinated plenty of bright minds. It then migrated, through those true believers, into our important cultural, religious and political institutions. Now it is affecting some of the country’s most prominent businesses.

  Unlike the traditional totalitarianism practiced by former communist countries, like the Romania I grew up in, this version is soft. It enforces its ideology not by jailing dissenters or physically eliminating them, but by social shaming, mob punishment, guilt by association, and coerced speech.

  When it comes to education, I believe the woke ideology is even more harmful than old-fashioned communism.

  Communism had a strong sense of objective reality anchored in the belief that humans are capable of discovering universal truths. It forcefully asserted, in fact, the absolute truth of dialectic materialism, as revealed by its founders Marx, Engels and Lenin. Communist ideology held science and mathematics in the highest regard, even though it often distorted the former for doctrinal reasons. 

  Mathematics was largely immune to ideological pressure, and thus thrived in most communist countries. Being skilled in math was a source of great societal prestige for school children. And it was a great equalizer: those from socioeconomically disadvantaged families had a chance to compete on equal footing with those from privileged ones.

  Like children all over the world, I was attracted to mathematics because of its formal beauty, the elegance and precision of its arguments, and the unique sense of achievement I was able to get by finding the right answer to a difficult problem. Mathematics also granted me an escape from the intoxicating daily drum of party propaganda — a refuge from the crushing atmosphere of political and ideological conformity. 

  The woke ideology, on the other hand, treats both science and mathematics as social constructs and condemns the way they are practiced, in research and teaching, as manifestations of white supremacy, euro-centrism, and post-colonialism.

  Take for example the recent educational program called “a pathway to equitable math instruction.” The program is backed financially by the Bill and Melinda Gates Foundation; it counts among its partners the Lawrence Hall of Science at UC Berkeley, the California Math project, the Association of California School Administrators, and the Los Angeles County Office of Education, among others; and it was recently sent to Oregon teachers by the state’s Department of Education.

  The program argues that “white supremacy culture shows up in the classroom when the focus is on getting the ‘right’ answer” or when students are required to show their work, while stipulating that the very “concept of mathematics being purely objective is unequivocally false”. The main goal of the program is “to dismantle racism in mathematics instruction” with the expressly political aim of engaging “the sociopolitical turn in all aspects of education, including mathematics.”

  In the past, I would have said that such statements should be ignored as too radical and absurd to merit refutation. But recent trends across the country suggest that we no longer have that luxury.

  So let me state the following for the record: Nothing in the history and current practice of mathematics justifies the notion that it is in any way different or dependent on the particular race or ethnic group engaged in it.

  For historical reasons, we often discuss contributions to the field of mathematics from the Egyptians, Babylonians, Greeks, Chinese, Indians and Arabs and refer to them as distinct entities. They have all contributed through a unique cultural dialogue to the creation of a truly magnificent edifice accessible today to every man and woman on the planet. Though we pay tribute to great historical figures who inform the practice of mathematics, the subject can be taught — and often is — with no reference to the individuals who have contributed to it. In that sense it is uniquely universal. 

  Schools throughout the world teach the same basic body of mathematics. They differ only by the methodology and intensity with which they instruct students. 

  It is precisely this universality of math — together with the extraordinary ability of American universities to reward hard work and talent — that allowed me, and so many other young scientists and mathematicians, to come to this country and achieve success beyond our wildest dreams. 

  The idea that focusing on getting the “right answer” is now considered among some self-described progressives a form of bias or racism is offensive and extraordinarily dangerous. The entire study of mathematics is based on clearly formulated definitions and statements of fact. If this were not so, bridges would collapse, planes would fall from the sky, and bank transactions would be impossible.

  The ability of mathematics to provide right answers to well-formulated problems is not something specific to one culture or another; it is really the essence of mathematics. To claim otherwise is to argue that somehow the math taught in places like Iran, China, India or Nigeria is not genuinely theirs but borrowed or forged from “white supremacy culture.” It is hard to imagine a more ignorant and offensive statement. 

  Finally, and most importantly, the woke approach to mathematics is particularly poisonous to those it pretends to want to help. Let’s start with the reasonable assumption that mathematical talent is equally distributed at birth to children from all socio-economic backgrounds, independent of ethnicity, sex and race. Those born in poor, uneducated families have clear educational disadvantages relative to others. But mathematics can act as a powerful equalizer. Through its set of well-defined, culturally unbiased, unambiguous set of rules, mathematics gives smart kids the potential to be, at least in this respect, on equal footing with all others. They can stand out by simply finding the right answers to questions with objective results. 

  There is no such thing as “white” mathematics. There is no reason to assume, as the activists do, that minority kids are not capable of mathematics or of finding the “right answers.” And there can be no justification for, in the name of “equity” or anything else, depriving students of the rigorous education that they need to succeed. The real antiracists will stand up and oppose this nonsense.

  Tyler Durden
  Sat, 03/06/2021 – 20:30

• Bitcoin Could Soon Run Head First Into U.S. Money Laundering Laws
  Bitcoin Could Soon Run Head First Into U.S. Money Laundering Laws

  Among the challenges in regulating bitcoin will be the Biden administration’s handling of recent anti-money laundering laws put into place by the Trump administration pertaining to bitcoin and cryptocurrencies. 

  The rules, implemented at the last-minute by the Trump administration, seek requirements for financial services firms to report identities of cryptocurrency holders, according to Bloomberg. The point of the rules is to stop attempts to use crypto as a means of transferring money illicitly. 

  Lobbying against the regulations are “heavyweights from both K Street and Wall Street”, according to Bloomberg, including Fidelity and the U.S. Chamber of Commerce. The Chamber of Commerce has said the rule would have “unintended long-term consequences” on the virtual currency industry.

  Also lobbying against the rule have been “Republican lawmakers, including former Representative Cynthia Lummis, who is now a Wyoming senator; Arkansas Senator Tom Cotton and Democratic Representative Tulsi Gabbard of Hawaii”. 

  

  The rules were implemented by the Financial Crimes Enforcement Network or FinCEN, after President Trump lost the 2020 election. The move drew criticism and even the threat of lawsuits from pro-crypto trade groups. The rule would require filings to the Treasury every time a customer moves at least $10,000 worth of virtual currency into a wallet not hosted at an exchange. These are similar to the reports that banks already send under existing AML laws when customers take out $10,000 or more in cash. 

  The regulation would also require banks and exchanges to keep records of customers who send $3,000 or more of virtual currencies to someone else’s unhosted wallet. 

  Obviously, such regulation would maim one of bitcoin’s biggest “assets”: the ability to transfer money anonymously and “outside the system”. Should Treasury Secretary Janet Yellen move forward with the rules, crypto services could wind up becoming more expensive – and some cryptocurrencies could even disappear altogether. 

  Additionally, if the rules are adopted, they could cause a “sharp fall” in crypto prices, according to Bloomberg. Matthew Maley, chief market strategist for Miller Tabak & Co., said: “Bitcoin is very risky and very volatile and it’s going to continue to be that way. If you add something like a new regulation, it’s going to be very vulnerable to a correction.”

  FinCEN published the rule December 18 and rushed through a 15 day comment period where more than 7,600 public comments were received. 

  As of today, there’s no timetable on when the Biden administration will decide on the rule.

  Of course this is just the latest in “the death of bitcoin”-esque worries. In fact, as 99Bitcoins notes, Bitcoin has died 402 times since inception.

  

  Tyler Durden
  Sat, 03/06/2021 – 20:00

• California’s Energy Policies Hurt Minority Citizens The Most
  California’s Energy Policies Hurt Minority Citizens The Most

  Authored by Jude Clemente via RealClear Energy (emphasis ours),

  In 2020, some 9 million Californians were unable to pay their energy bills. The California Public Utilities Commission (CPUC) reports that customers of the major investor-owned electric and gas utilities accumulated $1.15 billion in unpaid bills during the year.

  

  As a “clean energy” climate leader, California seeks to achieve a carbon-free economy before 2050, ensuring that its electrical system can withstand extreme weather events and supply affordable energy to 40 million people.

  That last goal might be the biggest challenge. The wind and the sun may be free, but deriving electricity from them is anything but.

  California’s residential electricity price in 2020 was $20.50 per kWh, or 55% higher than the national average of $13.20 – an expensive energy problem that is only getting worse (see Figure).

  The latest iteration of California’s Renewable Portfolio Standard (RPS), the 100% Clean Energy Act, was enacted in 2018. It requires California utilities to use 100% clean energy by 2045, with an interim requirement of 60% by 2030.

  The costs are immense.

  Experts at the University of Chicago’s Energy Policy Institute reported in November that “electricity prices increase substantially after RPS adoption,” adding $30 billion in extra costs after just seven years.

  Here are just some of the numbers, according to new research from UC Berkeley’s Energy Institute at Haas:

  • Average residential prices per kWh in San Diego Gas & Electric’s (SDGE) service territory are about double the U.S. average.

  • Pacific Gas and Electric’s (PG&E) rates are 80% above the U.S. average.

  • Southern California Edison’s (SCE) prices are 45% higher than the U.S. average.

  • Since 2013, rates at San Diego Gas & Electric have risen nearly 50%, with customers of PG&E paying almost 40% more.

  

  A new report from UC Berkeley attributed California’s high prices to huge fixed costs for generation and grid investments that simply get passed on to customers.

  For example, costs for rooftop solar and wildfire mitigation are quickly mounting.

  Experts at UCLA found that California’s clean energy programs are benefitting the rich and leaving vulnerable families behind.

  As wealthier residents install rooftop solar systems to reduce their electricity bills, lower- and middle-income households bear a bigger burden for covering those fixed costs.

  California’s expensive electricity problem will only get worse.

  From 2020-2022, the state’s big three investor-owned electric utilities (PG&E, SCE, and SDGE) plan to spend $22 billion on hardening their systems by cutting back vegetation and pursuing other measures to fight wildfires, along with the high costs of transmission and other network upgrades.

  CPUC concedes that this could increase bundled residential rates 10-20% above the rate of inflation.

  Fitch Ratings has praised the credit-worthiness of the Los Angeles Department of Water and Power (LADWP) because it has a “very strong ability to raise revenue.”

  No kidding.

  A few years ago, the city lifted the caps on adjustment factors and made other changes to ensure that rising costs could be seamlessly passed on to customers.

  LADWP has a revenue-decoupling feature in its electric rates, so when sales decline, prices can be raised the following year to compensate for the losses.

  In other words, if power usage falls, whether from a shrinking population or businesses leaving, LADWP can simply up its rates to compensate.

  Indeed, many criticize California’s cap-and-trade system as a disguised tax, because higher costs just get pushed onto captive consumers.

  Hurts Minority Citizens Most

  From Hewlett-Packard to Occidental Petroleum to Tesla, the list of businesses leaving California is growing. These departures represent lost job opportunities for the state’s residents. And higher energy prices disproportionately affect minority communities.

  Already battered by Covid-19, the last thing minority communities need is regressive taxes, such as those imposed by California energy policies:

  • After controlling for factors such as income and household size, experts at UC Berkeley conclude that African-American renters pay $273 more each year than their white peers. African-American homeowners annually pay $408 more for energy than white homeowners.
  • UCLA’s sustainability group recently showed how these disadvantaged communities in Los Angeles could be left behind in the transition to renewables, electric cars, and energy-efficient technologies.

  Experts are telling officials that California’s exorbitantly high electricity prices could block the goal of electrification and even turn public sentiment against renewables. 

  As an input for everything, higher cost energy increases the costs of everything, particularly devastating for food, water, heating/cooling, and other necessities that hold mostly inelastic demand. 

  More laws across the state are banning natural gas hookups in favor of more expensive electricity, even as gas prices are at their lowest levels in decades.

  On an energy-equivalent basis, gas-banning in California is forcing homeowners and renters to pay four times as much for their energy as they would if they were consuming natural gas directly.

  Simply put, the goal to “electrify everything” is a de facto energy tax on low- and middle-income Californians that could add more instability to an already proven unstable state power grid. 

  Minority communities are understandably fighting back.

  A coalition of Latino civil rights leaders has sued California over the state’s energy and housing policies. A mandate to force rooftop solar on new homes is expected to worsen the state’s affordable housing problem, adding costs of $12,000 per home.

  The California Restaurant Association has also sued the city of Berkeley for its gas ban: according to the Census Bureau’s American Community Survey, 60% of all restaurants in California are owned by minorities.

  This is why civil rights leaders like Revs. Al Sharpton and Jesse Jackson are actively supporting natural gas.

  The recent Texas energy crisis showed that policies to ensure affordable and reliable energy truly are a matter of life and death. California should take heed of that lesson.

  Tyler Durden
  Sat, 03/06/2021 – 19:30

• Kroger Opens Fully-Automated Ohio Fulfillment Center As Fears Mount Of Rising Technological Unemployment 
  Kroger Opens Fully-Automated Ohio Fulfillment Center As Fears Mount Of Rising Technological Unemployment 

  With demand for shipped products soaring during the COVID-19 pandemic and foreseeable future, the transition to warehouse automation is already underway – likely to displace warehouse workers and result in rising technological unemployment. 

  Supermarket chain Kroger opened its first automated warehouse in Bulter County, Ohio, last week, reported Hamilton JournalNews. The massive 335,000-square-foot customer fulfillment center is entirely run by robots and artificial intelligence that can put together an order of about 50 items in six minutes compared with 30 to 45 minutes it takes a Kroger employee to pick items from shelves. 

  

  The new $55 million automated facility is known as the “shed” and is the first of 20 planned. 

  The Cincinnati-based grocer completed its first order at the facility last Wednesday. Rodney McMullen, Kroger’s chairman and CEO, told investors during Thursday’s call:

  “This marks the soft opening of the facility, and we look forward to our grand opening in early April.

  We continue to be excited about the elevated experience that this will bring to our customers in the tri-state area and across the country as we continue to open additional facilities,” McMullen said. 

  Kroger’s partnership with U.K.-based Ocado has been an essential part of leveraging advanced robotics technology to run the supermarket chain’s e-commerce segment. 

  An Ocado “shed” helps Kroger achieve faster delivery times compared to the in-store experience. It also lowers costs for the grocer. 

  The growing demand for grocery e-commerce by Kroger comes at a time when Instacart, otherwise known as the “personal shopper” app, mulls over robo-driven warehouses as they come to the same realization as Kroger that robots are more efficient and faster in fulfilling orders than humans. 

  The main takeaway is that fulfillment centers will one day be operated by robots and artificial intelligence no matter what the products are. Millions of working-poor Americans, mostly young and less-educated, have joined the ranks of Amazon and other e-commerce retailers as “pickers” in giant warehouses. Many of these jobs will be displaced in the coming years by automation as technological unemployment is set to soar. Maybe if Amazon employees unionize there would be a slower effort by the e-commerece giant to automate its warehouses. 

  This note is a warning to all warehouse workers that robots are coming for their jobs – perhaps now is the time to find a new occupation that will be less impacted by the economy’s technological transformation in the 2020s.   

   

  Tyler Durden
  Sat, 03/06/2021 – 19:00

• Ditch The Afghanistan Experts
  Ditch The Afghanistan Experts

  Authored by Daniel L. Davis via RealClear World (emphasis ours),

  U.S. President Joe Biden is coming under heavy pressure to abandon the May 1 deadline to withdraw U.S. combat troops from Afghanistan. The push to move the deadline might come from a former secretary of state, the congressionally mandated Afghan Study Group, or even NATO’s secretary-general. Opposing the pleas of these popular figures are 20 years of unbroken strategic failure. There is ample evidence to suggest that 20 more years of failure await, should the president give in to the wishes of these personalities.

  

  In February, former Secretary of State Madeline Albright argued Biden should ignore the May 1 withdrawal date and instead adopt a series of five new steps. The Afghan Study Group likewise advocated to abandon the withdrawal date and offered its own objectives. Meanwhile, NATO Secretary-General Jens Stoltenberg said the May 1 date was a “conditions-based” deal and declared the Taliban hadn’t met the conditions, and therefore NATO should continue the war.

  All of these advocates ignore that every tactic and objective they advocate has been tried over the past two decades, usually multiple times, and uniformly they have failed.

  When Barack Obama came into office, Secretary of Defense Robert Gates, Secretary of State Hillary Clinton, and Commander of U.S. Central Command David Petraeus convinced the new president that they had a better strategy than that employed by Obama’s predecessor. They advocated for a dramatic troop increase and the adoption of a counterinsurgency strategy. Obama listened. He authorized a surge of 17,000 troops to Afghanistan in February 2009, and another surge of 30,000 that December.

  Obama was himself unsure the strategy would work. According to Jonathan Alter, however, Obama pressed all his senior officials before making the final decision on Nov. 29 of that year, and he pointedly asked whether they could complete the mission in the 18 months they had promised. All said yes. “If you can’t do the things you say you can in 18 months,” Obama demanded, “then no one is going to suggest we stay, right?” All agreed.

  And yet as I personally observed — I was one of the surge troops from 2010-2011 — it was obvious from even a cursory observation on the ground that the mission wouldn’t be successfully completed in 18 months, or even in 18 years. Instead, Obama prosecuted eight more years of inconclusive war in Afghanistan. Donald Trump campaigned on ending endless wars and won the 2016 election. Unfortunately, as president he also came under enormous pressure by supposed experts against ending the war.

  Then-National Security Advisor H.R. McMaster and Secretary of Defense James Mattis – both heavyweight former generals with combat experience – sought to sway Trump against following his instincts and ending the war. In August 2017, Trump announced that not only would he not be ordering a withdrawal, but he would reluctantly increase the number of troops.

  “My original instinct was to pull out, and historically I like following my instincts,” the president explained. The turnaround, the New York Times reported, was “a victory of sorts” for Mattis and McMaster, who had successfully pressured Trump to order the troop increase. Again the “new” strategy didn’t work, and the result was merely to add four more years to the failed war.

  Now it is Biden who is coming under pressure, again by men and women that seem to have great credentials on paper, to seek yet another so-called new strategic roadmap. Again, they advocate against ending the war and withdrawing. If Biden proves to be the fourth straight president to listen to these experts and choose to cancel the withdrawal and continue the war, it is likely he too will be passing off the war to his successor – as the futile and wasteful adventure reaches 24 or 28 years.

  I warned in 2010 and 2012 that the war in Afghanistan was unwinnable. The fundamentals that led me to make that conclusion a decade ago have not changed. So long as Pakistan continues to secretly help the Taliban, the Afghan government remains one of the most corrupt in the world, the Taliban remains committed to fighting, and the Afghan Security Forces remain of limited capability, it won’t matter how many troops Biden orders to Afghanistan, how long they remain there, or what strategy he adopts: We will continue losing the war.

  The best thing President Biden can do for America’s national security and the health and wellbeing of our troops is to end the war and withdraw our troops, on schedule, by May 1. Anything else will needlessly extend the futility into perpetuity.

  Daniel L. Davis is a Senior Fellow for Defense Priorities and a former Lt. Col. in the U.S. Army who deployed into combat zones four times. He is the author of “The Eleventh Hour in 2020 America.” Follow him @DanielLDavis1. The views expressed are the author’s own.

  Tyler Durden
  Sat, 03/06/2021 – 18:30

• How Tokyo Is Using 1,350 Ton Pendulums To Earthquake-Proof Older Buildings
  How Tokyo Is Using 1,350 Ton Pendulums To Earthquake-Proof Older Buildings

  After 2011’s Tohoku earthquake in Japan, the country has been working diligently to “earthquake-proof” itself. The 2011 quake resulted in the deaths of over 22,000 people, including those who died in the subsequent tsunami, according to Nikkei. 

  The quake also caused the Fukushima power plant meltdown. 

  In Tokyo, the quake wasn’t catastrophic, but it was noticed. “The shaking gradually became bigger and bigger, and we didn’t know when it would stop. It was very frightening,” one resident said. Shaking his building lasted 10 minutes. 

  For some parts of the Tokyo skyline, earthquake-proofing buildings means installing 1,350 ton “pendulums” that can help buildings become more resistant to shaking caused by seismic movements. One of Japan’s biggest general contractors, Kajima, is carrying out the installations.

  

  They are part of a broader stroke of retrofits and building upgrades as the country looks to manage earthquake risk moving into the future. Haruhiko Kurino, a senior group leader with Kajima, said: “Many people in high-rise buildings felt uneasy. The earthquake brought home to us that we should take actions to make people inside buildings feel safe and secure.”

  Atsuomi Obayashi, a risk management expert and professor at Tokyo’s Keio University, said: “The 2011 Tohoku earthquake spurred many more companies to tighten their earthquake countermeasures.”

  Even before the quake, however, buildings were constructed specifically to be able to withstand earthquakes. Buildings are meant to be flexible and absorb the shock of such natural disasters. Few buildings suffered direct damage or collapse since the Great Hanshin-Awaji Earthquake in 1995.

  

  Now, instead of just focusing on buildings not collapsing, the focus has turned to reducing their sway, Nikkei reports:

  Earthquakes create two types of seismic motion: short-period and long-period. Long-period seismic motion creates large, slow shaking that can make high-rise buildings sway violently for a long time. The epicenter of the 2011 earthquake was far from Tokyo, but the long-period seismic motions did not weaken much, even far from the epicenter.

  As a result many people in Greater Tokyo were injured by falling objects and fixtures. The swaying in tall buildings often lasts for more than 10 minutes in a big earthquake and can make people feel seasick.

  The pendulums that are installed on rooftops help solve this problem by swinging along with the building, but with a slight delay. They help absorb the vibrations of the building. 

  

  And while demand for office space may be slowing due to Covid, demand for retrofitting buildings with these pendulums is still firm. Tetsuya Hanzawa at Shimizu’s center for safety and reliability engineering told Nikkei: “It is becoming more important for corporate Japan to adopt more earthquake-resistant ceilings, in terms of business continuity.”

  Ohigashi concluded: “Buyers are picky now. As buyers seek more quality and safety, it is crucial for owners of old buildings to update their quality to stay competitive.” 

  Tyler Durden
  Sat, 03/06/2021 – 18:00

• Gigafactory Demand Leads To Price Explosion In Battery-Grade Lithium
  Gigafactory Demand Leads To Price Explosion In Battery-Grade Lithium

  Via Mining.com,

  Domestic Chinese battery-grade lithium carbonate prices assessed by Benchmark Mineral Intelligence are on a tear in 2021 after bottoming out in the second half of last year, following a lengthy slump. 

  

  Ex-works lithium carbonate in China (≥99.5% Li2CO3) jumped by 68% to its highest since June 2019 in the first two months on the back of high battery demand, particularly for lithium iron phosphate (LFP) cathode, and a slower-than-anticipated transition to high nickel chemistries, according to Benchmark. 

  Benchmark’s megafactory tracker points to the extent of the rise in demand reflected in China’s battery production figures, which totalled 12 GWh in January, an increase of nearly 320% compared to the same month last year when the country was in the first stages of the pandemic.

  The surge was led by production of LFP batteries which is growing at a breakneck speed, up nearly 500% year- on-year.

  Surging Chinese lithium carbonate prices, which now hold a premium over hydroxide prices for the first time since April 2018, helped push the Benchmark Lithium Price Index up by 14.4% in February 2021, its second-largest move on record after January 2021, the London-headquartered research and price reporting agency said.

  While the most rapid gains were in China, Benchmark’s global weighted average lithium hydroxide prices are up 8% year-to-date and ex-Chinese carbonate prices up by an average of 17.1% in February:

  

  In fact, all 11 of Benchmark’s lithium prices registered increases in February 2021 as producers of both spodumene and lithium chemicals worldwide have begun to sell out inventories and fill order books through until the end of Q2 2021.

  While lithium’s majors are beginning to reengage in expansion plans, three years of falling lithium prices have failed to incentivise sufficient investment into the supply chain, leading to greater risks of price volatility as battery demand ramps up.

  Tyler Durden
  Sat, 03/06/2021 – 17:30

• Red-Hot Freight Market Sends Used Container-Ship Values Soaring
  Red-Hot Freight Market Sends Used Container-Ship Values Soaring

  No one predicted that the global shipping container industry would be on fire in the last couple of quarters, considering China’s robust economic rebound following the virus-induced downturn. Container rates have soared since last spring as there are few signs of immediate cooling. 

  Container shipowners are capitalizing on the red hot ocean freight market by flipping older ships. Monaco-based International Maritime Enterprises sold its container ship Crete I for $46 million, more than four times its 2016 value ($11 million), according to Bloomberg, citing a new industry report via TradeWinds. 

  

  The market for second-hand ships is soaring as the sale of new vessels has sunk in the last couple of years. A typical container ship takes more than one year to build – so boosting new ship supply cannot be readily done – hence why demand increase and value explosions are being observed on the secondary markets. 

  Clarkson Research Services Ltd. said a 10-year-old container ship with the capacity to haul 6,600 steel boxes fetches about $41 million today – that’s a considerable jump from its $9.5 million value back in 2016.

  

  “The recent price increases have happened far more quickly than previous sales and purchase cycles,” said Stephen Gordon, managing director at Clarkson Research. “Recent prices trends for 10-year-old vessels have more than doubled in less than six months, whereas in 2016-17 and 2004-2005 it took nearly 18 months for similar percentage price increases.”

  “February was the second-highest activity on record for transactions measured in ship container capacity,” Gordon said.

  Time charter rates for a 6,800-box container ship have erupted. 

  

  Container shipping data from Freightos and Harper Petersen & Co show container rates have been surging since April-June of 2020.

  

  Demand for freight containers and the heavy flows from China to the US East/West Coast has resulted in a shipping container shortage in Asia. 

  In September, we first noted that demand for ocean freight out of China was “leading to equipment shortages in Asia.”

  “The surge in volumes is leading to equipment shortages in Asia. Some shippers are paying premiums on top of spiking rates to guarantee containers and space. The imbalance is also putting pressure on overwhelmed US ports and importers to process and return empty containers quickly.”

  While the buying frenzy for second-hand container ships continues – we suspect this trend will last until the global economic rebound stalls – with China’s credit impulse already peaking – this could be in the second half of this year. 

  

  From used cars to used private jets to now used container ships, real asset prices are exploding higher. But how long will this madness last? 

  Tyler Durden
  Sat, 03/06/2021 – 17:00

• Israel Updating Plans To Attack Iran, Ready To 'Act Independently' 
  Israel Updating Plans To Attack Iran, Ready To ‘Act Independently’ 

  Authored by Dave DeCamp via AntiWar.com,

  Israeli Defense Minister Benny Gantz told Fox News in an interview published Friday that the Israeli military is updating its plans to strike Iran’s nuclear program and is prepared to act independently.

  Gantz falsely portrayed Iran’s recent steps to advance its civilian nuclear program as the Islamic Republic racing to develop a bomb, something he said Israel would stop. “If the world stops them before, it’s very much good. But if not, we must stand independently and we must defend ourselves by ourselves,” he said.

  

  Gantz cited nuclear activity that Iran is willing to quickly reverse if the US lifts sanctions and returns to the nuclear deal, known as the JCPOA. But Gantz, like most Israeli officials, is opposed to a revival of the agreement.

  Israeli officials have been making veiled threats about attacking Iran if President Biden rejoins the JCPOA. Other incidents in the region that are being blamed on Iran are causing some to fear that Israel might be preparing an attack sooner rather than later.

  Without providing evidence for the claim, Israel blamed Iran for an explosion on an Israeli-owned cargo ship in the Gulf of Oman that happened last week. No crew members were hurt, and the ship was back at sea a few days after the incident. When asked about possible retaliation, Israeli Prime Minister Benjamin Netanyahu said Israel was “striking at” Iran throughout the region.

  “This is a target map. Each one of them has been checked legally, operationally, intelligence-wise and we are ready to fight,” Gantz told the FOX correspondent while handing him a classified map.

  EXCLUSIVE: Israeli Defense Minister Benny Gantz shows Fox News a classified target map, revealing Hezbollah missiles amid civilian infrastructure https://t.co/fPisnRjtjs pic.twitter.com/fm4nOQ5yLm

  — Trey Yingst (@TreyYingst) March 4, 2021

  https://platform.twitter.com/widgets.js

  On Wednesday, Israel blamed Iran for another incident in the region. Israeli Environmental Protection Minister Gila Gamliel claimed Iran was responsible for a large oil spill that hit Israel last month.

  Surprisingly, Israeli military and intelligence officials doubted Gamliel’s claim, as did other officials in the Environmental Protection Ministry.

  

  Regardless of whether Iran was responsible or not, Israel could be planning a strike against the Islamic Republic over the two incidents. Sources told Business Insider that the Biden administration and its European allies are fearing that Israel is planning a “substantial” attack on Iran.

  Tyler Durden
  Sat, 03/06/2021 – 16:30

• JPMorgan Estimates Up To $316 Billion In Forced Month-End Selling
  JPMorgan Estimates Up To $316 Billion In Forced Month-End Selling

  Friday’s post-European close ramp notwithstanding…

  

  … stock markets, and especially growth stocks, had a rude awakening this week as rising rates finally hammered high duration stocks, shown in this chart which we have been posting ever since November to warn readers of who will get hammered first.

  

  For those who hope that the worst is now over, JPM has some bad news.

  In one of his latest Flows and Liquidity reports, JPM quant Nick Panigirtzoglou writes that as we approach quarter-end, the equity rebalancing flow question is resurfacing in client conversations. As we notes, “the equity rally and the bond sell-off during the current quarter is naturally creating a pending rebalancing flow for multi-asset investors away from equities into bonds for pension funds and balanced mutual funds. How much of equity/bond rebalancing flow should we expect into current quarter-end?”

  To answer this question, the Greek strategist applies a familiar framework and looks at the four key multi-asset investors that have either fixed allocation targets or tend to exhibit strong mean reversion in their asset allocation. These are balanced mutual funds, such as 60:40 funds, US defined benefit pension plans, Norges Bank, i.e. the Norwegian oil fund, and the Japanese government pension plan, GPIF.

  For those curious about the details, below is a more detailed summary of the considerations behind the four key investor classes ahead of month and quarter-end.

  1. Balanced mutual funds including 60:40 funds, a close to $7.5tr AUM universe globally, tend to rebalance over 1-2 months or so. The lesson from last Nov/Dec is that balanced mutual funds exhibit flexibility and they do not necessarily rebalance every single month. During the previous quarter, they appear to have postponed rebalancing for Nov-end or Dec-end and to have waited until January to de-risk/rebalance. JPM believes that funds de-risked in January, as a result of the tumble in balanced MFs equity beta…

  

  .. and since it would have been too soon to rebalance again in February, the quant believes that they have likely postponed any pending rebalancing to March. Assuming they were fully rebalanced at the end of January, which is a reasonable hypothesis given the reduction in their betas in January and by taking into account the performance of global equities and bonds since then, JPMorgan estimates around $107bn of equity selling by balanced mutual funds globally into the end of March in order to revert to their 60:40 target allocation.

  2. US defined benefit pension plans are a similarly big universe with AUM of around $8tr. They tend to rebalance more slowly over 1-2 quarters or so. Assuming they were fully rebalanced at the end of December, and by taking into account the QTD performance of US equities and bonds, JPM expects that the pending equity rebalancing flow by US defined benefit pension plans into the current quarter-end is negative at around -$110bn: “In other word, US defined benefit plans would need to sell $110bn of equities towards the end of the current quarter and buy a similar amount of bonds for their allocations to revert to end-December levels.” Making matters worse, and given the improvement in their funded ratios, Panigirtzoglou notes that it is possible that they would seek to take advantage of this improvement to de-risk, “which could pose some upside risk to this estimate.”

  3. Norges Bank, a $1.3tr AUM entity as at the end of 2020, is calculated to see negative $65bn in rebalancing (out)flows. This, according to JPM, incorporates also the fact that the Norwegian government looks set to continue to rely on net transfers from its fund to finance part of its budget deficit and assumes that the equity weight would be returned to its target of around 70%. In the second half of 2020, the Norges Bank allowed its equity weight to increase to nearly 73%, and in the event it would simply seek to keep its equity weight unchanged at 73% would imply around $22bn of equity sales, which JPM thinks of as a lower bound estimate.

  4. The Japanese government pension plan, or GPIF, a $1.7tr AUM entity, is also set to sell: JPM estimates that the pending equity rebalancing flow by the GPIF into the current quarter-end based on current equity and bond returns is also likely negative at around $34bn.

  Putting these together, we get:

  • Mutual -$107BN
  • Defined Pension -$110BN
  • Norges Bank -$65BN (could be -$22BN)
  • GPIF -$34BN

  … a grand total of $316BN.

  To be sure, this number will likely be lower following last week’s selloff which followed the original JPM analysis, and may be some $40BN less based on assumptions about forced Norwegian selling, we are still talking about selling in the $100BN+ range in the days before quarter end, which is why JPM concludes that “in all, we see some vulnerability in equity markets into quarter-end from pension funds entities as well balanced mutual funds selling equities and buying bonds to rebalance towards their target equity/bond allocations.“

  And while JPM’s last forced selling forecast was a dud, with the bank’s Nov 2020 prediction of a similar number ($310BN) in year-end selling never materializing (as JPM now acknowledges) and stocks shooting higher by the end of last year, the reality this time is that with markets suddenly far more jittery many whale investors will not risk testing if JPM is wrong twice in a row and may simply frontrun the potential selling, creating a self-fulfilling prophecy as fears of possible selling spark waves of actual selling. The only question we have is when does the frontrunning officially begin?

  Tyler Durden
  Sat, 03/06/2021 – 16:00

• Tulsi Gabbard Calls Out The US Dirty War On Syria That Biden & Aides Admit To
  Tulsi Gabbard Calls Out The US Dirty War On Syria That Biden & Aides Admit To

  Via Pushback with Aaron Maté at The Grayzone,

  While Joe Biden has faced some mild Congressional pushback for bombing the Iraq-Syria border, Tulsi Gabbard says her former colleagues are ignoring the larger issue: the ongoing US dirty war on Syria.

  After a decade of proxy warfare that empowered Al Qaeda and ISIS, the US is now occupying one-third of Syria and imposing crippling sanctions that are crushing Syria’s economy and preventing reconstruction.

  Watch: Featuring video clips from — Tulsi Gabbard, former Democratic Congressmember; President Joe Biden; Brett McGurk, National Security Council coordinator for the Middle East and North Africa; Martin Dempsey, former Joint Chiefs chairman; Rob Malley, Special Envoy for Iran; John Kerry, Special Envoy for Climate & former Secretary of State; former President Donald Trump; Alena Douhan, UN Special Rapporteur on Sanctions; Dana Stroul, Deputy Assistant Secretary of Defense for Middle East; Vice President Kamala Harris.

  While Gabbard has been vilified for her stance on Syria, many top White House officials – including Joe Biden himself – have already acknowledged the same facts that she has called out.

  Aaron Maté plays clips of Biden and some of his most senior aides admitting to the horrific realities of the US dirty war on Syria, and argues that Gabbard only stands apart in being wiling to criticize it.

  * * *

  

  Tyler Durden
  Sat, 03/06/2021 – 15:30

• Pope Pleads For Peace In Historic Meeting With Powerful Shiite Cleric In Iraq
  Pope Pleads For Peace In Historic Meeting With Powerful Shiite Cleric In Iraq

  On Saturday Pope Frances traveled to the Shia holy city of Najaf while on his four-day papal visit to Iraq – the first ever such trip by the head of the Roman Catholic Church. There he held a historic and somewhat controversial meeting with the country’s top Shiite cleric, Grand Ayatollah Ali al-Sistani, amid a massive security presence. 

  The 90-year old Sistani is among the most senior Shiite clerics in the world, whose quiet but powerful influence has helped shaped post-US invasion Iraq. The months in the making meeting was held in Sistani’s own home. 

  

  Pope Francis’ main message to the top Islamic cleric during the 50-minute meeting reportedly emphasized the importance of peaceful coexistence between Muslims and Christians of Iraq.

  Sistani likewise “affirmed his concern that Christian citizens [who] should live like all Iraqis in peace and security, and with their full constitutional rights,” according to a subsequent press release.

  And a Vatican statement further said the Pope thanked al-Sistani for having “raised his voice in defense of the weakest and most persecuted.” The dialogue itself during the meeting was kept quiet. 

  The meeting took place in close vicinity to the golden-domed Imam Ali Shrine, among the most revered sites in Shiite Islam. The shrine was target of a major twin car bombing in August of 2003 which killed 95 people, and later claimed by al-Qaeda in Iraq.

  Video of @Pontifex visit to Sayed Sistani today pic.twitter.com/z2oOgeDjzi

  — Sajad Jiyad سجاد (@SajadJiyad) March 6, 2021

  https://platform.twitter.com/widgets.js

  According to AFP, Sistani’s office “published an image of the two, neither wearing masks: Sistani in a black turban with his wispy grey beard reaching down to his black robe and Francis all in white, looking directly at the grand ayatollah.”

  The significance of the meeting is sure to reverberate across borders, given “The 90-year-old al-Sistani has been a consistent counterweight to Iran’s influence. With the meeting, Francis is implicitly recognizing him as the chief interlocutor of Shiite Islam over his rival, Iranian Supreme Leader Ali Khamenei. News of the meeting heightened long-standing rivalries between the Shiite seminaries of Najaf and Iran’s city of Qom over which stands at the center of the Shiite world,” an AP report previously explained. 

  Tyler Durden
  Sat, 03/06/2021 – 15:00

• Newsom COVID 'Equity' Plan: Vaccinate 2 Million Latinos Or California Won't Reopen
  Newsom COVID ‘Equity’ Plan: Vaccinate 2 Million Latinos Or California Won’t Reopen

  Authored by Victoria Taft via PJMedia.com,

  California Governor Gavin Newsom has completely changed his response to COVID – again – this time leveraging opening the state for all Californians on the backs of low-income Latinos living in the areas with the highest rates of the illness.

  In the name of “equity,” Newsom announced Thursday that 40% of all the state’s available vaccines will go to Latino communities in the Central Valley and in pockets of LA because Latinos have suffered the most death and illness from COVID.

  

  And there’s a catch: Until the Latinos in these areas take the vaccine in higher numbers, California will stay locked down.

  State Health and Human Services Director Dr. Mark Ghaly said once the shots are in the arms, the state can reopen.

  “As we achieve higher levels of vaccine in the hardest hit communities, we feel more confident that more and more activities across the state can occur,” he said in a briefing Thursday.

  […]

  Once 2 million vaccine doses are given out in those neighborhoods, the state will make it easier for counties to move through reopening tiers that dictate business and school reopenings. With 1.6 million shots administered, he said he expects to hit that target in the next week or two.

  Once the state gives out 4 million doses in those neighborhoods, state officials will revise the metrics for reopening sooner.

  The new plan swaps out the current color-based tier plan with a person-of-color-based plan.

  The Associated Press reported that the governor said getting the vaccines into the arms of Latinos is a “race against exhaustion,” whatever that means.

  “It is a race against the variants. It’s a race against exhaustion. It’s a race to safely, thoughtfully open our economy, mindful that it has to be an economy that doesn’t leave people behind, that is truly inclusive,” Newsom, a Democrat, said at a news conference. He also encouraged people to wear two masks.

  State lawmaker Lorena Gonzalez, the woman who’s responsible for AB 5, which largely killed the freelance worker economy in California on behalf of her union pals, wondered how the change in the plan would affect the governor’s previously announced plan to get teachers in the classroom.

  The changes announced Wednesday are “kind of not fair” to those who negotiated the deal, Assemblywoman Lorena Gonzalez said.

  “If we are going to change the tiers and suddenly everyone is in red tier, that changes the classes that have to be open, the number of classes and the testing cadences,” the San Diego Democrat said Thursday just before the Legislature voted on the bill.

  “So, if you get calls from your teachers union a little upset, they have the right to be upset. You don’t negotiate a deal and change the parameters of that deal on the day we are voting on it.”

  The Sacramento Bee reports that the executive director of the California Teachers Association, Joe Boyd, is a bit whipsawed at how confusing Newsom’s COVID response has been.

  He said the governor’s change to the definition of the red tier makes things more complicated.

  “We’ve changed the meaning of what it means to be in a tier now three times,” he said Thursday, speaking on a panel with the Public Policy Institute of California. “At some point, we have to have some consistency of what to expect.”

  The governor also announced that he was advising people to wear double masks.

  This is after Newsom criticized Texas Governor Gregg Abbott for halting his mask mandate, making it voluntary. He called Abbott reckless.

  Of course, Newsom has broken his own coronavirus rules very publicly at least twice, at one point putting a Fresno Mexican restaurant in danger of being closed down because Newsom visited inside, against county COVID rules. The other example was Newsom’s double-standard dinner at the French Laundry with people from all different families, nearly all of whom were lobbyists.

  👀👀 pic.twitter.com/C3dEkYfvA2

  — Bill Melugin (@BillFOXLA) March 2, 2021

  https://platform.twitter.com/widgets.js

  ABC News 7 reported that Newsom was going all-in with giving out vaccines based on equity, which is to say, “color.”

  Gov. Gavin Newsom has called equity the state’s “North Star.” Yet community health clinics focused on serving low-income and vulnerable Californians say they haven’t been getting enough doses. Ghaly said Thursday that Newsom’s administration will work with communities to make sure the vaccine actually ends up in the arms of those patients, not to day-trippers from wealthier ZIP codes who have the time and tech savvy to schedule appointments online.

  The Sacramento Bee reported that “tying reopening to vaccination equity metrics was cheered by representatives of the legislative Black and Latino caucuses, as well as social justice and equity groups. Latinos make up roughly half of cases and deaths in California even though they are 39% of the population. […] Data show that of shots given, only about 17% were administered in vulnerable communities that have been disproportionately affected by the pandemic.”

  Holding the rest of the state hostage to the vaccination rate of Latinos in certain zip codes seems an odd way of approaching the issue. The governor is apparently hoping that others will pressure Latino citizens to take a vaccine they may or may not want. If you like mask-shamers, just wait until vaccine-shaming becomes a cottage industry in the Golden State.

  This plan may meet Newsom’s definition of “equity,” but certainly won’t enhance comity between Californians.

  Tyler Durden
  Sat, 03/06/2021 – 14:35

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• How The Fight Over American Freedom Will Probably Escalate
  How The Fight Over American Freedom Will Probably Escalate

  Authored by Brandon Smith via Alt-Market.us,

  Three months ago in December I published an article titled ‘Is The Globalist Reset Failing? The Elites May Have Overplayed Their Hand’. I was specifically interested in the development of the pandemic “crisis”, the lockdown mandates of governments worldwide, the bizarre vaccination campaign for the new and under-tested mRNA cocktail which was rushed out to the public in the span of six months, the World Economic Forum’s open statements that they hoped to exploit the pandemic as a springboard for their globalist agenda, and the public’s reaction to it all.

  

  I have to say, I continue to see a divergence in what the elites clearly wanted to happen vs. what has actually happened. If the Event 201 pandemic war game on a coronavirus outbreak, held two months before the actual outbreak occurred in China, is any indication, then the globalists greatly overestimated the fear effect of Covid.

  They predicted at least 65 million deaths from a coronavirus outbreak, but over a year has passed since the pandemic went international and the official death count stands at 2.5 million, with over 40% of deaths in the US attributed to nursing home patients that were ALREADY dying from preexisting conditions. Removing suspect nursing home deaths from the equation, the death count is probably closer to 1.5 million, again, if we adhere to official estimates.

  To put this number in perspective, the CDC states that global deaths from the flu virus peak at around 649,000 depending on the year. Deaths from the flu and pneumonia reach as high as 1.4 million globally per year. Studies funded by the Bill and Melinda Gates foundation find annual pneumonia death stats that are comparable to the CDC’s. Yet, we never saw Bill Gates calling for economic lockdowns, mask mandates and medical passports because of the flu or pneumonia. Why is that?

  Today, the death rate of covid is 0.26%, FAR below initial predictions by globalist institutions and governments. It is now widely proven that the lockdowns did NOTHING to slow the infection spread of the virus, and now many areas of the US are starting to experience what the lab coat “professionals” affectionately call “herd immunity”. Infections and deaths are plunging, and the lockdowns and mask mandates were useless.

  Like the vast majority of all viral illnesses, humans simply get sick, endure, build immunity and get healthy. Some of us die, as we always have, and government intervention is not needed nor is it welcome. This is why large portions of US and European populations are refusing to accept the lockdowns and the vaccines. Why destroy the economy and submit to a potentially dangerous genetic cocktail over a disease that 99.7% of the population is sure to survive?

  The establishment elites really blew it this time.

  My suspicion, my “conspiracy theory” if you will, is that the globalists announced their reset agenda under the assumption that the death rate for covid would be MUCH higher than it is. They were expecting something biblical, and instead they got something not much more dangerous than the flu and pneumonia.

  There is now mass public resistance to the vaccinations and medical passports. This is probably why they rushed out the vaccines in the span of 6 months instead of a year to 18 months as they hinted at in early 2020. They are trying to get as many people as possible to take the experimental vaccines before the citizenry realizes that covid is a nothing-burger.

  I can say that in my area the majority of people never wore the masks and the majority of local businesses never tried to enforce them. And though they initially went along with the first economic shutdown, they will not be complying with another. In my state of Montana, there are 1,300 deaths attributed to covid. In my county, the estimated infection rate is over 25% (which means almost everyone has probably already been infected), and there are only 13 deaths total.

  No one is scared of this thing. Almost no conservative is going to wear a mask, and many people in Red states (and some in Blue states) are going to refuse to take the vaccines or accept medical passports.

  This means that the globalists have a big problem. They obviously invested a lot into this pandemic. It is the key to their entire Reset agenda. Without a frightening pandemic killing tens of millions, the globalists will not be able to lock down the public and prevent them from traveling or organizing. They will not be able to institute the medical passports and contact tracing apps that would allow them to watch the public 24/7. They certainly won’t get most Americans to go along with the cashless society and the centralized global governance the elites are so obsessed with.

  The fear of coronavirus is waning. The globalists have indeed failed in epic fashion. But, this doesn’t mean that they are going to give up. If my experience studying psychopathic people tells me anything, it is that when these lunatics are cornered they tend to double and triple down on their failures.

  The question is, what will happen next? The establishment will need maximum instability and chaos in the near term if they hope to salvage their Reset project. If they wait too long awareness will spread and they might not get another chance for many decades to come, if ever. Here are the events I expect to see over the course of the next year…

  Covid Mutation Hype

  The globalists are doomed unless they can keep the pandemic panic rolling forward. For now, puppets like Biden and Fauci are going to pretend as if a full reopening of the economy is going to happen. This us a lie. Already we are seeing Biden waffling on when a reopening will take place. He has indicated that it will be at least a YEAR before the shutdowns will completely end, and this is predicated on the majority of Americans submitting to vaccinations and medical passports.

  In other words, the establishment is telling us that they intend to hold the economy hostage until we take the jab and give up our freedoms.

  Now, are these inbred totalitarians just out of their minds? Well, probably, but that doesn’t mean they don’t have a Plan B. Just look at all the hype surrounding “covid mutations” in places like South Africa and Brazil; the narrative will be that a “new covid variant” that is more dangerous and deadly than the first virus is spreading, and that the lockdowns must return for the greater good of the public.

  As a recent article from ‘The New Scientist’ states:

  “Existing vaccines should stop people getting severely ill and dying if they do get infected by the P.1 variant. However, because many people remain unvaccinated, plans to ease lockdown restrictions would have to be rethought if this variant causes a resurgence in case numbers. Plus, any variant that circulates widely will have more opportunities to evolve into a more dangerous form.”

  The New Scientist does not seem to understand basic science. The overwhelming majority of viruses circulating in the world usually evolve into less deadly forms of their original iteration. Viruses need to survive too, and they don’t do this by mutating into more and more deadly monstrosities that kill their favorite hosts. There is still no evidence that the new covid mutations are any threat whatsoever, but the establishment is already staging the narrative that new lockdowns are coming.

  Federal Lockdowns

  If the mutation narrative continues on the path it seems to be following, then I expect the Biden Administration to attempt a national federalized lockdown similar to the Level 4 lockdowns used in Europe and Australia, and it will be announced sometime this year.

  This program will trigger several reactions; most importantly, most conservative states and counties will refuse to follow federal mandates. I know that my county and probably most of Montana will defy any new shutdown.

  There will be several economic consequences that will erupt from this conflict; some positive and some negative.

  Domestic Economic Warfare

  This phase of the crisis will happen within a month to two months of any national shutdown. Red states will refuse to comply. State politicians, even if they are part of the agenda, will be too scared to try to enforce federal mandates. They will be compelled by the conservative citizenry to keep their states open. Most people in these areas will ignore mandates.

  This will lead to a red state fiscal boom, at least in the beginning, as business continues to thrive in conservative areas while blue states suffer under medical tyranny. Companies will flee leftist states by the thousands and move to any states that remain open and accommodating. This will be short lived, though.

  Biden and the federal government will try to retaliate, first by cutting off federal funds to any state that does not bow to their power and refusing to give stimulus to any businesses that relocate. Blue states will be flush with stimulus cash while red states will be forced to reduce or eliminate welfare programs and some pension funds.

  Of course, the government has no real money to give, they only have our tax dollars and the fiat that the central bank creates from thin air. The likely response will be that conservative states and citizens will simply stop paying federal taxes. Another reaction will be red states taking over federal lands and utilizing the resources on those lands to rejuvenate their industry and make up for the federal dollars lost.

  What this amounts to is a soft secession of conservative regions, which will eventually lead to federal attempts at physical intervention (the economic war will turn into a shooting war). The argument from the establishment will be that conservatives are putting the rest of the country “at risk”, that we are “selfish” and “literally killing grandma”.

  Complete Erasure Of Conservatives From The Internet

  I expect Biden and Big Tech to further pursue their current witch hunt against conservative voices, far beyond what we have already seen. In order to win a fight with conservatives they will first have to silence us so that our side of the argument is never seen or considered by the rest of the population. If they allow us to be heard, we will undoubtedly win because facts and moral reason are on our side.

  It is hard to demonize people that simply want to be free.

  But, if you can silence conservatives and moderates, then the narrative can be rigged. The establishment spin doctors can tell people that we don’t actually want freedom; we want something else, something evil and nefarious. They can tell people we are “fascists”, and that we are “racists” and that we actually want tyranny. Who is going to tell the public otherwise when we are removed from all available platforms and our websites are booted off service providers due to “dangerous ideas”?

  Gun Control Madness

  I know that some people think that leftists under Biden will not try to carry out a widespread gun crackdown and that much of the current talk is merely hollow rhetoric. I disagree. I think the globalists are going for broke, and they need to get as many combat capable firearms as they can from Americans soon. Democrats will push hard for legislation like HR 127.

  They will then offer a “compromise” with Republicans and the NRA, cutting out portions of the bill. This will be a trick to make the public think that the new restrictions are a “reasonable compromise”. They think we will breath a sigh of relief and say “Well, at least they didn’t take everything…”

  The gun grabbers are delusional.

  What will really happen is millions of gun owners will pass local and state laws negating federal restrictions. No conservatives are going to give up their gun rights, allow red flag laws to be implemented or allow high capacity firearms to be limited; not at this stage in the game.

  International Intervention

  Eventually, leftists and the establishment will realize that conservatives will be harder to subjugate than they expected. They will discover that a large part of the US military and law enforcement is on our side. They will start to see mutiny among the people that they rely on as cannon fodder to carry out their dictates.

  Even now, there are sheriff’s departments across the country refusing to enforce lockdown orders. And, 30% to 50% of medical professional say they will not be taking the covid vaccine depending on the state. When the rebellion goes live, this is when the globalists will have to pursue extreme options. They will not be able to win using domestic forces. Instead, they will seek out an international response, probably through the United Nations.

  The rationale will be that the US has an enormous nuclear arsenal and that the international community cannot allow these weapons to fall into the hands of “white supremacists”. This is when the real fight will begin. If international intervention fails in the US, the globalists will find their heads on the chopping block. If the globalists win the fight in the US then there will be very few people left to resist them in the years going forward.

  I have had numerous readers from all over the world write to me, saying that they believe in the face of the pandemic lockdowns it is now all up to Americans to turn the tide. I agree. A successful rebellion against globalism in America will lead to rebellions elsewhere, but the fact remains that if we lose, no one else will dare lift a finger. The future is in our hands.

  *  *  *

  If you would like to support the work that Alt-Market does while also receiving content on advanced tactics for defeating the globalist agenda, subscribe to our exclusive newsletter The Wild Bunch Dispatch.  Learn more about it HERE.

  Tyler Durden
  Fri, 03/05/2021 – 23:40

• ​​​​​​​First-Ever "Space Hotel" Begins Construction In 2025, Operational By 2027
  ​​​​​​​First-Ever “Space Hotel” Begins Construction In 2025, Operational By 2027

  Orbital Assembly Corp., a California-based startup, has raised a million dollars with aims at opening an out-of-this-world space hotel in low Earth orbit by 2027, according to Daily Mail. 

  Orbital calls itself the “world’s first large-scale space construction company” and has grand ambitions to build the first space hotel in low Earth orbit, beginning in 2025. The hotel will be equipped with restaurants, a cinema, spa, and space pods (rooms) for 400 people.

  The 3-year-old company plans to use robots to construct the celestial hotel shaped like a Ferris wheel. The 650-foot-wide wheel-shaped structure will spin with an angular velocity high enough to generate moon-like levels of artificial gravity for occupants.

  

  If realized, Voyager Station will be the biggest human-made structure in space. It will be made up of a series of rings, with modules attached to the rings’ outermost area.

  

  Some of these 24 modules will house crew quarters, power systems, research labs, and supplies. 

  

   

  The rotating wheel space station was an idea derived out of the 1950s from aerospace engineer Wernher von Braun. 

  To complete the build and make it affordable, Elon Musk’s SpaceX has dramatically lowered the cost of launching things into space. Before the reusable Falcon 9 rocket, launching items into space cost around $8,000 per kg – prices are now around $2,000/kg. SpaceX believes Starship will bring it to list a few hundred dollars. 

  Orbital is set to test the concept with a much smaller scale prototype space station in a zero-gravity research facility. 

  “This will be the next industrial revolution,” explained John Blincow, founder of the Gateway Foundation, adding it will create a new space industry. The Voyager station’s concept was first realized with Gateway Foundation in 2012, then rolled into Orbital in 2018. 

  Essentially a new space race has already begun as NASA works to commercialize spaceflight. This shift of space exploration: from the government to private corporations, has already ignited a space boom and could help boost the economy in the coming years. 

  Tyler Durden
  Fri, 03/05/2021 – 23:20

• Escobar: The Shape Of Things To Come In China
  Escobar: The Shape Of Things To Come In China

  Authored by Pepe Escobar via The Asia Times,

  It’s Lianghui (“Two Sessions”) time – the annual ritual of the Beijing leadership. The stars of the show are the top political advisory body, the Chinese People’s Political Consultative Conference; and the traditional delivery of a work report by the Prime Minister to the top legislature, the National People’s Congress (NPC).

  

  The review of the draft outline of China’s 14th Five-Year Plan will proceed all the way to March 15. But in the current juncture, this is not only about 2025 (remember Made in China 2025, which remains in effect). The planning goes long-range towards targets in the Vision 2035 project (achieving “basic socialist modernization”) and even beyond to 2049, the 100th anniversary of the People’s Republic of China.

  Premier Li Keqiang, delivering the government work report for 2021, stressed that the target for GDP growth is “above 6%” (the IMF had previously projected 8.1%). That includes the creation of at least 11 million new urban jobs.

  On foreign policy, Li could not draw a sharper contrast with the Hegemon: “China will pursue an independent foreign policy of peace” and will “promote the building of a new type of international relations”.

  That’s code for Beijing eventually working with Washington on specific dossiers, but most of all focusing on strengthening trade/investment/finance relations with the EU, ASEAN, Japan and the Global South.

  The outline of the 14th Five-Year Plan (2021-2025) for the Chinese economy had already been designed last October, at the CCP plenum. The NPC will now approve it. The key focus is the “dual circulation” policy, whose best definition, translated from Mandarin, is “double development dynamics”.

  That means a concerted drive to consolidate and expand the domestic market while continuing to push foreign trade/investment – as in the myriad Belt and Road Initiative (BRI) projects. Conceptually, this amounts to a quite sophisticated, very Daoist, yin and yang balancing.

  In early 2021, President Xi Jinping, while extolling Chinese “conviction and resilience, as well as our determination and confidence”, was keen to stress the nation faces “unprecedented challenges and opportunities”. He told the Politburo “favorable social conditions” must be created by all means available all the way to 2025, 2035 and 2049.

  Which brings us to this new stage of Chinese development.

  The key target to watch is “common prosperity” (or, better yet, “shared prosperity”), to be implemented alongside technological innovations, respect for the environment, and fully addressing the “rural question”.

  Xi has been adamant: there’s too much inequality in China – regional, urban-rural, income disparities.

  It’s as if in a cool reading of the dialectical drive of historical materialism in China, we would arrive at the following model. Thesis: imperial dynasties. Antithesis: Mao Zedong. Synthesis: Deng Xiaoping, followed by a few derivations (especially Jiang Zemin) all the way to the real synthesis: Xi.

  On the Chinese “threat”

  Li stressed China’s success in containing Covid-19 domestically; the nation spent at least $62 billion on it. This should be read as a subtle message, addressed especially to the Global South, about the efficacy of China’s governance system to design and execute not only complex development plans but also cope with serious emergencies.

  What’s ultimately at stake in this competition between wobbly Western (neo)liberal democracies and “socialism with Chinese characteristics” (copyright Deng Xiaoping) is the capacity to manage and improve people’s lives. Chinese scholars are very proud of their national development plan ethos, defined as SMART (specific, measurable, achievable, relevant and time-bound).

  A very good example is how China, in less than two decades, managed to extricate 800 million people out of poverty: an absolute first in History.

  All of the above is rarely evoked as Atlanticist circles drown in virtually 24/7 China demonization hysteria. Wang Huiyao, the director of the Beijing-based Center for China and Globalization, at least had the merit to bring into the discussion Sinologist Kerry Brown of King’s College, London.

  Drawing from comparisons between Leibniz – close to Jesuit scholars, interested in Confucianism – and Montesquieu – who only saw a despotic, autocratic, imperial system – Brown re-examines 250 years of entrenched Western positions on China and remarks how is “more difficult than ever” to engage in a reasonable debate.

  He identifies three major problems.

  1. Throughout modern history, there’s no Western appreciation of China as a strong and powerful nation, and its restored historical importance. Western mindsets are not ready to deal with it.

  2. The modern West never really thought of China as a global power; at best as a land power. China was never seen as a naval power, or capable of exercising power way beyond its borders.

  3. Propelled by the iron certainty over its values – enter the very much debased concept of “true democracy” – the Atlanticist West has no idea what to make of Chinese values. Ultimately the West is not interested in understanding China. Confirmation bias reigns; the result is China as a “threat to the West”.

  Brown points to the key predicament afflicting any scholar or analyst trying to explain China: how to convey China’s extremely complex worldview, how to capture the China story in a few words. Soundbites do not apply.

  Examples: explaining how a whopping 1.3 billion people in China have some sort of health security, and how 1 billion enjoy some kind of social security. Or explaining the intricate details of China’s ethnic policies.

  Premier Li, delivering his report, vowed to “forge a strong sense of community among the Chinese people and encourage all of China’s ethnic groups to work in concert for common prosperity and development”. He did not specifically mention Xinjiang or Tibet. It’s an uphill task to explain the trials and tribulations of integrating ethnic minorities into a national project amid non-stop hysteria on Xinjiang, Taiwan, South China Sea and Hong Kong.

  Come and join the party

  Whatever the Atlanticist West’s whims, what matters for the Chinese masses is how the new Five-Year Plan will deliver, practically, what Xi has previously described as “high-quality” economic reform.

  Things look good for powerhouses Shanghai and Guangdong – they were already aiming at 6% growth. Hubei – where Covid-19 cases first appeared – is actually targeting 10%.

  Based on frenetic social media activity, public opinion confidence in the Beijing leadership remains solid, considering a series of factors. China won the “health war” against Covid-19 in record time; economic growth is back; absolute poverty has been eradicated, according to the original timetable; the civilization-state is firmly established as a “moderately prosperous society” 100 years after the founding of the Communist Party.

  Since the start of the millennium, China’s GDP grew no less than 11-fold. Over the past 10 years, GDP more than doubled, from $6 trillion to $15 trillion. No less than 99 million rural people, 832 counties and 128,000 rural villages were the last ones to be extricated from absolute poverty.

  This complex hybrid economy is now even engaged in setting up an elaborate, “sweet” trap for Western firms. Sanctions? Don’t be fools; come here and enjoy doing business in a market of at least 700 million consumers.

  As I’ve noted last year, the systemic process in play is like a sophisticated mix of internationalist Marxism with Confucianism (privileging harmony, abhorring conflict): the framework for “community with a shared future for mankind”. One country – actually a civilization-state, focused on its renewed historical mission as re-emerging superpower. Two sessions. And so many targets – and all of them achievable.

  Tyler Durden
  Fri, 03/05/2021 – 23:00

• Watch: Boeing "Loyal Wingman" Stealth Drones Makes First Flight 
  Watch: Boeing “Loyal Wingman” Stealth Drones Makes First Flight 

  About two years after we told readers the pilotless “Loyal Wingman” drone was being developed in Australia, the military unmanned aerial vehicle that uses artificial intelligence to attack enemy targets has conducted its first test flight, according to ABC (Australian Broadcasting Corporation). 

  Boeing developed the Loyal Wingman in partnership with the Defence Department and Royal Australian Air Force (RAAF). It’s the first time in more than five decades a military plane has been designed and manufactured in Australia. 

  

  The RAAF wants the Loyal Wingman to fly alongside high-value assets such as the Lockheed Martin F-35 Lightning II, McDonnell Douglas F/A-18 Hornet, Boeing P-8 Poseidon, and Boeing E-7 Wedgetail.

  Designed by Boeing Phantom Works in Brisbane, the largest Boeing development center outside the US, the stealth drone has a nautical mile range of 3,704 km (approximately 2,300 miles). The fighter-like jet is 11.6 meters long and will be embedded with a host of electronic warfare sensors. As far as the type of weapons the drone will carry, well, that remains classified. 

  The drone’s artificial intelligence will allow it to fly independently to support manned aircraft while maintaining a safe distance between other aircraft.

  Australia plans to spend $89 million to acquire three more Loyal Wingman later this year. 

  “It is a milestone for Australia, for the Boeing Company, and for the Royal Australian Air Force,” said President of Boeing Australia, Dr. Brendan Nelson.

  A boost for our industry team and Australian sovereign capability as we partner with @AusAirForce to co-develop 3 more #LoyalWingman to advance the aircraft’s capabilities.

  Thanks @DeptDefence for your commitment to growing Aussie innovation!

  Release: https://t.co/Tht7saqd45 pic.twitter.com/poV0AQO89d

  — Boeing Australia (@BoeingAustralia) March 2, 2021

  https://platform.twitter.com/widgets.js

  … and here’s the video of the first-ever test flight of the stealth drone. 

  Watch the first ever #LoyalWingman flight.

  “A year ago this was a concept – now it’s a reality – it’s amazing to imagine and then create a new uncrewed aerial capability with our partner @BoeingAustralia. Designed & made right here in Australia!” AVM Cath Roberts. #AusAirForce pic.twitter.com/f5fUqRgpOC

  — Royal Australian Air Force (@AusAirForce) March 2, 2021

  https://platform.twitter.com/widgets.js

  The drone’s development comes as a great power competition between the US and China will continue to flourish in the 2020s. Both countries are fighting for global dominance and have been quickly modernizing their respective militaries for potential conflict in the Pacific, which is not that far away from Australia.

  Tyler Durden
  Fri, 03/05/2021 – 22:40

• San Francisco Pays $16.1 Million To Shelter 300 Homeless In Tents
  San Francisco Pays $16.1 Million To Shelter 300 Homeless In Tents

  Authored by Rick Moran via PJMedia.com,

  California is in the midst of a self-induced homelessness crisis that shows no sign of abating anytime soon. The crisis is especially acute in San Francisco, where Mayor London Breed has erected three tent cities to house about 300 homeless people.

  

  The cost? About $61,000 a year per tent. All told, the cost of the program is $16.1 million. I guess in San Francisco, even the tents are first class.

  The city is running a $650 million deficit and the tent city isn’t eligible for reimbursement by the government, so that money comes out of city coffers. If the homeless were housed in a first-class hotel, the federal government would gladly reimburse the city for that, but not for a few measely tents?

  SFist:

  In the six “Safe Sleeping Villages” set up by the city of San Francisco during the pandemic, the cost of maintaining a single tent-camping spot is $5,000 per month, or $61,000 per year – more than it would cost to put each of these people in a market-rate apartment.

  The insane costs of running these sleeping “villages,” which only have space for a total of 262 tents spread across the six sites, makes one immediately think of the criticisms that are leveled against the Homeless Industrial Complex, as conservative commentators are eager to call it. The revelation of the pricetag for the tent program — $16.1 million for the year — came at a budget committee meeting on Wednesday, as the Chronicle reports, via Abigail Stewart-Kahn, the interim director of the Department of Homelessness and Supportive Housing.

  In addition to the tents, the city supplies meals, sanitation services, and police protection.

  The cost boils down to $190 per tent per night, which includes 24-hour security, bathrooms, maintenance, and three meals per day. This is cheaper than the per-day cost for the hotel program, but the hotel program is getting 100% federal reimbursement. (Thanks, Biden.)

  Also, the Department of Homelessness and Supportive Housing has committed to rehousing everyone as the [sic] come out of the hotel rooms — an enormous task, given that there are upwards of 2,000 people currently in the program.

  San Francisco counts about 6,400 people as homeless, although that doesn’t include people living out of their cars, or the thousands who flit from temporary shelters to relative’s residences to friends and neighbors — anywhere they can find a place to lay their body down. Many of these people have jobs that don’t pay them enough to live within 50 miles of San Francisco.

  The city was basically forced to adopt the tent idea because most homeless shelters closed down due to COVID restrictions. But $5,000 a tent? Certainly, allowances should be made but that is a ludicrous amount of money to spend on any group, regardless of their hard-luck circumstances.

  Even city council members are critical.

  “I understand the motivation to create sleeping space during this COVID-19 crisis,” says Supervisor Ahsha Safaí, speaking to the Chronicle.

  “But we really need to dive deep to see if this a sustainable model… without any federal reimbursement.”

  Perhaps if they had “dove deep” before they wasted this money, they wouldn’t be regretting it now.

  Tyler Durden
  Fri, 03/05/2021 – 22:20

• Money Can Buy Happiness After All
  Money Can Buy Happiness After All

  What’s the relationship between money and happiness? Previous studies have indicated that, while money can in fact buy happiness, it plateaus at approximately $75,000/year.

  However, as Visual Capitalist’s Carmen Ang details below, new research suggests otherwise.

  Using over a million real-time reports from a large U.S. sample group, a recent study found that happiness increases linearly with reported income (logarithmic), and continues to rise beyond the $80,000/year mark.

  Below, we’ll provide more details on the research methodology, while touching on a few possible reasons why higher incomes may improve people’s happiness levels.

  

  How is Happiness Measured?

  Past research on happiness relative to income has relied on retrospective data, which leaves room for human memory errors. In contrast, this new study uses real-time, logged data from a mood tracking app, allowing for a more accurate representation of respondents’ experienced well-being.

  Data was also collected by random prompts over a period of time, with dozens of entries logged for each single respondent. This provides a more well-rounded representation of a person’s overall well-being.

  Two forms of well-being were measured in this study:

  • Experienced well-being
    A person’s mood and feeling throughout daily life.

  • Evaluative well-being:
    Someone’s perception of their life upon reflection.

  Both forms of well-being increased with higher incomes, but evaluative well-being showed a more drastic split between the lower and higher income groups.

  The Results (Measured in Standard Deviations from Mean)

  

  Why Does Money Buy Happiness?

  The report warns that any theories behind why happiness increases with income are purely speculative. However, it does list a few possibilities:

  • Increased comfort
    As someone earns more, they may have the ability to purchase things that reduce suffering. This is particularly true when comparing low to moderate income groups—larger incomes below $80,000/year still showed a strong association with reduced negative feelings.

  • More control
    Control seems to be tied to respondents’ happiness levels. In fact, having a sense of control accounted for 74% of the association between income and well-being.

  • Money matters
    Not all respondents cared about money. But for those who did, it had a significant impact on their perceived well-being. In general, lower income earners were happier if they didn’t value money, while higher income earners were happier if they thought money mattered.

  Whatever the cause may be, one thing is clear—Biggie Smalls was wrong. Looks like more money doesn’t necessarily mean more problems.

  *  *  *

  Like this? Then you might enjoy this article, Which Countries are the Most (and Least) Happy?

  Tyler Durden
  Fri, 03/05/2021 – 22:00

• These Are The Companies Whose Employees Most Often Get Payday Loans
  These Are The Companies Whose Employees Most Often Get Payday Loans

  Submitted by Priceonomics,

  Payday loans are used by people who need money fast, who often have no other way of borrowing money to cover an unexpected expense. The benefit of these kinds of loans is they enable you to meet your immediate financial obligations. The risk, however, is you are taking on debt and incurring future obligations that require future income to fulfill.

  

  This article analyzes the employment status of people who take on payday loans. Do they have jobs that will enable them to pay back the loans in a timely fashion or are they cornering themselves into an amount of debt without the income to ever repay the loans?

  LendUp provides loans to people to cover unexpected expenses or when they need the money fast. Due to its years of underwriting loans and working with customers, the company knows a lot about the financial background of loan recipients.

  In this analysis, LendUp reviews the data on the employment characteristics of Americans who turn to payday loans. How many people who turn to payday loans have jobs? Are they employed full-time and where do they work?

  The overwhelming majority of payday loan recipients (81.2%) have full time jobs. When you add the number of recipients that work part-time or are already retired, that accounts for well over 90% of recipients. Most commonly, payday loan recipients work in sales, office, and healthcare support. The most common employer of LendUp users who seek a payday loan is Walmart, followed by Kaiser, Target and Home Depot.

  * * *

  As part of its loan application process, LendUp asks borrowers to state their employment status and current employer. For this analysis, the company reviewed loans from 2017 to 2020 to see the most common employment status, industries and employers. The data is from states where LendUp currently operates (WI, MO, TX, LA, MS, TN, CA) plus additional states in which LendUp previously made loans (IL, KS, LA, MN, OK, OR, WA, WY). When considering the most common employers of payday loan recipients, this data set will reflect the largest employers in our largest markets, like California.

  To begin, let’s look at the employment status of people who get payday loans via LendUp. What percentage of loan recipients have full time employment versus some alternative?

  

  81.2% of all payday loan recipients on LendUp have full-time employment, meaning that they should have income coming to pay back their debts. More commonly, people use payday loans to cover the timing mismatch of having an expense coming in before the paycheck arrives to cover it. If you add those that are part-time employed, retired, or self-employed to those with full-time employment, you account for 96.1% of payday loan recipients. Just 1.2% of payday loan recipients are classified as unemployed.

  As part of its application process, LendUp payday loan recipients report information on their industry of employment. The following chart breaks down loan recipients by industry:

  

  The most common industry for needing a payday loan is sales related. This could include retail workers or sales people working on a commission with an erratic pay schedule. The second most common industry is people working in office and administrative. Of note, the third most common category is healthcare related.

  Lastly, let’s look at the companies with the most payday loan recipients. As mentioned prior, keep in mind that this data reflects the employment base in areas where LendUp operates and that also larger employers will naturally show up more often on the below list:

  

  Walmart, the largest employer in the United States, is the number one employer of payday loan recipients through LendUp. Twice as many payday loan recipients work at Walmart compared to the second most common company, Kaiser. The list is dominated by retail companies, but also healthcare, education, and government.

  * * *

  This analysis shows that the vast majority of payday loan recipients are employed full time. Despite earning a regular income, expenses come up that people do not have the bank account balances to cover. Many of these people work in school, hospitals, and the stores that have provided essential services throughout the pandemic. People get payday loans to cover urgent expenses, and for many Americans, these loans are the only source of funding available during times of emergency or when financial needs exceed available funds.

  Tyler Durden
  Fri, 03/05/2021 – 21:40

• Emmy For Slow-Motion Career Trainwreck: Cuomo Stripped Of Emergency Powers As Sexual Assault Charges Mount
  Emmy For Slow-Motion Career Trainwreck: Cuomo Stripped Of Emergency Powers As Sexual Assault Charges Mount

  In November, the TV Academy presented Cuomo with the International Emmy Founders Award “in recognition of his leadership during the COVID-19 pandemic and his masterful use of TV to inform and calm people around the world.” It sure wishes it could take that day back.

  Late on Friday, three days after NY legislators reached a deal to strip disgraced NY governor Andrew Cuomo – who now finds himself in a vortex of potentially criminal scandals involving both nursing home deaths and alleged sexual assaults – of his emergency powers, and two days after an “embarrassed” Cuomo told a disgusted TV audience (well everyone except for the virtue-signaling sycophants at CNN and MSNBC) that he was “very sorry” but was “not resigning” in the aftermath of his own sexual assault scandal, late on Friday, the New York legislature approved a bill to repeal the pandemic-era emergency powers afforded to the scandal-plagued Governor Cuomo.

  The measure, which received final passage from the Assembly on Friday evening, revoked temporary powers given to Cuomo in March that effectively gave him dic(k)tator powers, allowing him to supersede the legislature, as well as local laws, to issue hundreds of sweeping emergency directives on everything from closing businesses and schools to mandating the use of masks. In retrospect, this was the worst – and deadliest – decision the legislature had made who may be just as culpable of crimes as Cuomo . 

  Under the new measure, the governor cannot issue any new orders. However, directives already in place can stand or be altered with approval by the legislature. The legislation, sponsored by Heastie and Senate Majority Leader Andrea Stewart-Cousins, would require Cuomo to issue a notice five days before extending or modifying any directives. The Legislature, or local municipality if applicable, would review the order. The Legislature can terminate the directives at any time and no directive could be acted on unless the governor has responded to all comments from relevant legislative committee chairs, or municipal entities, according to the bill.

  The governor is expected to sign the measure after saying he helped negotiate it.

  As Bloomberg reports, the rebuke from lawmakers, where Democrats hold a supermajority in both chambers, follows public outcry over sexual-harassment claims by what are now three women against Cuomo and allegations that his administration deliberately covered up Covid-19 deaths of nursing-home residents.

  In the latest twist which emerged late in the week, Cuomo’s administration said Thursday that officials had altered a July report of data on the deaths to exclude those who had died outside the facilities. The administration was responding to a New York Times report that said these changes show that the state had a fuller accounting of the deaths at the time, despite resisting requests for that data.

  Meanwhile, in a remarkable sign of bipartisanship, a growing list of state lawmakers, including in his own Democratic party, have called for Cuomo’s resignation as scandal upon scandal mounted. The third-term governor has apologized for making women feel “uncomfortable,” and has acknowledged mistakes in reporting of the nursing-home data, but has refused to step down.

  Earlier this week, Cuomo said he had brokered the emergency-power deal with lawmakers to focus just on curbing new directives. Assembly Speaker Carl Heastie, a fellow Democrat, disputed Cuomo, saying lawmakers didn’t work with the governor to cut a deal.

  Senate Deputy Majority Leader Michael Gianaris said on the floor that the governor lied to the public and was not involved in negotiations. Asked if he was bothered by the lie, Gianaris said: “There is so much that this governor has done that I’m bothered by.” Asked if he trusts the governor, Gianaris said: “I haven’t trusted this governor in a long time.”

  Gianaris is a democrat. Imagine if he was republican. Currently, only the governor may declare and end a state of emergency. “For the first time ever, we are adding a power for the Legislature to nullify a state of emergency,” Gianaris said.

  The just passed bill also would require Cuomo to publicly post all information justifying emergency directives online in a searchable format.

  But Republican lawmakers argued that the bill doesn’t fully revoke Cuomo’s powers, and it allows previous directives to continue. They also said the measure should have an expiration date. “Let’s be clear about what this bill actually does and stop putting lipstick on a pig,” Republican Assemblyman Michael Lawler said on the floor. Senator Andrew Lanza, a Staten Island Republican, said his no vote was “not about Andrew Cuomo the person.”

  “This is about the Senate and the Assembly having a say with respect to what happens with their constituents back home,” he said. “One-party rule is one thing. One-man rule is entirely another.”

  As Bloomberg notes, Cuomo’s emergency powers were set to expire on April 30, but as the pandemic wore on, lawmakers bristled at Cuomo’s growing authority. Republicans introduced a number of measures to strip Cuomo’s emergency powers, but they had failed to take hold with enough of the Democrat-controlled Legislature. Lawmakers worried that revoking his authority would affect the state’s ability to quickly respond to the health crisis. Democrats’ united push to revoke Cuomo’s powers highlights growing tension against the governor among members of his own party. The move comes just four weeks until the state budget deadline, threatening to impede Cuomo’s agenda.

  Calls to pull back Cuomo’s powers increased after a Jan. 28 report from Attorney General Letitia James said that more nursing-home residents died from the virus than the state Health Department had reported. A top Cuomo aide later admitted that the state withheld the data from state lawmakers while it was being investigated by the federal government.

  “While early versions of the report included out-of-facility deaths, the Covid task force was not satisfied that the data had been verified against hospital data and so the final report used only data for in- facility deaths, which was disclosed in the report,” state Health Department spokesperson Gary Holmes, said in a statement. “DOH was comfortable with the final report.”

  Senator James Skoufis, in a statement on Friday, said the latest revelation in the Times report “demands answers and accountability.” He called for an investigation into state Health Commissioner Howard Zucker’s handling of nursing-home deaths.

  White House spokeswoman Jen Psaki called the reports “troubling.” She said the Biden administration “certainly would support any outside investigation but this wouldn’t be a determination made by us.”

  Meanwhile, things are just getting worse for Cuomo: on Thursday, one of the governor’s accusers, former aide Charlotte Bennett said in an interview with CBS News that the governor propositioned her and asked if a past sexual trauma continued to affect her intimate relationships, an exchange that left her “terrified.”

  In response to the mounting allegations that their boss is a sexual freak with a Napoleon complex, at least four Cuomo aides have left their jobs since the allegations surfaced, including first deputy press secretary Will Burns and Gareth Rhodes, a senior adviser who often appeared at Cuomo’s televised virus briefings and helped lead the state’s vaccination effort. Rhodes’ wife on Monday tweeted her support for Anna Ruch, one of the governor’s accusers.

  Then, on Friday, Cuomo’s office confirmed the latest departures of two women from his staff: interim policy adviser Erin Hammond and press secretary Caitlin Girouard. Girouard, who departed on Friday, had issued the statement last month denying sexual-harassment allegations of Cuomo’s first accuser, former economic aide Lindsay Boylan. She said Boylan’s claims were “quite simply false” in a statement issued on Feb. 24. In a December statement, she had also said “there is simply no truth to these claims.”

  Girouard said she accepted a job offer in the private sector on Jan. 26 and that it was the “honor of a lifetime serving Governor Cuomo.” Hammond didn’t immediately respond to a request for comment but an administration spokesman said her departure had been planned for several months.

  The uproar over the various allegations has taken a toll. Cuomo’s approval rating dropped to 45% in a Quinnipiac University poll released Thursday, from 72% in May 2020. While 59% say he should not seek a fourth term as governor, 55% of New York voters say Cuomo should not resign, as numerous Democrats in the Legislature have called on him to do.

  Tyler Durden
  Fri, 03/05/2021 – 21:21

• Iran's IRGC Says It Thwarted Rare Airline Hijacking Attempt Midflight 
  Iran’s IRGC Says It Thwarted Rare Airline Hijacking Attempt Midflight 

  A bizarre story circulating widely in Iranian state media sources says the country’s elite Islamic Revolutionary Guard Corps (IRGC) thwarted a rare attempt to hijack a passenger plane soon after it took off from an airport in the southwest city of Ahvaz. 

  An IRGC statement said a terrorist targeted an Iran Air Fokker 100 regional commercial jet that was bound for the northwestern city of Mashhad, and tried to force it to fly south across the Persian Gulf. The incident reportedly happened Thursday and resulted in the plane making an emergency landing at Isfahan Airport in the central part of the country.

  

  There were no casualties or injuries reported, and few details given, but only that IRGC operatives neutralized and arrested the would-be hijacker during the flight, which the government statement described has having sought to divert to the “southern shores of the Persian Gulf.”

  As The Times of Israel observed in reporting it, that description “would include the countries of Bahrain, Saudi Arabia and the United Arab Emirates, three nations long suspicious of Iran’s intentions in the wider region.”

  Such hijacking attempts are very rare in the Islamic Republic, particularly also because Iran typically stations undercover armed marshals aboard domestic flights. The last hijacking incident happened in 2000.

  The IRGC statement issued Friday praised the swift response of IRGC air marshals: 

  “The noble and heroic nation of the Islamic Iran is informed that with the grace of God, the conspiracy to hijack a Fokker 100 aircraft belonging to Iran Air… which had taken off from Ahvaz airport to the holy city of Mashhad at 22:10 hours Thursday night was neutralized with the vigilance of the IRGC’s flight security team.”

  The military says it continues to investigate “dimensions and angles of the conspiracy”. 

  Some of #Iran‘s media outlets–including IRIB & Mostaghel–are using this photo in reporting about the hijacking of the flight from Ahvaz to Mashhad yesterday that appears to be years old per a reverse image search. 🤔 pic.twitter.com/xSHvQBTto4

  — Jason Brodsky (@JasonMBrodsky) March 5, 2021

  https://platform.twitter.com/widgets.js

  In the past when there are unexpected terrorist disruptions in the country, Tehran has quickly laid blame on foreign plots and attackers, including routinely pointing the finger at Israel and Saudi-sponsored operatives. 

  Tyler Durden
  Fri, 03/05/2021 – 21:20

• "The Saudi-Led Coalition Is Struggling" – Ansar Allah's "Concerning" Success In Ops Against Riyadh
  “The Saudi-Led Coalition Is Struggling” – Ansar Allah’s “Concerning” Success In Ops Against Riyadh

  Submitted by South Front,

  Yemen’s Ansar Allah are on the offensive on Marib city, once again. The Saudi-led coalition is struggling.

  The Houthis, as Ansar Allah, are colloquially known, reportedly captured 10 out of 14 districts of the city in their latest push on March 4th.

  The Houthi government deputy foreign minister, Hussein al-Ezzi said that apart from the significant central district of Marib city, every other significant location was under their control. A key strategic location, home to one of the largest oil infrastructures in Yemen, Marib has seen intensified fighting and a renewed military offensive. It is also the last Saudi stronghold in the relatively calm area of Central Yemen. If entirely lost by the Saudi-led coalition, the city would allow the Houthis to carry out even more attacks on targets within the Kingdom’s borders.

  Saudi-led coalition airstrikes have continued bombarding Houthi positions, according to Houthi media. These manage to impede the swift movement of forces, but haven’t deterred the offensive. As it usually happens when the Houthis get the upper hand anywhere in Yemen, the so-called Western world begins yelling “foul”.

  UN Secretary General Antonio Guterres immediately said that widespread fighting could lead to the displacement of thousands. He called on Ansar Allah to halt their offensive on every front, and primarily on Marib. No calls for the Saudi-led coalition to stop their airstrikes or continuous ceasefire violations in al-Hudaydah were made.

  In addition to Marib City, the Houthis struck behind enemy lines. This included two attacks.

  The first one targeted the King Khalid Air Base in the southern Saudi province with a Qasef-2K suicide drone. It was reportedly successful. Ansar Allah claimed to have had fired a cross-border missile and struck a Saudi Aramco facility in the Read Sea city of Jeddah.

  According to the Houthi military spokesman, Yahya Sarea, the attack took place at dawn on March 4th, and was carried out with a Quds-2 winged missile. It reportedly struck its target.

  Riyadh has not admitted either of the attacks, and there are no other details. The UN also said it has received unconfirmed reports.

  The Axis of Resistance appears to be really pushing its enemies back, with 4 US convoys being targeted in the same day in Iraq, and Israel having a lull in its activity in recent days.

  Tel Aviv accused Iran of carrying out an “eco-terrorism” attack by spilling oil in the Mediterranean Sea. There are concerns that a large-scale, heavy retaliation is coming. Time will only show if a response will really come and in what form it will be.

  Currently, the Houthis are pushing successfully and the US is suffering for its attack on the Iraqi-Syriain border, and Israel is plotting its next move.

  Tyler Durden
  Fri, 03/05/2021 – 21:00

• The Four Day Work Week Is Catching On
  The Four Day Work Week Is Catching On

  As Covid has likely forever changed the work landscape for many companies, more and more institutions are even starting to experiment with a four day work week. 

  Awin Chief Executive Officer Adam Ross, who made the change at his company, allowing his workers to leave early on Fridays, recently told Bloomberg: “We firmly believe that happy, engaged, and well-balanced employees produce much better work. They find ways to work smarter, and they’re just as productive.”

  And its not just Awin. It’s a trend that is growing much larger around the globe. For example, according to ZipRecruiter, postings that have mentioned a four day work week have tripled over the last three years, to 62 per 10,000 postings. Major companies like Unilever are even experimenting with the four day work week. Spain’s government is looking into whether to subsidize the idea and it is even catching on in Japan. 

  Will Stronge, director of research at Autonomy, said:  “The four-day week is picking up momentum. For the large majority of firms, reducing working hours is an entirely realistic goal.”

  The question is will the new schedule catch on. Six or seven day work weeks have been the norm since the late nineteenth century, Bloomberg notes. Even nowadays, popular billionaires like Jack Ma have hailed a six day a week work week as “vital for long-term success”. Bloomberg also noted that “in the U.K., the Labour Party lost the 2019 general election even as it campaigned on a pledge to trim the standard workweek to 32 hours within a decade.”

  

  The push to change workplace environments has been pronounced coming out of Covid. And the four day work week is showing improved productivity, according to a study from the University of Reading. There has also been a push to move to a four day work week to “rethink working patterns, and reduce energy consumption.”

  Germany’s 2.3-million-member IG Metall proposed the idea when Covid started to wreak havoc on the auto industry, as did a group led by former U.K. Shadow Chancellor John McDonnell. Renault SA is giving about 13,000 of its workers Fridays off until mid-August as it looks to cut costs. 

  Ross said that at his company, he has an 80 employee task force helping with the transition – which includes deciding which employees will be off when and figuring out the logistics of having his finance department work five days a week.

  “The experience has been so positive that he can’t imagine going back,” he told Bloomberg. “Companies used to make provisions for people’s physical health but never their mental health. I see that changing, and we want to be a driver for it.”

  Tyler Durden
  Fri, 03/05/2021 – 20:40

• There's Only One News Story, Repeating Over And Over Again
  There’s Only One News Story, Repeating Over And Over Again

  Authored by Caitlin Johnstone,

  Doing daily commentary on world power dynamics feels a lot like staring up at the sky watching clouds. Sometimes you see a three-legged pony up there, sometimes a gargoyle, sometimes a laughing baby, but really you’re only ever watching tiny water droplets being moved around by atmospheric winds. They can take on any number of different shapes, but no matter how long you lay there staring up at them you’re really only ever seeing one dynamic play out with different appearances from moment to moment.

  The daily news is very much the same, except most consumers of news media aren’t aware that they’re watching clouds. They really do think they’re looking at a three-legged pony, a gargoyle, a laughing baby.

  “Ooh, there’s a doggy!” they squeal and clap their hands. “Ooh! Ooh now it’s a kitty cat!”

  They don’t see the real underlying dynamics, they just see the forms those dynamics are taking from moment to moment. They don’t see the water droplets being moved around by the breeze, they just see the shapes.

  Just as clouds are always water droplets in the air no matter what shapes they take, news stories are only ever one dynamic playing out with different appearances.

  There is only ever one news story on any given day, and it is always the same news story: wealthy and powerful people seek more wealth and power, and narratives are spun to advance these agendas.

  That’s it. That’s all you’re ever seeing when you read the news. There are sports scores and the occasional celebrity death mixed in for entertainment, but when it comes to major political and governmental events you’re only ever seeing the effects of wealthy and powerful people working to obtain more wealth and power and narratives being spun to promote these agendas.

  Today it’s the Democratic Party killing the $15 minimum wage, protests in Haiti, US electoral shenanigans in Ecuador, bombings and sanctions on Syria, China bad, Russia bad. Appearances which taken individually at first glance look like breaking news stories, but when examined closely and integrated into the big picture are actually the exact same dynamics that were playing out yesterday with slightly different shapes. Tomorrow those same dynamics will play out again in different appearances. The shapes are different, but it’s always water droplets in the air.

  

  It’s the exact same news story playing out over and over and over again, day after day after day. Alarm clock goes off at six AM, Sonny and Cher sing “I Got You Babe”, and Bill Murray wakes up to Groundhog Day once again.

  “Well it looks like Jibby Jorpson is set to be the new leader, somehow staving off an early challenge from the popular socialist candidate,” reports the news man. “In other news, the ostensibly left-wing party will be unable to help the working class due to bliff blaff bloffa reasons, a dangerous dictator in a crucial geostrategic region urgently needs to be removed from power because widdle diddle doodad, and coming up: do we need more internet censorship to prevent wakka dakka dingdong?”

  Next morning. Alarm clock. “I Got You Babe”, Bill Murray, Groundhog Day again.

  “Well it looks like Miggy Morpson is set to be the the new leader, somehow staving off an early challenge from the popular socialist candidate,” reports the news man. “In other news, the ostensibly left-wing party will be unable to help the working class due to wing wang wappa reasons, a dangerous dictator in a crucial geostrategic region urgently needs to be removed from power because kooka kakka keeka, and coming up: do we need more internet censorship to prevent yope yap yimmy?”

  Over and over and over again. And over and over and over. The excuses change, the narrative spin changes, the component parts of the agendas change, but it’s only ever the same one story: wealthy and powerful people seek more wealth and power, and narratives are spun to advance these agendas.

  Once you see the clouds as clouds, you never again get confused about what those shapes in the sky really are. You see different iterations of the exact same dynamic where you used to see individual breaking news stories.

  When you have this insight and realize it’s always the same story playing out over and over again, there’s a common temptation to give in to despair and bitterness. Maybe you keep fighting, but you do it with a bored, jaded and entirely uninspired mentality.

  It doesn’t need to be this way though. Just because the fight isn’t happening the way you used to imagine doesn’t mean it’s hopeless or tedious, it just means you need to look at it differently. You don’t have a 50-fight career against 50 different opponents who you fought for 10 rounds each, you have a one-fight career against a single opponent who you’ve been fighting for 500 rounds.

  Just because the fight is longer than you once thought and the opponent much more resilient than you once thought doesn’t mean that one long fight is without end, or that it is unwinnable. It just means it looks different than it used to. It was ponies and doggies, now it’s clouds. You still bite down on your mouthpiece and throw leather with all your strength.

  But it’s important to do it with focus on the whole. When we oppose ruling power structures and the narratives that they are using to advance their agendas, it’s important to also zoom out and point to their place in the whole. It benefits no one to treat any of the manifestations of the recurring one news story as separate from all the other arrangements: you’ve got to tie it in to the greater dynamics of empire and oligarchy at every opportunity. Otherwise you’re just feeding into the illusion of doggies and kitties in the sky.

  That’s all we’re ever doing here: trying to point to the recurring Groundhog Day story over and over again from as many different angles as possible to help people see the clouds. We can use individual news stories as illustrations to show people the bigger picture of what’s really going on, but really all we’re ever doing is helping them see it all as water droplets arranging in different shapes from day to day.

  Help enough people see the big picture, and the fight is as good as won. Then, and only then, does Bill Murray awaken to a new day.

  *  *  *

  Thanks for reading! The best way to get around the internet censors and make sure you see the stuff I publish is to subscribe to the mailing list for at my website or on Substack, which will get you an email notification for everything I publish. My work is entirely reader-supported, so if you enjoyed this piece please consider sharing it around, liking me on Facebook, following my antics on Twitter, or throwing some money into my tip jar on Patreon or Paypal. If you want to read more you can buy my new book Poems For Rebels (you can also download a PDF for five bucks) or my old book Woke: A Field Guide for Utopia Preppers. For more info on who I am, where I stand, and what I’m trying to do with this platform, click here. Everyone, racist platforms excluded, has my permission to republish, use or translate any part of this work (or anything else I’ve written) in any way they like free of charge.

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  Tyler Durden
  Fri, 03/05/2021 – 20:20

• Japan Supercomputer Finds Double-Masking Doesn't Work
  Japan Supercomputer Finds Double-Masking Doesn’t Work

  Many Americans are asking themselves: Is double making offering more protection against COVID-19 than a single mask? 

  To answer that question, we ask readers: Does anyone wear two condoms?

  The answer is probably no. But members of the Biden administration and at least one state governor are touting the extra benefits of double masking. 

  Last month, Dr. Anthony Fauci, the chief medical advisor to the president and the director of the National Institute of Allergy and Infectious Diseases, initially said, “there’s no data that indicates that that is going to make a difference.” He then flip-flopped, saying that the CDC is investigating “whether two masks may be better than one” and added that “it makes common sense”… and added that the reason they have not recommended it until now is that “they are a science-based organization.”

  Fauci then added, unscientifically, “if one mask serves as a physical barrier, it makes common sense, and certainly can’t hurt and might help to wear two masks.”

  This week, California Governor Gavin Newsom also doubled-down (literally) on double making following Texas and Mississippi actions to go maskless. 

  “We will be doubling down on mask-wearing,” said Newsom on Thursday, “not arguing to follow the example of Texas and other states that I think are making a terrible mistake.”

  According to Reuters, science doesn’t bode well for the folks pushing double masks.

  

  A Japanese supercomputer simulation showed this week that wearing two layers of masks provided minimal benefit in blocking the virus. 

  A study released by scientific research institute Riken and Kobe University on Thursday contradict Fauci and Newsom’s recommendations that double masking is “common sense.” 

  “Researchers used the Fugaku supercomputer to model the flow of virus particles from people wearing different types and combinations of mask,” according to Reuters. 

  

   

  They found a single surgical-type mask had 85% effectiveness in blocking particles if worn correctly, and a polyurethane mask was around 89%. 

  Researchers said wearing two masks doesn’t help because it builds air resistance and causes leakage around the edges.

  “The performance of double masking simply does not add up,” wrote lead researcher Makoto Tsubokura.

  

  In this presentation slide supplied by the Riken Center for Computational Sciences. Red is a loosely fitted non-woven mask. Green is a fitted non-woven mask. Green and brown are a non-woven mask with a polyurethane one on top. The bar graph illustrates the “droplet collection efficiency”. The blue bar shows the results of wearing loose-fit non-woven (surgical) mask. while red shows a fitted non-woven mask, and purple shows a fitted non-woven mask plus polyurethane mask.

  “Wearing two masks does not make them twice as effective but only slightly more so,” Tsubokura added cited by the Asahi Shimbun newspaper.

  “Wearing one nonwoven mask is enough, and make sure it is put on properly without leaving a gap between the fabric and the nose.”

  As JapanToday notes, the findings in part contradict recent recommendations from the U.S. Centers of Disease Control and Prevention (CDC) that two masks were better than one at reducing a person’s exposure to the coronavirus.

  So if two masks don’t work, proven by a Japanese supercomputer, then what is the underlying agenda by US government officials who parade themselves around media outlets touting double making is “common sense”?

  Tyler Durden
  Fri, 03/05/2021 – 20:00

• As Insurrection Narrative Crumbles, Democrats Cling To It More Desperately Than Ever
  As Insurrection Narrative Crumbles, Democrats Cling To It More Desperately Than Ever

  Authored by Glenn Greenwald via greenwald.substack.com,

  Twice in the last six weeks, warnings were issued about imminent, grave threats to public safety posed by the same type of right-wing extremists who rioted at the Capitol on January 6. And both times, these warnings ushered in severe security measures only to prove utterly baseless.

  

  First we had the hysteria over the violence we were told was likely to occur at numerous state capitols on Inauguration Day. “Law enforcement and state officials are on high alert for potentially violent protests in the lead-up to Inauguration Day, with some state capitols boarded up and others temporarily closed ahead of Wednesday’s ceremony,” announced CNN. In an even scarier formulation, NPR intoned that “the FBI is warning of protests and potential violence in all 50 state capitals ahead of President-elect Joe Biden’s inauguration.”

  The resulting clampdowns were as extreme as the dire warnings. Washington, D.C. was militarized more than at any point since the 9/11 attack. The military was highly visible on the streets. And, described The Washington Post, “state capitols nationwide locked down, with windows boarded up, National Guard troops deployed and states of emergency preemptively declared as authorities braced for potential violence Sunday mimicking the Jan. 6 attack on the U.S. Capitol by a mob of pro-Trump rioters.” All of this, said the paper, “reflected the anxious state of the country ahead of planned demonstrations.” 

  But none of that happened — not even close. The Washington Post acknowledged three weeks later:

  Despite warnings of violent plots around Inauguration Day, only a smattering of right-wing protesters appeared at the nation’s statehouses. In Tallahassee, just five armed men wearing the garb of the boogaloo movement — a loose collection of anti-government groups that say the country is heading for civil war — showed up. Police and National Guard personnel mostly ignored them.

  All over the country it was the same story. “But at the moment that Biden was taking the oath of office in Washington, the total number of protesters on the Capitol grounds in Topeka stood at five — two men supporting Trump and two men and a boy ridin’ with Biden,” reported The Wichita Eagle (“With Kansas Capitol in lockdown mode, Inauguration Day protest fizzles). “The protests fizzled out after not many people showed up,” reported the local Florida affiliate in Tallahassee. “The large security efforts dwarfed the protests that materialized by Wednesday evening,” said CNN, as “state capitols and other cities remained largely calm.”

  

  Indeed, the only politically-motivated violence on Inauguration Day was carried out by Antifa and anarchist groups in Portland and Seattle, which caused some minor property damage as part of anti-Biden protests while they “scuffled with police.” CNN, which spent a full week excitedly hyping the likely violence coming to state capitols by right-wing Trump supporters, was forced to acknowledge in its article about their non-existence that “one exception was Portland, where left-wing protesters damaged the Democratic Party of Oregon building during one of several planned demonstrations.”

  Completely undeterred by that debacle, Democrats and their media spokespeople returned with a new set of frightening warnings for this week. The date of March 4 has taken on a virtually religious significance for the Q-Anon movement, announced NBC News’ Ben Collins, who was heard on NPR on Thursday speaking through actual, literal journalistic tears as he recounted all the times he called Facebook to plead with them to remove dangerous right-wing extremists on their platform (tears commence at roughly 7:00 mark). Valiantly holding back full-on sobbing, Collins explained that he proved to be so right but it pains and sorrows him to admit this. With his self-proclaimed oracle status fully in place, he prophesized that March 4 had taken on special dangers because Q-Anon followers concluded that this is when Trump would be inaugurated.

  This is how apocalyptic cult leaders always function. When the end of the world did not materialize on January 6, Collins insisted that January 20 was the day of the violent reckoning. When nothing happened on that day, he moved the Doomsday Date to March 4. The flock cannot remain in a state of confusion for too long about why the world has not ended as promised by the prophet, so a new date must quickly be provided with an explanation for why this is serious business this time.

  This March 4 paranoia was not confined to NBC’s resident millennial hall monitor and censorship advocate. On March 3, The New York Times warned that “the Capitol Police force is preparing for another assault on the Capitol building on Thursday after obtaining intelligence of a potential plot by a militia group.” All this, said the Paper of Record, because “intelligence analysts had spent weeks tracking online chatter by some QAnon adherents who have latched on to March 4 — the original inauguration date set in the Constitution — as the day Donald J. Trump would be restored to the presidency and renew his crusade against America’s enemies.”

  These dire warnings also, quite predictably, generated serious reactions. “House leaders on Wednesday abruptly moved a vote on policing legislation from Thursday to Wednesday night, so lawmakers could leave town,” said the Times. We learned that there would be further militarization of the Capitol and troop deployment in Washington indefinitely due to so-called “chatter.” NPR announced: “The House of Representatives has canceled its Thursday session after the U.S. Capitol Police said it is aware of a threat by an identified militia group to breach the Capitol complex that day.”

  

  Do you know what happened on March 4 when it came to violence from right-wing extremists? The same thing that happened on January 20: absolutely nothing. There were no attempted attacks on the Capitol, state capitols, or any other government institution. There was violent crime registered that day in Washington D.C. but none of it was political violence by those whom media outlets warned posed such a grave danger that Congress has to be closed and militarization of Washington extended indefinitely.

  Perhaps the most significant blow to the maximalist insurrection/coup narrative took place inside the Senate on Thursday. Ever since January 6, those who were not referring to the riot as a “coup attempt” — as though the hundreds of protesters intended to overthrow the most powerful and militarized government in history — were required to refer to it instead as an “armed insurrection.”

  This formulation was crucial not only for maximizing fear levels about the Democrats’ adversaries but also, as I’ve documented previously, because declaring an “armed insurrection” empowers the state with virtually unlimited powers to act against the citizenry. Over and over, leading Democrats and their media allies repeated this phrase like some hypnotic mantra:

  But this was completely false. As I detailed several weeks ago, so many of the most harrowing and widespread media claims about the January 6 riot proved to be total fabrications. A pro-Trump mob did not bash Office Brian Sicknick’s skull in with a fire extinguisher. No protester brought zip-ties with them as some premeditated plot to kidnap members of Congress (two rioters found them on a table inside). There’s no evidence anyone intended to assassinate Mike Pence, Mitt Romney or anyone else.

  Yet the maximalist narrative of an attempted coup or armed insurrection is so crucial to Democrats — regardless of whether it is true — that pointing out these facts deeply infuriates them. A television clip of mine from last week went viral among furious liberals calling me a fascism supporter even though it did nothing but point out the indisputable facts that other than Brian Sicknick, whose cause of death remains unknown, the only people who died at the Capitol riot were Trump supporters, and that there are no known cases of the rioters deliberately killing anyone

  (Two FBI operatives have since anonymously leaked that it is looking at a “suspect” who may have engaged with Sicknick in a way that ultimately contributed to his death. But nothing still is known; Sicknick’s mother claims he died of a stroke while his brother says it was from pepper spray; and all of this is worlds away from the endlessly repeated media claim that a bloodthirsty pro-Trump mob savagely bashed his head in with a fire extinguisher.)

  What we know for sure is that no Trump supporter fired any weapon inside the Capitol and that the FBI seized a grand total of zero firearms from those it arrested that day — a rather odd state of affairs for an “armed insurrection,” to put that mildly. In questioning from Sen. Ron Johnson (R-WI) on Thursday’s hearing, a senior FBI official, Jill Sanborn, acknowledged this key fact:

  (The “one lady” who died referred to by this FBI official was Ashli Babbitt, an unarmed Trump supporter who was killed when she was shot point blank in the neck inside the Capitol on January 6 by an armed Capitol Police Officer).

  The key point to emphasize here is that threats and dangers are not binary: they either exist or they are fully illusory. They reside on a spectrum. To insist that they be discussed rationally, soberly and truthfully is not to deny the existence of the threat itself. One can demand a rational and fact-based understanding of the magnitude of the threat revealed by the January 6 riot without denying that there is any danger at all.

  Those who denounced the excesses of McCarthyism were not insisting that there were no Communists in government; those denouncing the excesses of the Clinton administration’s attempts to seize more surveillance power after the Oklahoma City courting bombing were not denying that some anti-government militias may do violence again; those who objected to the protracted and unhinged assault on civil liberties by the Bush/Cheney and Obama administrations after 9/11 were not arguing that there were no Muslim extremists intent on committing violence.

  The argument then, and the argument now, is that the threat was being deliberately inflated and exaggerated, and fears stoked and exploited, both for political gain and to justify the placement of more and more powers in the hands of the state in the name of stopping these threats. That is the core formula of authoritarianism — to place the population in a state of such acute fear that it acquiesces to any assertion of power which security state agencies and politicians demand and which they insist are necessary to keep everyone safe.

  There is, relatedly, a massive political benefit from convincing the population that the opponents and critics of those in power do not merely hold a different ideology but are coup plotters, insurrectionists, domestic terrorists. That is the same political benefit that accrued from trying to persuade the population that adversaries of the Democratic Party were treasonous Kremlin agents. The more you can demonize your opponents as something monstrous, the more political power you can acquire.

  And as Democrats and liberals now gear up to demand a new War on Terror, this one domestic in nature, it should be no surprise that the rhetorical leaders of their effort now are the same lowlife neocon and Rovian slanderers — Bill Kristol, David Frum, Steve Schmidt, Nicolle Wallace, Rick Wilson — who demonized everyone who questioned them as part of the first War on Terror as traitors and terrorist-lovers and subversives. It is not a coincidence that neocons are leading the way now as liberals’ favorite propagandists: they are the most skilled and experienced in weaponizing and exaggerating terrorism threats for political gain and authoritarian power.

  “The House announced it was canceling its Thursday session and security officials urged staffers who could to work from home. Meaning that domestic terrorists have succeeded in shutting down the government again.” https://t.co/dOAPLjoJce

  — Bill Kristol (@BillKristol) March 4, 2021

  https://platform.twitter.com/widgets.js

  Ultimately, if this “armed insurrection” and threat of domestic terrorism are so grave, why do media figures and politicians in both parties — from Adam Schiff to Liz Cheney — keep lying about it and peddling fictions? Politicians and media figures do that only when they know that the threat, in reality, is not nearly as menacing as they need it to be to fulfill their objectives of political gain and coercive power.

  Tyler Durden
  Fri, 03/05/2021 – 19:40

• Rampant Shoplifting Forces Ten Bay Area Walgreens To Close 
  Rampant Shoplifting Forces Ten Bay Area Walgreens To Close 

  The effects of the virus pandemic and socio-economic implosion that followed compounded with failed liberal leadership could soon transform San Francisco into an empty ghost town. 

  Such is the case with pharmacy giant Walgreens fleeing the metro area amid a rash of shoplifting. Since 2019, Walgreens has closed ten stores in the city, with the latest store set to close later this month. The closure is the third since October 2020. 

  According to Washington Examiner, the Walgreens at the corner of Bush and Larkin streets posted a notification on their front windows announcing the closure on Mar. 17.

  

  “All of us knew it was coming. Whenever we go in there, they always have problems with shoplifters,” a regular customer, Sebastian Luke, told the San Francisco Chronicle.

  Last October, a news reporter with Inside Edition captured the moment when a man jumped over a Walgreens counter and stole an air bed. The video shows the man taking off on an electric scooter as he escaped without any intervention from employees or customers. 

  “I feel sorry for the clerks, they are regularly verbally assaulted,” Luke said. “The clerks say there is nothing they can do. They say Walgreens’ policy is to not get involved. They don’t want anyone getting injured or getting sued, so the guys just keep coming in and taking whatever they want.”

  At one location, the San Francisco Chronicle said it loses about $1,000 per day in merchandise because of shoplifting.

  San Francisco Chamber of Commerce told SFGATE that complaints of shoplifting at drugstores are “frequent.” 

  Theft of less than $950 in goods is treated as a nonviolent misdemeanor under California law. But in most cases, for shoplifting, the criminal is released. 

  The San Francisco Police Department told the Washington Examiner that it is “aware of incidents of retail theft where groups of suspects enter stores, grab product and merchandise and flee.” 

  … and with the exodus of city residents, the decimation of small and medium-sized enterprises (due to pandemic), and soaring socio-economic problems in the metro area, San Fran could one day be a hallowed out town, sort of like Baltimore and or Detroit if these trends persist. 

  Tyler Durden
  Fri, 03/05/2021 – 19:20

• The Myths Of Green Energy
  The Myths Of Green Energy

  Authored by Charles Hugh Smith via The Daily Reckoning,

  Finance is often cloaked in arcane terminology and math, but the one dynamic that governs the future is actually very simple. Here it is:

  All debt is borrowed against future supplies of affordable hydrocarbons (oil, coal and natural gas).

  Since global economic activity is ultimately dependent on a continued abundance of affordable energy, it follows that all money borrowed against future income is actually being borrowed against future supplies of affordable energy.

  Many people believe that alternative “green” energy will soon replace most or all hydrocarbon energy sources, but this belief is not realistic. All the “renewable” energy sources are about 3% of all energy consumed, with hydropower providing another few percent.

  There are unavoidable headwinds to this appealing fantasy…

  

  Reality Check

  1. All “renewable” energy is actually “replaceable” energy, analyst Nate Hagens points out. Every 15-25 years (or less) much or all of the alt-energy systems and structures have to be replaced, and little of the necessary mining, manufacturing and transport can be performed with the “renewable” electricity these sources generate. Virtually all the heavy lifting of these processes require hydrocarbons and especially oil.

  2. Wind and solar “renewable” energy is intermittent and therefore requires changes in behavior (no clothes dryers or electric ovens used after dark, etc.) or battery storage on a scale that isn’t practical in terms of the materials required.

  3. Batteries are also “replaceable” and don’t last very long. The percentage of lithium-ion batteries being recycled globally is near-zero, so all batteries end up as costly, toxic landfill.

  4. Battery technologies are limited by the physics of energy storage and materials. Moving whiz-bang exotic technologies from the lab to global scales of production is non-trivial.

  5. The material and energy resources required to build alt-energy sources that replace hydrocarbon energy and replace all the alt-energy which has broken down or reached the end of its life exceeds the affordable reserves of materials and energy available on the planet.

  6. Externalized costs of alt-energy are not being included in the cost. Nobody’s adding the immense cost of the environmental damage caused by lithium mines to the price of the lithium batteries. Once the full external costs are included, the cost is no longer as affordable as promoters claim.

  7. None of the so-called “green” “replaceable” energy has actually replaced hydrocarbons; all the alt-energy has done is increase total energy consumption. This is what’s called Jevons Paradox: every increase in efficiency or energy production only increases consumption.

  Here’s a real-world example: Building another freeway doesn’t actually reduce congestion in the old freeway; it simply encourages people to drive more, so both freeways are soon congested.

  All Future Income Is a Claim on Future Energy

  Setting aside the impracticalities of replacing most or all hydrocarbons with “replaceable” energy, the real issue is all debt service/repayment is ultimately funded by future energy.

  On the face of it, future income is used to pay back borrowed money, but all future income is nothing more than a claim on future energy.

  “Money” without access to affordable energy is worthless.

  Imagine being air-dropped into the Sahara desert with a backpack of gold and $100 bills. You’re wealthy in terms of “money” but if there’s no water, food and transport to buy with your money, you’ll die.

  The point is that “money” is only valuable if the essentials of life are available at affordable prices.

  Right now the average full time wage in the U.S. is about $19/hour, and the average cost of a gallon of gasoline is $2.25. So a mere 7 minutes of (pretax) labor will buy a gallon of gasoline.

  But what happens if inflation increases the cost of oil but wages continue stagnating? What happens to the economy if it takes one hour of labor to buy a gallon of gasoline instead of 7 minutes?

  The Hidden Costs of Alternative Energy

  Economics claims that cheaper substitutes will appear to replace whatever is expensive, so cheap electricity will replace costly oil, or transport will switch to cheap natural gas, etc.

  But these proposed transitions are not cost-free.

  The cost of replacing 100 million internal combustion engine (ICE) vehicles is non-trivial, as is building the “replaceable” energy infrastructure needed to power all these vehicles.

  The true costs of “replaceable” energy have been fudged by not counting external costs or replacement costs; the full lifecycle costs of “replaceable” energy are much higher than promoters are claiming.

  There are supply constraints that are also not included. For example, all the plastic in the world is still derived from oil, not electricity. (Note that each electric vehicle contains hundreds of pounds of plastic.)

  Energy in any form is not magically pliable. Just as we can’t turn electricity into jet fuel, we can’t turn a barrel of oil into only diesel fuel. Coal can be turned into liquid fuel but the process is non-trivial.

  All of which is to say that the cost of energy in hours of labor is likely to increase, possibly by more than the global economy can afford.

  There may also be supply constraints, situations where the energy people want and need is not available in sufficient quantities to meet demand at any price.

  As “software eats the world” and automation replaces costly human labor, it’s also likely that the erosion in the purchasing power of labor that’s been a trend for 20 years will continue and accelerate.

  Analyst Gail Tverberg has done an excellent job of explaining that it’s not just the availability of energy that matters, it’s the affordability of that energy to the bottom 90% of consumers.

  Central Banks Can’t Print Energy

  Again, “money” is nothing but a claim on future energy, because energy is the foundation of the global economy. Without energy, we’re all stranded in the desert and all our “money” is worthless because it can no longer buy what we need to live.

  Central banks can print infinite amounts of currency but they can’t print energy, and so all central banks can do is add zeroes to the currency. They can’t make energy more affordable, or guarantee that a day’s labor will buy more than a fraction of the energy that labor can buy today.

  The global financial system has played a game in which “money” is either printed or borrowed into existence, on the theory that energy will be more abundant and more affordable in the future. If this theory turns out to be incorrect, the “money” used in the future to pay back debts incurred today will have near-zero value.

  The question is: how much energy, water and food will the “money” created out of thin air in the future buy?

  If the lender can only buy a tiny sliver of the energy, water and food that the “money” could have bought at the time the “money” was borrowed, then it won’t really matter how many zeroes the “money” will have. What matters is how much purchasing power of essentials the “money” retains.

  Borrowing trillions of dollars euros, yen and yuan every year expands the claims on future energy at a rate that far exceeds the actual expansion of energy in any form.

  This has created an illusion that we can always create money out of thin air and it will magically hold its current purchasing power for ever greater amounts of energy, food and water.

  The monumental asymmetry between the staggering rate of expansion of “money” — claims on future energy — and the stagnant supply of energy means this illusion is only temporary.

  Tyler Durden
  Fri, 03/05/2021 – 19:00

• Manhattan Office Rents Plunge To Lowest Since 2018 Amid Record Supply Glut
  Manhattan Office Rents Plunge To Lowest Since 2018 Amid Record Supply Glut

  Whether “working from home” is a temporary fad or a permanent “new normal” remains to be seen, but for New York’s office market, the vacant present is as ugly as it gets.

  According to a new report from Colliers, office rents in Manhattan are plunging amid as the glut of available office space has hit the highest on record going back 20 years. In a desperate scramble to lock in tenants, In February the average asking rent fell for an eighth straight month to $73.12 a square foot, the lowest since March 2018.

  And ensuring that prices will stay low for a long time, at the same time vacant space continues to pile up. The office availability rate rose for a ninth consecutive month to 15.5%, a record in data going back to 2000, the brokerage said; the amount of space listed by tenants for sublease jumped by 1.1 million square feet.

  In a stark testament to the post-pandemic world, leases were signed for less than 1 million square feet of Manhattan office space last month, a whopping 51% drop from January. Not surprisingly, the five biggest agreements were in Midtown.

  The Manhattan office market continues to struggle nearly a year after the pandemic hit, which has emptied Manhattan’s skyscrapers. And since most employees are still working from home, just 14% of workers in the New York metropolitan area were back at their desks as of Feb. 17, according to data from Kastle Systems.

  

  “The sublet spaces currently on offer at deeply discounted rates is a veritable flood of biblical proportions, with more likely to come online soon,” Ruth Colp-Haber, chief executive officer of brokerage Wharton Property Advisors told Bloomberg. 

  Even with the vaccine rollout, reaching at least 16.3% of the total population, companies opt for “hybrid” work as remote working dominates. 

  Jim Wenk, a vice chairman at Savills North America, said commercial real estate in the borough will have a “very choppy period for the foreseeable future.”

  As more proof of the hard times, major magazine publisher Conde Nast (who owns brands such as ARS Technica, GQ, Teen Vogue, The New Yorker, Vanity Fair, Vogue, Wired, among other popular magazines) is a major anchor tenant in the new World Trade Center, recently skipped out on rent as it asked for rent discounts and a reduction in square footage.

  Earlier this week, JP Morgan is reportedly looking to sublet hundreds of thousands of square feet at 4 New York Plaza in the financial district and 5 Manhattan West in the Hudson Yards area. 

  To make matters worse, Hudson Yards, a massive complex on Manhattan’s Far West Side with condos, office space, and retailers built over an enormous railroad yard, had investors panic because the company refuses to open its books. The combination of work-at-home and folks moving to suburbs has left Hudson Yards, and other places across the borough a ‘ghost town.’ 

  Meanwhile, in a world where traditional offices are undercutting each other’s prices at a record pace, WeWork is somehow hoping to make a splash when it re-emerges from the dead, this time in the form of a SPAC. Good luck to them.

  Tyler Durden
  Fri, 03/05/2021 – 18:40

• Baltimore Student Who Failed All But Three Classes In Four Years Was Ranked In Top Half Of His Class
  Baltimore Student Who Failed All But Three Classes In Four Years Was Ranked In Top Half Of His Class

  Authored by Jonathan Turley,

  As teacher unions fight to keep schools closed, the true cost is being felt by students who are racking up failing grades, dropping out of virtual classes, increasing drug use, and, in rising numbers, committing suicide.  In response, some union officials like the President of the Los Angeles Teacher’s Union has labelled calls to return to class examples of white privilege despite overwhelming science supporting resumption of classes. However, for minority students, this shutdown has taken a dire situation and turned into a freefall disaster. The pandemic led to the closure of an already failing public school system, as evident in a shocking story out of Baltimore. As recently reported, a high school student almost graduated near the top half of his class after failing every class but three in four years. He has a 0.13 GPA.  His mother finally went public in exasperation with the failures in the public schools.

  

  Tiffany France is understandably upset. She is a mother of three who works three jobs to support her family. She was never told that her son failed 22 classes and was late or absent 272 days over his first three years of high school. She was called for only one teacher-student meeting and that meeting never occurred at Augusta Fells Savage Institute of Visual Arts.

  France ultimately had to pull her son out of the school and enrolled him in an accelerated program to allow him to graduate in 2023.

  For decades, we have spent huge amounts of money in school districts like Washington, D.C. and Baltimore as these cities and their leaders have failed to address these failures. We have had a lost generation of kids who have neither the education nor the trained skills to succeed in society. Yet, there is no accountability for the political and educational leaders in these cities.

  In the meantime, school officials seem intent on driving top performing students from their systems in Boston, New York and other cities where advanced programs are being shutdown or suspended. Mayor Bill deBlasio proclaimed that public schools are a means to redistribute wealth as students continue to fail on every level in the system.  Other education officials have denounced “meritocracy” as racist.  These officials, including a recent congressman, attack standardized tests as racist rather than make real progress to improve performance on such tests for these children.

  The top spending public school districts are also some of the worst performing school districts.  New York topped the per capita spending at $24,040 per kid. Washington, D.C. is close at $22,759.  Baltimore is often ranked in the top three per capita spending districts.

  According to a 2019 study, over half of the New York City public schoolkids cannot handle basic math or English.  On tests, Asian kids shows a  74.4 percent proficiency in math with a 66.6 proficiency for whites, a 33.2 percent proficiency for Hispanics, and a 28.2 percent proficiency for African Americans.  Thus, more than two third of African American kids were not able to handle basic math in a school system with one of the highest per capita expenditures for students in country. Thus, public schools may be a vehicle for deBlasio to “redistribute wealth” but he is not distributing education or learning to those who need it the most.

  In Washington, with the highest per capita spending on students, education officials “celebrated” a small improvement of scores in 2019. However, the scores would make most people cringe.  Only 21.1 percent of black students were proficient in math (as opposed to 78.8 percent for white students).

  In Wisconsin, the 2019 scores (for students in grades 3 to 8 and grade 11) showed only 39.3% of students tested proficient or better in English/language and only 40.1% demonstrated a proficient or better understanding of math. Both showed drops. However, the racial disparity was particularly shocking. Ironically, the gap slightly narrowed due to white students declining in scores. However, in the eighth grade, only 12.1 percent of black students were proficient or advanced in English. There was still as 30 point gap for black students.

  In the meantime, the pandemic has led to delays, reductions, or outright cancellations of standardized testing in many districts. So now students will not be going full-time to school and also not be tested on their proficiency in subjects in some districts. It is as if they did not exist, which is precisely the problem. Politically, they do not seem to register in terms of importance or influence. They are useful objects for politicians who use them for campaigns for more money or power. Yet, they seem utterly detached from any actual benefits as these leaders allow public schools to continue on the same course of proven failure.

  Watching this happen to the public schools has been particularly hard for many of us who are ardent supporters of public education. Growing up in Chicago during the massive flight of white families from the public school system, I remained in public schools for much of my early education. My parents organized a group to convince affluent families remain in the system. They feared that, once such families left, the public schools would not only loose diversity but political clout and support. They also wanted their kids to benefit from such diversity. My wife and I also believe in that cause and we have kept our four kids in public schools through to college.  We believe public education plays a key role in our national identity and civics. They shape our next generation of citizens.  My children have benefitted greatly from public schools and the many caring and gifted teachers who have taught them through the years.

  Reading accounts like that of Tiffany France is a disgrace. She is working three jobs and counting on the school system to give her three children and education . . . and a chance.  Yet, Baltimore and other cities have failed such children for decades. There is no accountability in the system.  These leaders are failing whole generations and leaving them to an endless cycle of poverty and crime. Yet, they are reelected or reappointed every year. Educational leaders demand more money but show little progress or success. The money evaporates and nothing seems to change for Tiffany France or her children.

  The problem is not standardized testing. It is the lack of education where a student with below a 1.0 GPA could qualify for cum laude recognition in Baltimore. Decades and billions of dollars have been exhausted without significant improvement. However, the real cost of our failure is born by these students who find little solace in knowing that their per capita expenditures continue to rise as their scores continue to fall. If we ran our highway system like this, we would have billion-dollar gravel roads for highways. In our education system, we are spending billions but kids like Tiffany’s son are going nowhere fast.

  Tyler Durden
  Fri, 03/05/2021 – 18:20

• Tom Brady Rookie Card Fetches Record $1.32 Million At Auction 
  Tom Brady Rookie Card Fetches Record $1.32 Million At Auction 

  Yet another record for Tampa Bay Buccaneers quarterback Tom Brady, yet this one is not on the football field. His rookie card just sold for $1.32 million in an online auction, which is by far the highest price ever paid for an NFL card, according to the auction house.

  This followed on the heels of Patrick Mahomes’ autographed rookie card in February going for $861,000 at an online auction. And just two years ago an autographed card from Brady’s rookie season sold for over $400,000 – which was the highest at that time. 

  PWCC Marketplace confirmed the final record price on its Instagram account Thursday, featuring an image of the ultra-rare card:

  

  The auction house, considered the largest trading card marketplace in the world, announced, “This month we had the pleasure of brokering a record-breaking sale on a 2000 Playoff Contenders Championship Ticket Tom Brady.”

  “Only one of 100 cards in the world, even less if you consider grade – this incredible card was picked up by James Parker, a long-time Brady fan,” the statement added. 

  Widely considered the greatest player of all-time, Brady recently added a 7th Super Bowl win to his already record career.

  

  The purchaser described what motived him to shell over such a large sum in the auction house press release…

  “I lived in Boston for 10 years and so am a huge fan of Brady. The last Super Bowl win was just a mind-blowing accomplishment.”

  Park added, “I’ve also had a love of collecting cards since I was a kid. Given Brady’s uncontested status as GOAT (greatest of all time) in football, this card is an important piece of sports history and of any collection.”

  

  Sports Illustrated describes further of what’s behind the record-smashing price tag: “The piece is being dubbed the ‘Holy Grail’ of Brady football cards, much in the way the Wayne Gretzky O-Pee-Chee has defined the hockey great’s collectible market.”

  We’ve not yet quite reached Picasso auction prices, but given that 43-year old Brady has said he’s already thinking about chasing a number eight Super Bowl win, it might not take long at this rate for his memorabilia to skyrocket further to such levels.

  Tyler Durden
  Fri, 03/05/2021 – 18:00

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• How Democracy Dies: Big Tech Becomes Big Brother
  How Democracy Dies: Big Tech Becomes Big Brother

  Authored by Leni Friedman Valenta with Dr. Jiri Valenta via The Gatestone Institute,

  “Digital giants have been playing an increasingly significant role in wider society… how well does this monopolism correlate with the public interest?,” Russian President Vladimir Putin said on January 27, 2021.

  “Where is the distinction between successful global businesses, sought-after services and big data consolidation on the one hand, and the efforts to rule society[…] by substituting legitimate democratic institutions, by restricting the natural right for people to decide how to live and what view to express freely on the other hand?”

  Was Mr. Putin defending democracy? Hardly. What apparently worries him is that the Big Tech might gain the power to control society at the expense of his government.

  What must be a nightmare for him — as for many Americans — is that the Tech giants were able to censor news favorable to Trump and then censor Trump himself. How could the U.S. do this to the president of a great and free country?

  Putin made these comments at the Davos World Economic Forum, in which he and Chinese President Xi Jinping, sped on by the “Great Reset” of a fourth industrial revolution, used enlightened phrases to mask dark plans for nation states in a globalist New World Order. Thus did Xi caution attendees “to adapt to and guide globalization, cushion its negative impact, and deliver its benefits to all countries and all nations.”

  In March 2019, Putin signed a law “imposing penalties for Russian internet users caught spread ‘fake news’ and information that presents ‘clear disrespect for society, government, state symbols the constitution and government institutions.'” Punishments got even heavier with new laws in December.

  Meanwhile, opposition leader Alexei Navalny has been sentenced to prison for more than three years (with a year off for time served), in part because he revealed photos of a lavish Russian palace allegedly belonging to Putin on the coast of the Black Sea. Its accouterments supposedly include an $824 toilet brush. Many of the thousands of people protesting Navalny’s imprisonment have since been protesting Putin by waving gold-painted toilet brushes.

  How nice that American Big Tech companies is pushing democracy in Russia — even while it is denying it at home. Do you notice how many leaders in Europe have risen to condemn censorship in America even though many in Europe are censoring their citizens as well, and are not exactly fans of the person who was being censored, former President Donald J. Trump? Like Putin, they probably do not want Big Tech competing with their governments, either.

  

  The power-sharing of the U.S. Federal government with Big Tech appears a recipe for unharnessed power and corruption. Navalny caught on right away, saying:

  “This precedent will be exploited by the enemies of freedom of speech around the world. In Russia as well. Every time when they need to silence someone, they will say: ‘this is just common practice, even Trump got blocked on Twitter.'”

  What watchdog, if any, is now restraining Big Tech in America? It has become quite clear that Big Tech’s censorship may well have cost Trump the election, even if one ultimately finds that election fraud did not.

  Big Tech took it upon itself to censor an exposé — published by the New York Post on October 24, 2020, as well as follow-up exposés — reporting that Hunter Biden, Joe Biden’s son, had sold his influence to China and Ukraine, and had raked in millions for the family.

  The Media Research Center (MRC) found that “One of every six Biden voters we surveyed (17%) said they would have abandoned the Democratic candidate had they known the facts about one or more of these news stories”. That information might well have changed the outcome in all six of the swing states Biden reportedly won.

  Last August, Twitter also undertook censoring the trailer of an explosive documentary entitled “The Plot Against the President.” The film, narrated by Rep. Devin Nunes (R-CA) with commentary by leading members of the Republican Party, exposes leading members of the Democratic Party and their deep state allies, many of whom knowingly used phony evidence to frame President Trump and some in his circle to try convince Americans that he and his campaign had colluded with the Russian government to win the 2016 election.

  The film claims, using with recently declassified information, that President Barack Obama, as well Hillary Clinton, were involved in an almost four-year attempted coup incomparably more undemocratic than any riot at the Capital Building on January 6.

  Rep. Devin Nunes, the top Republican on the House Intelligence Committee, claimed in August 2020 that Biden also knew of the ongoing efforts to unseat Trump. Nevertheless, Trump did not target them, perhaps to avoid dividing the country even further.

  According to the Washington Times, the Twitter account of the movie, which debuted in October 2020, attracted 30,000 followers. Twitter blacklisted it for a day, but after a public uproar, put the popular documentary back. Our question is: How many blacklistings did Twitter not put back?

  The January 6 riot at the U.S. Capitol was a pivotal event for Trump and the Republican Party. Prior to January 6, President Trump had offered to deploy 10,000 troops to the capitol, according to his former Chief-of-Staff Mark Meadows. The Pentagon and the Department of Justice had also offered help but were also reportedly turned down by the US Capitol Police The problem, apparently, was “optics” — about a Capitol now surrounded by barbed wire and thousands of troops, which the current Administration now seems to like.

  Freedom of Information Act (FOIA) requests for further details about the event were also rejected — it is not clear by whom. It is ridiculous, therefore, for anyone to frame the riots, ugly as they were, as a seditious “insurrection,” particularly in light of what appears to be a massive security failure that could have averted the violence. One thing is certain: the timing of the event could not have been more perfect for opposition groups, which is probably why it had been planned for weeks before January 6.

  What these efforts and the media did achieve was an end to all attempts to ascertain election fraud at a time when Vice President Mike Pence was counting Electoral College ballots, and allowing speeches from those supporting that claim. Some politicians even called for the resignation of Senators Ted Cruz and Josh Hawley, and referred them to the ethics committee for even suggesting an election audit of battleground states, despite questions having been asked — with no objections — concerning the results of the 2000, 2004 and 2016 presidential elections.

  Ultimately, the result of the latest “witch hunt” against President Trump, as it has been called, was a contrived impeachment attempt to bar Trump from a future presidential bid — a kangaroo court devoid of due process, hearings, witnesses, and evidence. The prosecution, however, was undeniably eloquent in evoking “democracy” for a totally undemocratic procedure that justly resulted in Trump’s acquittal.

  Meanwhile, Facebook and Twitter banned Trump and some of his supporters from their cyber domains. An alternative social media platform, Parler, was banned from the Apple and Google app stores, and then completely closed down by Amazon.

  Meanwhile, mainstream social media platforms were reportedly used to rally and organize carry out riots in American cities last year. No one was penalized.

  Do not, however, expect such slackness now. According to Fox News:

  “People like Obama-era CIA Director John Brennan and Rep. Alexandria Ocasio-Cortez, D-N.Y., have made various public statements labeling Republicans as extremists — with Ocasio-Cortez claiming the GOP has ‘white supremacist sympathizers’ within its ranks, and Brennan claiming ‘domestic violent extremists’ in the form of far-right supporters of President Trump are more dangerous than Al Qaeda.”

  Columnist and radio host Jeffrey Kuhner warns that a new bill, H.R. 350, “is the liberals’ equivalent of the Patriot Act redux. This time, however, it is not aimed at Islamic jihadists. Rather, it directly targets Trump patriots.” Kuhner writes that the bill “has the full backing of the Democratic congressional leadership, the Biden administration… Big Media and Big Tech.”

  “The bill empowers the Deep State to monitor, surveil and spy on American citizens’ social media accounts, phone calls, political meetings and even infiltrate pro-Trump or ‘Stop the Steal’ rallies.

  “Conservatives who are deemed potentially ‘seditious’ or ‘treasonous’ can be arrested and jailed, fined and/or lose their employment. The goal is simple: to crush all dissent to the Biden regime.”

  Moreover, last month the new Secretary of Defense, Lloyd Austin, ordered a “stand down “of the entire military for 60 days, “so each service, each command and each unit can have a deeper conversation about this issue [extremism].” Normally stand downs last only a few hours or days and do not involve the entire military. Austin, in addition, has pledged to “rid our ranks of racists and extremists.”

  These are words that can be applied to anyone dreamed up, including Trump supporters, and based, of course, on nothing but propaganda.

  Austin’s plan is therefore needless, divisive and dangerous, considering the foreign dangers now circling their prey. This punishment of the regime’s “foes” makes one wonder what is next. Are we already marching in lockstep with Russia and China? The way to unite and strengthen the United States is not through suppression and punishment but through political power with checks and balances, a free press and closer adherence to the Constitution.

  But here, again, there seems to be. a problem. The Federalist wrote in July:

  “According to a new Quillette survey released last month, 70 percent of self-identifying liberals want to rewrite the U.S. Constitution ‘to a new Americans constitution that better reflects our diversity as a people.'”

  Oh, so that is what we lack: diversity!

  What can Americans Do? We are presently at a tipping point in America. Communist China is working hard and is focused on global domination; we are just messing around. In an increasingly digital world, the war against infringements on our freedoms most probably needs to be fought largely in the digital and cyber-space. That is why ending censorship in both the traditional and social media is such an important priority. First, break up the Big Tech companies. Let them become the utilities they originally claimed to be, or else be liable to lawsuits as other publishers are.

  We do take some comfort that whereas dictatorships in authoritarian countries such as China and Russia is vertical — from the top down — in America, the central government shares power with the states from the bottom up, and with powers separated: the executive, the judiciary and the legislative. Fortunately, governors such as Ron DeSantis in Florida, Greg Abbott in Texas and Kevin Stitt in Oklahoma are now moving legislatively to counter federal laws that may have adverse effects on freedom of speech, jobs, election integrity, the energy industry, the first or second amendments and general constitutional rights.

  This does not speak, however, to the major issue here — that democracy cannot survive in a country where a few technocrats and oligarchs can choose to deny access to information or platforms to candidates running for office. It is simply unacceptable that they alone — unelected, unappointed, untransparent and unaccountable — can deem what is “harmful” to society. The job now for all of us is to prevent the United States from slowly becoming a full-blown tyranny.

  Tyler Durden
  Thu, 03/04/2021 – 23:40

• Pompeo Considers 2024 Presidential Run On One Condition
  Pompeo Considers 2024 Presidential Run On One Condition

  Mike Pompeo won’t rule out a 2024 run for president, but only if Donald Trump does not seek office, the former Secretary of State told Fox News‘ “Hannity.”

  

  “I care deeply about America,” Pompeo told host Sean Hannity, adding “You and I have been part of the conservative movement for an awfully long time now. I aim to keep at it.”

  When Hannity said he’d take that as a “strong maybe” in regards to a 2024 run, Pompeo responded “That’s perfect.”

  Pompeo said that under the Biden administration, the country has gone from “America First” to “blame America first,” and expressed concern over how President Biden is being perceived by foreign leaders.

  “World leaders and my counterparts all across the world are watching closely,” he said, adding “Senior leadership all across the world, they watch every statement that is made, they watch every move. They see what their patterns are like, the kinds of behaviors they exhibit when times are tough and when the pressure is really on.”

  The former Secretary of State compared Biden’s lack of press engagement to Trump’s near-constant presence.

  “President Trump would be out there. He talked to the media all the time, probably more than any modern president,” he said. “He was out engaging with the media on a broad range of topics … When a leader can’t do that, when they can’t take questions, when they can’t explain the policies they are engaged in, when they seem to be hiding behind — whether that’s staff or just the fact that they don’t have time. Leaders watch that and they wonder.

  “When the United States exhibits weakness. It creates real risk for our soldiers, sailors, airmen and Marines all across the world,” Pompeo continued. “Weakness begets wars and strength determines whether an adversary is going to be deterred, and it also determines whether allies really want to toss in with us when the times get most difficult.”

  According to Pompeo, China represents “the most sustained threat to our fundamental way of life,” and suggested that the Biden administration “take that threat most seriously.”

  “The American people deserve it and I know that they’re going to demand it.”

  Watch:

  Tyler Durden
  Thu, 03/04/2021 – 23:20

• Towards $100 Oil
  Towards $100 Oil

  By Princeton Energy Advisors

  WTI stood at $61.50 / barrel when we issued our weekly assessment of EIA oil markets data yesterday. Nevertheless, we stated that, “We might expect WTI at $64 / barrel this time next week, and $65-66 / barrel would not be surprising.” We did not need a week. Less than twenty-four hours later, WTI had surged above $64 / barrel. It could well rise far above this level, and with shocking speed.

  Bloomberg notes:

  OPEC+ decided to keep a tight limit on oil production next month, sending prices soaring in a market that had been expecting additional supply. The agreement is a victory for Saudi Arabia, which has consistently pushed to tighten the market. The cartel had been debating whether to restore as much as 1.5 million barrels a day of output. But after being urged to “keep our powder dry” by Saudi Energy Minister Prince Abdulaziz bin Salman, members agreed to hold steady at current levels — with the exception of modest increases granted to Russia and Kazakhstan. In a briefing after Thursday’s meeting, the prince went one step further by making the kingdom’s additional 1 million barrel-a-day production cut open-ended. He gave no date for phasing out the voluntary reduction and told reporters he is in no hurry to do so.

  This is exactly as we noted in our analysis three weeks ago:

  If the trend holds up, the only barrier between us and $100 oil after Memorial Day will be the mood of Vladimir Putin and the goodwill of Saudi Prince Mohammed bin Salman. Both their treasuries are bare. They will be looking to refill the coffers, and not only that, but to buttress their positions against a Biden team less friendly to poisoners and ax murders than the previous administration.

  Meanwhile, US shales look to sit on the sidelines a while longer. As Reuters reports from CERAWeek, the industry’s leading conference:

  In the past, rising prices have enticed shale companies to ramp up production even after they promised prudence, and $60 oil would have once prompted companies to rush drilling rigs and frack fleets back to work. That is not happening now. “They are not taking the bait,” [IHS Markit analyst Raoul] LeBlanc said. Private companies are likely to increase oilfield activity, but not enough to meaningfully boost U.S. output, said LeBlanc, adding that U.S. spending is likely to remain around $60 billion, flat with 2020, as companies prioritize shareholder returns. “The severe drop in activity in the U.S. along with the high decline rates of shale and the pressure from the investment community to maintain discipline instead of growth means in my view that shale will not get back to where it was in the U.S.,” said Occidental Petroleum CEO Vicki Hollub.

  At some point, of course, US operators will take the bait. But too late. The Saudi decision to extend the 1 mbpd cut indefinitely can be taken as a declaration of intent — indeed, a thinly veiled declaration of war on the Biden administration — by the Kingdom, and by extension, the rest of the OPEC+ cartel. They are going to keep pushing prices up relentlessly. Pencil in a $10/barrel rise per month. At that pace, oil prices could reach $100/barrel during the course of the summer. That’s the message the Saudis and Russians want to send to the Biden administration: “Look who has the leverage now.”

  Gasoline prices have already neared $4 / gallon in California and are flirting with $3 / gallon for regular on the East Coast. It will get worse. Possibly much worse.

  

  And of course the Fed will have to raise interest rates right into the meat of the stimulus program and a still lingering pandemic.

  It will get ugly.

  Tyler Durden
  Thu, 03/04/2021 – 23:00

• Supersonic Combat Drone Concept Unveiled In Singapore; Already 100 "Pre-Orders"
  Supersonic Combat Drone Concept Unveiled In Singapore; Already 100 “Pre-Orders”

  The world of drones is quickly evolving as a supersonic unmanned combat air vehicle (UCAV) concept has been officially launched by Singapore-based defense firm Kelley Aerospace, according to Flight Global. 

  Known as the “Arrow,” Kelley is expected to test a proof of concept 1/4 scale model in early 2021. Kelley has already received 100 “pre-orders” for the UCAV. 

  

  Arrow is built from a single-shell of carbon fiber, with a maximum take-off weight of 37,000 pounds. The UCAV is able to travel Mach 2.1 or about 1,611 mph. 

  “It is designed for a reduced radar cross-section and infra-red signature. The carbon fiber and monocoque design endows the Arrow with outstanding strength and stiffness,” the company said in a statement. 

  The cost of the drone ranges between $9 million and $16 million. It’s the “world’s first supersonic UAV that pushes the boundary with the state-of-the-art swarm and autonomous aerial flight logic — making it a formidable UAV,” the company said. 

  

  The Arrow is designed to work with human-crewed aircraft and be a force multiplier on the modern battlefield. It’s also capable of intelligence, surveillance, target acquisition, and reconnaissance tasks.

  No specifics have been provided on the customers who pre-ordered the supersonic drones or when series production begins. This all suggests that the world of combat drones is quickly evolving as stealth and speed are greatly increased in these war machines.

  Already, the US and Russia appear to be developing the next generation of drones. 

  Tyler Durden
  Thu, 03/04/2021 – 22:40

• China's "Sharp Eyes" Program Aims To Surveil 100% Of Public Space
  China’s “Sharp Eyes” Program Aims To Surveil 100% Of Public Space

  Authored by Dave Gershgorn via OneZero.medium.com,

  One of China’s largest and most pervasive surveillance networks got its start in a small county about seven hours north of Shanghai.

  

  In 2013, the local government in Pingyi County began installing tens of thousands of security cameras across urban and rural areas — more than 28,500 in total by 2016. Even the smallest villages had at least six security cameras installed, according to state media.

  Those cameras weren’t just monitored by police and automated facial recognition algorithms. Through special TV boxes installed in their homes, local residents could watch live security footage and press a button to summon police if they saw anything amiss. The security footage could also be viewed on smartphones.

  In 2015 the Chinese government announced that a similar program would be rolled out across China, with a particular focus on remote and rural towns. It was called the “Xueliang Project,” or Sharp Eyes, a reference to a quote from communist China’s former revolutionary leader Mao Zedong who once wrote that “the people have sharp eyes” when looking out for neighbors not living up to communist values.

  Sharp Eyes is one of a number of overlapping and intersecting technological surveillance projects built by the Chinese government over the last two decades. Projects like the Golden Shield Project, Safe Cities, SkyNet, Smart Cities, and now Sharp Eyes mean that there are more than 200 million public and private security cameras installed across China.

  Every five years, the Chinese government releases a plan outlining what it looks to achieve in the next half-decade. China’s 2016 five-year plan set a goal for Sharp Eyes to achieve 100% coverage of China’s public spaces in 2020. Though publicly available reports don’t indicate whether the program has hit that goal — they suggest that the country has gotten very close.

  China’s modern surveillance scheme started in 2003, according to Dahlia Peterson, research analyst at Georgetown University’s Center for Security and Emerging Technology, with the creation of the Golden Shield Project.

  The Golden Shield Project, run by the Ministry of Public Security (MPS), is, in part, responsible for the country’s strict internet censorship. But the program also included physical surveillance. The MPS created databases that included 96% of China’s citizens, with one titled the National Basic Population Information Database. That database includes household registration information, called “hukou,” as well as information on past travels and criminal history, according to a report from the Immigration and Refugee Board of Canada.

  Local population databases were also created, according to a paper published in the American Journal of Political Science. These local databases allowed for blacklists, which barred the use of public transportation. Police would be dispatched if someone who had been blacklisted tried to book a bus, train, or airline ticket.

  Following Golden Shield, China launched two other surveillance projects focused on the installation of cameras. Safe Cities, launched in 2003, focused on disaster warnings, traffic management, and public security. SkyNet focused on installing cameras connected to facial recognition algorithms.

  “Chinese state-run media has claimed Skynet can scan the entire Chinese population in one second with 99.8 percent accuracy, yet such claims ignore glaring technical limitations,” Peterson wrote.

  Observers should take these figures with a grain of salt: Accurate and up-to-date information about China’s surveillance initiatives isn’t easily available, and what is publicly known is mainly generated by academics and journalists with some access to government officials or surveillance equipment manufacturers. It’s also unclear which cameras are exclusively viewed by village, city, and provincial governments, and which feed data back to the central government.

  Just like Golden Shield, the SkyNet program still exists today, and benefits from 16 years of A.I. research, as well as the tech industry’s boom. According to the New York Times, SkyNet data is used at building complexes that use facial recognition to open security gates. The photos from those security gates are then shared with local police to build a database of the local population.

  However, these surveillance schemes are mostly targeted at cities, where funding and population density makes centralized surveillance easier. Sharp Eyes, which is focused on rural areas, is meant to offload work from potentially understaffed police departments.

  For instance, an article written by Chinese state media about the Sharp Eyes implementation in Pingyi notes that the county has a population of 1 million people, and only about 300 police officers.

  What gets reported to police by the Sharp Eyes program isn’t just limited to crime. One Pingyi resident in the state media article spoke of reporting a collapsed manhole cover, while another mentioned that they had suspected a multilevel marketing scheme happening in a nearby building. The MLM organization was reported to the police, who allegedly broke it up with warnings and fines.

  According to Peterson, the Sharp Eyes project is implemented differently depending on each city or town’s needs, but the general premise is the same: The city or town is divided into a grid, and each square of the grid acts as its own administrative unit. Citizens watch security footage from within their grid, giving a sense of ownership over their immediate surroundings. Municipal data can then be aggregated based on reports from each square on the grid.

  Cities can also add new technology to the mix at their discretion. Though the system primarily relies on facial recognition and locally broadcast CCTV, the city of Harbin, for instance, published a notice that it was looking for predictive policing technology to sweep a person’s bank transaction data, location history, and social connections, as well as make a determination as to whether they were a terrorist or violent.

  Much of the funding for these various surveillance schemes comes from the central government, but regional municipalities and cities also foot the bill for local networks of cameras. At times, counties’ surveillance spending far outstrips other municipal services. An analysis of more than 76,000 government procurement notices by ChinaFile showed that surveillance spending has become a significant portion of many cities’ budgets. In 2018, contracts from the city of Zhoukou showed that officials spent as much on surveillance as they did on education, and spent more than twice as much money on surveillance as on environmental protection programs.

  In some instances, Chinese citizens even crowdfund these surveillance measures. In the Shandong province, residents of the small city of Linyi raised an additional 13 million yuan, or $2 million, to help support the full coverage of video surveillance cameras.

  This countrywide demand for surveillance technology has created a gold rush for companies developing and selling surveillance technology. Many of the companies selling camera hardware and video management software, especially for locally streamed Sharp Eyes footage, aren’t well known outside of China.

  In a list translated by CSET’s Peterson, some of the top companies supplying this technology are surveillance camera manufacturers VisionVera and UniView, as well as big data company Neusoft. On its website, Neusoft specifically calls out that it manages a database on a population of 1.3 billion, and integrates data from more than 20 government sectors, as well as analyzes tens of millions of social videos.

  Internationally known Chinese companies like Sensetime, Megvii, Hikvision, and Dahua are far more prevalent in conversations about the persecution of ethnic minorities. These companies have all been sanctioned by the U.S. government based on their involvement with the human rights abuses in Xinjiang, where the Chinese government has been accused of committing genocide against the country’s Uighur ethnic minority. Reports from Xinjiang’s internment camps are horrific, with documented cases of rape, sterilization, or forced labor.

  The facial recognition system pitched to Xinjiang’s Shawan region to detect religious minorities was developed by Megvii, which denies involvement in the program. However, ChinaFile found contracts and state media reports that suggest large parts

  A recent report from the LA Times and surveillance industry watchdog IPVM also showed that Dahua had also developed facial recognition to specifically detect Uighurs, a Chinese ethnic minority widely persecuted in China’s Xinjiang province. A separate report from IPVM showed how Huawei and Megvii cooperated in the development of a Uighur detection system in 2018.

  China’s next five-year plan, which covers 2021 to 2025, places specific emphasis on giving social governance to local municipalities via the grid system, as well as building out even more security projects, to “strengthen construction of the prevention and control system for public security.”

  This means the future of China’s surveillance apparatus likely looks a lot like Sharp Eyes: More power and social control given to local governments, so neighbors watch neighbors.

  The government also emphasized the persecution of those it maintains as hostile and separatists.

  “We will also closely guard against, and crack down on, the infiltration, sabotage, subversion and separatist activities of hostile forces,” the plan says.

  Tyler Durden
  Thu, 03/04/2021 – 22:20

• Mark Cuban Says Dallas Mavericks Will Accept Dogecoin For Tickets And Merchandise
  Mark Cuban Says Dallas Mavericks Will Accept Dogecoin For Tickets And Merchandise

  In continued proof positive that we are living in a simulation that has been set up for the sole purpose of ridiculing us, Mark Cuban has now come out and said that the Dallas Mavericks are going to be accepting Dogecoin for ticket sales and merchandise.

  Dogecoin was a “meme” crypto that has slowly mutated from a joke among the investing community to a coin that is being taken semi-seriously by people like Elon Musk – though we’re not sure exactly how much credibility that lends the coin. 

  “Sometimes in business you have to do things that are fun,” Mavericks owner Mark Cuban said on Thursday, Bloomberg reported.  “Because we can, we have chosen to do so,” he continued.

  

  The coin has been praised by Cuban for its “entertainment and educational value,” Bloomberg writes.

  We also wrote about a week ago that Elon Musk was taunting the SEC, who were reportedly investigating Musk over his Tweets about Dogecoin. It was just hours after the headline broke the the SEC could be investigating Musk over Tweets he put out related to cryptocurrency Dogecoin that Musk – who formerly had told the SEC he didn’t respect them, and to “suck Elon’s c*ck” – yet again took to Twitter to taunt regulators.

  Responding to a Tweet casting doubt about an SEC investigation and referring to Musk as “Emperor Musk”, Musk responded that he “hopes” the SEC does open an investigation into his Tweets. 

  “It would be awesome,” Musk wrote.

  Meanwhile, Cuban went on the record telling GameStop shareholders in February to hold “if you can afford to”. 

  Cuban took to a Reddit message board to do an “Ask Me Anything (AMA)” for the WallStreetBets crowd last month. “If you can afford to hold the stock, you hold. I don’t own it, but that’s what I would do,” were Cuban’s words of wisdom to Reddit users, while GameStop stock plunged in the background. 

  Tyler Durden
  Thu, 03/04/2021 – 22:00

• Bipartisan Senators Seek To Strip Biden Of War Powers
  Bipartisan Senators Seek To Strip Biden Of War Powers

  Authored by Mike Shedlock via MishTalk,

  At long last we see action to kill war power authorizations used by three presidents.

  

  Senators Go After Endless Wars

  In a long overdue effort Bipartisan Senators Introduce Bill to Strip Biden of War Powers.

  Sens. Tim Kaine and Todd Young on Wednesday introduced bipartisan legislation that would repeal decades-old authorizations for the use of military force in the Middle East, amid escalating tensions between the U.S. and Iran in the region.

  Kaine (D-Va.) and Young (R-Ind.) unveiled the measure as lawmakers have expressed frustration with President Joe Biden’s decision to launch airstrikes in Syria last week without first seeking congressional approval. It also comes just hours after an Iraqi military base housing U.S. troops and civilian contractors was hit by rocket attacks.

  The bill would repeal the 1991 and 2002 authorizations that cleared the way for a prolonged military conflict in Iraq, culminating in calls from Democrats and Republicans alike to end the so-called “forever wars” in the region.

  Senators from across the ideological spectrum signed onto the Kaine-Young bill as co-sponsors on Wednesday, including Sens. Tammy Duckworth (D-Ill.), Mike Lee (R-Utah), Chris Coons (D-Del.) and Chuck Grassley (R-Iowa).

  “Last week’s airstrikes in Syria show that the executive branch, regardless of party, will continue to stretch its war powers,” Kaine said. “Congress has a responsibility to not only vote to authorize new military action, but to repeal old authorizations that are no longer necessary.”

  Biden angered congressional Democrats when he launched airstrikes against Iran-backed military installations in Syria, with lawmakers lamenting that the White House did not consult with Congress ahead of time and did not properly notify them about the strikes.

  Congress has largely abdicated its constitutional authority to declare war, and presidents from both parties have used outdated authorizations to legally justify U.S. military action — including, and perhaps most notably, the 2001 authorization for the use of military force against al Qaeda and the Taliban, which was approved in the aftermath of the Sept. 11 attacks. The Kaine-Young bill, though, only deals with the 1991 and 2002 measures, which are entirely focused on Iraq.

  No Longer Necessary?!

  Not quite. Those bills were never necessary and never should have been passed at all, in any form.

  Bush, Obama, and Trump all made terrible use of those bills. 

  Congress and Congress alone should authorize war and be damn careful when it does. 

  Warmongers on both sides, notably Hillary Clinton, agreed to fight a stupid second war with Iraq on what any reasonable person should have seen as a pack of lies by Bush and Cheney. 

  We are still there needlessly and senselessly. 

  Republicans would not strip Trump but some will be happy to strip Biden. Better late than never, but still not enough.

  One Step Further

  Congress should go one step further and set a timeline for all troops to return from everywhere starting with the Mideast and Cuba, preferably immediately.

  Tyler Durden
  Thu, 03/04/2021 – 21:40

• February Payrolls Preview: Has The Surge Arrived
  February Payrolls Preview: Has The Surge Arrived

  It’s crunch time.

  After several disappointing payrolls reports including just +49K in January and a loss of -227k in December – which helped keep the reflation genie at bay – Friday’s jobs report is expecting to show that the pace of nonfarm payroll growth is starting pick-up in February. And while JPMorgan now expects the US to start adding 675,000 jobs every month to hits its bogey of 8 million new jobs created for the year, the labor market signals are mixed going into the report: as Newsquawk recaps…

  • ADP’s gauge of payrolls missed expectations, noting only a sluggish labor market recovery;
  • initial jobless claims data surged in the BLS jobs report survey week, although analysts suggest that the data might have been distorted by reporting issues and potential fraud, blunting the signal it provides for the BLS jobs report;
  • the ISM report showed that while both employment sub-components remained above the 50-mark, the manufacturing jobs market improved, while the services jobs market cooled slightly;
  • Challenger’s job cuts data was far more optimistic, however, seeing announced layoffs falling to Dec’19 levels, but warned that if the jobs market doesn’t improve soon, it could signal stagflation.

  Beyond the headline, desks are paying attention to the dynamic between the participation and wage growth; if participation continues to fall, it could buoy the wage growth metrics, but this should not be taken as a good sign, and would instead reflect the hardship low-paid workers are facing.

  Finally, a blowout number will be the worst possible outcome, adding to the already mounting reflationary concerns and adding to them the possibility that the Fed will hike much sooner than expected should the unemployment rate tumble in coming months.

  Looking at Goldman’s individual forecast, the bank estimates nonfarm payrolls rose 225k in February, as “above consensus of +200k.Falling infection rates and a net easing of business restrictions likely supported job growth in virus-sensitive industries.” According to the vampire squid, Big Data employment signals also indicate a pickup in job growth on net, and the severe winter storms in the South probably struck too late to significantly affect the report. At the same time, seasonal adjustment represents a two-sided source of uncertainty, as the seasonal hurdles have evolved in an increasingly unfavorable direction in recent months. Goldman also estimates an unchanged unemployment rate of 6.3%, “reflecting a solid expected rise in household employment offset by a rebound in labor force participation.”

  With that said, here is what sellside expectations are currently courtesy of Newsquawk:

  • Nonfarm payrolls (exp. 200k, prev. 49k);
  • Private Payrolls (exp. 210k, prev. 6k);
  • Manufacturing Payrolls (exp. 18k, prev. -10k);
  • Government Payrolls (prev. 43k);
  • Unemployment Rate (exp. 6.3%, prev. 6.3%);
  • Average Hourly Earnings M/M (exp. +0.2%, prev. 0.2%);
  • Average Hourly Earnings Y/Y (exp. 5.3%, prev. 5.4%);
  • Average Workweek Hours (exp. 34.9hrs, prev. 35.0hrs);
  • Participation Rate (prev. 61.4%),
  • U6 Underemployment (prev. 11.1%).

  WAGES:  BMO’s analysts will be closely watching labor market participation as well as the average hourly earnings data. Earnings are seen rising by 0.2% m/m, although BMO says watching the composition will be key, explaining that as we continue to see struggles in the low-skill, low-wage earning sector, that will cause natural upward pressure on average hourly earnings, simply because those lower paid jobs will not factor into the equation. Therefore, if the participation rate continues to slip, and hourly earnings are reported to rise, it should not be taken as a positive sign, and instead will highlight the plight faced by low-income earners.

  ADP: There were 117k private payrolls added to the US economy in February, according to ADP, short of the 177k that the Street was expecting. ADP said that the labour market continued to post a sluggish recovery across the board; large-sized companies are  increasingly feeling the effects of the pandemic, while job growth in the goods producing sector paused in the month. The report also noted that the services sector remained well below its pre-pandemic levels; however, this sector is one that will likely benefit the most over time with re-openings and increased consumer confidence. In terms of the read for Friday’s official BLS data, Pantheon  macroeconomics reminds us that the ADP data incorporates lagged official BLS payrolls data, although it is unclear how heavily these data are weighed; “The BLS estimates that private payrolls rose only 6K in January, thanks in part to seasonal adjustment problems which substantially depressed the manufacturing and construction numbers, at least,” Pantheon says, “We’re assuming  these seasonal quirks will reverse in February, so we expect the official payroll number to be stronger than ADP, but we’re pulling our estimate down to 300K from 400K.”

  INITIAL JOBLESS CLAIMS: Initial jobless claims coinciding with the BLS survey window reported 841k initial jobless claims, way above the 765k the Street was expecting, and was the highest weekly figure since early December. The data revealed that claims for regular state benefits also rose by 13k to 861. However, some desks were noting that the data might have been distorted by a spike in pandemic assistance claims in Ohio, amid backlogs and fraud, perhaps blunting the signal claims provides this month. Nevertheless, Oxford Economics said that “the latest jobless claims data are consistent with the downbeat message from labour market indicators at the start of the year,” adding that “while downside risks remain, broader vaccine distribution and increased fiscal support should lead to a marked improvement in labour market trends by the spring and summer.”

  BUSINESS SURVEYS: The two ISM surveys highlighted the differing fortunes for the manufacturing and services sectors (The former surprised to the upside, while the latter disappointed). Within the survey’s sub-components, the manufacturing survey saw Employment rise by 1.8 points to 54.4, the third straight month of manufacturing employment growth; ISM said that continued strong new-order levels, low customer inventories and an expanding backlog indicate potential employment strength for the rest of the first quarter, adding that for the sixth straight month, survey panellists’ comments indicate that significantly more companies are hiring or attempting to hire than those reducing labour forces. The Services ISM report, however, saw the employment sub-index slip by 2.5 points in the month to 52.7, tough remained in growth territory (above 50.0) for the second month; ISM noted that comments from respondents included: “Unable to fill vacant positions with qualified applicants” and “Need more resources to meet demand.”

  CHALLENGER LAYOFFS: Data from Challenger showed that US-based employers’ planned job cuts fell to around 34.5 k from around 79.5k, which the data compiler said was the lowest monthly total since December 2019. The commentary attached was optimistic, noting that the jobs churn has come to a halt: “If healthy job creation follows, this could mean a full recovery is on the horizon, especially as companies see an end to the pandemic in sight,” though warned that “if we do not see jobs begin to return, we could be entering a stagnation cycle, potentially keeping the currently unemployed out of work longer.” But Challenger also added that there was some good news: “we are seeing a high number of hiring plans, particularly in Retail, Entertainment, and Health Care, which were hit hard due to the pandemic.”

  ARGUING FOR A BETTER THAN EXPECTED REPORT:

  • Covid. While the public health situation remained dire in February, infection rates fell and the severity of business restrictions generally eased. Reflecting this, restaurant seatings on OpenTable rebounded modestly further to -56% from -59% (yoy survey week to survey week).
  • Big Data. High-frequency data on the labor market were generally positive in February, with five of seven measures Goldman tracks indicating acceleration relative to the January report and generally stronger gains in the more reliable datasets.
  • Job cuts. Announced layoffs reported by Challenger, Gray & Christmas fell by 58%nin February after declining by 19% in January (mom, SA by GS). Layoffs were at the lowest level since May 2018 (35k).

  

  • Employer surveys. Business activity surveys increased on net in February employment components of both our services (+0.6pt to 50.0) and manufacturing (+1.2 to 57.4, the highest level since Nov. 2018) survey trackers increased.

  Neutral/mixed factors:

  • Seasonality. The seasonal factors used to convert the unadjusted data into seasonally adjusted nonfarm payroll growth evolved in a more restrictive direction in both December and January. The seasonal hurdles relative to the prior year were 216k and 284k higher,  respectively, despite survey periods with the same lengths and similar calendar configurations. Seasonal factors evolve for many  reasons, but the magnitude of the evolution over the last two months and the plethora of one-time adjustments by the BLS in mid-2020 (whose effects could now be unwinding) present two-sided risk for tomorrow’s data.
  • Jobless claims. Initial jobless claims declined during the February payroll month, naveraging 827k per week vs. 835k in January, despite a +25k boost to the payroll-month average from likely fraud in Ohio. Continuing claims fell 393k between the payroll survey weeks, but this decline partly reflects expiring regular-state-programs (as opposed to reemployment). Across all employee programs including emergency benefits, continuing claims increased by 71k (some of which reflect benefit renewals following the Phase 4 package).
  • ADP. Private sector employment in the ADP report increased by 117k in February, below consensus expectations but above the pace of the official measure in January.
  • Job availability. The Conference Board labor differential—the difference between the percent of respondents saying jobs are plentiful and those saying jobs are hard to get — increased into expansionary territory (to +0.7 in February from -2.5 in January), but sits well below the October level (+7.1).

  Arguing for a weaker-than-expected report:

  • Winter Storms. Severe weather disrupted business activity and caused mass power outages in Texas and the South in the middle of the month. However, we believe the resulting power outages and business disruptions began 2-3 days after the payroll survey week was already over (see Exhibit 2). We still view weather as a negative factor this month, because the Northeast and Midwest also endured a few blizzards in the first half of the month.

  

  As usual, pay close attention to the number of unemployed workers on temporary layoff, which spiked to a record high 18.1mn in April, retraced to 2.75mn in January. The smaller number of workers left on temporary layoff reduces the scope for the rapid pace of gains seen in the summer, but it remains a positive factor relative to the pre-coronavirus pace of job gains.

  

  Tyler Durden
  Thu, 03/04/2021 – 21:20

• China Makes Move On Riyadh As Washington Considers Sanctions
  China Makes Move On Riyadh As Washington Considers Sanctions

  Submitted by James Durso of OilPrice,

  Panda Express isn’t just a fast-food chain in Saudi Arabia. Soon it’ll be the daily Air China flight bringing Chinese businessmen and officials to the kingdom.

  Saudi Arabia recently achieved the distinction of joining Turkey as an American ally subject to sanctions.

  

  The sanctions followed the U.S. Director of National Intelligence report that an operation to “capture or kill” Saudi activist (and Qatari agent of influence) Jamal Khashoggi in October 2018 was “approved” by Saudi crown prince Mohammed bin Salman.  

  U.S. Treasury Department sanctions targeted Saudi officials and the Rapid Intervention Force, the crown prince’s bodyguards. The U.S. State Department announced the “Khashoggi Ban,” a visa restriction policy targeting 76 Saudis believed to have acted against activists, dissidents, or journalists. The Biden administration announced it would consider limiting Saudi arms sales to “defensive” weapons.

  The American sanctions and visa restrictions left the Crown Prince unscathed for now, but many in Washington are still angry he sidelined their candidate for the throne, former interior minister Muhammad bin Nayef, and may hope to criminalize him to scupper improved relations with Israel, and move him out of the line of succession.

  Financial markets took the two-year-old news in stride, and the crown prince’s allies claimed the report was a “practical victory” as it lacked details and “used equivocal words like ‘probably.’” (The report’s phrase “capture or kill” left open the possibility things just got out of hand.) The Saudi foreign ministry declared  the government “categorically rejects the abusive and incorrect conclusions” and affirmed the “enduring partnership” between the kingdom and the U.S.

  Not so the media, who feel “Biden is doing the same thing as Trump” or  Representative Adam Schiff (D-CA), who thundered, “There must be accountability, and we will continue to press for it.”

  Biden’s announcement the U.S. would re-join the Iran nuclear deal, and a U.S. pause in arms sales to Saudi Arabia over the brutal campaign against Iran’s proxies in Yemen, signaled Washington’s intent to align itself with Iran. But some relief is in sight for Riyadh: the kingdom’s growing relationship with China, which is now receiving over 2 million barrels of oil per day from Saudi Arabia, its largest supplier.

  Riyadh will remind Beijing it did them a solid when Mohammed bin Salman defended China’s treatment of its 10 million Muslim Uighurs. (Though, like governments everywhere do when they do something unpleasant, it was couched as “counter-terrorism and de-extremism measures.”

  The relationship with China goes back to 1986, when the Saudis bought about 50?Chinese CSS-2 ballistic missiles.  Saudi Arabia was the largest relief donor following the 2008 Sichuan earthquake, and it recently offered support after the COVID-19 outbreak. Though the relationship has been described as “functional, but not strategic” and won’t replace the American relationship, better Sino-Saudi ties will give Riyadh breathing room.

  Beijing will be glad to increase its influence on both shores of the Persian Gulf. It has secured a  partnership with Iran and has boosted BRI links with Saudi Arabia, but it will work to avoid getting drawn into regional conflicts to safeguard its $150 billion investment in the Gulf region.  In the kingdom, China will pursue additional sales of high-technology goods, and seek to invest in Mohammed bin Salman’s showplace, the $500 billion NEOM, the “first cognitive city.” One venue for Sino-Saudi cooperation – and a signal to the U.S. – would be adoption of the Yuan in place of the Dollar in payment for hydrocarbon sales to China.

  Aside from moving closer to China politically and economically, Saudi Arabia may diversify its weapons suppliers and China is the kind of no-conditions seller every buyer wants. And the kingdom may start to “make” instead of “buy” by growing the capability of Saudi Arabian Military Industries so it is  less vulnerable to a parts cutoff by the U.S. 

  Qatar, Bahrain, and the United Arab Emirates voiced their support for Saudi Arabia as Washington’s actions probably reminded them how quickly the U.S. abandoned longtime ally Hosni Mubarak for the Muslim Brotherhood. As Cairo, Jerusalem, and Abu Dhabi ponder Iran’s next steps and the shape of their mutual support, the potential for a U.S. reversal will be baked in. Accordingly, they may explore broader relations with Beijing.

  Two days after announcing sanctions, the White House undermined itself when it justified the absence of action against the crown prince by explaining “The United States has not historically sanctioned the leaders of countries where we have diplomatic relations or even some where we don’t have diplomatic relations,” which is surely news to Syrian President Bashar al-Assad. It’s a far cry from Candidate Biden’s boast he would “make them [Saudi Arabia] in fact the pariah that they are.”

  To be sure nothing was lost in translation, the State Department then said “We are very focused on future conduct,” and so grandfathered Khashoggi’s killing.  

  So, the U.S. “circled back” to business as usual over a few days, but it was few very illuminating days for America’s friends and enemies.

  Saudi Arabia faces a rough patch, but the U.S. faces a dilemma: It pined for a youthful modernizer  who would liberalize the economy and put the kingdom on a “new religious trajectory.” Now that it has him, what does it do if he commissions a murder and doesn’t seem worried he was found out?

  Tyler Durden
  Thu, 03/04/2021 – 21:00

• A Preview Of What's Coming: Vaccinated Americans' Spending On Air Travel Soars
  A Preview Of What’s Coming: Vaccinated Americans’ Spending On Air Travel Soars

  In the week following the unprecedented Texas cold blast which literally froze spending both the plains states and, to a lesser extent, across the US…

  

  …  the latest BofA aggregated credit and debit card data showed that, as expected, total card spending rebounded to 3.5% yoy for the 7 days ending February 27th as the deep freeze lifted.

  Some observations from the bank’s economists:

  Winter blizzard recovery: Combined total card spending in TX, LA, OK, MS, AR, and TN jumped to +6.5% yoy for this 7-day period from -25% yoy the prior week (Exhibit 13).

  

  Low income slowdown: Total card spending for the low income cohort has slowed, owing to a delay in tax refunds. As shown in the chart below, tax refunds are running about 2 weeks behind last year.

  

  Naturally, this impairs the yoy growth rate in spending, particularly for the lower income population. However, BofA expects spending to be boosted in mid-March when tax refunds accelerate, especially if it overlaps with the next fiscal stimulus, at which point we may see a supernova in spending.

  

  But perhaps the most interesting data point in the latest weekly spending report from BofA was the bank’s focus on spending trends amongst older Americans, or as BofA calls them “traditionalists” which are aged 73 –92, who are most likely to have received the COVID vaccine.

  In particular, spending on airfare surged for traditionalists as compared to other generations – this can be seen in the chart below which shows the indexed level of average spending by cohort to June 2020; traditionalists – i.e., vaccinated Americans’ – spending is now 4X the level in June.

  

  As an aside, BofA did not see the same spending surge for lodging which may suggest that traditionalists are traveling to see family rather than take vacations.

  

  Finally, spending at restaurants and bars increased modestly for this cohort recently relative to other age cohorts but there was little difference in brick & mortar retail spend.

  

  Tyler Durden
  Thu, 03/04/2021 – 20:40

• To Defend Conservative Media, GOP Must Defend The Constitution
  To Defend Conservative Media, GOP Must Defend The Constitution

  Authored by Rick Santorum via RealClear Politics (emphasis ours),

  Republicans have long understood that the modern Democratic Party has little patience for free expression. Leftist speech police shut down debate on college campuses; biased media outlets like MSNBC lambasted President Trump’s language instead of discussing his policies; and now congressional Democrats are looking to cancel conservative media outlets like Fox News and Newsmax.

  

  It is critical that conservatives don’t allow the left to ignore the First Amendment or make it irrelevant. Free speech is a core value that has made America the best country in human history. That’s why last summer I asked conservative consumers to press social media to allow more conservative content. Unfortunately, some conservatives have made the mistake of thinking the government can force platforms to host content in violation of their policies.  As our wise Founding Fathers knew, the government is not the savior or protector of our rights, it is the biggest threat to them.

  Some conservatives are asking the government to use antitrust law and changes to Section 230 to pressure social media to host more conservative speech. These requests for government intervention are likely to blow up in our face — and will prevent us from being able to take a principled stand against the left using government to attack our free speech rights.

  Democrats just held a hearing where House members laid into right-leaning television channels for spreading disinformation about COVID and last year’s presidential election. And House Democrats issued a letter to cable companies and streaming providers demanding to know why they are carrying programming from Fox News, Newsmax, and One America News.

  Here we see Democrats using government power to do precisely what our founders prohibited in the First Amendment when they wrote, “Congress shall make no law … abridging the freedom of speech.”  Now that Democrats are in control of the federal government, they want to kick the First Amendment aside and intimidate broadcasters and social media into removing conservative content they don’t like.

  Republicans are rightfully irate at this authoritarian power play, but I have been warning them for months that threatening Big Tech with government action for barring content would open the door for government to bar content! When are conservatives going to figure out that joining hands with the left to call for government sanctions against companies exercising their legal rights never ends well for us or the country.  

  Unfortunately, some conservative are still pushing the government to get involved in speech issues.  In a dozen Republican-led states, we see legislation designed to punish social media for their content moderation policies by denying tax exemptions and empowering private lawsuits. These state laws surely will not survive First Amendment court challenges, which will only embolden social media to use more political bias in content moderation. And through unconstitutional attempts to make social media sites carry our content, conservatives give up the constitutional high ground we need when criticizing Democrats for undermining the First Amendment.

  If conservatives are to protect free speech, we must show America that Democrats’ attempt to cancel Fox News is unconstitutional. We must show how, once again, the American left is willing to sacrifice our core national ideals to silence their political opponents. But conservatives can’t do this if we too are willing to use the heavy hand of government to enforce our own speech codes. Instead, we should ensure Section 230 remains intact so competitors to Big Tech social media outlet, like Gab, Rumble, and Parler, can continue to thrive. And we should avoid politicizing antitrust law to allow leftist bureaucrats to go after any American company that’s not living up to the left’s social justice agenda.

  As I wrote last September, “Liberal Bias and All, Social Media Is Still Conservatives’ Best Electoral Tool. We shouldn’t help progressives destroy it.”  Now we see what’s happened once Republicans opened the door for government to circumvent the First Amendment — Democrats are ripping that door off its hinges.  If we want to protect the American right to free speech, we must not hand the left the tools they need to silence us once and for all.

  Tyler Durden
  Thu, 03/04/2021 – 20:20

• Stunning Views Of Freight Train Derailment In California Desert
  Stunning Views Of Freight Train Derailment In California Desert

  On Wednesday evening, a freight train derailment in the Southern California desert sent more than 40 railcars careening off the tracks into a mangled mess of metal. 

  San Bernardino County Fire (SBCF) tweeted pictures and a drone video of the train derailment. They said the incident occurred on the Burlington Northern Santa Fe Railway Company (BNSF Railway) rail network east of Ludlow, on Old National Trails Highway, or about 150 miles northeast of Los Angeles. 

  SBCF said, “BNSF cargo railcars, no injuries, no fire, Haz-Mat on scene. No impact to I-40.” Judging by the pictures released by the local police agency, a variety of cars were involved in the incident, including tanker cars, boxcars, and hoppers. 

  Mixed Freight Derailment 

  

  Tanker Cars And Other Cars Derailed 

  

  More Scenes Of The Incident

  

  A drone video shows first responders in hazmat suits inspecting a tanker car. 

  Ludlow (update): #SBCoFD & @BNSFRailway Haz-Mat units make entry into a round tank car carrying a flammable liquid. pic.twitter.com/c1xqk6ZeV4

  — San Bernardino County Fire (@SBCOUNTYFIRE) March 4, 2021

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  The police drone captured stunning views of the mangled railcars.  

  

  

  “Initial reports indicate 44 cars derailed, and one car carrying ethanol alcohol is leaking,” BNSF spokeswoman Lena Kent told NBC Los Angeles. 

  Investigators are still working the incident area to figure out how the derailment occurred. 

  Tyler Durden
  Thu, 03/04/2021 – 20:00

• 10Y Treasury Hits A Stunning -4.25% In Repo As Yields Blow Out
  10Y Treasury Hits A Stunning -4.25% In Repo As Yields Blow Out

  Last night we first pointed out something shocking: as a result of a massive wave of shorting in Treasurys in the past three days, the 10Y hit a record -4% in repo, an extremely rare event and one which occurs only when there is a dramatic shortage of collateral as a result of overshorting (think of it as very hard to borrow condition for stocks). What was even more amazing is that the repo rate was below the fails charge, which at least in theory is the absolute minimum that a 10Y rate can hit in repo. Effectively, it meant that an investor in the repo market lending money so others could short the 10Y ends up paying rather than getting paid. Needless to say, this is a clear breach of one of the most fundamental relationships in the repo market, where lenders of cash always get paid – however little – in order to make a more liquid and efficient market.

  This stunning issue quickly escalated and this morning Bloomberg followed up on this critical topic:

  

  And with everyone suddenly obsessing with both the SLR and repo malfunction, that’s why we said that during today’s WSJ video conference event, Jerome Powell has to address i) the ongoing crunch in the repo market and ii) the fate of the SLR extension, as the two are closely tied – after all if the bond market is confident that there is capacity to soak up the trillions in reserves being released by the Fed as the Treasury drains the $1.5 trillion in cash held in the TGA account, many of the acute issues in the extremely illiquid Treasury market would go away.

  Alas, for some bizarre reason Powell never got that question today… or perhaps he simply did not want to answer it and made it clear in advance. In any case, with everyone in the market expecting Powell to discuss the fate of the SLR, his failure to do so was one of the reasons why bond yields erupted shortly after 12pm, as uncertainty over the fate of the SLR – and by extension bank balance sheet capacity – has now grown exponentially (for those confused by all the SLR hoopla, please read this).

  It’s also why during the disappointing Powell address we said that we should brace for an even more dramatic move in repo:

  Let’s see if 10Y hits -8% in repo today

  — zerohedge (@zerohedge) March 4, 2021

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  Ok, fine, we were just a bit hyperbolic, but in retrospect we may not have been too far off. Here’s why.

  In his latest repo market commentary by Curvature’s Scott Skyrm published after the Powell conference, the repo guru asked – rhetorically – “how low can Repo rates go in the 10 Year Note? Or, in the past, how low have 10 Year Repo rates gone? Extremely low 10 Year Note rates only occur during single-issues.”  That, Skyrm explained, is the period of time between when a new 10 Year Note was issued and its first reopening a month later. Which is true… however usually the single-issue repo crunch pushes the 10Y to -1%, at most -2% in repo. What we saw yesterday was unprecedented. Or rather, there was just one precedent… and it was during a market crash.

  Skyrm said that from his own experience, what we call “extremely low” Repo rates is anything that’s below -3.00% – which is below the Fail Charge right now. Since the beginning of 2018, the 10 Year Note traded below -3.00% only two other times: a more “solid” -3.50% from 6/10/20 to 6/12/20, and the only time there was an even lower, record low repo print of -5.75% was during the peak of the covid crash, on 3/13/20.

  

  What is striking is that March 3, 2021 was not a crisis. Neither was March 4. And yet, as Skyrm says after hitting -4.00% on Wednesday, the 10Y dipped even further to -4.25% today.

  

  The good news is that after hitting a near record low in repo today, the 10Y stabilized modestly, rising to a still abnormal -1.00%, which may have been the result of today’s announcement that the Treasury’s 10Y reopening next week will be $38BN, which should relieve some of the single-issue pressure (it was below . But if there is more to the repo squeeze than just single-issue funding pressure, the 10Y will remain very special in repo for a long, long time.

  Meanwhile, the shorting in the 10Y has now resumed, and after blowing out to 1.55% during Powell’s catastrophic speech, the benchmark treasury was last seen trading north of 1.57%, and fast approaching last week’s blowout level of 1.61%.

  

  And while we wait for tomorrow’s repo market data to see just how massive the latest shorting burst has been, one thing that is certain is that with Powell neither doing nor saying anything today because as the Fed Chair said there was nothing “abnormal” about the market, the same market will now quickly push the 10Y to a level Powell does find “abnormal” and forces him to launch YCC far sooner than if Powell had simply said something about the SLR today and eased some of the soaring market panic.

  Tyler Durden
  Thu, 03/04/2021 – 19:40

• How Much Money Will Biden's New Stimulus Inject Into The Market
  How Much Money Will Biden’s New Stimulus Inject Into The Market

  Looking at market action over the past few weeks, it is clear that markets are finally fretting about yields and inflation. As DB’s Jim Reid puts it, “there is no doubt the forces working in financial markets in 2021 will be fairly extreme – reopenings, massive pent-up demand, the strongest US growth since the early 1980s, huge central bank liquidity and a likely enormous Biden fiscal package.”

  And yet, as everyone knows by now, a substantial portion of the coming Biden stimulus will quickly be redirected into stocks. But how much?

  That’s the question Jim Reid asked in his recent daily note, writing that whilst rising yields are a threat to all risk assets, “it’s worth highlighting that a large amount of the upcoming US stimulus checks will probably find their way into equities.” He then refer to a survey conducted last week by DB’s chief equity strategist Binky Chadha polling online brokerage account users which suggested they would invest around 37% of future stimulus checks in the stock market. This is a material force because as Reid notes, “behind the recent surge in retail investing is a younger, often new-to-investing and aggressive cohort not afraid to employ leverage.”

  This makes sense, although someone should probably tell those respondents with an income level over $100,000 (who plan on investing 43% of their stimulus into the market) that they aren’t getting a stimulus…

  

  So here is Reid’s math: “Given stimulus checks are currently penciled in at c.$405bn in Biden’s plan, that gives us a maximum of around $150bn that could go into US equities based on our survey. Obviously only a proportion of recipients have trading accounts, though. If we estimate this at around 20% (based on some historical assumptions), that would still provide around c.$30bn of firepower – and that’s before we talk about any possible boosts to 401k plans outside of trading accounts.”

  For some context, the DB credit strategist notes that over the last five years mutual funds and ETFs have seen monthly outflows of -$9.1bn from US equities. The marginal buyer has been companies themselves conducting buybacks. However, over the last four months following Biden’s victory, this number has increased to over $15bn per month (a near record).

  His conclusion: “stimulus checks could accelerate the large inflows into US equities seen in recent months after many years of weak flow data. Will this be enough to offset any impact of higher yields? Expect this push/pull to continue for some time.”

   

   

   

  Tyler Durden
  Thu, 03/04/2021 – 19:20

• Newsom Urges Double-Masking For All Californians, Will Not Make "Terrible Mistake" Like Texas
  Newsom Urges Double-Masking For All Californians, Will Not Make “Terrible Mistake” Like Texas

  Having immediately decried the actions of Texas and Mississippi – in giving their citizens back some freedom and the ability to think for themselves – as “absolutely reckless,” California Governor Gavin Newsom has doubled-down (literally) on the virtue-signaling.

  “We will be doubling down on mask wearing,” said California Governor Gavin Newsom on Thursday, “not arguing to follow the example of Texas and other states that I think are making a terrible mistake.”

  The Sacramento Bee is reporting tonight that new state health guidelines announced by Gov. Gavin Newsom on Thursday recommend that Californians wear two cloth masks or one filtered mask when going out in public to prevent the spread of COVID-19.

  “We are encouraging people basically to double down on mask wearing, particularly in light of all what I would argue is bad information coming from at least four states in this country. We will not be walking down their path, we’re mindful of your health and our future,” Newsom said.

  To Newsom’s point about doubling down, California updated its recommendations for mask wearing on Thursday with the following:

  “‘Double masking’ is an effective way to improve fit and filtration. A close-fitting cloth mask can be worn on top of a surgical/disposable mask to improve the seal of the mask to the face.”

  Interestingly, Newsom also announced Thursday that counties across the state could be cleared to open more businesses and lift other restrictions sooner than anticipated under an update that loosens some requirements in his Blueprint for a Safer Economy.

  So he is easing restrictions (cough recall pandering cough), like Texas; and at the same time urging ‘double masking’?

  

  Of course, he will claim he is ‘just following the science’ but as AIER’s Paul Alexander detailed at length, why the CDC’s mask-mandate study is fault-ridden:

  Based on our assessment of this CDC mask mandate report, we find ourselves troubled by the study methods themselves and by extension, the conclusions drawn. The real-world evidence exists and indicates that in various countries and US states, when mask mandates were followed consistently, there was an inexorable increase in case counts. We have seen that in states and countries that already have a high frequency of mask wearing that adding mandates had little effect. There was no (zero) benefit of adding a mask mandate in Austria, Germany, France, Spain, UK, Belgium, Ireland, Portugal, and Italy, and states like California, Hawaii, and Texas. Importantly, we do not ascribe a cause-effect relationship between the implementation of mask mandates and the rise in case rates, but we also demand the same approach when it comes to claiming some sort of causal relationship between the introduction of mask mandates and likely claims by the CDC that their findings could support their implementation countrywide. 

  We think that inclusion of such evidence on the failures of masks mandates globally and states within the US would have made for more balanced, comprehensive, and fully-informed reporting.

  …

  Trusting the science means relying on the scientific process and method and not merely ‘following the leader.’ It is not the same as trusting, without verification, the conclusory statements of human beings simply because they have scientific training or credentials.

  Read more here…

  History does not bode well for times that politics meddles with science. Martin Kulldorff, a professor at Harvard Medical School and a leader in disease surveillance methods and infectious disease outbreaks, describes the current COVID scientific environment this way: “After 300 years, the Age of Enlightenment has ended.”

  We wonder how a citizenry that is already demanding his recall will react to this latest escalation in restrictions.

  Tyler Durden
  Thu, 03/04/2021 – 19:00

• Honda Is Now Selling Japan's First Level 3 Autonomous Car
  Honda Is Now Selling Japan’s First Level 3 Autonomous Car

  Honda is taking the lead in autonomous driving sales in Japan. 

  The auto manufacturer has announced that sales of its Legend sedans in Japan will be equipped with a “Traffic Jam Pilot” feature that allows the car to drive itself on crowded highways. 

  Honda says it is going to make 100 of the limited edition sedans, according to Bloomberg on Thursday. The company was one of the first to be granted a Level 3 self-driving designation in Japan. Hitoshi Aoki, who was in charge of the project for Honda, said: “Long-distance driving will be very comfortable and drivers will have less stress”.

  

  Level 3 means that certain features are autonomous, but the driver still must be able to take over. 

  The end game for many vehicle manufacturers is seen as Level 5 autonomy, where a car doesn’t need any human input to navigate roadways. 

  Autonomy has been brought up time after time as a bull case in the Tesla world. For example, Cathie Wood used it as the centerpiece of her Tesla bull case on Benzinga’s podcast earlier this week. “Our conviction on its autonomous strategy has increased over last few months,” she said, apparently unaware that Tesla has logged just 12.2 autonomous testing miles in California. 

  

  Gene Munster also threw around the world “autonomy” during a CNBC debate with Gordon Johnson earlier in the week.

  Elon Musk has claimed that Tesla will have Level 5 autonomy by the end of 2021. C|NET has called Tesla’s current level of autonomy not “even reliably Level 3 autonomous”. 

  And so, once again, the legacy auto manufacturers – which are already vying to pass Tesla in battery, design, quality, hardware and service –  now appear to be passing Musk in sales of bona-fide Level 3 vehicles. 

  Tyler Durden
  Thu, 03/04/2021 – 18:40

• Powell Plunges Markets Into "Disorder"
  Powell Plunges Markets Into “Disorder”

  Fed Chair Powell’s failure to deliver during his speech today – No hints at a ‘Twist’, refuses to speculate on repo issues, no pushback against recent bond vol, and no mention of SLR exemption – sparked chaos across all asset classes today with stocks, bonds, and gold puking as the dollar soared…

  

  Powell sparked the biggest sell program since October…

  

  Source: Bloomberg

  Or to put it another way…

  Small Caps were the days biggest loser, puking over 5% from the intraday highs. Stocks rebounded after S&P found support at its 100DMA and unch for the year and Nasdaq reversed right at its 10% correction level and 100DMA…

  

  Nasdaq entered correction (down 10%) and is in the red for 2021. The S&P also fell into the red but found support there…

  

  Source: Bloomberg

  Robinhood’s brand new investor hotline right now pic.twitter.com/dNO0b64h1Y

  — zerohedge (@zerohedge) March 4, 2021

  https://platform.twitter.com/widgets.js

  The Nasdaq fell below its 100DMA today and all the other majors fell below their 50DMA but found support at those levels…

  

  Energy stocks rallied on the day (as oil exploded higher) but tech wrecked and financials were hit (even with higher rates)…

  

  Source: Bloomberg

  Hedge funds have really puked up their favorite holdings. After a solid February, March has been a bloodbath…

  

  Source: Bloomberg

  BUZZ – the social media sentiment ETF – tanked from its open…

  

  TSLA tumbled to $600…

  

  ARKK sank hard – down 28% from the highs…

  

  The collapse of momo stocks continued…

  

  Source: Bloomberg

  Growth and value puked – this was not simply rate-related…

  

  Source: Bloomberg

  And suddenly, profitability (and not narratives) matter…

  

  Source: Bloomberg

  As IPOs and SPACs were clubbed like a baby seal into a bear market…

  

  Source: Bloomberg

  VIX spiked to 32 intraday…

  

  Credit markets had an ugly day with IG and HY spreads blowing out…

  

  Source: Bloomberg

  Bonds were a bloodbath today after Powell’s failure to deliver (2Y unch, 10Y +6bps)…

  

  Source: Bloomberg

  10Y yields spiked up to 1.55%… and stayed there…

  

  Source: Bloomberg

  Real yields surged higher and dragged gold down…

  

  Source: Bloomberg

  The dollar shot higher as we suspect liquidity fears are rearing their ugly head, hitting its highest since November…

  

  Source: Bloomberg

  Broad selling pressure spilled over into crypto with Bitcoin dumping back below $50k…

  

  Source: Bloomberg

  Oil surged on surprise OPEC+ decision to not hike output…

  

  And as oil prices surge, so $3.000 gas prices at the pump loom…

  

  Source: Bloomberg

  PMs were pummeled…with gold back below $1700..

  

  And silver tumbled below $26, erasing all the Reddit-Raiders’ gains…

  

  Finally, we note that amid all of Powell’s comments he said:

  “I would be concerned by disorderly conditions in markets or persistent tightening in financial conditions that threatens the achievement of our goals.”

  Well, judging by today’s explosion in vol across every asset class, and financial conditions at their tightest since November…

  

  Source: Bloomberg

  Dear Fed Chair: are market conditions still orderly?

  — zerohedge (@zerohedge) March 4, 2021

  https://platform.twitter.com/widgets.js

  It’s time to get back to work, Mr. Powell. It’s pretty clear that’s what the market is demanding… and with the market pricing in 118bps of rate-hikes.between the end of 2022 and the end of 2024…

  

  Source: Bloomberg

  We leave you with former Dallas Fed president Richard Fisher’s comments:

  “[The Fed] cannot live in fear that gee whiz the market is going to be unhappy that we are not giving them more monetary cocaine.“

  “Does The Fed really want to have a put every time the market gets nervous? …Coming off all-time highs, does it make sense for The Fed to bail the markets out every single time… creating a trap?”

  “The Fed has created this dependency and there’s an entire generation of money-managers who weren’t around in ’74, ’87, the end of the ’90s, and even 2007-2009.. and have only seen a one-way street… of course they’re nervous.”

  “The question is – do you want to feed that hunger? Keep applying that opioid of cheap and abundant money?”

  “…but we have to consider, through a statement rather than an action, that we must wean the market off its dependency on a Fed put.”

  Those words were spoken almost exactly a year ago!

  Tyler Durden
  Thu, 03/04/2021 – 18:22

• The Fed Will Need More Than Words To Keep The Bubble Inflated
  The Fed Will Need More Than Words To Keep The Bubble Inflated

  Authored by Michael Maharrey via SchiffGold.com,

  Bond yields spiked. The stock market threw a tantrum. Reuters analyst Dhara Ranasinghe called it “a tussle over borrowing costs.”

  The Fed won round 1, thanks to a little help from the Aussies.

  But even the mainstream seems to have noticed that this wrestling match isn’t over and the Fed may be forced to take real action soon.

  As Ranasinghe put it, “Round Two, and perhaps even Round Three, are inevitable, and they may require policy action rather than just words.”

  By policy action, they mean upping quantitative easing – exactly as Peter Schiff has predicted.

  

  The bond market got clobbered on Friday. As prices fell, the yield on the 10-year Treasury pushed as high as 1.61% and the 30-year hit 2.4%. These rates aren’t high by historical standards, but Peter said it was one of the biggest interday moves in the bond market that he’s ever seen. Up to that point, stock markets hadn’t reacted much to rising interests rate, but on Friday, they sat up, took notice, and threw a tantrum. The Dow dropped some 480 points.

  The bond market bloodbath on Friday is part of a larger trend. Yields have been pushing upward for weeks. Conventional wisdom tells us that this is due to a quicker than expected economic recovery and this may force the Fed to tighten monetary policy sooner than expected. This is precisely why we’ve seen the big selloff in gold. A lot of people actually believe the Fed is going to reverse course on its monetary policy.

  But Fed officials have been working diligently to jawbone this notion away. Jerome Powell testified on Capitol Hill last week saying he doesn’t expect inflation to reach the 2% target for at least three years.

  But Peter says there is a reality out there that nobody wants to acknowledge. Bond yields are not spiking because the economy is strong. They are spiking because of inflation – Powell’s assurances notwithstanding.

  Bond yields are going up because there is a massive supply of bonds because we have massive deficits. And even though the Fed is buying a lot of bonds, they ain’t buying enough. So, those extra bonds, there’s no buyer, and so the price keeps falling.”

  The reality is that talk isn’t going to be enough to keep a lid on rising interest rates. And this Reuters article reveals that at least some people out there in the mainstream get it too.

  Reiterating such messages [that inflation isn’t a problem and loose monetary policy will remain in place for years], alongside interventions by smaller central banks such as Australia and South Korea, calmed bond markets. Bets on early-2023 Fed rate hikes have ebbed.”

  Reuters mentioned Australia. The fact of the matter is the Reserve Bank of Australia stepped in and did the Fed’s dirty work this time. On Monday, the Aussie central bank announced plans to double its quantitative easing program.

  After the big selloff Friday, stock markets rallied on Monday, with the Dow up better than 600 points. As Peter noted, very few people in the US mainstream financial media connected the rally with the RBA’s policy move.

  Nobody was really talking about the fact that our rally was made in Australia. But it was. And the significance, I think, of what the Australian central bank did, is I think it created an implied put here in the US market. Because I think when traders looked at what the Reserve Bank of Australia did, they assumed that the Federal Reserve would ultimately do the same thing, which is exactly what I’ve been saying the entire time.”

  The Reuters analyst seems to get this. Ranasinghe identifies the stock market bubble blown up by the Fed.

  Central bank stimulus that crushed borrowing costs to below inflation has fed an equity bull run that has added $64 trillion to the value of global stocks since 2008. Higher yields would put that entire edifice at risk.”

  Then Ranasinghe accurately observes that the Fed has consistently played the role of white knight, riding in to rescue the market when necessary.

  The shifting power balance [between the markets and the Fed] became evident in 2013 when a market tantrum forced the Fed to backtrack on plans to start withdrawing stimulus. Another market revolt erupted in late 2018, egged on by then President Donald Trump. The Fed soon pivoted from raising rates to cutting them. So markets have seen this movie before.”

  And Ranasighe understands that the Fed really can’t let interest rates rise when the entire economy is predicated on cheap money.

  What happens in sovereign bond markets matters because higher yields here raise borrowing costs for companies and households. As capital flow slows, so does economic growth. And higher yields are harder to stomach in a world that has racked up an additional $70 trillion rise in debt since 2013.”

  Given the realities, it’s not hard to predict what the Fed will do. The central bank will do exactly what Peter Schiff has been saying it will do. It will boost QE.

  If the Australian central bank has already panicked and is increasing the size of its QE program, not to help the economy but to stop interest rates from rising, why wouldn’t the Federal Reserve do the same thing? After all, all of these central bankers are using the same playbook. So, I think what happened is now the markets are starting to realize that they don’t have to worry about a big increase in interest rates because if there is more significant upward pressure, if the bonds really start to fall, then the US Federal Reserve is going to do exactly what the Australian Reserve Bank did, and it is going to increase the size of its asset purchase program – QE – and is going to start buying more bonds to prevent bond prices from falling and to prevent interest rates from rising.”

  The Fed could be put to the test sooner rather than later. Next week, the Fed will auction 3-year and 10-year bonds. The last debt sale saw lackluster demand and there’s no reason to think investors are going to suddenly be starving for US bonds. That could mean another bad day for the bond market and another spike in yields.

  According to Reuters, ING Bank predicts the US Treasury will issue another $4 trillion in debt this year. That compares with $3.6 trillion in 2020. The Fed’s monthly purchases currently total $120 billion.

  The math doesn’t add up, as a John Hancock analyst told Reuters.

  As we do more stimulus, we will issue more US Treasuries, so if the Fed doesn’t increase quantitative easing they are in essence tapering.”

  The Fed can’t taper. It can’t let interest rates spike. And words won’t be enough to hold interest rates down. The Fed is going to have to take action and that means more bond-buying.

  Tyler Durden
  Thu, 03/04/2021 – 18:20

• "Full Throttle Correction" – Tumbling Nickel Prices Lead Sudden Industrial Metals Slump
  “Full Throttle Correction” – Tumbling Nickel Prices Lead Sudden Industrial Metals Slump

  Industrial metal prices have soared over the last year to highs not seen in over a decade as bets on economic recovery from the pandemic push up the prospects for “pent-up demand” due to a cleaner and greener future. Though industrial metal prices are stumbling in the last five sessions, that has set off alarm bells with some commodity analysts. 

  S&P GSCI Industrial Metals index tagged a near-decade high last week after an 11-month rip roar rally of 75% from pandemic lows. Base metals are essential inputs for batteries and home electronics as post-crisis consumption and supply chain disruptions have led to price increases. The prospects of a greener future with government and companies globally announcing net-zero emissions have unleashed momentum and speculative traders into these metals. 

  

  But over the last five sessions, something spooked the industrial metals market. On Thursday, nickel prices plunged more than 4%, dragging down copper by almost 5% at one point. 

  Saxo Bank commodity analyst Ole Hansen told Reuters that the massive influx of speculative money flowing into industrial metals over the last year was bound to burst. He said, “It’s been a long time coming.” 

  Hansen said the latest plunge in nickel prices was the “trigger” and “now we see correction at full throttle.”

  

  Commodity analysts at Citi told clients that more supply from Tsingshan Holding Group Co., the world’s top stainless steel producer, in China, and Tesla’s efforts to reduce the nickel in its batteries threatens the industrial metal price outlook. 

  “We are very concerned the impact this will have on speculative positioning at a time the market also goes into a large physical surplus,” Citi analysts wrote.

  A little more than two months ago, we told our Premium subs that Chinese credit impulse “just peaked” – and since it impacts virtually every aspect of the global economy – it is a proxy of global economic growth. 

  JPMorgan’s Mislav Matejka explained last month China’s credit impulse is in the process of “peaking.” The change in the growth rate of aggregate credit as a percentage of gross domestic product in the country has a tremendous impact on the global economy’s future. Saxo Bank once said the credit impulse leads the global economy by 9 to 12 months.

  

  Putting this all together – could a downturn in industrial metals as China’s credit impulse tops, suggest global economic growth is set to stumble later this year?

  Tyler Durden
  Thu, 03/04/2021 – 18:00