- Tennessee Nurse Passes Out On Camera Minutes After Taking COVID-19 Vaccine
Tennessee Nurse Passes Out On Camera Minutes After Taking COVID-19 Vaccine
Tyler Durden
Thu, 12/17/2020 – 23:56A Tennessee nurse passed out on camera ten minutes after taking the COVID-19 vaccine.
Critical care nurse Tiffany Dover at CHI Memorial Hospital in Chattanooga was having a lucid discussion with WRCBtv following her vaccination, when she became visibly impaired – holding her hand to her head and swaying. She then apologized to the news crew, turned away from the camera, and fainted.
“Ten minutes after the shot, Dover became light-headed and passed out while speaking with us,” the outlet reported.
Watch:
Dover took the vaccine on camera beforehand (h/t).
She told WRCBtv that this is ‘not an uncommon reaction for her,’ explaining “I have a history of having an over-reactive vagal response, and so with that if I have pain from anything, hangnail or if I stub my toe, I can just pass out.”
The rest of the vaccinations reportedly went off without a hitch after the hospital received 975 doses.
The Vagal response occurs when the vagus nerve is stimulated, setting off a chain of events within the body involving the central nervous system, peripheral nervous system and the cardiovascular system.
If triggered, it causes an abrupt drop in blood pressure and a decreased heart rate, which can cause blood to pool in the legs – which in some cases can result in brief loss of consciousness known as vasovagal syncope.
Examples:
Override Early AccessOn - But, But, Masks!??…
But, But, Masks!??…
Tyler Durden
Thu, 12/17/2020 – 23:40Much heralded COVID-19 model-student South Korea saw new infections with the virus rise again to more than 1,000 cases per day, dramatically higher than during the first wave in February and March.
Here’s CNN: “In Hong Kong, Taiwan, China, South Korea, Japan and other Asian nations, mask wearing is uncontroversial, near universal, and has been proven effective…”
Here’s Forbes: “What South Korea teaches us is that … mass production and distribution of face masks and the promotion of their use, are winning strategies in this battle.“
Here’s NYTimes: “The country showed that it is possible to contain the coronavirus without shutting down the economy… Television broadcasts, subway station announcements and smartphone alerts provide endless reminders to wear face masks…”
The head of the World Health Organization, Tedros Adhanom Ghebreyesus, has hailed South Korea as demonstrating that containing the virus, while difficult, “can be done.” He urged countries to “apply the lessons learned in Korea and elsewhere.”
As Statista’s Willem Roper notes, the country has been praised extensively for reducing cases of COVID-19, but a continuously climbing case count shows how the threat of new outbreaks looms even after flattening the curve (twice before).
After a second outbreak in August and September was squashed, South Korea had already tightened restrictions again.
The highest number of daily new cases in the initial wave was recorded at 813 on Feb 29.
You will find more infographics at Statista
Still, these cases being recorded now are only a sliver of those detected daily in the U.S. and Europe. There, daily new case counts of COVID-19 are still in the tens of thousands… so keep wearing your masks!!!
🔥 🔥 🔥!!!!
This is insane! Every country that introduced mandatory masks had their case numbers explode after!! Mask don’t work!
Retweet!!!! pic.twitter.com/3VssX0WK4V
— The Epigenetic Whisperer 👉The Bodhisattva Bastard (@epigwhisp) December 16, 2020
Override Early AccessOn - This Picture Is Worth A Thousand Words
This Picture Is Worth A Thousand Words
Tyler Durden
Thu, 12/17/2020 – 23:25The New York Times’ Hiroko Masuike captured customers at The Smith restaurant in Manhattan Wednesday evening, bundled up in winter jackets, underneath propane heaters on a sidewalk patio, while the first major winter storm of the season blanketed the city nearly one foot of snow.
Thanks to Andrew Cuomo’s decision to once again shut down indoor dining in New York on Monday, these patrons had to eat outside in the middle of a freakin’ snowstorm.
As the wind blew, the propane heaters appeared worthless as a few of the patrons were sipping on soup and have likely downed a liquor shot or two to stay warm.
Source: NYT Perhaps the patrons on Wednesday night were devoted customers supporting their local restaurants, rain or shine, considering a record number of eateries across the country can’t pay December rent.
As we’ve mentioned before, Goldman Sachs has noted that if daily average temperatures slide below 40°F – then it would be associated with a steep drop off in consumer activity at eateries.
So back to the picture – patrons can thank the government for why they had to eat a nice meal outside in the middle of a major snowstorm.
Override Early AccessOn - Is America's Fourth Estate (Free Press) In Foreclosure?
Is America’s Fourth Estate (Free Press) In Foreclosure?
Tyler Durden
Thu, 12/17/2020 – 23:20Authored by Leni Friedman Valenta with Jiri Valenta via The Gatestone Institute,
The “fourth estate” refers to freedom of the press. The term may have first been used by the philosopher-statesman Edmund Burke, who in 1787 highlighted the press as free and apart from the other three British “estates” — clergy, royalty and commoners.
The modern meaning, however, refers to the press as a fourth and free power — as even a “watchdog” — over the executive, legislative and judicial branches of our government. Today, however, it is the watchdog that needs watching.
The foundation on which the United States is built, freedom of speech and freedom of the press, is enshrined in the First Amendment to the US Constitution:
“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”
Before our eyes, however, this freedom is being distorted, strangled and withheld.
Young people today seem to have no idea of what the media used to be when America was more united. All the newspapers and media outlets recognized and covered the same big stories. The ideal to which journalistic professionalism aspired was objective reporting — at least an attempt toward it — and the media at least tried to keep “news” balanced, and separate from opinions and op-eds.
Today, journalism has changed so that the “news” is often conflated with unsupported and biased opinion. Consider Newsweek‘s story on Senator Ron Johnson’s (R-Wis.) poll-supported claim that “Donald Trump would have won the election if the media had given more coverage to unsubstantiated allegations concerning President-elect Joe Biden’s son, Hunter.” The word “unsubstantiated” is the reporter’s opinion — not a certified fact. As we are seeing now, and as Senator Johnson was doubtless well aware, the allegations were smothered in substantiation. All a reporter had to do was look.
Similarly, some journalists cannot seem to hold themselves back from reporting on Trump’s supposedly “baseless” claims of election fraud — despite eyewitness affidavits, vote count anomalies, abrogations of both the Constitution and states’ election laws, and the use of Dominion voting machines and Smartmatic software that are reported to have the capacity to flip votes secretly from one candidate to another.
Widely censored by both Big Tech and the mainstream media was a New York Post article which asserted that an abandoned laptop, the undisputed property of former Vice-President Joe Biden’s son, Hunter, implicates him as the family “concierge” for the Biden family’s influence-peddling in China — a country cited by Director of National Intelligence John Ratcliffe as America’s “National Security Threat No. 1.”
Two corroborated reports in the New York Post highlighted Hunter Biden’s financial interests in various foreign countries — include his partnering with two Chinese military companies, one under investigation for espionage and the other for human rights violations. Both New York Post articles were censored — actually totally blocked — for two weeks by Twitter and Facebook, as was, for a time, the Twitter account of White House Press Secretary Kayleigh McEnany for having posted the contraband information.
As Glen Greenwald, who recently resigned from The Intercept, the website he co-founded, wrote, weeks before the election:
“Early in the day, users who attempted to link to the New York Post story either publicly or privately received a cryptic message rejecting the attempt as an ‘error.’ Later in the afternoon, Twitter changed the message, advising users that they could not post that link because the company judged its contents to be ‘potentially harmful.'”
Recently, YouTube, announced that it was removing all videos accurately “claiming (that) mass fraud changed election results.” Left unperturbed, however, are masses of inaccurate material, such as that President Trump allegedly colluded with Russia, or Chinese and Iranian propaganda claiming “the US army may have brought the coronavirus disease to Wuhan.”
It was also, it seems, perfectly fine for the New York Times, as its editor-in-chief, Dean Baquet, admitted, to have “built our newsroom” around the fake Russia Hoax for two years, but the confirmed facts concerning the Biden family’s influence peddling was apparently “not fit to print” — especially before an election the newspaper was manipulating.
Divisions in the media have also created for the public widely divergent images of the president. To one group, President Trump is supposedly a far-right, authoritarian tyrant, allegedly seeking permanent rule; a buffoon, a fascist, racist, white supremacist, narcissist, lunatic, and incompetent, lacking in both empathy and presidential dignity.
To another group, he is the patriotic upholder of the American Constitution, a man of legendary accomplishments in office — four more partners for peace in the Middle East (the UAE, Bahrain, Sudan and Morocco); producing and delivering a new vaccine in less than a year; expanding school choice to improve “equality”; preventing Iran from a nuclear breakout; protecting the US border from trafficking and drug smuggling, and unmasking and confronting China as a lawless, omnivorous threat. To this group, he is a Hercules, delivering for the people in spite of unrelenting attempts to undermine him, and by far the last best hope of saving the United States from an energized, appeasement-prone, increasingly socialist takeover.
Many believe that what the US has been experiencing – such as the bogus charges of collusion with Russia, a kangaroo impeachment, and now an election that appears overwhelmingly stolen — is nothing less than a succession of attempted coups d’états, more in keeping with Russia, China, Venezuela and Cuba than with a sustainable republic.
This month, it was claimed that Republican Governor Brian Kemp of Georgia “awarded a $107 million contract to Dominion voting machines two weeks after meeting with People’s Republic of China’s Consul General.”
Senator Chuck Schumer has already announced that he would like to “change America.” He has not quite specified into what.
Transitions to tyranny — in the name of “helping the people” — usually take place along with the “cancel culture’s” desecration of statues, re-writing of history, outbreaks of rioting, looting, murders and ongoing denigration to whip up hate.
For much of the country, the attempted coups have now been sanctified and made to seem legitimate by the election — that many feel was “stolen” — of former Vice-President Biden. One can surely understand how Republicans feel now that the top-ranking conspirators involved the attempted coups have captured the government through their figurehead, former Vice-President Biden.
Clearly, voter fraud must be investigated, as scheduled in upcoming hearings under Senator Ron Johnson December 16. If elections continue the same way — by legitimizing practices that sidestep Constitutional and states’ laws — as they threaten to do in two run-off elections in Georgia on January 5, we will no longer have a viable republic. The two upcoming elections in Georgia to determine control of the Senate may end up being the last firewall of a workable, multi-party nation.
Also clear is that the election of former Vice-President Biden was made possible not only because he was supported by almost universally biased mainstream newspapers and television stations that distorted or snuffed stories at will, as well as by Wall Street corporations and Big Tech companies aching to do business with a lucrative, if hegemonic, China.
Currently, power in America is concentrated in six companies:
“News Corp, Disney, Viacom, Time Warner, CBS and Comcast own 90% of the TV stations, radio stations, movies, magazines and newspapers that 277 million Americans rely on for news and entertainment.”
Those companies have been “consolidated from 50 companies back in 1983.” Supporting them are supposed “fact checkers” — often suspect, and funded in large part by liberal billionaires such as George Soros and Bill Gates who most of the time support the Democrats.
Meanwhile, countless Americans have had advertising accounts or websites abridged or closed simply because Big Tech does not agree with their views. The investigative organization “Project Veritas” exposed Twitter’s “shadow banning” mainly right-of-center views, meaning that “users were blocked from the platform without even being notified.”
On November 17, the Senate Judiciary Committee questioned Facebook’s CEO Mark Zuckerberg and Twitter’s CEO Jack Dorsey about their political bias and practices, perhaps in an effort to curb their manipulation of a tremendous market dominance of information. Republican Josh Hawley questioned Zuckerberg about one program in particular, “Tasks,” which is ostensibly used to share and coordinate “security-related” information between Twitter, Facebook and Google.
Zuckerberg claimed that the coordination was confined to “terrorism and foreign government influence but not content.”
Really? Then why did the media “breathlessly” cover Adam Schiff’s fake “content” that the laptop scandal was “Russian disinformation,” a claim emphatically denied by Director of National Intelligence John Ratcliffe.
Despite Big Tech’s millions in donations to members of Congress, some members are considering revoking Section 230 of the Communications Decency Act , which provides immunity to Big Tech from content they post, or breaking up the Big Tech companies as violators of anti-trust laws, the better to enable competition.
Zuckerberg also mentioned the intention of the three media giants to support the two Democrats in the senate run-off races in Georgia on January 5. A George Soros-Bloomberg group has already contributed $300,000 to the two Democrats in their attempt to defeat incumbent Republican Senators Kelly Loeffler and David Perdue.
Of the Democratic challengers in Georgia, Jon Ossoff has had business ties with a Chinese company, PCCW Media, a telecom company, whose chairman, Richard Li, has for years opposed pro-democracy protestors in Hong Kong. The Rev. Raphael Warnock, backed by the billionaire George Soros, is anti-military, anti-Israel, and has praised a fellow-preacher, Frederick Haynes III, “a Louis Farrakhan-supporting preacher after he compared President Donald Trump’s election to the Sept. 11 terrorist attacks and applauded efforts to defund police departments.”
The latest efforts by the media giants have been the attempt to discredit President Trump’s claims of massive fraud in the election; claims backed up by Trump lawyers such as Rudy Giuliani, Jenna Ellis, Lin Wood and Sidney Powell, as well as various experts in technology.
How did all this come about in star-spangled America? The radicalization seems to have actually begun in our institutions of higher learning, perhaps by teachers and others in power. Many who were radical protestors in the 1960s and ’70s, may well have since been indoctrinating public school children with a version of history calculated to make them despise their country and accept communism.
As presidential historian Craig Shirley has written in “They’re Coming for you, Mark Zuckerberg”:
“As instructed in Rules for Radicals by Saul Alinsky, the left either destroys or takes over institutions in order to gain control; power. Public education … is now under the thumb of the left and their labor unions, and our children are not learning, except to mouth leftist bromides.”
At present, radicalized schools are, not surprisingly, turning out radicalized reporters. According to a study by the National Association of Scholars, Democrat professors outnumber Republican ones by nine to one. In the Northeast, the ratio was 15.4 to one. If you want to know what happened to the Republicans, just ask Daniel Ravicher, a law professor at Miami University, censured for tweets that supported Trump.
What we are witnessing in the universities appears to be massive, Marxist-inspired group-think. It has also infested the media and other areas of society, thereby crushing another essential linchpin of democracy: the free marketplace of ideas.
If you think that a slow-motion coup seems unlikely, tune in to William Binney’s interview with Chris Hedges. A former technical director of the National Security Agency (NSA), Binney maintains he retired in disgust when he realized that the NSA used the technology that he had created to spy on Americans.
One hopeful sign is that in the US, we do not have complete censorship — at least yet. In freedom of the press lies its reverent responsibility for the freedom and welfare of the people.
As more and more news of the election fraud has comes to the attention of Americans, rallies have sprung up in support of honest elections. So far, still to be answered, is the question: If election officials can ignore legalities with impunity, how, going forward, can there be trustworthy elections?
Whatever the final outcome of the current presidential election, let us hope that the frogs are starting to jump out.
Override Early AccessOn - Walmart To Expand Autonomous Box Truck Deliveries In Louisiana
Walmart To Expand Autonomous Box Truck Deliveries In Louisiana
Tyler Durden
Thu, 12/17/2020 – 23:00Walmart is set to expand its autonomous vehicle program with Gatik, a Palo Alto-based technology company, to make deliveries between New Orleans and Metairie, Louisiana, in 2021, according to a Walmart corporate update.
Walmart’s autonomous vehicle program began last year when it started picking up customers’ orders on a two-mile route between a warehouse and store in Bentonville, Arkansas.
The autonomous vehicles have safely recorded more than 70,000 operational miles in autonomous mode with a safety driver.
With much success over the last year, Walmart is set to expand its fully autonomous trucks at a second location in Louisiana. These trucks will begin delivering items from a “live” Walmart Supercenter to a designated pickup location where customers can retrieve their orders.
The new route, stretching between New Orleans and Metairie, Louisiana, will begin sometime in 2021.
“Our trials with Gatik are just two of many use cases we’re testing with autonomous vehicles, and we’re excited to continue learning how we might incorporate them in a delivery ecosystem,” said Tom Ward, Walmart’s senior VP of customer product.
“This unlocks the opportunity for customers who live further away from our store in New Orleans to benefit from the convenience and ease of Walmart’s pickup service, Ward said.
Walmart’s quest to automate the last-mile has also led the company to even pilot test drones.
However, there’s a dark side to America’s largest retailer quickly adopting automation; that is, it will displace jobs.
Override Early AccessOn - Frog-Marched Into Klaus Schwab's Dystopian Nightmare
Frog-Marched Into Klaus Schwab’s Dystopian Nightmare
Tyler Durden
Thu, 12/17/2020 – 22:40Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,
As The Republic Dies The Next Generation Must Rise
The first rule of screenwriting, or in fact any fiction writing, is, “Conflict doesn’t create character, it reveals it.” People are who they are and we only find out what they are made of when tested to their limit.
This is the essence of all good storytelling – create characters who rise to be role models for us as we navigate our way through a Universe hostile to our very existence.
While I hesitate to ascribe such noble ideas as ‘character’ to any politician there are a few out there who have shown great potential. I’ve written about all of them at various times in the past few years.
Matteo Salvini in Italy, Hungarian Prime Minister Viktor Orban, Russian President Vladmir Putin, Nigel Farage in the UK and even a flawed figure like Donald Trump are all examples of men who history will remember as having stood up when needed.
At times each of them tried to move heaven and earth to stop the degradation of society, culture and the human condition in the face of an implacable enemy – communist ideologues bent on forcing humanity into submission to their will.
But with the Supreme Court abdicating its primary responsibility under the Constitution last week citing itself in an unconstitutional ruling from 1925 (H/T Martin Armstrong for this) means it is over for Trump and the U.S. to stop the final transformation of the U.S. into an oligarchy in reality if not in spirit.
There is no mechanism for states to redress grievances of any import now. What was left of the compact between equal sovereign states died with a whimper in the halls of the SCOTUS and to thunderous applause by the BlueCheckMarked Sneetches on Twitter.
This means that a stolen election will in all probability stand up come Inauguration Day. The entrenched oligarchy has won this round.
Fine. But it doesn’t mean the efforts of the men I just listed will have been in vain. In fact, quite the opposite.
Because what it has done is revealed the character if everyone involved. What they do next now that they have the power they’ve always craved to transform America will determine what people who have principles other than raw power will do.
We’re beginning to see that response form up. This election isn’t over but the positioning for the future a post-republic America has already begun.
Since election day Tulsi Gabbard, a tweener between Gen-X and a Millennial, has been a non-stop source of, admittedly, Quixotic bills to put paid her insurgent campaign in the Democratic primaries as someone interested in fixing real foundational problems with the country and the bipartisan corruption in Washington.
“Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety.” -Ben Franklin@RepThomasMassie & I intro’d ‘Protect Our Civil Liberties Act’ (HR8970) to repeal the so-called Patriot Act & end illegal government surveillance pic.twitter.com/QEB8gKxFKu
— Tulsi Gabbard 🌺 (@TulsiGabbard) December 16, 2020
https://platform.twitter.com/widgets.js
She continues to reach across party lines introducing legislation which form the basis for a populist election strategy targeting the 2022 and 2024 elections.
From whistleblower protection to repealing Section 230 of the CDA to the bill in the tweet above co-sponsored with libertarian Thomas Massie, Gabbard is an example of what the future holds for the political future once this meta-stable, oligarchic rule-by-men period of America is over.
It’s clear that Gabbard wants no part of being a part of the Democratic Party that’s in power now. That’s why she didn’t run for re-election and I suspect these moves are all laying the groundwork for a return to politics in 2024 as an independent or Sanders-like outsider.
I’ve been writing for years now that our problems stem from an unwillingness of the older generations of politicians to give up power. If anything, they persist because they are owned by the forces that put them there in the first place to pull off this betrayal of the people that has been in the works for decades.
And they will stay in place until they are no longer needed. Just ask Diane Feinstein who is now being sacrificed to make way for the transition team to finish the job she started.
I always saw Trump as Gen-X’s moment to pull a Ronald Reagan and say, “Mr. Trump, tear down this Swamp!” but the real story is that Gen-X is allowing Obama to do that tearing down and hand what’s left back to the old monied elites.
The fight now is between the cross-currents within Gen-X. Equal parts commie and libertarian the one uniting principle is a desire to reform the old order.
It is my read that people like Gabbard, Massie, Sen. Rand Paul and a few others see the problem. Gabbard’s a leftist, but she’s no doctrinaire commie. That makes her and interesting pivot figure around which a coalition to retake control or build back better the U.S. can be formed. This will be necessary once Obama’s incoming crew of vandals overreaches and are thrown out on their asses.
Regardless of the outcome in the coming months and years the changing of the guard is close at hand. Post-Trump America will look very different than pre-Trump. Trump was the apotheosis of the Boomers.
His legacy will be forcing the Deep State into the open, bringing the fight against them out of the shadows.
Trump, however, doesn’t represent the future of America. He’s weighed down with the mythology of an America that never really existed.
That mythology, however, is something worth building on not allowing Obama and The Vandals to tear down. I believe Gabbard understands this.
I also believe at least 75 million Americans understand this.
For the American people to not be frog-marched into the dystopian nightmare of Klaus Schwab’s dreams it will be the revealed character of the Gabbards, Massies and Pauls to lead once the violence reaches a crescendo.
Make no mistake, there will be violence. It is inevitable because the people who voted for Trump will not be placated with UBI or settle down as their voices are silenced.
The fraudsters will forever be looking over their shoulders, lashing out at minor opposition as traitors who need to be put down.
Here we are presented with a staged picture with three white privilege guys straight out of central casting for the latest Obama-produced ‘documentary’ on equality coming to Netflix in the spring.
This is your “Unity” agenda from the most statist of state house organs, NPR, the echo chamber of choice for the low-information ‘informed’ shitlib. This is the face of the Biden/Harris administration.
This is just the beginning of what we can look forward to when the GOP loses both seats in the Georgia run-off and the Democrats, despite historically-low support and engagement with actual voters, run the table.
Once ensconced they will persecute their political enemies in ways only Alex Jones has contemplated to this point. And it will be this escalation that will reveal the quality of the character of these next-generation politicians.
They will have the choice, leader of men or cowards. The republic we’ve known is dead. Maybe that’s a good thing. But what comes after won’t be up to the people who just destroyed it. That job is the next generation’s job. Their moment is coming in the next couple of years. They will have to be ready.
* * *
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Brave – click the Triangle on your Brave Search BarOverride Early AccessOn - US Coast Guard Offloads $411 Million In Cocaine, Marijuana At South Florida Port
US Coast Guard Offloads $411 Million In Cocaine, Marijuana At South Florida Port
Tyler Durden
Thu, 12/17/2020 – 22:20More than 23,000 pounds of cocaine and nearly 8,800 pounds of marijuana, worth approximately $411.3 million, were offloaded by the US Coast Guard Cutter James on Wednesday at Port Everglades in Fort Lauderdale, Florida, after a series of busts in international waters.
The US Coast Guard said in a press release that the drugs were “interdicted in international waters of the Eastern Pacific Ocean off the coasts of Mexico, Central, and South America.” Eight American and UK vessels seized contraband from 20 suspected drug smuggling ships.
“This patrol highlights our crew’s continued commitment to protecting the American people from our adversaries,” said Capt. Todd Vance, James’ commanding officer.
Vance continued: “Despite COVID, the James crew demonstrated supreme resilience, and the results of their exceptional performance are being showcased today.”
Vance told CBS Miami that “with absolute certainty, we know that each interdiction saves life and helps to protect others from violence, extortion, and instability.”
With the drugs in the federal government’s custody – the question we ask is what happens to all the cocaine and marijuana?
Override Early AccessOn - Hamilton Beats MMT
Hamilton Beats MMT
Tyler Durden
Thu, 12/17/2020 – 22:00Authored by Todd Buchholz via Project Syndicate,
Ultra-low interest rates have fueled growing support for Modern Monetary Theory, which holds that governments can simply print money and ignore rising public debt levels without having to face the consequences. It is a neat and tempting argument, as long as one ignores history and common sense.
Was Alexander Hamilton a fool? Modern Monetary Theorists must think so. Hamilton, whose story is now sung by millions of schoolchildren, persuaded the young United States to absorb state debt, pay it back, and build a trustworthy reputation.
“If we assume the debts,” goes a lyric from the musical Hamilton, “the union gets a new line of credit, a financial diuretic. How do you not get it?”
Should Hamilton have simply torn up the states’ Revolutionary War debt? MMTers seem to believe so, arguing that countries can often print money and ignore debt with little pain. I wish I could believe that government debt doesn’t matter (or that Elvis is still alive). But debt matters a great deal, and we should be thankful that US President-elect Joe Biden’s presumptive treasury secretary, Janet Yellen, is not an MMT acolyte.
Nonetheless, MMTers have been picking up ever more support. Ultra-low interest rates have fueled a growing temptation to keep printing money and ignoring debt until the very moment inflation flares up. Whenever that moment comes, MMTers assure us that the government will simply cut spending to cool off the economy. They present a neat argument if you ignore history and common sense by trusting politicians to do precisely what they are most averse to doing.
This is not to suggest that governments should slash spending during the COVID-19 Great Cessation, which has pushed the US jobless rate close to 7%. I support big deficits now, but eventually the US and other governments will need to rein in their raging budgets. In ten years, the Medicare and Social Security trust funds will run dry, triggering 10-25% cuts in health and pension benefits for the elderly.
The age-old refrain from debt apologists is, “We owe the money to ourselves.” But we don’t just owe money to ourselves: about one-third of US debt is held by foreigners, including around $1.1 trillion that is in China’s hands. Moreover, even if we consider only the debt held by Americans, we must ask, “Who is ‘we’?” Lenders who bought US Treasuries in good faith are not the same individuals who would benefit from tearing up the bonds or inflating away their value.
Today’s debt apologists have many forerunners, some buried in the rubble of ancient Greece, where fourth century BC municipalities defaulted to the Temple of Delos. In 1793, Louis XVI lost his head while trying to placate the French monarchy’s creditors. In the 1920s, the Weimar Republic experienced devastating hyperinflation until the central bank gained enough freedom from freewheeling politicians to stabilize a new currency. More recently, Chile, Peru, Zimbabwe, Argentina, and Brazil have all met with near ruin after implementing MMT. Venezuela’s debt is now twice its GDP, and its inflation rate is best expressed using scientific notation.
Of course, MMTers dismiss these cases as exotic examples from the dizzy tropics.
As MMT popularizer Stephanie Kelton of Stony Brook University tweeted in 2012, “People who scream, ‘Zimbabwe!’ have no idea what caused hyperinflation there…”
Fine, then, let’s look instead at “advanced” economies. In the 1970s, the United Kingdom was the “sick man of Europe” (a phrase first applied by Czar Nicholas I to the crumbling Ottoman Empire), suffering explosive inflation and a sinking currency. In 1976, following an extraordinary conversion, Labour Prime Minister James Callaghan begged the International Monetary Fund for a bailout, performed a fiscal about-face, and declared to debt apologists, “I tell you in all candor that that option no longer exists.”
Fortunately, responsible budgeting can indeed revive a country’s prospects. During the 1990s, Canada and Sweden faced dreadful economic crises that wiped out millions of jobs. In 1992, Sweden’s central bank raised interest rates to 500% to protect the currency from collapsing after politicians had more than doubled the country’s level of borrowing. Both Sweden and Canada adopted responsible measures to slash spending, and their economies soon boomed. For its part, the US created about 18 million net new jobs in the 1990s – a bonanza kicked off by a spending pact between President Bill Clinton, a Democrat, and congressional Republicans.
Faced with all of these examples, MMTers’ only response is to claim that their approach has worked for Japan.
Never mind that the Japanese have in fact rejected MMT in both word and deed. Bank of Japan Governor Haruhiko Kuroda specifically calls MMT “an extreme argument that won’t be accepted.”
Why does Japan not fit the MMT model? For starters, 90% of Japanese debt is Japanese-held, most of it by branches of government, not by private institutions. Second, Japan has doubled its consumption taxes to pare the debt, and reduced per capita spending for the elderly in recent years. Would MMTers support either of these policies?
In any case, even if we were to pretend that Japan is following the MMT playbook, why would anyone want to take credit for the results? The country has experienced 20 years of stagnation, with GDP growing at less than 1% per year, and private investment as a share of GDP eroding. Two decades ago, Sony and Toyota led the world; today, Apple and Tesla overshadow them.
Former IMF Chief Economist Kenneth Rogoff scoffs that MMT is neither modern, monetary, nor a theory. That is too harsh. MMT is indeed modern, but modern like a Jackson Pollock painting – colorful, hypnotic, and a mess. It may be alluring, but it is not safe for work or for school. Instead, children should rap to the wisdom of Hamilton.
Override Early AccessOn - "Bullying Attitude": China, US Trade Blame For Breakdown In Military-To-Military Talks
“Bullying Attitude”: China, US Trade Blame For Breakdown In Military-To-Military Talks
Tyler Durden
Thu, 12/17/2020 – 21:40China’s military has blamed the United States for a breakdown in military-to-military talks which were scheduled as part of the 2020 China-US military maritime consultative agreement (MMCA) meetings.
This comes after on Wednesday the US side blasted China for being a no-show for the Dec.14 through 16 meetings. Currently both sides are claiming that the other military delegation didn’t show.
The agreed upon talks are connected with efforts to ensure a defusing of tensions, also toward the establishment and maintaining of a military ‘de-escalation’ hotline to ensure no unintentional close-call military encounters leading to spiraling conflict and war.
First, the US side had this to say:
The US military has slammed China for failing to appear at virtual, senior-level meetings slated for this week, with the top US admiral for the Asia-Pacific saying it was “another example that China does not honor its agreements”.
“This should serve as a reminder to all nations as they pursue agreements with China going forward,” Admiral Phil Davidson, the commander for US Indo-Pacific Command, said in a statement on Wednesday.
“We remain committed to the MMCA and call on the PLA to hold the MMCA dialogue in a manner consistent with the MMCA Charter and purpose as an operational safety dialogue,” Adm. Davidson added.
But on Thursday a Chinese People’s Liberation Army-Navy spokesman leveled the same charge right back, saying it’s the Americans refusing to participate. “The U.S. side did not abide by the consensus reached between the two sides and called black white to make the accusation,” the PLA’s Liu Wensheng said.
“The US side insisted on forcing its unilateral agenda, arbitrarily reducing the length of the annual meetings and changing the nature of the talks,” Liu said further of what was to be an online meeting. “The US side even tried to force China’s participation without an agenda agreed by both sides.”
As related by state media, the PLA official said further:
These unprofessional, unfriendly and unconstructive actions reflect the U.S. side’s consistent bullying attitude, according to Liu.
“We hope the US side will earnestly respect the contents of the agreement and reach consensus with China on relevant issues as soon as possible to facilitate the smooth holding of the meetings,” the statement added.
Tensions are already on edge given we’ve now entered the final weeks of the Trump presidency, with Beijing hopeful the Biden administration will reverse course on the White House’s pressure campaign, also related to accusations that China is directly responsible for the spread of the global COVID-19 pandemic, a constant refrain of Trump’s.
Override Early AccessOn - Are The Teachers Unions Keeping the Schools Closed?
Are The Teachers Unions Keeping the Schools Closed?
Tyler Durden
Thu, 12/17/2020 – 21:20Authored by Amelia Janaskie via The American Institute for Economic Research,
On Monday, December 7th, North Carolina teachers did not show up in their classrooms, but instead logged onto Facebook and posted photographs of themselves dressed in red with the caption, “A show of solidarity with our colleagues.”
This gesture was in defiance of the Orange County Superintendent’s call for teachers to return to schools and a way to protest school openings, on the grounds that it was too dangerous for teachers to do their jobs in person because of the coronavirus pandemic.
The local teacher’s union, Orange County Association of Educators, supported the movement in a Facebook post saying, “We have yet to hear sufficient rationale for how teaching from our classrooms helps our students, who can tell when our morale is low and our stress levels are high.”
Schools across the country – in New York City, DC suburbs, Pittsburgh, and so on – are closing again for fear that a new wave of infections will occur from holiday travel and more people staying indoors. In Orange County, the teachers are still unwilling to hold in-person classes even though the county is seeing a low positive test rate of 3.1%, well below the state’s positive test rate goal of 5%.
It would be reasonable for teachers to oppose schools being open if Covid-19 posed a significant risk to students.
However, we knew early on that the science demonstrates there is virtually no risk of severe illness or death to children. On April 22nd, a study from The Journal of the American Medical Association (JAMA) found:
“Most children with COVID-19 presented with mild symptoms, if any, generally required supportive care only, and typically had a good prognosis and recovered within 1 to 2 weeks.”
Likewise, two months later, a study from the Lancet stated: “COVID-19 is generally a mild disease in children, including infants.”
In the US alone, only 254 young people under the age of 17 have died of Covid-19.
This number accounts for roughly 0.085% percent of Covid-19 deaths in the United States.
At the same time, school closures cause great harm to children and teenagers, especially in the long term.
School districts across the country are observing much higher class failure rates compared to previous years. Salt Lake City schools reported the percentage of students falling below grade level jumped from 23 percent in 2019 to 32 percent in the first trimester of 2020. In Fairfax County, Virginia, the number of students who have two or more failing grades has increased by 83%. Significant evidence shows that a truncated school year supplemented with online learning is vastly inferior to the education children get in-person. Virtual learning is particularly harmful to students from poor socioeconomic backgrounds who do not have sufficient resources to support their learning.
Not only are students failing more classes, but enrollment is low. A survey of school administrators found that about 50 percent of respondents from Pre-K up to high school experienced either a large or small decline in enrollment, with Pre-K seeing the biggest decline of 62 percent. On a global scale, the United Nations projects that 24 million children are in danger of dropping out of school as a result of lockdowns and school closures. Lower enrollment may also be attributed to other factors, such as more parents choosing to homeschool their children since schools are closed.
In addition to the direct effects of school closures – educational deprivation – there are documented, serious unintended consequences. Child abuse is going unreported, because school personnel are the main source of reporting child maltreatment. Closures have severed the in-person interaction of children and teachers, putting children at risk. A National Institutes of Health (NIH) article studied Florida county-level data of maltreatment reports, finding 27% (15,000) fewer than expected in March and April alone.
The problem is not only that school personnel cannot observe children, meaning that abuse is going unnoticed. Many parents have lost their jobs due to lockdowns, creating enormous stress within a household that ultimately leads to child maltreatment. This is not mere speculation but is substantiated by the evidence: another NIH article concluded that “job loss during the COVID-19 pandemic is a significant risk factor for child maltreatment.” Thus, not only are child maltreatment cases going underreported, but they are increasing as more parents are dealing with the stress of job loss.
School closures also prevent the social interaction that is vital to children’s development, leading to increased feelings of isolation, depression, and anxiety. According to the Centers for Disease Control (CDC), between January and October of 2020, the number of mental health-related hospital visits increased by 24% for 5 to 11 year-olds and by 31% for 12 to 17 year-olds.
School closures and other aspects of lockdowns have not only halted young people’s social interactions, but prevented doctor visits and participation in life milestones: school plays, proms, and graduations. The profusion of fear inundating society from media outlets and political figures leads children to feeling a loss of security and routine, which is extremely harmful to their psychological health.
Overall, a JAMA study shed light on the massive destruction that school closures have on children. The authors estimated a decrease of 5.53 million years of life for children due to school closures, owing to lower income, reduced educational attainment, and worse health outcomes.
Despite teachers’ worry about transmission in school, contracting the virus in schools is a low risk. An article from Nature, citing multiple studies, indicates that spread among children in schools is low. In fact, children are less likely to transmit the virus to adults (parents, staff members) than adults would infect each other.
There are plenty of countries – England, South Korea, and Italy, for example – who also opened schools and saw low transmission in schools. In any event, at-risk teachers could be accommodated by allowing them to help their colleagues from home, for instance planning classes or grading papers.
The data makes apparent that school closures are not a matter of public health. Instead, lobbying groups – who sway government officials to support their special interests – are central to the matter. They are teachers unions.
In a study aimed at understanding the external influences of school closures during the pandemic, Corey DeAngelis from Reason Foundation and Christos Makridis from MIT found teachers unions to be a significant factor.
They discovered that school districts are less likely to reopen when there is a strong union presence.
“…we see that a 10% rise in union workers is associated with a one percentage point decline in the probability of reopening in person”
Furthermore, they “generally find that school district reopening decisions are unrelated to COVID-19 risk as measured by recent cases per capita and deaths per capita in the county.”
Other studies have also found that school closures are tied to the presence of teachers unions, as opposed to the high rates of Covid-19, which one would expect.
While much of the public believes that politicians have their constituents’ best interest in mind, politicians are often acting at the behest of labor unions and other lobbying groups, which have been shown to sway them in ways that benefit their group and not the community as a whole.
Teachers unions are incentivized to lobby for themselves and reap high benefits, but their petitions ultimately lead to unintended consequences for children and their parents.
Nothing provides more evidence for the devastation of lockdowns than school closures. In the midst of our focus on complete disease avoidance, we have failed to acknowledge an extremely important vulnerable group. Children. Though they may seem quiet, they are calling for our help.
At this point, confusion or debate over school openings is completely unfounded. We knew of the extremely low risk of Covid-19 for children in April.
Override Early AccessOn - Top Ranking Catholic Cardinal Says COVID-19 Used To Advance 'Godless And Murderous Agenda' , Usher In 'Great Reset'
Top Ranking Catholic Cardinal Says COVID-19 Used To Advance ‘Godless And Murderous Agenda’ , Usher In ‘Great Reset’
Tyler Durden
Thu, 12/17/2020 – 21:00In early November, an Italian archbishop and Pope Francis foe, Carlo Maria Vigano, launched an attack against those behind pandemic lockdowns across the globe, warning President Trump in a letter of the coming “Great Reset” whose architects are “a global élite that wants to subdue all of humanity, imposing coercive measures with which to drastically limit individual freedoms and those of entire populations.”
Archbishop Carlo Maria Viganò “The purpose of the Great Reset is the imposition of a health dictatorship aiming at the imposition of liberticidal measures, hidden behind tempting promises of ensuring a universal income and cancelling individual debt,” Vigano’s letter continues.
Now, roughly six weeks later, one of the most powerful Catholics in the United States, Cardinal Raymond Burke, has kicked it up a notch – slamming “secular forces” who want to “make us slaves to their godless and murderous agenda” in a Saturday homily.
Cardinal Raymond #Burke has warned of the danger of “certain forces” who are using the cover of #COVID19 to promote “fear,” attack freedom and the family.
The Great Reset is the new normal#GreatReset https://t.co/JLxAy6Zit8 pic.twitter.com/4RSu6OOCcy— Il Teatro della Politica (@PraesesMundi) December 14, 2020
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Burke also slammed the US reliance on China, saying “To attain economic gains, we as a nation have permitted ourselves to become dependent upon the Chinese Communist Party, an ideology totally opposed to the Christian foundations upon which families and our nation remain safe and prosper.”
COVID-19
Burke – who sits on the Church’s Supreme Tribunal of the Apostolic Signatura, the highest judicial authority in the Catholic Church – then turned his attention to the pandemic, saying “Then there is the mysterious Wuhan virus about whose nature and prevention the mass media daily give us conflicting information. What is clear, however, is that it has been used by certain forces, inimical to families and to the freedom of nations, to advance their evil agenda. These forces tell us that we are now the subjects of the so-called ‘Great Reset,’ the ‘new normal,’ which is dictated to us by their manipulation of citizens and nations through ignorance and fear.“
Watch the entire homily below:
Override Early AccessOn - When Money Dies, 100 Years Later
When Money Dies, 100 Years Later
Tyler Durden
Thu, 12/17/2020 – 20:40Authored by Jeff Deist via The Mises Institute,
When Money Dies, Adam Fergusson’s cautionary account of hyperinflation in Weimar-era Germany, is the book Americans desperately need to read today.
Ours is a nation willfully lacking in knowledge and understanding of money; a cynic might think this lack of apprehension is by design. Money is seldom discussed in schools, popular media, or politics. And almost a century after the stark lessons of 1923 Germany, the West is convinced it can’t happen here. In our overwhelming material abundance, aided by the natural deflationary pressures of markets, we simply have lost our ability to imagine a hyperinflationary scenario. Sure, there have been currency meltdowns since the two world wars in places like Yugoslavia, Zimbabwe, Bulgaria, and Argentina. Yes, Venezuela and arguably Turkey face currency crises today. But we need not worry about this, because modern central banks—especially the US Federal Reserve and the European Central Bank—have tamed inflation through sheer technocratic expertise and a willingness to use extraordinary monetary policy tools. Asset purchases and balance sheet expansion, ultralow or negative interest rates, and a determination to provide as much “liquidity” as an economy needs are the new normal for central bankers. Thanks to this open embrace of centrally planned money, former Fed chair (and likely future Treasury secretary) Janet Yellen assured us we need not expect another financial crisis in our lifetime.
To believe this, one has to believe policy is more important than production, and that an express policy of inflation is the mechanism to forestall too much inflation. This is a curious position.
It’s also a position sorely tested by the events of 2020. With governments across the world shutting down business, schools, and travel in response to covid, central banks have opened the floodgates of expansionary monetary policy like never before. Any slight tapering of the Fed’s balance sheet, still swollen from the crash of ’07, is now a pipe dream as it heads toward $10 trillion (Congress chipped in with its own $2.7 trillion fiscal stimulus bill, with another $1 trillion imminent). The fed funds rate is barely perceptible at 0.25 percent, and reserve requirements for banks are suspended since March. M1 money supply spiked precipitously, while Congress funded nearly half of 2020 federal spending with Treasury debt. Fed chair Jerome Powell now tells us the bank’s sadistic 2 percent annual inflation target must average out over a period of years. In other words, we should expect (dubious official) inflation measures to run at 4 or 5 percent in coming years, to make up for the all the years when inflation supposedly was near zero.
Is it any wonder even mainstream hedge fund gurus like Ray Dalio now sound the alarm against hyperinflation? Cash is trash!
Fergusson’s book should be assigned to central bankers stat (we wonder how many of them know of it). It’s not a book about economic policy or banks per se, but rather a historical account of folly and hubris on the part of German politicians and bureaucrats. It’s the story of a disaster created by humans who imagined they could overcome markets by monetary fiat. It’s a reminder that war and inflation are inextricably linked, that war finance leads nations to economic disaster and sets the stage for authoritarian bellicosity. Versailles and reparations alone were perhaps not enough to create the conditions for Hitler’s rise, but without the Reichbank’s earlier suspension of its one-third gold reserve requirement in 1914 it seems unlikely Germany would have become a dominant European military power. Without inflation, Hitler might have been a footnote.
Most of all, When Money Dies is a tale of privation and degradation. Not only for Germans, but also Austrians and Hungarians grappling with their own political upheavals and currency crises in the 1920s. In a particularly poignant chapter, Fergusson describes the travails of a Viennese widow named Anna Eisenmenger. Her Austrian kronen, which in 1914 were worth one-quarter of a British pound sterling, spiral to 1/35,000 by 1922. As the twenties unfold, she is forced into black markets and pawning assets to procure food for her war-damaged children. Her late husband’s gold watch exchanges for potatoes and coal. Luckier than most Viennese women, she owns small investments which produce modest income—fixed in kronen. Her banker urges her to immediately exchange any funds for Swiss francs, but this practice is banned by authorities. The downward spiral of her life, marked by hunger and hoarding anything with real value, happens so quickly she barely has time to adjust.
Conditions in Vienna find voice in the realistic silent film about the era called The Joyless Street, starring a young Greta Garbo. Her character sees everything deteriorate around her; even her father beats her with his cane for returning home without food. Once friendly neighbors become suspicious of each other’s stores of bread and cheese, while prostitution becomes rampant. Angry people jostle in line waiting for the butcher to open; when he does only the most attractive women receive the scraps of meat available that day. Everything familiar and beautiful in society becomes degraded and cheapened seemingly overnight.
1920s Germany and Austria represent extreme hyperinflationary scenarios, but such grim historical lessons should counsel us to avoid repeating their mistakes. As Professor Jörg Guido Hülsmann so capably explains in The Ethics of Money Production, there are enormous moral and civilization components to monetary policy. Inflation not only harms our economy, it makes us worse people: profligate, shortsighted, lazy, and unconcerned with future generations. This is perhaps the greatest untold story in America today: the story of how the Fed not only fundamentally shifted our economy from one of production to consumption, but also the profound ethical and sociological implications of that shift.
Our make-believe economy, as Axios puts it, increasingly depends on enormous levels of ongoing fiscal and monetary intervention. Corporations borrow so cheaply we might call it “house money,” then buy back their own stock rather than hire or expand. Newly created money and credit benefits those closest to the spigot, juicing equity markets but doing little for ordinary people. Congress spends with abandon, knowing the Fed will keep its debt service low and provide a ready backstop market for US Treasurys—but little of the stimulus reaches Main Street. Whole industries, including airlines, seek bailouts for covid shutdowns. Those shutdowns also strain tax revenue for state budgets; Mr. Biden promises a bailout there too. Meanwhile, small business and retail face an apocalypse which already leaves tens of millions unemployed. Once again, the presumed answer to all of this is the Fed.
Hyperinflation may not be around the corner or even years away; no one can predict such a thing. The US dollar may well hold or gain value relative to foreign currencies over the coming years. After all, foreign currency exchange values are relative and “King Dollar” may remain a perceived store of value. But at some point the US economy must create real organic growth if we hope to maintain living standards and avoid an ugly inflationary reality. No amount of monetary or fiscal engineering can take the place of capital accumulation and higher productivity. More money and credit is no substitute for more, better, and cheaper goods and services.
History shows us how money dies. Yes, it can happen here. Only a fool thinks otherwise.
Override Early AccessOn - On Monday, Tesla Will Join The S&P500: Here's What Happens Next
On Monday, Tesla Will Join The S&P500: Here’s What Happens Next
Tyler Durden
Thu, 12/17/2020 – 20:20One of the most anticipated and material changes to the S&P500 is set to take place in just hours, when Tesla – a $615 billion company that has barely generated any GAAP profits in its operating history – is set to join the world’s most important market index.
What happens then? Well, as with every other thing in the market, there are two schools of thought.
According to one, which Bloomberg affectionately calls the Wall Street smart beta data nerds – Tesla will be a drag on the index. These “smart beta” quants believe that market-weighted indexes suffer by chaining their fortunes to big and bloated companies. As such, Tesla’s imminent entry into the S&P 500 is stirring their passions by framing the debate in particularly stark terms. According to Bloomberg, index pioneers such as Rob Arnott are making the rounds and publishing studies in the run-up, “trumpeting data that purports to show that megacap companies have the potential to harm passive returns.” Their pessimistic view coincides with that of the smart-beta folks who say many stock indexes stumble when the massive companies that dominate them run out of room to grow.
In a recent paper titled “Tesla – The Largest-Cap Stock Ever to Enter S&P 500: A Buy Signal or a Bubble?”, Arnott and a colleague at Research Affiliates looked at 31 years of data and found that when a company is big enough to enter the index as one of its 100 largest members, it falls 7% over the following year, on average. Meanwhile, the average deleted company beats the gauge by 20% after being kicked out (in this case, Tesla is replacing Apartment Investment and Management which is down 46% YTD).
According to Arnott, the data is evidence that benchmark overseers such as S&P Dow Jones Indices “buy high and sell low,” resulting in a performance gap of 24% between megacap entrants and discretionary deletions over the next 12 months That ends up costing investors money, and exposes what quants such as Arnott consider a fundamental flaw of market-cap indexes – “too much dependence on companies whose best days may be behind them.”
To Arnott, Tesla’s addition is a case in point of indexes chasing performance: “This Tesla addition is a beautiful illustration of that,” Arnott told Bloomberg in a phone interview. “It’s run up 800% from the March lows. Now you want to add it?” Ironically, the stock surged by about 50% precisely on the news of the S&P addition, begging the question if there is any good news left.
A similar skeptical of S&P’s handling of Tesla was voiced by Vincent Deluard who in a note titled “Time to Fire the S&P 500 Index Committee,” the StoneX strategist wrote that waiting around to add Tesla cost index investors more than $500 billion and “transferred retirement savings to speculators.”
To be sure, the overriding concern among quants and most fundamental traders, is the gaping valuation mismatch between Tesla – currently trading at 20 times sales or almost 10 times the S&P 500’s valuation – and the rest of the S&P.
An attempt to ease investor concerns with a far more sanguine take was published overnight by Goldman’s chief equity strategist, David Kostin, who wrote that “when Tesla joins the S&P 500 next week it will lift the index P/E ratio by just 0.4 multiple turns, much less than most investors expect.” According to Kostin, Tesla currently trades at (only) 170 times consensus 2021 earnings with a $600 billion market cap and $480 billion float cap.
Based on its current capitalization, the company will join the index with a weight of about 1.5%, according to Goldman calculations and given Tesla’s large size and elevated multiple, many investors erroneously intuit that the company’s inclusion into the S&P 500 will lift the index’s current 22x P/E multiple (already close to the highest levels on record) by two multiple turns or more.
Another way to think about the impact of Tesla on S&P 500 P/E is that the stock will raise the index market cap by roughly 1.5% with only a de minimis contribution to index earnings. As a result, the inclusion will lift the aggregate index P/E multiple by slightly less than 1.5%, or less than half of a P/E multiple turn. This impact would be similar whether the stock traded at a P/E multiple of 170x, 500x, or1000x. As Kostin further explains, the stock’s inclusion should lift the S&P 500 EV/sales ratio by about 1%, from 3.11x to 3.14x.
That said, Tesla’s inclusion will have a larger impact on the S&P 500 market cap-weighted P/E multiple, which will lift the cap-weighted P/E by two turns, from 28.9x to 31.0x. According to Goldman calculations, that post-inclusion multiple will register at the 96th percentile since 1980, compared with a 99th percentile rank for the aggregate P/E. Hardly cheap, despite Kostin’s tremendous efforts to make it seem like a non-issue.
Perhaps realizing that attempts to fundamentally justify the inclusion may be falling short, Kostin then falls back to several iconic inclusions that also appeared rich at the time, and writes that “investors then and now are acutely aware of the “super-cap premium” commanded by select companies. In 2000, CSCO and GE traded at forward P/Es of130x and 40x, respectively. Today, AMZN trades at a forward P/E of 70x and TSLA trades at 170x.” Yes… and what about all those other companies that have been booted from the S&P500 – we are fairly confident that anyone can cherry pick a handful of examples to “justify” their thesis.
In any case, one actually useful observation from Kostin is the calculation of what impact Tesla’s inclusion would have had on S&P performance had it been a member all year. Since TSLA has risen by 657% this year, outperforming the S&P 500 by 640 pp, had it been a constituent all year, it would have lifted the total index return by roughly 200 bp, from 16% to 18%.
Of course, that’s the plan all along – that by adding such hypergrowth companies as Tesla, the S&P will approach Nasdaq-type returns. The only question, of course, is if it’s not too late and – as Arnott warns – the inclusion comes just as Tesla peaks.
Making this particular bearish case comes from twitter user SqueezeMetrics who lays out why the index inclusion may be the worst possible news for Tesla bulls as its “bursts the Tesla” bubble :
How S&P inclusion bursts the Tesla bubble:
Ever since June (at $200/share), Tesla stock has been driven by a perpetual motion machine of hype and call option flows — nothing more. And everyone knows it.
Here’s what not everyone knows:
- When a stock joins the S&P 500, it becomes part of a massive volatility complex, which is a terrifying web of arbitrage and pseudo-arbitrage relationships. Tesla will join the index as a top-ten component of a cap-weighted index. It’s big.
- Its bigness will allow all manner of dispersion, relative value, and market-making traders to begin relying on Tesla’s newfound correlation to the index. This will invariably cause arbitrageurs to buy SPX options/vol and sell TSLA options/vol to “close the spread.”
- Since Tesla stock is driven by the returns on call options, it is a slave to “vanna”: the relationship between option prices (implied volatility) and delta (stock exposure).
In other words, since June, $TSLA goes up only when implied volatility (IV) goes up (purple line is IV).
When Tesla joins the index, these historic call option flows and the hype machine behind them will hit the big red fire truck that is the S&P, at 500mph.
Implied volatility will be unable to rise. Call options will bleed value. New flows will be absorbed by real traders.
With the call option hype trade hampered, the stock will have no possibility of further returns — a deliciously ironic end to the ugliest of Robinhood’s many ugly children.
And an appropriately ironic fate for Tesla – a victim of its own “success.”
Too bearish? We give the final word to investing icon Arnott whose assessment is hardly more optimistic:
“When people say, ‘When is the Tesla bubble going to burst?’ I’ve jokingly said on the 22nd of December,” Arnott said. “Nobody knows, but that’s when the index addition argument disappears and that’s when the market starts to search out what the company’s really worth.”
We will know if Arnott is right in just a few days.
Override Early AccessOn - Amazon's Halo Device Will Tell You If You're Condescending, Opinionated, Or Fat
Amazon’s Halo Device Will Tell You If You’re Condescending, Opinionated, Or Fat
Tyler Durden
Thu, 12/17/2020 – 20:00Authored by Robert Wheeler via The Organic Prepper blog,
As small businesses disappear into the black hole of “pandemic restrictions,” major international corporations devour what is left of the market. Those institutions, which Carroll Quigley referred to as future “corporate overlords,” are rolling out new technologies just in time for the “Great Reset.”
Just when you think technology couldn’t get any more invasive
There’s nothing angelic about Amazon’s new wearable technology.
Halo, Amazon’s new AI health bracelet, offers body composition analysis, tone of voice analysis, sleep & activity tracking. Presumably, this new tech is another convenient application to bring awareness to users of such things as too much body fat or if their tone is a bit too abrasive or “condescending.”
While some individuals may benefit from both of these nudges, a recent review of Halo by the Washington Post (the unabashed purveyor of the loss of civil liberties) forcibly admits that Halo is the “most invasive tech we’ve ever tested.”
Authors Geoffrey Fowler and Heather Kelly wrote:
Hope our tone is clear here: We don’t need this kind of criticism from a computer. The Halo collects the most intimate information we’ve seen from a consumer health gadget – and makes the absolute least use of it. This wearable is much better at helping Amazon gather data than at helping you get healthy and happy.
Incidentally, Amazon’s CEO Jeff Bezos owns The Washington Post.
So, we could reasonably expect the authors of this review, Fowler and Kelly, to soon have to look for other employment avenues. Either that or the review was a cleverly placed advertisement, designed to draw controversy to an app that could use some in house advertisement. And to target those readers who don’t seem to care much about their own privacy.
AI now informs people they are condescending, opinionated, and fat
Halo collects more invasive information than FitBit or Apple Watch. With no screen, sounds, vibrations, or any striking design, Halo uses sensors to monitor physical activity, sleep, skin temperature, and heart rate. The only way to read that data is through a companion phone app.
The wearable device collects new information like body photos (of a scantily clad user) and voice recordings, feeding the data into Amazon’s AI software for analysis.
Amazon says HALO requires users to be nearly naked for the complete body scan to calculate body fat percentage. This scan requires users to stand in front of their phone’s camera in their underwear for a 360-degree scan.
The shots then go to Amazon’s cloud for analysis.
Remember when people scoffed at the phrase, “Big Brother is always listening?”
This new device is. And it tells you when you are being condescending or sound opinionated. Although, supposedly, you can push a button and cut off the microphone. Temporarily…sure you can.
The WaPo writers seemed considerably more concerned with the device’s voice analysis, focused on the fact that it is not as accurate as they would like. No mention of the frightening reality that Halo possibly represents the last vestiges of privacy and personal data.
The Halo’s voice tone analysis is questionable on a whole other level. You train the device to recognize your voice by reading sample phrases, and then it listens out constantly for moments in conversation that go beyond your neutral tone. (There is a button you can press to temporarily turn off the microphone.) The Halo plots these moments as positive vs. negative and high vs. low energy, and then applies more nuanced descriptors to them – for example, a voice that registers as negative and low energy might be classified as “discouraged.” You can review a dozen, or more, of these per day in the Halo app.
“For the most part, people are relatively unaware of how they sound to others and the impact that may have on their personal and professional relationships,” said Amazon’s medical officer Maulik Majumudar.
Do we want another product designed to mine for personal data?
The Halo is designed to mine your data. As with all devices like this one, the privacy policy states Amazon won’t sell or share your data without your explicit permission and that you are in control of it. The writer’s of the WaPo article had this to say:
But that still leaves open plenty of other ways for Amazon to profit from your information. In an anonymized way, it can data mine the heart rate, activity, sleep and tone patterns of Halo owners, using it to tailor its health algorithms and learn about human bodies. Make no mistake: disrupting medicine is the next goal for big tech.
Medical industries are attempting to push digestible microchips to monitor patients’ intake of medicine from afar by their doctor. Halo is just one more step in that direction. First, there were the handhelds. Now we are in the age of wearables. “Ingestibles” are next in line on our way to merging man and machine.
Undoubtedly, those concerned with the direction in which humanity is heading will be labeled as Luddites and conspiracy theorists. We won’t be vindicated when we are proven right, either. It hasn’t happened any other time. One must wonder what kind of person would welcome such invasive technology. And could THEIR wearable technology eventually invade OUR privacy?
Override Early AccessOn - Atlantic City Auctions Chance To Blow Up Trump Casino
Atlantic City Auctions Chance To Blow Up Trump Casino
Tyler Durden
Thu, 12/17/2020 – 19:40The Atlantic City government thought it would be a great idea to auction off the chance to press a virtual button to blow up President Trump’s former casino and hotel next month.
According to AP News, the demolition of the former Trump Plaza Hotel and Casino building has been transformed into a fundraiser for the Boys & Girls Club of Atlantic City. The mayor hopes the auction will raise hundreds of thousands of dollars to benefit the local community.
“Some of Atlantic City’s iconic moments happened there, but on his way out, Donald Trump openly mocked Atlantic City, saying he made a lot of money and then got out,” said Mayor Marty Small.
Small continued: “I wanted to use the demolition of this place to raise money for charity.”
Trump’s casino shuttered operations in 2014 and has fallen into a disrepair state that demolition was the only solution.
The demolition is scheduled for Jan. 29, just nine days after the presidential inauguration.
The winner of the online auction, listed at Live Auctioneers, currently with ten bids at a price of around $7k, will have the ability to push a virtual button that starts the building’s implosion.
The auction’s website says the Boys & Girls Club has “stood at the forefront of the city’s future for nearly 50 years.” Donations from the fundraiser “will help to sustain programs that serve over 2,500 youth in Atlantic City including Academic Enrichment, Arts, & Recreational ProgramsSTEAM Education – new STEAM lab praised by Apple CEO Tim Cook.”
It wouldn’t shock us if some prominent liberal wins the auction; it would be a liberal’s wet dream to blow up a former Trump building.
Override Early AccessOn - The Decimal Point That Blew Up The World
The Decimal Point That Blew Up The World
Tyler Durden
Thu, 12/17/2020 – 19:20Authored by Jeffrey Tucker via The American Institute for Economic Research,
What was the basis of panic that led the lights to darken on civilization?
The most important date here might be March 11, 2020. That’s when Congress itself flew into an unwarranted panic, and acquiesced to a lockdown at the urging of the “experts.”
State governors followed one by one, with few exceptions, and the rest of the world joined the lockdown frenzy.
In February, people were aching to know the answer to the following.
Would this “novel virus” have familiar patterns we associate with the flu, seasonal colds, and other predictable and manageable pathogens? Or would this be something entirely different, unprecedented in our lifetimes, terrifying, and universally deadly?
Crucial in this stage was public-health messaging. In previous pandemics from post-1918 throughout the 20th century, the central messaging was to stay calm, go to the doctor if you feel sick, avoid deliberately infecting others, and otherwise trust the systems in place and keep society functioning. This was long considered responsible public-health messaging, and this was pretty much where we stood throughout most of January and February, when publications regardless of their political outlook maintained sobriety and rationality.
Something dramatically changed this time. They pushed panic, tapping into a primal fear of disease. The reality of pandemic, as it turns out, has been familiar. The severity of its impact has been radically disparate across demographics, hitting mainly the elderly and infirm with 40% of deaths tracing to long-term care facilities with an average age of death nearly equal to the average lifespan. It is regionally migratory. It follows a seasonal pattern from pandemic to its endemic equilibrium.
What has been different has been the messaging that has almost universally been structured to create public frenzy, from the New York Times’s February 28 urge to “go medieval” to Salon’s latest demand that we panic even more.
My own sense of impending doom began on March 6 with the cancellation of South by Southwest in Austin, Texas, an action of the mayor alone, and completely without modern precedent. I wrote about it on March 8. Four days later, President Trump gave a nationwide address that ended with a shocking announcement that all flights from Europe would be stopped to keep the coronavirus out even though the virus had been here since January. The next day, on March 13, the administration issued what amounted to a shutdown plan for the nation.
This timeline, however, misses a crucial step.
We should be grateful to Ronald B. Brown of Waterloo University for his extraordinary paper that appears in Disaster Medicine and Public Health Preparedness (Vol 14, No. 3): “Public Health Lessons Learned From Biases in Coronavirus Mortality Overestimation.” It also appears on the website of the National Institutes of Health with a date of August 12.
Our author’s thesis was that the wild overreaction and unprecedented lockdowns of life began with what was a terminological mixup that led to a misplacement of a decimal point in a report from the National Institutes of Health.
It was a seemingly small error but it provided the basis on which Anthony Fauci testified at the House Oversight and Reform Committee about the seriousness of novel coronavirus spreading across the globe.
Here is the video in question. As you watch, you will note the seeming precision of data that actually masks a huge problem. He obscures the huge difference between the infection fatality rate, the case fatality rate, and the overall death rate. Nowhere does he mention survival rates. Not one person present pushed back on his claims. In the blizzard of data, he finally summarizes in a way that terrified everyone. Covid, he said, is “10 times more lethal than the seasonal flu.”
Even apart from that prediction, his entire demeanor was: this is entirely new, very deadly, and unbearably unmanageable without extreme measures. Fauci’s implicit message to Congress and the American people was that it is time to panic.
Fauci was claiming what in fact he could not know, conflating two distinct data sets, and extrapolating in ways that allowed him to make a completely unsupported claim that very obviously turned out to be false. Two years ago, 61,000 Americans of all ages died of flu, exclusive of other ailments.
If you incorrectly impose on that a “case fatality rate” of 0.1% and extrapolate to Covid infections, you end up with at least 800,000 deaths from Covid alone – not “with” or “involving” Covid as the CDC classifies deaths today (that alone represents a big change). This is a scary prediction at the time; it seemed to add weight to the estimates out of the Imperial College of London that 2.2 million people would die without locking down. This testimony led a whole generation of lawmakers to believe that none of the traditional medical measures could or would work. There is no comparing this with the flu or any respiratory illness. This was the Other that justified a once-in-many-generations national emergency that required an end to our way of life.
The trouble is that the whole claim was based on a terminological misstatement that fed a basic math error. As Brown explains:
Sampling bias in coronavirus mortality calculations led to a 10-fold increased mortality overestimation in March 11, 2020, US Congressional testimony. This bias most likely followed from information bias due to misclassifying a seasonal influenza IFR as a CFR, evident in a NEJM.org editorial. Evidence from the WHO confirmed that the approximate CFR of the coronavirus is generally no higher than that of seasonal influenza. By early May 2020, mortality levels from COVID-19 were considerably below predicted overestimations, a result that the public attributed to successful mitigating measures to contain the spread of the novel coronavirus.
Let’s follow Brown here as he takes the reader through the crucial differences between the IFR and the CFR. IFRs from samples across the population “include undiagnosed, asymptomatic, and mild infections.” To calculate the average IFR across the population, you do randomized samples to judge its prevalence. The results are inclusive of cases – what we used to call actual “sick” people – but extend to people who merely carry traces of the dead virus but are in no substantial danger of passing it onward or experiencing any severe outcomes. Cases, on the other hand, “are based exclusively on relatively smaller groups of moderately to severely ill diagnosed cases at the beginning of an outbreak.” The CFR is a smaller group. Brown provides the following graphic to show how epidemiology has long considered the difference.
Based on this graphic alone, you can see why it becomes crucial to keep these terms straight.
The CFR is higher; IFR is lower; the crude mortality rate is lower still.
The CFR measures severity; the IFR measures prevalence.
Those are the two general issues one needs to know to assess whether and to what extent a virus outbreak is mild, moderate, serious, or severe. This matters due to the long-observed evolved reality of respiratory viruses: there is a trade off between the forces. The more severe the virus, the quicker it burns itself out. The milder (and “smarter”) it is, the more it can spread. To mix up severity and prevalence is to make a mess of all the important categories that infectious disease specialists use to assess the social impact of a new virus.
Moreover, if you are going to compare how severe a pandemic is, you have to compare apples to apples, which means at the very minimum that we must be careful to distinguish apples from oranges from pears. That is precisely what the early messaging surrounding the coronavirus did not do.
Cases are not deaths; even more crucially, cases in a traditional sense mean that people are actually sick, not merely that they have been tested positive by a PCR test. Adding to the confusion, most data sources on Covid today use the term “cases” to identify any positive test, with or without symptoms, when the correct word would be “infections.” Further, the PCR test itself presents its own problems. As Brown notes, “A serious limitation of RT-PCR testing is that nucleic acid detection is not capable of determining the difference between infective and noninfective viruses.” The widespread use of the PCR test has made its own contribution to blurring all these crucial distinctions.
Now consider an extraordinary article from the New England Journal of Medicine that appeared on February 28, with Anthony Fauci as the co-author. The import of the piece was to claim that Covid and flu are quite similar in severity.
“The overall clinical consequences of Covid-19 may ultimately be more akin to those of a severe seasonal influenza (which has a case fatality rate of approximately 0.1%) or a pandemic influenza (similar to those in 1957 and 1968) rather than a disease similar to SARS or MERS, which have had case fatality rates of 9 to 10% and 36%, respectively.”
What matters here is not the prediction as such but the switching of the word infection with case: the flu has “a case fatality rate of approximately 0.1%.” This was incorrect even at the time of writing. You can call it a misprint or sloppy or downright duplicitous. Regardless, even the World Health Organization had identified the 0.1% figure as the flu’s infection fatality rate. If you assume one symptomatic confirmed case for every infection (or what is now confusingly called “cumulative cases”), the error could be a misplace decimal: 0.01% not 0.1%. Regardless, Fauci’s article directly contradicted the WHO, and ran counter to everything that was already then known. But his CFR claim about flu is precisely what led him to claim in front of the Congressional committee that Covid would be deadly in ways that defy all experience of this generation.
Brown further explains:
As the campaign to mitigate coronavirus transmission was implemented from March into May, 2020, expected coronavirus mortality totals in the United States appeared much lower than the overestimation reported in Congressional testimony on March 11. Compared with the most recent season of severe influenza A (H3N2) in 2017-2018,with 80,000 US deaths reported by CDC officials, US coronavirus mortality totals had just reached 80,000 on May 9, 2020. By then, relative to the 2017-2018 influenza, it was clear that the coronavirus mortality total for the season would be nowhere near 800,000 deaths inferred from the 10-fold mortality overestimation reported to Congress. Even after adjusting for the effect of successful mitigation measures that may have slowed down the rate of coronavirus transmission, it seems unlikely that so many deaths were completely eliminated by a nonpharmaceutical intervention such as social distancing, which was only intended to contain infection transmission, not suppress infections and related fatalities. Also in early May, 2020, a New York State survey of 1,269 COVID-19 patients recently admitted to 113 hospitals found that most of the patients had been following shelter-in-place orders for 6 wk, which raised state officials’ suspicions about social distancing effectiveness. Still, polls showed the public credited social distancing and other mitigation measures for reducing predicted COVID-19 deaths, and for keeping people safe from the coronavirus.
As of this writing, however, deaths “involving” or “with” Covid has passed 300,000, which while less than half as high as what Congress heard they would be on March 11, is still quite high, provided these deaths have not been broadly misclassified. However, on March 24, the CDC made an announcement of serious significance. It would now calculate coronavirus mortality by including “probable” and “likely” deaths in the International Classification of Diseases code (ICD).
This became an invitation to misclassification. People who otherwise would have previously been classified as having heart disease or some other comorbidity could now be classified as Covid. This also included a financial incentive to do just that. For this reason, when the CDC announced that “for 6% of the deaths, Covid-19 was the only cause mentioned,” it came as a shock to people. What that means is that 94% of the deaths attributed to Covid were associated with additional comorbidities that prevented the immune system from fighting off the virus.
Following the March 11 Fauci testimony, in which he conflated IFR and CFR, the national media went wild with Covid and flu comparison. The following article, for example, blew up from BusinessInsider in June: “The coronavirus death rate in the US is almost 50 times higher than that of the flu. See how they compare by age bracket.” If you look carefully at the charts, you can see something fishy: they calculated infection fatality rate for flu against the case fatality rate for Covid. That necessarily generates a wild overestimate for Covid deaths. The charts are terrifying – and have nothing to do with reality.
Let’s hop forward from the testimony days to one month later when full-scale panic had already hit the U.S. Speaking at a White House press conference, Fauci then made a claim that strains credulity at every level. He said at a White House press briefing that the stringencies and “social distancing” could not and would not be relaxed until there are no “no new cases, no deaths.” Such a thing has happened only once in the history of viruses: smallpox. From the first experiments with inoculation to the final eradication took some 250 years. And yet here we have Fauci explaining that life could not be normal and functioning again until this widespread virus, relatively mild for 95% of the population, was completely eradicated from the planet!
And now we have the vaccine, and plenty of questions remaining about it, such as why non-vulnerable populations would prefer to take it over gaining the exposure necessary for naturally acquired immunity. Asking such a basic question is very close to being tabooed, even as lawmakers and other institutions are toying with the idea of making it mandatory. Even then, many of the lockdown advocates from earlier this year are saying that it will not enable us to go back to normal, to take off the masks, to go to the movies, or travel again. This is precisely the belief you might expect from a crowd that participated in what John Iaonnidis called a “one-in-a-century evidence fiasco” and are desperately trying to dig themselves out of losing every bit of scientific credibility.
Whether Brown is correct that the whole panic truly does trace to a brain flakeout on the part of Fauci – or even perhaps a deliberate “noble lie” to deceive the public into accepting the unacceptable – it hardly matters. The problem we face now is a huge tangle over terminology such that “infections” that could include as many as 90% false positives (according to the NYT) are called cases, while the once-distinct condition called cases which used to indicate actually being sick no longer has any precise meaning. The cacophony of statistical confusion here truly boggles the mind.
In the midst of all of this, the CDC itself finally updated its own estimates of the infection fatality rate of Covid-19. The CDC wisely took account of the huge demographic stratification of severe outcomes. There is not one rate that applies to the whole population or to any particular individual. There are only backward looking estimates of outcomes. They are all follows:
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0.003% for 0-19 years
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0.02% for 20-49 years
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0.5% for 50-69 years
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5.4% for 70+ years
Flipping the data to state it by survival rate by age:
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99.997% for 0-19 years
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99.98% for 20-49 years
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99.5% for 50-69 years
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94.6% for 70+ years
John Ioannidis sums up the disparity by age with the following infection fatality rate for people under the age of 70: 0.05%. This conclusion has been peer-reviewed and published by the World Health Organization.
How does this compare with the flu? We do not really know. As science journalist Shin Jie Yong has written, “There seems to be no data on age-specific IFR of the seasonal flu.” What this means is that crucial testimony of Fauci from March 11, in which he casually predicted based on bad numbers, that Covid would be ten times worse than the flu, can neither be confirmed or denied based on age-specific severe outcomes.
However, we can assemble the data based on years of lost life. Consider the long-term view over the future course of existing lifetimes. JusttheFacts reports:
If 500,000 Covid-19 deaths ultimately [in the future] occur in the United States—or more than twice the level of a prominent projection—the disease will rob about 6.8 million years of life from all Americans who were alive at the outset of 2020.
In contrast:
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* the flu will rob them of about 35 million years.
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* suicides will rob them of 132 million years.
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* accidents will rob them of 409 million years.
As testing has expanded dramatically throughout the population, the estimated infection fatality rate of Covid will fall further. Thus can we observe a chart of “cases” (actually positive tests) all over the world and compare it with severe outcomes and see something remarkable that should make every living person fundamentally question why they decided to shut down the world and wreck billions of lives.
Another statistic that bears repeating, Covid – based on infections vs deaths – has close to a 99.9% survival rate. Imagine how the world would have been different had Fauci told that to the Congress on that fateful day of March 11. Or what if Fauci had revealed that the average age of death from Covid would almost equal the average lifespan in the US and exceed it in most parts of the world? People present might have wondered why they were holding hearings at all.
All these categories of data placement carry with them the danger of creating an illusion of control. Viruses do not come with little gears inside them with these rates. Human beings collect data and create them, and not one of them (whether IFR, CFR, infection rates, mortality rates, survival rates) pertains infallibly to any single individual. Our response to a virus is contingent on our own health, age, cross immunities, T cell memory, and a thousand other factors that no politician controls.
What we know is that a terminological confusion, a misplaced decimal point, a one-word error in data description, and a massive amount of arrogant presumptions about how to control a virus set in motion a series of events that turned our great and prosperous country into a disaster of confusion, demoralization, foregone medical services, closed businesses, wrecked arts and education, and long bread lines. The lockdowners who created this appalling disaster, the people who turned our trust into betrayal and a blizzard of statistical baloney, need to look at the science and data as they stand and come clean.
Override Early AccessOn -
- South Carolina Bills Would Cut Taxes On Gold And Silver, Support Sound Money
South Carolina Bills Would Cut Taxes On Gold And Silver, Support Sound Money
Tyler Durden
Thu, 12/17/2020 – 18:40Three bills prefiled in the South Carolina House would cut taxes on precious metals and take important steps toward treating gold and silver as money instead of as commodities. Passage of these bills would also set the stage to undermine the Federal Reserve’s monopoly on money.
South Carolina is the first state to propose this kind of legislation for the 2021 session, but more states will likely follow suit. This is part of a broader movement at the state level to support sound money.
The Federal Reserve is the engine that drives the most powerful government in the history of the world. Ron Paul popularized the slogan “End the Fed,” but Congress is nowhere near abolishing the central bank. It can’t even come up with the will to audit the Fed.
Even though state action can’t end the Fed, there are steps states can take that will undermine the Federal Reserve’s monopoly on money. By passing laws that encourage and incentivize the use of gold and silver in daily transactions by the general public, state action such as the passage of these bills in South Carolina has the potential to create a wide-reaching impact and set the foundation to nullify the Fed’s monopoly power over the monetary system.
Rep. Stewart Jones (R-Laurens) filed all three bills.
House Bill 3377 (H3377) would make gold and silver coins legal tender in the state. Under the proposed law, “gold and silver coins minted foreign or domestic shall be legal tender in the State of South Carolina under the laws of this State. No person or other entity may compel another person or other entity to tender or accept gold or silver coin unless agreed upon by the parties.”
Practically speaking, this would allow South Carolina residents to use gold or silver coins to pay taxes and other debts owed to the state. In effect, it would put gold and silver on the same footing as Federal Reserve notes.
The phrase, “unless agreed upon by the parties” has important legal ramifications. This wording reaffirms the court’s ability, and constitutional responsibility according to Article I, Section 10, to require specific performance when enforcing such contracts. If voluntary parties agree to be paid, or to pay, in gold and silver coin, South Carolina courts could not substitute any other thing, e.g. Federal Reserve Notes, as payment.
South Carolina could become the fourth state to recognize gold and silver as legal tender. Utah led the way, reestablishing constitutional money in 2011. Wyoming and Oklahoma have since joined.
KNOCKING DOWN BARRIERS
Taxes on gold and silver erect barriers to using gold and silver as money by raising transaction costs. House Bill 3378 (H3378) would effectively exempt gold, silver and platinum bullion from state capital gains taxes. Passage of this legislation would eliminate a barrier to investing in gold and silver. It would also make it more practical to gold and silver in everyday transactions, a foundational step for people to undermine the Federal Reserve’s monopoly on money.
South Carolina has already repealed the sales tax on gold and silver. That removed one barrier to buying gold and silver. Passage of H3378 would remove another.
In effect, “states that collect taxes on purchases of precious metals act as if gold and silver aren’t money at all.”
Imagine if you asked a grocery clerk to break a $5 bill and he charged you a 35 cent tax. Silly, right? After all, you were only exchanging one form of money for another. But that’s essentially what South Carolina’s capital gains tax on gold and silver bullion does. By eliminating this tax on the exchange of gold and silver, South Carolina would treat specie as money instead of a commodity. This represents a small step toward reestablishing gold and silver as legal tender and breaking down the Fed’s monopoly on money.
“We ought not to tax money – and that’s a good idea. It makes no sense to tax money,” former U.S. Rep. Ron Paul said during testimony in support an Arizona bill that repealed capital gains taxes on gold and silver in that state. “Paper is not money, it’s fraud,” he continued.
GOLD BULLION DEPOSITORY
Stewart also prefiled House Bill 3379 (H3379). This joint resolution would create a study committee to determine the feasibility and efficacy of the establishment of a bullion repository in this state to store gold, silver, and other metals for the state’s reserves and for investments. The committee would be required to issue a report of its findings to the General Assembly by January 15, 2022.
South Carolina has a model it could follow. In the summer of 2015, Texas Gov. Doug Abbot signed a law creating a state gold bullion and precious metal depository in his state. The depository received its first deposits in the summer of 2018. The facility will not only provide a secure place for individuals, businesses, cities, counties, government agencies and even other countries to store gold and other precious metals, the law also creates a mechanism to facilitate the everyday use of gold and silver in transactions. In short, a person will eventually be able to deposit gold or silver – and pay other people through electronic means or checks – in sound money.
A state gold repository also creates an avenue toward financial independence. Countries around the world, including China, Russia and Turkey, have been buying gold to limit their dependence on the US dollar. University of Houston political science professor Brandon Rottinghaus said a state depository can serve a similar function for Texas.
“This is another in a long line of ways to make Texas more self-reliant and less tethered to the federal government. The financial impact is small but the political impact is telling, Many conservatives are interested in returning to the gold standard and circumvent the Federal reserve in whatever small way they can.”
The Tennessee legislature passed a resolution declaring support for the creation of a gold bullion depository in the Volunteer State back in 2016, but never followed up with any legislation. If South Carolina does create a study committee, it will be imperative to follow up with further legislation to actually establish a repository once the report is issued.
BACKGROUND
The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” Currently, all debts and taxes in South Carolina are either paid with Federal Reserve Notes (dollars) which were authorized as legal tender by Congress or with coins issued by the U.S. Treasury — very few of which have gold or silver in them.
The Federal Reserve destroys this constitutional monetary system by creating a monopoly based on its fiat currency. Without the backing of gold or silver, the central bank can easily create money out of thin air. This not only devalues your purchasing power over time; it also allows the federal government to borrow and spend far beyond what would be possible in a sound money system. Without the Fed, the US government wouldn’t be able to maintain all of its unconstitutional wars and programs.
Passage of H3377 would reestablish gold and silver as legal tender in the state and take a step toward that constitutional requirement, ignored for decades in every state. Passing H3378 would remove one of the tax barriers that hinder the use of gold and silver as money.
Passage of both bills would also begin the process of abolishing the Federal Reserve system by attacking it from the bottom up – pulling the rug out from under it by working to make its functions irrelevant at the state and local levels, and setting the stage to undermine the Federal Reserve monopoly by introducing competition into the monetary system.
Constitutional tender expert Professor William Greene said when people in multiple states actually start using gold and silver instead of Federal Reserve Notes, it would effectively nullify the Federal Reserve and end the federal government’s monopoly on money.
“Over time, as residents of the state use both Federal Reserve notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve notes do will lead to a “reverse Gresham’s Law” effect, where good money (gold and silver coins) will drive out bad money (Federal Reserve notes). As this happens, a cascade of events can begin to occur, including the flow of real wealth toward the state’s treasury, an influx of banking business from outside of the state – as people in other states carry out their desire to bank with sound money – and an eventual outcry against the use of Federal Reserve notes for any transactions.”
Once things get to that point, Federal Reserve notes would become largely unwanted and irrelevant for ordinary people. Nullifying the Fed on a state by state level is what will get us there.
Override Early AccessOn - FX Strategist Explains Why This Time Bitcoinmania "May Be Different"
FX Strategist Explains Why This Time Bitcoinmania “May Be Different”
Tyler Durden
Thu, 12/17/2020 – 18:20Now that bitcoin is once again all the rage among investors, both retail and institutional, opinions on its future prices follow a bimodal distribution with a concentration at either extreme and few moderate view inbetween. Which is why this morning’s note from SocGen FX strategist Kit Juckes with interest as it presents one of the more nuanced takes on what may happen next, and if nothing else, we believe he hammers the point with the following observation on how “bitmania” is different from tulipmania:
“Bitcoin is different because even now, most activity is ‘buy to hold’; by people who believe it is the natural competitor to gold as a store of value in a time when central banks are playing footloose and fancy free with fiat money.”
Of course, the real reason behind bitmania – and why it may persist – is simple: it’s all in response to brrrr (which is why we find all the Fed fanboys bashing bitcoin so hilariously absurd).
As to why bitmania will likely have staying power, well, as Juckes concludes, “aAficionados believe that central banks who have turned the monetary tap wide open at the back end of a historic era when a surge in the global labor force, and huge technological change have kept inflation at bay, will be too slow to rein in inflation when these forces fade.”
He is, of course, right with one minor edit: not only will central banks not be able to rein in inflation, but they will welcome it which is also why the world is on the verge of a digital currency revolution where central banks will finally be able to literally print digital money which they can distribute, at their discretion, among the population.
We excerpt from his full note titled “Jay Powell is feeding the (dollar) bears again” below:
Between August and November 1636, just as what is now the Netherlands emerged from a long recession due to the resumption of the country’s war with Spain, an outbreak of the bubonic plague killed an eighth of the population of Haarlem. The boost that gave to incomes is cited as one of the reasons, along with the availability of credit in the country which invented fractional reserve banking, for the madness described as Tulipomania in Mike Dash’s excellent (short) book on the subject.
There will no doubt be comparisons of tulips and Bitcoin in the days/weeks/months ahead. In my mind the tulip mania became a speculative bubble, rather than an odd but harmless pastime for rich lovers of flowers, when people were buying in the hope of making a quick profit, and were mostly buying on credit. In this regard at least, Bitcoin is different because even now, most activity is “buy to hold” by people who believe it is the natural competitor to gold as a store of value in a time when central banks are playing footloose and fancy free with fiat money. Aficionados believe that central banks who have turned the monetary tap wide open at the back end of a historic era when a surge in the global labor force, and huge technological change have kept inflation at bay, will be too slow to rein in inflation when these forces fade.
I have a lot of sympathy for that view, and therefore for the idea that gold will remain in demand as long as policy rates remain very low. By the same token, Bitcoin has been around long enough that it probably isn’t going away. I certainly don’t however, have any desire to try to construct a fancy model to predict how high bitcoin prices might go. I’ll just make the point that if this does become a speculative bubble, it can get pretty wild before it bursts.
Of course, if there are bubbles around, they are being helped by Fed Chairman Jay Powell. The FOMC’s ‘dot-plot’, which I glanced at during half-time yesterday, looked hawkish. Mr Powell’s comments were anything but. Money’s staying way. Throw in hope that a fiscal package will be forthcoming, that an EU/UK trade deal can be struck now that fish, rather than the level playing field is the main obstacle, that the recovery Fund is up and running and of course, that vaccine deployment will continue, and the stage is set for the dollar to go on falling. The only problem is that it’s falling too fast. The last Bloomberg FX poll has a high forecast for Q4 2021 of 1.28. Our forecast is 1.27; that’s a 4% move, compared to the 3% the euro has risen in the last month alone.
All of that ensures that bitcoin – and gold – will go much higher, albeit with occasional bloodcurdling crashes.
Override Early AccessOn - Mike Green – This Car Has No Brakes (But We re Driving Uphill)
Mike Green – This Car Has No Brakes (But We re Driving Uphill)6216987388001
Tyler Durden
Thu, 12/17/2020 – 18:15Mike Green of Logica Capital Advisors joins Real Vision senior editor, Ash Bennington, to share his market outlook as U.S. equities yet again reach all-time highs. Green breaks down the current market structure, looking at how changes to order book depth and inter-asset correlations present investment risks. Green and Bennington discuss commodities, passive investing, and the Fed’s latest FOMC meeting, with Green sharing his outlook on inflation and interest rates. Lastly, Bennington asks Green his views on crypto-assets and particularly Bitcoin, which continues to surge immensely. In the intro, editor Jack Farley jobless reports on today’s jobless claims, the status of U.S. fiscal stimulus, and Tesla’s looming entry into the S&P 500. The paper by Rob Arnott on Tesla, which Jack mentions, can be found here: https://www.researchaffiliates.com/en_us/publications/articles/819-tesl….Override Early AccessOn
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