Dec 13

Today’s News 13th December 2021

  • Why The Russiagate Scandal Outranks The Rest
    Why The Russiagate Scandal Outranks The Rest

    Authored by J.Peder Zane via RealClearPolitics.com,

    Russiagate is the biggest scandal in American history.

    Nothing comes close in size, scope or harm to the republic than the years-long effort to cripple Donald Trump’s presidency by claiming he conspired with an enemy state to steal the 2016 election and then do its bidding as commander-in-chief.

    Its notorious predecessors – L’Affaire Lewinsky, Iran-Contra, Watergate, Teapot Dome, Crédit Mobilier, the XYZ Affair – involved relatively small numbers of malefactors engaged in specific acts of illegality and corruption (we still don’t know who, if anyone, planned the Jan. 6 assault on the U.S. Capitol)

    Russiagate, by contrast, is a vast conspiracy involving innumerable powerful forces, including the Democratic Party, NeverTrump Republicans, the Obama administration, the FBI, Department of Justice and the nation’s most prestigious news outlets.

    Where previous scandals often ended with public accountability for the perpetrators – Watergate saw the imprisonment of top White House aides and President Nixon’s resignation – and public reforms, Russiagate has produced no such reckoning.

    Russiagate began with a kernel of truth: Someone – probably Russians, though we still don’t know for sure – hacked the Democratic National Committee and Hillary Clinton’s private server. Fearful of what might be released, the Clinton campaign tried to discredit any damaging material by raising dark questions about its source. (Joe Biden executed this same strategy to great effect when he falsely described the evidence of corruption found on his son Hunter’s laptop as “Russian disinformation.”)

    In response, the Clinton campaign financed an absurd collection of conspiracy theories involving peeing prostitutes and billion-dollar bribes, the so-called Steele dossier. Its importance cannot be overstated – it was the dossier that linked the Trump campaign to the hacking. No dossier, no collusion theory.

    During the summer and fall of 2016, Hillary’s henchmen fed this preposterous concoction to Obama administration officials in the DOJ, FBI, CIA and State Department. Everyone knew it was a political operation: Declassified notes showed that then-CIA Director John Brennan briefed President Obama in July 2016 that Clinton planned to tie Trump to Russia as “a means of distracting the public from her use of a private email server.”

    Clinton staffers – including Jake Sullivan, who now serves as Biden’s national security adviser – tried to interest the mainstream press in its scurrilous accusations, but got little traction because they could not be verified. Instead of laughing it all off as transparent campaign mud-slinging, however, the FBI joined the conspiracy. The bureau took the extreme step of opening a counter-intelligence probe into an ongoing presidential campaign – and its agents perjured themselves to obtain wire-tapping warrants.

    Days after the November election, Hillary’s campaign focused on “Russian interference” as a chief reason for her defeat. On Jan. 5, 2017, President Obama, Vice President Biden and other key leaders met with FBI Director James Comey in the Oval Office to discuss Russia-related matters. We do not know what was discussed in that meeting, but the next day, Comey briefed President-elect Trump on some allegations in the Steele dossier. Four days later, on Jan. 10, CNN used that briefing as a news hook to report the collusion conspiracy theories as high-drama news.

    Over the next few months and years, current and former officials illegally fed misleading classified material and partisan anonymous quotes to the New York Times, Washington Post, NBC News and other sympathetic press outlets to advance the narrative. Brennan and former National Director of Intelligence James Clapper became a constant presence on cable news, using the top-secret authority of their previous positions to assure the public that collusion was real – although in sworn testimony, Clapper admitted he had not seen such evidence.

    Congressional Democrats, including Nancy Pelosi and Rep. Adam Schiff – who falsely claimed to have seen “more than circumstantial evidence” of Trump/Russia collusion – amplified the smears.

    The appointment of Special Counsel Robert Mueller to investigate the fantasy in May 2017 fueled the fire. His effort became part of the scheme: He only looked for evidence that might implicate Trump, ignoring questions about who cooked up the conspiracy theory, how they disseminated it throughout the government and media, and the laws they might have broken in the process.

    Despite his best effort, Mueller said he’d found no evidence of collusion when he released his report in April 2019. That should have killed the conspiracy theory and – following the script of previous major scandals – sparked a period of reflection by the government, the media and the American people that asked: How did we get this so wrong?

    Such a broad reckoning has not yet happened. DoJ Inspector General Michael Horowitz’s 2020 report detailing grave abuses in the FBI’s handling of the matter prompted little outcry and no sweeping reform. The recent indictments of Clinton-connected actors filed by Special Counsel John Durham – who is finally doing the work Mueller should have, exposing the malfeasance that actually transpired during the 2016 campaign – have, bizarrely, led partisans to minimize his findings and actually double-down on the debunked collusion narrative. Recent pieces in The Atlantic and New York Times, for example, suggest, without evidence, that “Mueller never definitively got to the bottom of what happened.”

    As Aaron Maté recently reported for RealClearInvestigations, many news organizations have refused to correct documented errors in Trump/Russia coverage, including deeply flawed articles that were awarded a Pulitzer Prize.

    Leading peddlers of the hoax – including Brennan, Clapper, Pelosi, Schiff and Sullivan – have paid no price for their actions. To date, no one has conducted probing interviews with Hillary Clinton or Barack Obama about their roles in the scandal.

    Engineered by broad swaths of the government and media, the effort to paint a sitting president as a foreign agent alone makes Russiagate the worst scandal in American history. But it is this second, still ongoing  phase – this willful effort to deny  what happened, this refusal to hold the  perpetrators accountable – that presents the most serious danger to our nation.

    If truth and justice don’t matter, what does?

    Tyler Durden
    Sun, 12/12/2021 – 23:30

  • Visualizing The History Of Cannabis Prohibition In The US
    Visualizing The History Of Cannabis Prohibition In The US

    The legal status of cannabis in the U.S. isn’t always clear. At the federal level, it is an illegal Schedule I drug. However, individual states have the ability to determine their own laws around cannabis sales and usage.

    But, as Visual Capitalist’s Avery Koop details below, cannabis was not always illegal at the top level. It was only in the last 100 years that cannabis faced a prohibition similar to the alcohol prohibition of the early 1920s.

    In this infographic from Tenacious Labs, we explore the fascinating history of cannabis prohibition in the U.S. dating all the way back to the 1900s.

    The Early History of Cannabis Legality

    The earliest laws surrounding the cannabis plant in the U.S. were drafted before the country was even founded. In 1619, a law was passed in the colony of Virginia which required every single farm to grow cannabis and produce hemp, an important commodity at the time.

    Over time, marijuana from the cannabis plant started to be used for medicinal purposes. Early recreational use was first introduced by Mexican immigrants in the early 1900s.

    Flash forward to the 1930s, when the country was struggling financially during the Great Depression. To encourage economic growth, alcohol prohibition was lifted, and those who had supported teetotalling began to target marijuana instead. At the time, cannabis was consumed largely in black and Mexican communities, and racist attitudes began to shape an association between crime, lewd behavior, immorality, and marijuana.

    Legal Changes

    The 1930s marked the beginning of America’s war against marijuana. Here’s a glance at some of the most famous laws around cannabis prohibition:

    • The Marihuana Tax Act (1937)

    • The Boggs Act (1952)

    • The Narcotics Control Act (1956)

    • The Controlled Substances Act (1971)

    In 1937, the Marihuana Tax Act was enforced, prohibiting marijuana federally but still allowing medical use. Prior to that, 29 states had already outlawed marijuana on their own.

    But by the 1950s, a counterculture movement had begun, with young people using marijuana recreationally much more than previous generations.

    Eventually, the Boggs Act (1952) and Narcotics Control Act (1956) were put in place to combat the counterculture. These laws set mandatory sentences for drug-related offenses, including marijuana. A first-offense marijuana possession conviction could result in a minimum sentence of 2-10 years with a fine of up to $20,000.

    In 1970, cannabis was classified as a Schedule I drug—the same category as heroin—under the Controlled Substances Act. However, the 70s also saw an opposing shift, with a number of states beginning to decriminalize marijuana.

     Decriminalization means that although possessing marijuana remains illegal, one is not subject to prosecution or jail time for possessing certain amounts.

    After decriminalization, commercial businesses began to capitalize and started to market marijuana-related products. Some products were marketed towards children, which, in tandem with the intensive hippie culture from the 70s, sparked a war against marijuana led by parents and supported by president Ronald Reagan.

    The Modern Era

    During the 1990s, five states passed laws to allow the medical usage of marijuana—between 2010 and 2020, 16 states passed medical marijuana laws.

    In 2021, a total of 18 states have fully legalized cannabis, while another 26 have allowed marijuana usage for medicinal purposes in some capacity. Furthermore, the MORE Act—a bill to legalize marijuana federally—was reintroduced in the House of Representatives in May 2021.

    If passed, the MORE Act (the Marijuana Opportunity Reinvestment and Expungement Act) would essentially remove cannabis from its classification as a Schedule I drug under the Controlled Substances Act. It would also work towards the expungement of criminals who were charged with crimes related to marijuana.

    While the U.S. government has gone back and forth with cannabis legalization over the years, it appears that in the 21st century, the path only leads one way: towards federal legalization.

    Tyler Durden
    Sun, 12/12/2021 – 23:00

  • China's Banking Assets Are $52 Trillion, Growing By $40 Trillion Since 2008: "This Is What Hyper MMT Looks Like"
    China’s Banking Assets Are $52 Trillion, Growing By $40 Trillion Since 2008: “This Is What Hyper MMT Looks Like”

    By Eric Peters, CIO of One River Asset Management

    Thermodynamics

    “The interaction of inflation-focused monetary policies in the west and China’s mercantilist model created what I call The Refrigeration Mode,” said the CIO, sitting atop his prodigious pile. “The process has been ongoing for twenty years,” he continued. “The inflation-focused policy framework is based on the fallacy that you can model an economy using an equilibrium framework,” he said. “Wicksell was the father of classical equilibrium in economics. He observed that for a pure credit economy – with no external gold backing for money, just credit-backed deposits – there were no clear forces that would drive the system toward equilibrium. To the 19th century Wicksell, a pure credit economy was a fictitious, futuristic concept, but it is effectively what we have today – and it is a path dependent system.”

    “What is a path dependent system?” asked the CIO, not waiting for my answer. “Take the male driver when lost. Despite all evidence around him, the male believes he is not lost. He is, of course. And yet has no need for a map. The male is merely taking a different route, maybe a better a route to the same inevitable, incorrect destination. That destination being equilibrium. It’s all taking place in the male’s head. The reality on the road, meanwhile, is rather different. He turned left at the fork in the road when he should have gone right. There is, now, no natural force – other than blind luck and a tactful passenger – which can rescue him. Further wrong turns, and his destiny await. His destination is path dependent.”

    “So now consider a simplified schematic,” said the CIO. “The economy receives a positive supply shock which lowers inflation and allows rates to fall. This brings forward consumption. Consumers borrow and spend. Asset prices go up. Financiers get excited. More intermediation and engineering. We get inevitable excess. Policy tightens. This causes a financial crisis, which the central bank is forced to respond to – with the fear of deflation in mind – and rates fall further. The net effect is that nominal and real rates ratchet lower in a path-dependent fashion. And this leads to a monetary policy that is so lost we’ve had to create a new word to describe our bizarre destination: a world of financialization or more appropriately, hyper-financialization. It is the optimization of the economy around finance and asset prices – the fuel for the Occupy Wall Street manifesto.”

    “Now let’s look at the other half of this system: China’s mercantile model,” said the CIO. “We all vaguely know the story here – we all tried shorting it at one point or another. China discovered the Magic Money Tree. They used it to build a manufacturing empire and stopped the magic escaping from the capital account. This was MMT used in anger. They repressed the exchange rate to take export market share and accumulated FX reserves in the process. These were recycled into US Treasuries, supporting lower US interest rates. They repressed depositors with negative real returns on deposits to favor investment over consumption. The consumption share of GDP has remained depressed throughout, subjugated to investment exports and government spending. No wonder property became the savings vehicle of choice – and seemed to be an everlasting bubble. Free money allowed a massively accelerated pace of industrial development, especially after China joined the WTO in 2001.”

    “China’s rapid industrialization and hunger for global market share kept deflationary pressure on durable goods prices for thirty years, helping to keep consumer price inflation and interest rates lower in the West. And the beauty of the Magic Money Tree was that China could insulate its highly cyclical industry from any default cycle. It monetized bad debt and preserved unprotected, deflationary capacity. The stock of money ballooned. Banking assets are now around $52 trillion. They’ve grown by about $40 trillion since 2008. They’re now twice the size of the US banking system and China’s banks have added the equivalent of the US banking systems in just eight years. This is what hyper MMT looks like.”

    “The net result is that western monetary policy and China’s mercantile model fed off one another to give us this Alice in Wonderland ‘through-the-looking-glass’ transformation of massive monetary growth into a deflationary mechanism: The Refrigeration Mode. Both sides got what they wanted: China leapfrogging industrial development, and the US got low inflation in the great moderation. But it had side effects. A massive monetary overhang in China, hyper financialization in the US. These extremes are now biting back on the system through the political economy.”

    “The Deflationary D’s may still be with us (debt, demographics, disruption, digitization), but the system dynamic is becoming inflationary and there are some new supply side shocks that aren’t deflationary for a change. Both sides are in (re)flux. On the macro policy side, we are seeing powerful social reactions to the extremes produced by The Refrigeration Mode. These extremes are feeding into the political economy. Whether it’s the ‘Tax the Rich’ dress at the Met Gala, politicians and celebrities at climate change marches around the world, or bipartisan support for China containment, the challenge to the status quo is clear and present. The COVID crisis merely poured petrol on it.”

    “It means fiscal policy is back in the driver’s seat – just as central banks put an inflationary bias into their reaction functions. Future bailouts are coming via Main Street, as much as Wall Street. And when monetary and fiscal policy combine, policy becomes more directly inflationary in CPI terms, not simply in asset price terms.”

    “On the China side, the model is pivoting. Common prosperity in its ‘dual circulation strategy’ shifts the emphasis from a reliance on exports to a focus on the domestic consumer in regional markets. A digital currency will be presented as a haven of stability, while other economies appear to be debasing their own currencies. Deleveraging is a goal – so more defaults will be allowed. Profits will take precedence to export market share. So expect to see China continuing to export more goods priced at a premium, leaning against commodity price inflation. Taken together, all these changes transform The Refrigeration Mode into its reverse: A Heat Pump.”

    Tyler Durden
    Sun, 12/12/2021 – 22:30

  • Billionaire Space Tourism Is Letting People Live Out Childhood Space Dreams…If They Can Afford It
    Billionaire Space Tourism Is Letting People Live Out Childhood Space Dreams…If They Can Afford It

    With the help of burgeoning space firms like Jeff Bezos’ Blue Origin, many of America’s ultra-rich are getting the opportunity to fulfill childhood space aspirations that may have otherwise been untenable. 

    At least that’s the story for venture investor Lane Bess, who made his money working in Silicon Valley’s cybersecurity startups, according to Bloomberg.

    He is going to be among 6 passengers that will be taking part in Blue Origin’s third manned space flight this weekend. 

    Bess said: “Part of who I am is seeking adventure and not being afraid to take risks. It’s fulfilling a boyhood dream.”

    And it’s not just Bess that’s getting to fulfill these childhood dreams. There has been a group of successful businesspeople who have been able to buy their way into outer space thanks to the “space race” taking place between billionaires like Richard Branson, Elon Musk and Jeff Bezos. 

    On Wednesday of last week, Japanese businessman Yusaku Maezawa also blasted off into space. The 46 year old is the first “tourist” to visit the ISS in over a decade. He also plans to be the “first paying passenger to fly around the moon” by way of Elon Musk’s SpaceX in 2023, the report notes.

    The man who put Maezawa’s trip together, Eric Anderson, chief executive officer of Space Adventures, says prices for such trips aren’t expected to come down anytime soon.

    He said: “The costs are labor, materials, infrastructure, and it’s all gone up over time. Imagine the cost of flying to Tokyo if you throw away the airplane after one flight.” 

    Bess did not disclose the price he paid for his trip, though Blue Origin had previously auctioned off a ticket to its inaugural crewed flight this past summer for $28 million. Bess didn’t win the action, he said.

    He said of the flight prep that “they’ve really tried to make this as consumer-friendly as possible”. 

    “Unlike SpaceX, Jeff Bezos has funded this primarily at his own cost. When you look at the facilities they’ve built and the engineering brilliance, it’s the kind of commitment very few people on Earth can make.” 

    Tyler Durden
    Sun, 12/12/2021 – 22:00

  • DeSantis Proposes $8 Million In Budget To Relocate Illegal Immigrants To Delaware, Martha’s Vineyard
    DeSantis Proposes $8 Million In Budget To Relocate Illegal Immigrants To Delaware, Martha’s Vineyard

    By Allen Zhong of EpochTimes,

    Florida Gov. Ron DeSantis set $8 million in his 2022–23 budget to transport illegal immigrants out of The Sunshine State. He proposed the spending in the Freedom First Budget (pdf) to protect against harms resulting from illegal immigration. The spending may include the transportation of unauthorized aliens located within Florida to other states or the District of Columbia.

    “In yesterday’s budget, I put in $8 million for us to be able to transport people illegally [in the United States] out of the state of Florida,” he said during a press conference on Friday.

    The Republican governor listed Delaware, President Joe Biden’s hometown state, and Martha’s Vineyard, where former President Barack Obama owns a mansion, as potential destinations to relocate the illegal immigrants.

    “If you sent [illegal immigrants] to Delaware or Martha’s Vineyard or some of these places, that border would be secure the next day,” he said.

    DeSantis also encouraged more counties to participate in the U.S. Immigration and Customs Enforcement’s (ICE) 287(g) program, under which individuals who have been arrested on criminal charges and are being booked into the county jails are asked about their immigration status.

    Other proposed measures to reduce the harms of illegal immigrants include listing convicted illegal aliens on a public website.

    DeSantis threatened to send illegal immigrants to Delaware back in November. He said his office is looking at legal avenues after his administration alleged that about 70 flights of illegal aliens were sent to Jacksonville, Florida, after being picked up by agents along the U.S.–Mexico border.

    “We’re going to get together and figure out what we can do in the immediate term to protect folks in Florida,” DeSantis told reporters, noting that his options are limited because the federal government controls the immigration policies and actions.

    But “if they’re not doing that,” DeSantis added, “then clearly the state should be able to come in and provide protection, and so that’s what we’re going to be looking to do.”

    “If they’re going to come here, we’ll provide buses,” DeSantis said, before proclaiming, “I will send them to Delaware.”

    Tyler Durden
    Sun, 12/12/2021 – 21:30

  • Smash And Grab Thieves Steal Millions In Jewelry From Rolls Royce Dealership
    Smash And Grab Thieves Steal Millions In Jewelry From Rolls Royce Dealership

    Thieves are becoming more brazen as they begin to target luxury shops. The latest incident was a smash and grab robbery at a Rolls Royce dealership in Chicago’s Gold Coast neighborhood, according to CBS Chicago. 

    On Saturday afternoon, two men, one armed with a handgun, raided the exotic car dealership. One thief used a hammer to break the display cases open and fill bags with expensive watches and other jewelry pieces. 

    In about 30 seconds, the men made off with over $2 million worth of jewelry, according to Joe Perillo, the dealership owner, who spoke with CBS Chicago. 

    “A city that I love and everybody loves to come to is going to be a desert if they don’t stop this. We’re going to have people moving out of this city — they’re moving out now — that want to just be safe,” said Perillo. 

    “They’re walking into my business, crashing the windows. And one guy stands with a gun. And we have to have this happen. Enough is enough,” he said. 

    Perillo voiced his frustration regarding Mayor Lori Lightfoot’s progressive policies that “if they [thieves] get arrested, they get let go. So how do you ever intend to solve the problem” of increasing retail thefts. 

    He added the county prosecutors and city leaders need to hold criminals accountable: 

    “It’s only a fool who keeps doing things the same way and expects different results. If the Mayor and Kim Foxx don’t do anything to get control of this, it’s not going to get better. It’s going to get worse,” he said.

    This luxury smash and grab follow a Louis Vuitton in the metro area was overrun by a flash mob. During Black Friday, there were other reports of retail stores in the region getting knocked up by thieves. 

    The mayhem is also unfolding across other progressive cities. Last month, a Nordstrom outlet in Walnut Creek, situated in the San Francisco Bay Area, was raided by 90 individuals. A Louis Vuitton in downtown San Francisco was also hit. 

    Smash and grabs are increasing in liberal cities because progressive laws have downgraded retail theft from a felony to a misdemeanor forcing stores to redesign their front entrances to prevent flash mobs. 

    Tyler Durden
    Sun, 12/12/2021 – 21:00

  • Beijing Signals Growth-Pain Threshold Is Reached
    Beijing Signals Growth-Pain Threshold Is Reached

    By Ye Xie, Bloomberg Markets Live commentator and analyst

    Three things we learned last week:

    1. Beijing’s focus has shifted to propping up the economy. The statement from the annual Central Economic Work Conference, where leaders set the economic strategy for the next year, signaled Friday that it’s a priority now to put a floor under the economy. It mentioned the words “stability” or “stabilize” 25 times, compared with 13 last year. Policy makers pledged to push forward infrastructure investments and cut fees and taxes. While it kept the mantra that housing is not for speculation, the authorities said they support reasonable demand for homes.

    The statement left out last year’s phrase that Beijing will keep the leverage ratio steady. The omission got some economists’ attention because it may suggest more monetary policy easing. But China Bull Research cautioned not to read too much into it because the CEWC didn’t mention the leverage ratio in 2019 either.

    So now what? Credit growth seems to have bottomed, but how far it can run up again is unknown as the broad control of the housing market remains intact. Investors are nonetheless encouraged that the macro policy mix is becoming more market friendly. Foreign investors added a record 49 billion yuan ($7.7 billion) via the northbound stock connect last week, while iron ore has gained about 30% since the low in mid-November.

    The next window to read the policy tea leaves comes on Wednesday when MLF loans mature. After the recent RRR cut, there’s speculation that the PBOC may lower the MLF rate, when the loans are rolled. It will come on the same day the Fed announces its policy decision. It sets up a potential show of the policy divergence between the Fed and PBOC (as first discussed here last week in “China Shifts To An Easing Mode While “Ex-China” Is On A Tightening Path“).

    2. Evergrande’s landmark default didn’t cause turmoil. Fitch labeled Evergrande and Kaisa Group as defaulters last week. But the tone of the junk bond market has improved after various policy tweaks.While default by the weakest credits are still likely, the BBB-/BB space is oversold, according to Citigroup’s credit strategists including Eric Ollom. They recommend buying a basket of junk bonds, including Country Garden, Shimao, Sino-Ocean and Sunac China.

    3. PBOC is drawing a line in the sand on the yuan. The central bank Thursday raised the foreign-exchange reserve, effectively draining the dollar supply to alleviate the appreciation pressure on the yuan. On Friday, the central bank set the fixing far weaker than analysts expected. While the one-two punch weakened the yuan a bit, the currency is not far away from the strongest since 2018. Monday’s fixing will be closely watched. There’s a risk that the counter-cyclical factor (CCF) will be re-introduced to add a weakening bias to the official fixing price.

    Tyler Durden
    Sun, 12/12/2021 – 20:30

  • Panic? US Mega-Corporations Rush To Abandon Vax Mandate
    Panic? US Mega-Corporations Rush To Abandon Vax Mandate

    Authored by Daniel McAdams via The Ron Paul Institute,

    This week’s nationwide annihilation of Biden’s Federal Contractor vaccine mandate at the hands Georgia Federal Judge R. Stan Baker has resulted in a landslide retreat of cowardly mega-corporations from their so-confident bullying of American workers.

    Biden’s illegal gamble, the nationwide Federal contractor vaccine mandate, has like his previous Medicare mandate and OSHA if-you-have-100-workers-mandatory-vax mandate been ripped to shreds early on in the courts.

    Biden’s mandates have always been a bullying gamble, an admission that they knew they were engaging in illegal acts but that they would continue to use the not-insignificant weapons of the executive branch to blast as much harm as possible until the courts stepped in and noted the obvious: “You can’t do this!”

    Cynics – and I sympathize – will say that the courts could have ruled either way so don’t get too excited.

    That’s the lesson of the past two years: There is nothing below us as we look down. It takes our breath away. We now understand that our civilization has been built on a pile of sand and any determined entity could tunnel under us as we are distracted by the human necessities of providing for our families and living our finite lives as best as possible.

    This horrible reality cannot be unseen.

    Previously we viewed our rulers – from dog catcher to president – as malevolent but for the most part at a distance. We never thought they would reach out with their gradually but steadily-acquired iron fist and squeeze the oxygen from our lungs: “Take a shot or starve!”

    The Hungarians in early 1918 similarly were shocked that living somewhat silently among them were aliens who would activate themselves at the exact most fertile moment and literally up-end their somnambulant state, imposing “mandates” on their society that included mobile gallows – a crude earlier form of the forced vax.

    With the welcome disintegration of this evil government decree – via Judge Baker’s ruling that the contractor mandate is illegal – one by one the mega-corporations also see their position as shifting to the untenable. They are bailing out as fast as possible.

    Some 83,000 Florida healthcare workers no longer face being kicked to the street by US government-sponsored terrorism, until this week dutifully enforced by the “free market” prostitutes in bed with the state.

    As hero Alex Berenson has reported Thursday, mega corporations in the US are also suddenly looking under themselves and finding that they are alone. No more government guns aimed at the powerless…at least for the time being.

    General Electric, 3M, Verizon, and Oracle have in the past day or so hedged their bets and snuck out of bed with the US government: no more vax requirements! We are talking about a large group of people no longer bound by the brotherhood of the needle.

    We are winning this for now and should pause to drink it in.

    But at the same time we must also look at what has rotted in our civilization that would allow such a force to upend us, to unleash this iron fist once hidden in a velvet glove. Life will never be the same knowing what these people have done to us. They must never be allowed to forget it.

    Tyler Durden
    Sun, 12/12/2021 – 19:30

  • Rupert Murdoch Buys Sprawling 340,000 Acre Montana Property, Mansion, For Reported $200 Million
    Rupert Murdoch Buys Sprawling 340,000 Acre Montana Property, Mansion, For Reported $200 Million

    While newly-listed shares of Buzzfeed continue their plunge, at least one tycoon is still proving that media can pay. 

    That’s because 90 year old Rupert Murdoch and his wife just purchased a sprawling $200 million cattle ranch, with attached mansion, that was formerly owned by the Koch family.

    The property is 340,000 acres, according to Bloomberg, and is known as “Beaverhead”. 

    A spokesperson for Murdoch declined to comment on the price of the property, but the previous owner has been confirmed to be Matador Cattle Co., a unit of Koch Industries. 

    It is the largest ranch sale in Montana’s history, the report says. Koch Industries bought the property about 70 years ago. It’s located near Yellowstone National Park.

    The property features elk, antelope and mule deer and is also located next to a 28 mile long river that’s good for trout fishing, Bloomberg noted.

    The price of the property pales in comparison to Murdoch’s reported net worth, which stands at about $8.8 billion.

    Tyler Durden
    Sun, 12/12/2021 – 19:00

  • $100,000 Bitcoin, $50 Oil, $2,000 Gold? 2022 Outlook In 5 Charts
    $100,000 Bitcoin, $50 Oil, $2,000 Gold? 2022 Outlook In 5 Charts

    By Mike McGlone, Bloomberg commodity strategist

    Peaking commodities and the declining yield on the Treasury long bond point to risks of reviving deflationary forces in 2022, with positive ramifications on Bitcoin and gold. A primary uncertainty heading into the new year is whether the U.S. stock market can keep rising amid Federal Reserve restraint, with implications for all assets.

    1. Money Supply Test: Sustainability vs. Vulnerability

    Asset class performance in 2022 is likely to be all about the potential for reversion toward the upward trajectory of U.S. money supply, which should favor gold, especially if stock-market returns normalize some. What’s different about that outlook, which has been relevant throughout much of history, is the proliferation of crypto assets. The fact that our graphic excludes the Bloomberg Galaxy Crypto Index (BGCI) due to distortions of its outsized performance, is a top reason cryptos are gaining exposure in portfolios.

    So, will the trend turn, or are we in for more of the same? Our bias is the latter, notably because the BGCI has overcome about a 60% correction in 2021 vs. the S&P 500, which hasn’t had a 10%-plus drawdown since the 2020 trough. Underperforming commodities face increasing pressure/

    Gold Too Low, Stocks Too High vs. Money Supply?

    2. How Sustainable Is This Disparity?

    A bit of a backup in market expectations for Federal Reserve rate hikes in 2022 — a top determinant of asset-price performance — is gaining potential from 2021 peaks in copper, crude oil and bond yields. It took about seven years at zero before the Fed began hiking in 2015. Fed funds futures show rates jumping toward 1% by the end of 2022. History has proven that a primary force to stop this process is some stock-market reversion. Our graphic depicts the S&P 500 the most extended above its 60-month moving average in two decades, and what we see as a consolidating gold bull market waiting on a catalyst to revisit $2,000-an-ounce resistance.

    The 2021 bounce in commodities and bond yields may be over, with implications for a resumption of enduring deflationary forces.

    Is a Fed Rate-Hike Cycle in 2022 a Dream?

    3. Bitcoin Says: Why Complicate a Bull Market?

    Bitcoin is a risk asset that’s evolving into a digital reserve asset in a world going that way, with positive implications for its price. Demand and adoption are rising and still appear in early days vs. supply, which is declining. The key question nearing the end of 2021 is whether Bitcoin is too hot, and our chart shows the crypto fairly priced at about its upward-sloping 50-week moving average. Not too extended and within an upward trajectory sets the stage for a potentially strong 2022. Bitcoin ended 2020 around 140% above its annual mean.

    The overextended condition a year ago has been relieved, and it’s now a question of a consolidating bull or the beginning of a reversal. Our bias is with the former, on the back of favorable demand vs. supply fundamentals. About $100,000 is good target resistance.

    100,000 Bitcoin, Target Resistance for 2022?

    4. Crude Wonders: Why Complicate a Bear Market?

    The big difference between commodities — notably oil — and Bitcoin is elasticity of supply, which points downward for crude prices in 2022. In 2021, West Texas Intermediate stretched the greatest distance above its 60-month moving average since the peak in 2008. This is a bad sign for prices. The price bounce is accelerating the paradigm shift of the U.S. gaining enduring status as a net crude and liquid-fuel exporter, and encouraging the proliferation of substitutes and electric vehicles.

    We see unfavorable production vs. consumption, along with a challenging economic backdrop, and prices more likely to revert toward lower means. Our graphic depicts WTI appearing too hot at about $72 a barrel vs. its 60-month mean closer $56.

    2021 Crude Bounce May have Cured The Recovery

    5. Alert to the Great Commodity Deflation

    The risk of, and propensity for, some typical reversion in broad commodity prices may be a top development in 2022. Our graphic depicts the potential early days of normalization for the Bloomberg Commodity Spot Index following an almost uninterrupted rally from 2020’s bottom. Commodity prices rising with China in decline is basically an oxymoron, based on historical patterns. The second cut of China’s reserve requirement ratio in 2021 (and likelihood of more to come), running alongside declining yields on the U.S. Treasury long bond is a poor mix for higher prices.

    China has been a primary source of demand for commodities, notably since 2003, and higher rates in the U.S. underpin the dollar, which typically is a headwind for commodity prices.

    Extreme Commodity Deflation Risks in 2022?

    Tyler Durden
    Sun, 12/12/2021 – 18:30

  • Hospitalizations, Mortality Cut In Half After Brazilian City Offered Ivermectin To Everyone Pre-Vaccine
    Hospitalizations, Mortality Cut In Half After Brazilian City Offered Ivermectin To Everyone Pre-Vaccine

    Early on in the pandemic, before the vaccines were available, the Southern Brazilian city of Itajai offered Ivermectin as a prophylaxis against the disease.

    Between July and December of 2020, roughly 220,000 people were offered a dose of 0.2mg/kg/day (roughly 18mg for a 200lb person) as an optional treatment for 2 days, once every two weeks.

    133,051 people took them up on it, while 87,466 did not.

    After analyzing the data, a team of researchers spanning several Brazilian institutes, the University of Toronto, and Columbia’s EAFIT concluded in a December pre-print study that hospitalization and mortality rates were cut in half over the seven month period among the Ivermectin group.

    The authors adjusted for relevant confounding variables, including age, sex, medical history, previous diseases, and other conditions.

    The analysis contradicts an October report by Business Insider which claims, based on a Brazilian ICU doctor’s anecdotal evidence, that the experiment was a failure.

    Study limitations:

    The authors note, “Being a retrospective observational analysis, it is uncertain whether results would be reproducible in a randomized, placebo-controlled, double-blind clinical trial, but likely, since groups of ivermectin users and non-users had  similar demographic characteristics, and rates were adjusted for the relevant confounding variables.”

    We’re sure the ‘fact checkers’ are already hard at work trying to debunk the pre-print, however they may also want to take a look at ivmmeta.com – a real-time meta analysis of 70 studies which found that Ivermectin works as a prophylaxis 83% of the time. In peer-reviewed studies, it was found effective 70% of the time as an early treatment, and just 39% of the time as a late treatment.

    As we noted during the whole ‘horse paste’ controversy:

    Ivermectin

    This widely prescribed anti-parasitic which is also used in horses has shown meaningful efficacy worldwide in the treatment of mild and moderate cases of Covid-19, plus as a prophylactic. India’s Uttar Pradesh province, with a population of over 200 million, says that widespread early use of Ivermectin ‘helped keep positivity [and] deaths low.’

    (source, May 12th)

    Separately, there have been several studies funded by the Indian government, primarily conducted through their largest govt. public medical university (AIIMS).

    • Role of ivermectin in the prevention of SARS-CoV-2 infection among healthcare workers in India: A matched case-control study (source)

    Conclusion: Two-dose ivermectin prophylaxis at a dose of 300 μg/kg with a gap of 72 hours was associated with a 73% reduction of SARS-CoV-2 infection among healthcare workers for the following month.

    • Ivermectin as a potential treatment for mild to moderate COVID-19 – A double blind randomized placebo-controlled trial (source)

    Conclusion: There was no difference in the primary outcome i.e. negative RT-PCR status on day 6 of admission with the use of ivermectin. However, a significantly higher proportion of patients were discharged alive from the hospital when they received ivermectin.

    • Clinical Research Report Ivermectin in combination with doxycycline for treating COVID-19 symptoms: a randomized trial (source, double-blind randomized, peer-reviewed)

    Discussion: In the present study, patients with mild or moderate COVID-19 infection treated with ivermectin in combination with doxycycline generally recovered 2 days earlier than those treated with placebo. The proportion of patients responding within 7 days of treatment was significantly higher in the treatment group than in the placebo group. The proportions of patients who remained symptomatic after 12 days of illness and who experienced disease progression were significantly lower in the treatment group than in the placebo group.

    Here are more human studies from other countries on the ‘horse dewormer’:
     
    Peru:
    • Sharp Reductions in COVID-19 Case Fatalities and Excess Deaths in Peru in Close Time Conjunction, State-By-State, with Ivermectin Treatments (source, peer-reviewed, University of Toronto, Universidad EAFIT)

    For the 24 states with early IVM treatment (and Lima), excess deaths dropped 59% (25%) at +30 days and 75% (25%) at +45 days after day of peak deaths. Case fatalities likewise dropped sharply in all states but Lima

    Spain:
    • The effect of early treatment with ivermectin on viral load, symptoms and humoral response in patients with non-severe COVID-19: A pilot, double-blind, placebo-controlled, randomized clinical trial (source, University of Barcelona, peer-reviewed)

    Findings: Patients in the ivermectin group recovered earlier from hyposmia/anosmia (76 vs 158 patient-days; p < 0.001).

    Bengladesh:

    • A Comparative Study on Ivermectin-Doxycycline and Hydroxychloroquine-Azithromycin Therapy on COVID-19 Patients (source – peer reviewed, though not govt funded)

    Conclusion: According  to  our  study,  the  Ivermectin-Doxycycline combination therapy has better symptomatic relief, shortened recovery duration, fewer adverse effects, and superior patient compliance compared to the Hydroxychloroquine-Azithromycin combination. Based on this  study’s  outcomes,  the  Ivermectin-Doxycycline  combination  is  a  superior  choice  for  treating  patients  with  mild to moderate COVID-19 disease.

    • A five-day course of ivermectin for the treatment of COVID-19 may reduce the duration of illness (source, peer-reviewed double blind randomized, though small sample size)

    Discussion: A 5-day course of ivermectin resulted in an earlier clearance of the virus compared to placebo (p = 0.005), thus indicating that early intervention with this agent may limit viral replication within the host. In the 5-day ivermectin group, there was a significant drop in CRP and LDH by day 7, which are indicators of disease severity.

    Why does Ivermectin, a ‘horse dewormer’ work? For starters, it’s a protease inhibitor. Interestingly, Pfizer’s 2x/day Covid-19 prophylactic they’re trialing right now is also a protease inhibitor.

    Perhaps the most damning evidence in favor of Ivermectin is the medical establishment’s position that it’s essentially snake oil, despite the fact that it’s had a glowing safety profile for decades, until now.

    Tyler Durden
    Sun, 12/12/2021 – 18:00

  • Titleist Bans "Let's Go Brandon" Personalization Of Its Golf Balls
    Titleist Bans “Let’s Go Brandon” Personalization Of Its Golf Balls

    Authored by Eric Utter via AmericanThinker.com,

    Don’t try to personalize your Titleist golf ball with the popular phrase “Let’s Go Brandon.”

    The golf equipment company bans customers from doing so on its website, alleging that the saying is “inconsistent” with its “values or brand identity.” When one tries to customize a golf ball with that message, one receives a notification stating:

    “Sorry, one or more of the words you have chosen cannot be used. Please see our Terms and Conditions to learn more about what we will imprint.”

    Titleist’s Terms and Conditions reads:

    “Acushnet Company [the parent company of Titleist] reserves the right to reject orders for imprints on our products that may, in our sole discretion, be inconsistent with our company values or brand identity, including, but not limited to logos, designs and/or personalizations that are negative in nature, advocate violence or illegal activity, or are slurs, hateful, threatening, libelous, defamatory, vulgar, obscene or pornographic.”

    As Fox News noted, “It is unclear which of those categories the phrase ‘Let’s Go Brandon’ violated.”

    The outlet added, “Certain political and vulgar messages that Fox News Digital tested on the website did not receive the same error message, including ‘F Trump,’ ‘ACAB,’ ‘Antifa,’ ‘Kill Cops,’ ‘Impeach Trump,’ and ‘Kill Trump.'”

    “Let’s Go” is an upbeat exhortation. “Brandon” is a common name. Whether apart or together, they/it are certainly not “threatening,” “libelous,” “vulgar,” “obscene,” or “pornographic.”

    “Let’s Go Brandon” is not a slur, which means an insinuation or allegation. Nor is it defamatory, the definition of which is “damaging the good reputation of someone.” Neither does it advocate violence or illegal activity.

    Is it hateful? Not on its face. Its symbolic or figurative meaning could conceivably be construed as such, but even that is relatively mild compared to so much else in our coarse modern society. And it is as nothing compared to what was directed at Trump (by individuals, groups and corporations) every day of his presidency, no obfuscation, restraint, or decorousness needed.

    So “F Trump” and “Kill Trump” are not “inconsistent” with Acushnet’s “company values or brand identity” but “Let’s Go Brandon” is? “F Trump” and “Kill Trump” are not “negative in nature” but “Let’s Go Brandon” is? That is the result when a company’s only value and brand identity is appeasing the woke mob to maximize profit, every other consideration be damned.

    I wonder if one could personalize a Titleist product on its website with “Titleist Sucks!?”

    Sadly, like many other corporations these days, the Acushnet Company appears to have no rationality, no integrity, no soul, and, ironically, no balls.

    Tyler Durden
    Sun, 12/12/2021 – 17:30

  • "We Expect A Sea Change": Morgan Stanley Admits It Was Wrong, Now Sees Liftoff In 2022 As Goldman Goes All-In With 7 Rate Hikes
    “We Expect A Sea Change”: Morgan Stanley Admits It Was Wrong, Now Sees Liftoff In 2022 As Goldman Goes All-In With 7 Rate Hikes

    At the start of the month, not long after Goldman capitulated and brought forward its first Fed rate hike forecast by one year to July 2022, virtually every Wall Street bank promptly followed in Goldman’s footsteps turning uber hawkish and expecting several rate hikes and/or accelerating tapering over the coming year. All, expect Morgan Stanley, which stubbornly refused to yield to peer pressure and continued to forecast no rate hikes in 2022 whatsoever.

    This remarkable divergence in Fed outlooks between the two most influential banks promoted us to tweet on Dec 1 that “2022 shaping up as a huge showdown between Goldman and Morgan Stanley. Former says 2, maybe 3 hikes; latter say no hikes. One will be spectacularly wrong.”

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    Just a few days later, with inflation soaring to a fresh 39-year-high (although perhaps finally topping out), Morgan Stanley decided to gracefully and quietly tap out and this week the bank’s -chief US economist Ellen Zentner, pulled forward the bank’s rate hike path by 6 months to September 2022, acknowledging that it was wrong and admitting that there has been a “pivot in the Fed’s reaction function.”

    Even so, Morgan Stanley still remains well beyond market expectations, saying it has “even greater conviction” in its call that core inflation moves off its highs in 1Q 2022, which however further validates concerns that the Fed is engaging in a policy error and tightening into a recession. 

    Here are some more details from Zentner’s note:

    Before investors close out the year, we need to get past the FOMC’s final meeting next week, and it comes with every opportunity for  surprise. On Wednesday, we expect the Fed to move to a hawkish stance by announcing that it is doubling the pace of taper, highlighting continued inflation risks and no longer labeling high inflation as transitory, and showing a hawkish shift in the dot plot. We think this shift will shake out in a 2-hike median in 2022, followed by 3.5 hikes in 2023 and 3 hikes in 2024.

    At the end of the meeting, we think the FOMC’s median view will align more closely with ours – we look for 2 hikes in 2022, followed by 3 hikes plus a halt in reinvestments in 2023. Moreover, we expect the Fed’s median forecast for core PCE and the unemployment rate will also come in reasonably close to our own, which now has higher inflation receding to around 2.5% 4Q/4Q next year, and the unemployment rate back to its pre-pandemic low around 3.5% in 4Q22.  The incoming data on the labor market and inflation has strayed materially from the Fed’s outlook and therefore warrants what we deem to be a sea change in its stance on the appropriate path for policy.

    At the same time, Zentener also says that the timing of liftoff in the bank’s forecast is tied closely to inflation outcomes, with its base case expectation that following the current re-acceleration in inflation we have been expecting, core PCE shows some slowing beginning in February next year. The pace of this deceleration will be important in determining how much of a breather the Fed takes between the end of its asset purchases and the first rate hike.

    Separately, on Friday we received data on inflation for the month of November showing that on a year-over-year basis, core CPI increased to 4.9% from 4.6%. Headline CPI ran at the highest rate since 1982. Despite the alarming headlines, financial markets seemed to be relieved at the results. Why? Because, according to Morgan Stanley, for the first time in months the month-over-month increase of 0.5% was in line with expectations instead of delivering an upside surprise.

    Going back to Morgan Stanley’s mea culpa, Zentener writes that in her outlook, the biggest out-of-consensus call has been the view that core inflation will show signs of slowing in 1Q22 as pandemic-related price pressures, particularly in goods, are slowly abating. She says that today she has “even more conviction in that view” and here’s why: 

    We are seeing nascent signs that pipeline inflation pressures are easing – based on evidence from company earnings transcripts, ISM comments, Korea trade data, China’s inflation data, the Fed’s Beige Book, a department huddle with our equity analysts, and our own survey.

    While Zentener admits that these sources by no means suggest that normalization “is well under way,” but at the very least they indicate that “bottlenecks have peaked” and the chief economist expects that in a few months, “this trend will work its way through the pipeline to finished goods prices at the consumer level.” It is unclear if Morgan Stanley’s previous thesis of a huge – and deflationary – inventory glut as supply chains blockages ease,

    In parting, the Morgan Stanley economist tries to deflect some of the blame for having been wrong in its call, and says that “to be right on our Fed call for 2 hikes in 2022, not only do we have to be right on the path for core PCE, but Chair Powell has to be willing to direct attention to slowing inflation as a way of pushing back on market expectations that are now pricing in nearly 3 hikes, with a healthy probability the Fed could begin as early as March.”

    But while Morgan Stanley is at least somewhat cautious about going hawkish, Goldman no longer has any such qualms, and moments ago on Saturday afternoon, the bank went all in on its hawkish relent… and so one month after pulling forward its call for a rate hike by over a year to July 2022, the bank now says that “the FOMC is very likely to double the pace of tapering to $30bn per month at its December meeting next week, putting it on track to announce the last two tapers at the January FOMC meeting and to implement the last taper in March.” As a result, Goldman now expects the FOMC to deliver rate hikes next year in May, July, and November (vs. June, September, and December previously) and another 4 in 2023 and 2024 (spread evenly 2 and 2). Some more details from the full note, which as usual is available to professional subs.

    New information about both inflation and the labor market since the FOMC last met supports a faster taper pace and an early liftoff. Inflation has increased further as prices of durable goods and shelter have continued to rise rapidly, though wage growth has slowed since enhanced unemployment benefits expired in September. Labor market slack has diminished rapidly, roughly in line with our expectations but faster than Fed officials expected.

    Chair Powell has indicated that the FOMC is likely to retire the word “transitory” from its statement and instead explain that it thinks the current period of elevated inflation is unlikely to “leave a permanent mark” by raising long-term inflation expectations. More meaningful changes to the statement, especially to language about inflation having run persistently below 2%, are also possible.

    We expect the Summary of Economic Projections to show somewhat higher inflation and lower unemployment. Our best guess is that the dots will show 2 hikes in 2022, 3 in 2023, and 4 in 2024, for a total of 9 (vs. 0.5 / 3 / 3 and a total of 6.5 in September). We think the leadership will prefer to show only 2 hikes in 2022 for now to avoid making a more dramatic change in one step, especially at a meeting when the FOMC is already doubling the taper pace. But if Powell is comfortable showing 3 hikes next year, then we would expect others to join him in a decisive shift in the dots in that direction.

    In conclusion, Goldman’s forecast calls for 3 hikes in 2022 (vs 2 for Morgan Stanley) and then 2 per year starting in 2023. The bank also expects two hikes per year starting in 2023 because like MS, it also expects inflation to fall to moderately above 2% and growth to slow to just above potential by then.

    That said, Goldman’s Jan Hatzius says that he “inferred from the September dots that Powell and Governor Brainard envision hiking twice per year in that environment, a slower pace than last cycle that we assume reflects the new monetary policy framework.” However, the bank will watch the December dots to see if they still view that as the default pace.

    Or, one can just look at what the market is saying and the conclusion there is clear: with the 4Y1Y – 2Y1Y curve inverting…

    … as STIR traders now expect rates in 2023 to be higher than in 2025, the verdict is simple: not only is the Fed engaging in policy error, hiking into an economic slowdown – with inflation having already peaked, someone has yet to explain to us how monetary policy will help alleviate supply chains, for example – but it will then proceed to rapidly cut rates (perhaps to negative) while injecting trillions more in QE once markets crash (amid the coming rate hike panic detailed meticulously by BofA CIO Michael Hartnett) to reflect the Fed’s panicked actions (which an objective observer could say reek suspiciously of political pandering to appease Joe Biden who is clearly freaking out about his collapsing rating and the impact inflation is having on it) some time in late 2022, just before the midterms.

    Tyler Durden
    Sun, 12/12/2021 – 17:22

  • China Creates "Humanized Pigs" To Be Used In COVID Research
    China Creates “Humanized Pigs” To Be Used In COVID Research

    In the years before COVID, the most visible testament to how far Beijing was willing to push its scientists past the bounds of what the international community deemed “acceptable” was its gene-editing prowess. A few years ago, one Chinese scientist shocked the world, and even wound up imprisoned in his home country for making the CCP look bad, when he unveiled the world’s first gene-edited human babies. The twin girls had their genetic material altered in utero to make them immune to their father’s HIV infection.

    We’re surprised that doesn’t come up more during discussions about Beijing’s rogue scientific endeavors – discussions that have become all the more common since COVID first burst out of Wuhan two years ago.

    Nobody knows where those gene-edited girls are now (the Chinese government won’t say), but Beijing has apparently found a new project for its best gene scientists: the country’s largest research institution has reportedly developed mutant “humanoid pigs” that are susceptible to the human strain of the coronavirus using the world’s premier gene editing technology.

    Once developed, the pigs will be used as test subjects as scientists test new remedies being developed to fight COVID. Though on this the Global Times, one of Beijing’s many state-controlled newspapers, didn’t go into much detail.

    A study published in August showed the researchers at the Institute of Microbiology of the Chinese Academy of Sciences explained how the scientists used CRISPR, a gene-editing tool, to remove the genetic protections that allow the pigs to reduce the human virus. The project clearly has the full backing of the CCP: the CAS research institution is the world’s largest organization of its kind and a formal arm of the Chinese government.

    Why pigs? The Global Times, a mouthpiece for the Chinese government, actually has a pretty cogent explanation.

    The existing cell lines and animal models on guinea pigs and some primates used for simulation of COVID-19 infection cannot capture the key characteristics of human physiology and therefore limit the accuracy of test on efficacy of vaccines and drugs.

    We suppose they’re as good a host as any farm animal. They might even kill two birds with one stone if the unused pigs can then be eaten during the next outbreak of Pig Ebola.

    Tyler Durden
    Sun, 12/12/2021 – 17:00

  • Morgan Stanley: As Uncomfortable As It Can Be To Admit Defeat, Here We Are
    Morgan Stanley: As Uncomfortable As It Can Be To Admit Defeat, Here We Are

    By Seth Carpenter, global chief economist at Morgan Stanley

    This past week, our US economics team revised its Fed call. The change is motivated by the notable shift in rhetoric from Chair Powell. I want to walk through some of the logic, some of the implications, and why we have not seen a second “taper tantrum.”

    In November, the taper was announced. Since then, inflation prints have evidently surprised the Fed to the upside, and the public debate about inflation has reached fever pitch. A subtle, but to me particularly telling cue, was Chair Powell asserting that price stability is now the path to full employment. Waiting until 2Q or 3Q for inflation to fall is off the table. Now the level, not just the trajectory of inflation, is key…and the Fed is set to accelerate the taper.

    A change in the reaction function means a change in our call. Of course, the market has been there for some time, and as uncomfortable as it can be to admit defeat, here we are. So what next?

    In my time at the Fed, policy decisions were taken one step at a time. The faster taper – as Cleveland Fed President Mester noted –simply provides optionality, it does not commit the FOMC to a hike when it is done. In March, I suspect Chair Powell and team will want to pause to assess the markets and the economy. If our inflation call is right, they will have to wrestle with monthly inflation prints that are coming down faster than forecast.

    Falling inflation should reduce, but not eliminate, the urgency to raise rates. Some persistence in trend inflation will remain, so we are looking for quarterly rate hikes, starting in September. Next, the question will be when to unwind the balance sheet. I was a debate participant inside the Fed during the last cycle. The winning argument was to start with rates because the Fed had experience with that tool but not with the balance sheet. One cycle using the new tool probably does not change the sequencing. Consider that the FOMC reversed course on rates in early 2019 while shrinking the balance sheet; tightening had gone too far, too fast. And in September that year, just months later, the Fed had to rebuild reserves after over-shrinking. A single cycle’s worth of experience does not look like enough. Of course, now there is further to go, so the unwind may start a bit lower than the 1.25% level last time, but I suspect the playbook is largely unchanged.

    Does a sea change at the Fed mean a tsunami for the rest of the world? In 2013, the 10-year yield troughed at 1.63% but ended the year a touch over 3%. Partly by design and partly by circumstance, we are in a different place today. Once bitten, twice shy: the Fed worked hard to avoid a taper tantrum this time. The foreshadowing started way back in the minutes of the September 2020 meeting.

    Markets have started to price in Fed hikes, but yields have moved nothing like they did in 2013. Global inflation has already put many EM central banks on a hiking path; instead of being caught off guard, most have stayed ahead of the curve [ZH; just ignore China which is already in easing mode]. And even with the market pricing rate hikes, real US rates look likely to pick up only gradually. This time really does seem to be different.

    Tyler Durden
    Sun, 12/12/2021 – 16:30

  • DHL Is Keeping Pace With The Holiday Rush By Adding 1,500 New Robots
    DHL Is Keeping Pace With The Holiday Rush By Adding 1,500 New Robots

    The holiday season is helping shipping company DHL usher in automation quicker than it ever has.

    The shipping and supply chain giant has been “rushing” to add automation heading into this holiday season, according to a new report from Bloomberg.

    The company “doubled its use of robots in the U.S. this year”, the report says, and now has a total of about 1,500 picking robots at its warehouses across the country.

    The additional automation comes on top of hiring an additional 15,000 seasonal workers, the report said. 

    Oscar de Bok, chief executive, told Bloomberg last week that the additions has helped DHL stay current with orders.

    de Bok commented: “The supply-chain disruption that we’re seeing at the moment is not a one-time thing. Because of the growth of e-commerce, supply chains are now organized differently because you get major hops and jumps at the end of the supply chain, because that’s the end-consumer.”

    He continued: “All the stores and the wholesalers and distributors that used to be in between are now less, and that’s why you get more disruptions in supply chains.”

    de Bok said that the company started ramping up its holiday season early this year, allowing it to sidestep bottlenecks and logistics problems that have swept the globe.

    In order to hire so aggressively, wages have risen as much as 15% in some parts of the U.S., the report notes. DHL has also created eight centers across the U.S. to recruit and train workers, the report noted. 

    Tyler Durden
    Sun, 12/12/2021 – 16:00

  • G-7 Warns Russia Of "Massive Consequences" For Ukraine Incursion
    G-7 Warns Russia Of “Massive Consequences” For Ukraine Incursion

    Authored by Alexander Zhang via The Epoch Times,

    The Group of Seven (G-7) major industrialized countries on Sunday warned that any Russian invasion of Ukraine would have “massive consequences” and would incur “a severe cost.”

    In a statement issued after a two-day summit held in the English city of Liverpool, G-7 foreign ministers said they are “united in our condemnation of Russia’s military build-up and aggressive rhetoric towards Ukraine.”

    The foreign policy chiefs from the United States, the UK, Canada, France, Germany, Italy, Japan, and the European Union, called on Russia to “deescalate, pursue diplomatic channels, and abide by its international commitments on transparency of military activities.”

    “Any use of force to change borders is strictly prohibited under international law,” they said. “Russia should be in no doubt that further military aggression against Ukraine would have massive consequences and severe cost in response.”

    “We reaffirm our unwavering commitment to Ukraine’s sovereignty and territorial integrity, as well as the right of any sovereign state to determine its own future,” they added.

    Earlier, UK Foreign Secretary Liz Truss told a press conference that the G-7 allies have “sent a very clear united message to [Russian President] Vladimir Putin.”

    Truss said the UK is considering “all options” including economic sanctions in response to potential Russian aggression.

    “When the UK has wanted to send clear messages and achieve clear goals, we have been prepared to use economic sanctions. So we are considering all options,” she told reporters.

    The warning comes amid rising tensions over a Russian troop buildup on the Ukrainian border, which is seen as a sign of a potential invasion.

    Ukrainian officials have estimated that more than 90,000 Russian troops are massing near the border in Russian-occupied Crimea, and have said they believe an attack is imminent. They have asked the United States and other countries for help defending the country’s borders.

    Ukraine was part of the Soviet Union before becoming an independent country in 1991.

    Ukrainian servicemen attend a rehearsal of an official ceremony to hand over tanks, armored personnel carriers, and military vehicles to the Ukrainian Armed Forces as the country celebrates Army Day in Kyiv, Ukraine, on Dec. 6, 2021. (Gleb Garanich/Reuters)

    Western countries view Ukraine as a bulwark against Russia, which harbours ambitions for more territorial control. Russia seized Crimea in 2014, when former U.S. President Barack Obama was in office.

    Truss also said the G-7 is concerned about China’s “coercive economic policies” across the globe.

    “We have been clear at this meeting this weekend that we are concerned about the coercive economic policies of China,” she said. “And what we want to do is build the investment reach, the economic trade reach, of like-minded, freedom-loving democracies.”

    Talking about the Iran nuclear issue, Truss warned the Islamic regime that the ongoing talks with world powers in Vienna is “the last chance for Iran to come to the negotiating table with a serious resolution to this issue.”

    She reiterated that the international community “will not allow Iran to acquire a nuclear weapon.”

    Tyler Durden
    Sun, 12/12/2021 – 15:30

  • El-Erian Says Fed Made "Worst Inflation Call Ever"
    El-Erian Says Fed Made “Worst Inflation Call Ever”

    New data released Friday by the Bureau of Labor Statistics showed price inflation in November rose to the highest in four decades. Americans are getting antsy about persistent inflation wiping out their real wage gains as Allianz Chief Economic Advisor Mohamed El-Erian warned the Federal Reserve is losing credibility by not tapering its balance sheet to rein in inflation.  

    El-Erian told CBS’ “Face the Nation” on Sunday that the most significant miscalculation in decades is the Fed’s inability to characterize inflation correctly. As readers know, Fed Chair Jerome Powell retired the “transitory” narrative on Nov. 30 and opted to label inflation as persistent. 

    “The characterization of inflation as transitory — it’s probably the worst inflation call in the history of the Federal Reserve,” El-Erian said. 

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    “It results in a high probability of a policy mistake,” he said. “So the Fed must quickly, starting this week, regain control of the inflation narrative and regain its own credibility. Otherwise, it will become a driver of higher inflation expectations that feed off themselves.”

    El-Erian said Powell “needs to ease his foot off the accelerator” in reference to the $120 billion in bond buying every month. He said there is “no reason why they [Fed] should be injecting so much liquidity,” adding that the Fed should not be boosting housing prices at a time when an unaffordability crisis is emerging.

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    Reducing bond-buying today will avoid a future hard wind-down of the balance sheet that could shock the economy into turmoil, El-Erian said. He has repeatedly said the Fed underestimated inflation risks that have led to soaring prices for energy, food, and shelter to all sorts of other consumer items, such as automobiles. 

    The Fed has been on a bond-buying spree for at least 20 or so months, purchasing $80 billion of Treasuries and $40 billion of mortgage-backed securities every month. Low rates have overstimulated the economy, pushing November’s Consumer Price Index to 6.8% YoY, or the highest print since 1982. 

    November’s CPI print is another blow for team transitory as the drivers of inflation were increasingly broad-based. 

    El-Erian doesn’t believe peak inflation has arrived and thinks consumer price increases could remain elevated in the months ahead. His comments on Friday were not far off from remarks made at the ADIPEC energy industry forum in Abu Dhabi last month. 

    It’s terrific to hear market realist El-Erian on mainstream media, continuing to pound the table about the Fed’s terrible inflation call.  

    Tyler Durden
    Sun, 12/12/2021 – 15:00

  • Turley: Gavin Newsom Calls For California Gun Ban Modeled After Texas Abortion Law
    Turley: Gavin Newsom Calls For California Gun Ban Modeled After Texas Abortion Law

    Authored by Jonathan Turley (emphasis ours),

    California Gov. Gavin Newsom thrilled many this weekend by saying that his administration will model a new law on Texas’ abortion ban that would let private citizens sue anyone who makes or sells assault weapons or ghost guns. It won’t work. Legally, that is. It will be hugely successful politically, but not without costs to the state and potential litigants.

    AP Photo/Jeff Chiu, File

    Gov. Newsom denounced the Supreme Court in Women’s Health v. Jackson for refusing to enjoin the Texas law that allows people to sue anyone who “aids or abets” one performed after about six weeks. That led to widespread a calls for the passage of legislation to “codify Roe,” including from the White House.

    Newsom, however, wants to replicate the law to limit Second Amendment rights the way that conservatives used it to limit reproductive rights.

    “I am outraged by yesterday’s U.S. Supreme Court decision allowing Texas’s ban on most abortion services to remain in place. But if states can now shield their laws from review by the federal courts that compare assault weapons to Swiss Army knives, then California will use that authority to protect people’s lives, where Texas used it to put women in harm’s way.”

    Newsom said that his staff will be working with the Legislature and California Attorney General Rob Bonta to craft the bill to let citizens sue anyone who “manufactures, distributes, or sells an assault weapon or ghost gun kit or parts” in California. They could seek damages of at least $10,000 per violation plus costs and attorney’s fees.

    Good luck with that.

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    The problem is multifold.

    First, the Texas law was quickly found to be unconstitutional, as would the California law. Indeed, many of us declared the law as facially unconstitutional under existing precedent on the day that it was enacted. That means that, while there are litigation costs, those costs would decrease quickly as other courts declare challenges to be unconstitutional.

    Second, the Supreme Court just allowed pre-enforcement challenges so the California law could be challenged to avoid any “chilling effect” on gun rights. Eight out of nine justices agreed that such early challenges are permissible against those with enforcement responsibilities in the abortion area. As a state that has led efforts to limit gun rights, there are a host of such officials with similar licensing powers in California.

    Third, and most importantly, Newsom limited the law to gun manufactures, distributors, and sellers” to the exclusion of a wider array of purchasers or “aiders and abetters.” The Texas law was so menacing because it exposed such a wide array of people to potential lawsuit. It would not be quite as popular to go after gun owners or gun rights groups. Yet, Newsom is targeting business which are going to be less intimidated by such litigation costs in a law that would be clearly unconstitutional.

    That is why, if the law is crafted as Newsom suggests, this won’t work legally. Nevertheless, there will be much cooing on cable programs at the cleverness of Newsom and the comeuppance for conservatives. Newsom will seize the moment in terms of popularity while leaving the costs to others to bear in the later failed litigation.

    Newsom did not help things by declaring “If the most efficient way to keep these devastating weapons off our streets is to add the threat of private lawsuits, we should do just that.” That is openly acknowledging that this law is meant to achieve indirectly what the state has failed to do directly: reduce gun ownership. That is precisely why the Supreme Court just green-lighted pre-enforcement challenges to the Texas law and now, with the help of Newsom, the California law would collapse quickly on the same grounds.

    In the recent decision in Chief Justice John Roberts noted that

    “The clear purpose and actual effect of S. B. 8 has been to nullify this Court’s rulings. … Indeed, “[i]f the legislatures of the several states may, at will, annul the judgments of the courts of the United States, and destroy the rights acquired under those judgments, the constitution itself becomes a solemn mockery.” United States v. Peters, 5 Cranch 115, 136 (1809). The nature of the federal right infringed does not matter; it is the role of the Supreme Court in our constitutional system that is at stake.”

    With his bravado, Newsom has guaranteed that courts will strike down his law as an open “mockery” of gun rights precedent and he will actually box in liberal judges and jurists in voting against the California law on the same grounds.

    Indeed, the California law would put the Biden Administration into a bind. It just intervened first as an amicus party and then an actual party in the Texas litigation. (As expected, the Court tossed out the Biden Administration’s lawsuit as “improvidently granted”). The Administration insisted that such a law is an abomination given that the rights of abortion are established and this is an effort to nullify those rights through exposure to lawsuits. Here Newsom himself said that that is precisely what they want to do.

    So, will the Biden administration refuse to oppose the law in defense of established gun rights as it did reproductive rights? If so, it would support criticism of the Justice Department of advancing in political agendas and make Attorney General Merrick Garland look like a feckless functionary. With the mid-term elections looming and falling polling numbers across the country, that is probably not a choice the Biden Administration would like to make to defend a legislatively-supported soundbite.

    Once the early courts strike down the California law, some citizens could face sanctions for frivolous lawsuits seeking litigation costs (unless such motions are blocked under the law).  Moreover, there will be a great expense of drafting and defending a law designed to support a soundbite. Many judges will be even less enamored with being asked to participate in what is largely political performance art.

    That is why the new California law is certain to play better on cable than in the courts.

    Tyler Durden
    Sun, 12/12/2021 – 14:30

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