Today’s News 19th May 2019

• On America's Hostile Coexistence with China

  Via ChasFreeman.net,

  Remarks to the Freeman Spogli Institute for International Studies China Program

  Ambassador Chas W. Freeman, Jr. (USFS, Ret.)
  Senior Fellow, Watson Institute for International and Public Affairs, Brown University
  Stanford, California, 3 May 2019

  President Trump’s trade war with China has quickly metastasized into every other domain of Sino-American relations.   Washington is now trying to dismantle China’s interdependence with the American economy, curb its role in global governance, counter its foreign investments, cripple its companies, block its technological advance, punish its many deviations from liberal ideology, contest its borders, map its defenses, and sustain the ability to penetrate those defenses at will.

  The message of hostility to China these efforts send is consistent and apparently comprehensive. Most Chinese believe it reflects an integrated U.S. view or strategy.  It does not.

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  There is no longer an orderly policy process in Washington to coordinate, moderate, or control policy formulation or implementation.  Instead, a populist president has effectively declared open season on China.  This permits everyone in his administration to go after China as they wish.  Every internationally engaged department and agency – the U.S. Special Trade Representative, the Departments of State, Treasury, Justice, Commerce, Defense, and Homeland Security – is doing its own thing about China.  The president has unleashed an undisciplined onslaught.  Evidently, he calculates that this will increase pressure on China to capitulate to his protectionist and mercantilist demands.  That would give him something to boast about as he seeks reelection in 2020.

  Trump’s presidency has been built on lower middle-class fears of displacement by immigrants and outsourcing of jobs to foreigners.  His campaign found a footing in the anger of ordinary Americans – especially religious Americans – at the apparent contempt for them and indifference to their welfare of the country’s managerial and political elites.  For many, the trade imbalance with China and Chinese rip-offs of U.S. technology became the explanations of choice for increasingly unfair income distribution, declining equality of opportunity, the deindustrialization of the job market, and the erosion of optimism in the United States.

  In their views of China, many Americans now appear subconsciously to have combined images of the insidious Dr. Fu Manchu, Japan’s unnerving 1980s challenge to U.S.  industrial and financial primacy, and a sense of existential threat analogous to the Sinophobia that inspired the Anti-Coolie and Chinese Exclusion Acts.

  Meanwhile, the ineptitude of the American elite revealed by the 2008 financial crisis, the regular eruptions of racial violence and gun massacres in the United States, the persistence of paralyzing political constipation in Washington, and the arrogant unilateralism of “America First” have greatly diminished the appeal of America to the Chinese elite.

  As a result, Sino-American interaction is now long on mutual indignation and very short on empirically validated information to substantiate the passions it evokes.  On each side, the other is presumed guilty of a litany of iniquities.  There is no process by which either side can achieve exoneration from the other’s accusations.  Guesstimates, conjectures, a priorireasoning from dubious assumptions, and media-generated hallucinations are reiterated so often that they are taken as facts.  The demagoguery of contemporary American populism ensures that in this country clamor about China needs no evidence at all to fuel it.  Meanwhile, Chinese nationalism answers American rhetorical kicks in the teeth by swallowing the figurative blood in its mouth and refraining from responding in kind, while sullenly plotting revenge.

  We are now entering not just a post-American but post-Western era.  In many ways the contours of the emerging world order are unclear.  But one aspect of them is certain: China will play a larger and the U.S. a lesser role than before in global and regional governance.  The Trump administration’s response to China’s increasing wealth and power does not bode well for this future.  The pattern of mutual resentment and hostility the two countries are now establishing may turn out to be indelible.  If so, the consequences for both and for world prosperity and peace could be deeply unsettling.

  For now, America’s relationship with China appears to have become a vector compounded of many contradictory forces and factors, each with its own advocates and constituencies.  The resentments of some counter the enthusiasms of others.  No one now in government seems to be assessing the overall impact on American interests or wellbeing of an uncoordinated approach to relations with the world’s greatest rising power.  And few in the United States seem to be considering the possibility that antagonism to China’s rise might end up harming the United States and its Asian security partners more than it does China.  Or that, in extreme circumstances, it could even lead to a devastating trans-Pacific nuclear exchange.

  Some of the complaints against China from the squirming mass of Sinophobes who have attached themselves to President Trump are entirely justified.  The Chinese have been slow to accept the capitalist idea that knowledge is property that can be owned on an exclusive basis.  This is, after all, contrary to a millennial Chinese tradition that regards copying as flattery, not a violation of genius.  Chinese businessfolk have engaged in the theft of intellectual property rights not just from each other but from foreigners.  Others may have done the same in the past, but they were nowhere near as big as China.  China’s mere size makes its offenses intolerable.  Neither the market economy in China nor China’s international trade and investment relationships can realize their potential until its disrespect for private property is corrected.  The United States and the European Union (EU) are right to insist that the Chinese government fix this problem.

  Many Chinese agree.  Not a few quietly welcome foreign pressure to strengthen the enforcement of patents and trademarks, of which they are now large creators, in the Chinese domestic market.  Even more hope the trade war will force their government to reinvigorate “reform and opening.”  Fairer treatment of foreign-invested Chinese companies is not just a reasonable demand but one that serves the interests of the economically dominant but politically disadvantaged private sector in China.  Chinese protectionism is an unlatched door against which the United States and others should continue to push.

  But other complaints against China range from the partially warranted to the patently bogus.  Some recall Hermann Göring’s cynical observation at Nuremberg that: “The people can always be brought to the bidding of the leaders. That is easy.  All you have to do is tell them they are being attacked and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same way in any country.”   There is a lot of this sort of manipulative reasoning at play in the deteriorating U.S. security relationship with the Chinese.  Social and niche media, which make everything plausible and leave no truth unrefuted, facilitate this.  In the Internet miasma of conspiracy theories, false narratives, fabricated reports, fictive “facts,” and outright lies, baseless hypotheses about China rapidly become firm convictions and long-discredited myths and rumors find easy resurrection.

  Consider the speed with which a snappy phrase invented by an Indian polemicist – “debt-trap diplomacy” – has become universally accepted as encapsulating an alleged Chinese policy of international politico-economic predation.  Yet the only instance of a so-called a “debt trap” ever cited is the port of Hambantota, commissioned by the since-ousted autocratic president of Sri Lanka to glorify his hometown.  His successor correctly judged that the port was a white elephant and decided to offload it on the Chinese company that had built it by demanding that the company exchange the debt to it for equity.  To recover any portion of its investment, the Chinese company now has to build some sort of economic hinterland for the port.  Hambantota is less an example of a “debt trap” than of a stranded asset.

  Then too, China is now routinely accused of iniquities that better describe the present-day United States than the People’s Middle Kingdom.  Among the most ironic of such accusations is the charge that it is China, not a sociopathic “America First” assault on the international status quo, that is undermining both U.S. global leadership and the multilateral order remarkably wise American statesmen put in place some seven decades ago.  But it is the United States, not China, that is ignoring the U.N. Charter, withdrawing from treaties and agreements, attempting to paralyze the World Trade Organization’s dispute resolution mechanisms, and substituting bilateral protectionist schemes for multilateral facilitation of international trade based on comparative advantage.

  The WTO was intended as an antidote to mercantilism, also known as “government-managed trade.”  China has come strongly to support globalization and free trade.  These are the primary sources of its rise to prosperity.  It is hardly surprising that China has become a strong defender of the trade and investment regime Americans designed and put in place.

  By contrast, the Trump administration is all about mercantilism – boosting national power by minimizing imports and maximizing exports as part of a government effort to manage trade with unilateral tariffs and quotas, while exempting the United States from the rules it insists that others obey.

  I will not go on except to note the absurdity of the thesis that “engagement” failed to transform China’s political system and should therefore be abandoned.  Those who most vociferously advance this canard are the very people who used to complain that changing China’s political order was not the objective of engagement but that it should be.  They now condemn engagement because it did not accomplish objectives that they wanted it to have but used to know that it didn’t.  It is telling that American engagement with other illiberal societies (like Egypt, the Israeli occupation in Palestine, or the Philippines under President Duterte) is not condemned for having failed to change them.

  That said, we should not slight the tremendous impact of America’s forty-year opening to China on its socioeconomic development.   American engagement with China helped it develop policies that rapidly lifted at least 500 million people out of poverty.  It transformed China from an angry, impoverished, and isolated power intent on overthrowing the capitalist world order to an active, increasingly wealthy, and very successful participant in that order.  It midwifed the birth of a modernized economy that is now the largest single driver of the world’s economic growth and that, until the trade war intervened, was America’s fastest growing overseas market.  American engagement with China helped reform its educational system to create a scientific, technological, engineering, and mathematical (“STEM”) workforce that already accounts for one-fourth of such workers in the global economy.  For a while, China was a drag on human progress.  It is now an engine accelerating it.  That transformation owes a great deal to the breadth and depth of American engagement with it.

  Nor should we underestimate the potential impact of the economic decoupling, political animosity, and military antagonism that U.S. policy is now institutionalizing.  Even if the two sides conclude the current trade war, Washington now seems determined to do everything it can to hold China down.  It seems appropriate to ask: can the United States succeed in doing this?  What are the probable costs and consequences of attempting to do it?   If America disengages from China, what influence, if any, will the United States have on its future evolution?  What is that evolution likely to look like under conditions of hostile coexistence between the two countries?

  Some likely answers, issue by issue.

  First: the consequences of cutting back Sino-American economic interdependence. 

  The supply chains now tying the two economies together were forged by market-regulated comparative advantage.  The U.S. attempt to impose government-dictated targets for Chinese purchases of agricultural commodities, semiconductors, and the like represents a political preemption of market forces.  By simultaneously walking away from the Paris climate accords, TPP, the Iran nuclear deal, and other treaties and agreements, Washington has shown that it can no longer be trusted to respect the sanctity of contracts.  The U.S. government has also demonstrated that it can ignore the economic interests of its farmers and manufacturers and impose politically motivated embargoes on them.  The basic lesson Chinese have taken from recent U.S. diplomacy is that no one should rely on either America’s word or its industrial and agricultural exports.

  For these reasons, the impending trade “deal” between China and the United States – if there is one – will be at most a truce that invites further struggle.  It will be a short-term expedient, not a long-term reinvigoration of the Sino-American trade and investment relationship to American advantage.  No future Chinese government will allow China to become substantially dependent on imports or supply chains involving a country as fickle and hostile as Trump’s America has proven to be.  China will instead develop non-American sources of foodstuffs, natural resources, and manufactures, while pursuing a greater degree of self-reliance.  More limited access to the China market for U.S. factories and farmers will depress U.S. growth rates.  By trying to reduce U.S. interdependence with China, the Trump administration has inadvertently made the United States the supplier of last resort to what is fast becoming the world’s largest consumer market.

  The consequences for American manufacturers of “losing” the China market are worsened by the issue of scale.  China’s non-service economy already dwarfs that of the United States.  Size matters.  Chinese companies, based in a domestic market of unparalleled size, have economies of scale that give them major advantages in international competition.  American companies producing goods – for example, construction equipment or digital switching gear – have just been put at a serious tariff disadvantage in the China market as China retaliates against U.S. protectionism by reciprocating it.  One side effect of the new handicaps U.S. companies now face in the China market is more effective competition from Chinese companies, not just in China but in third country markets too.

  Second: the U.S. effort to block an expanded Chinese role in global governance.

  This is no more likely to succeed than the earlier American campaign to persuade allies and trading partners to boycott the Chinese-sponsored Asian Infrastructure Investment Bank (AIIB).  That has isolated the United States, not China.  Carping at the Belt and Road initiative and related programs from outside them does nothing to shape them to American advantage.  It just deprives American companies of the profits they might gain from participating in them.

  The United States seems to be acting out of nostalgia for the simplicities of a bipolar world order, in which countries could be pressured to stand with either the United States or its then rival.  But China is not hampered by a dysfunctional ideology and economic system, as America’s Soviet adversary was.  What’s more, today’s China is an integral member of international society, not a Soviet-style outcast.  There is now, quite literally, no country willing to accept being forced to make a choice between Beijing and Washington.  Instead, all seek to extract whatever benefits they can from relations with both and with other capitals as well, if they have something to offer.  The binary choices, diplomatic group-think, and trench warfare of the Cold War have been succeeded by national identity politics and the opportunistic pursuit of political, economic, and military interests wherever they can be served.  Past allegiances do not anywhere determine current behavior.

  The sad reality is that the United States, which led the creation of the Bretton Woods institutions that have been at the core of the post-World War II rule-bound international system, now offers these institutions and their members neither funding nor reform.  Both are necessary to promote development as balances of supply, demand, wealth, and power shift.   The new organizations, like the AIIB and the New Development Bank, that China and others are creating are not predatory intrusions into the domain of American-dominated international finance.  They are necessary responses to unmet financial and economic demand.  Denouncing them does not alter that reality.

  Other countries do not see these organizations as supplanting pre-existing lending institutions long led by the United States.  The new institutions supplement the World Bank Group and regional development banks.  They operate under slightly improved versions of the lending rules pioneered by the Bretton Woods legacy establishments.   China is a major contributor to the new development banks, but it does not exercise a veto in them as the U.S. does in the IMF and World Bank.  The AIIB’s staff is multinational (and includes Americans in key positions).  The New Development Bank’s first president is Indian and its principal lending activity to date has been in South Africa.

  Washington has chosen to boycott anything and everything sponsored by China.  So far, the sad but entirely predictable result of this attempt to ostracize and reduce Chinese influence has not curbed China’s international clout but magnified it.  By absenting itself from the new institutions, the United States is making itself increasingly irrelevant to the overall governance of multilateral development finance.

  Third: the U.S. campaign to block China’s international investments, cripple its technology companies, and impede its scientific and technological advance.

  The actions of the Committee on Foreign Investment in the United States (CFIUS) to prevent Chinese investment in American industry and agriculture are well publicized and are becoming ever more frequent.  So are official American denunciations of Chinese telecommunications companies like Huawei and ZTE amidst intermittent efforts to shut them down.  In an ominous echo of World War I’s anti-German, World War II’s anti-Japanese, and the Cold War’s anti-communist xenophobia, the FBI has begun issuing loud warnings about the menace posed by the large Chinese student presence on American campuses.  Washington is adjusting visa policies to discourage such dangerous people from matriculating here.  It has also mounted a strident campaign to persuade other countries to reject Chinese investments under the “Belt and Road” initiative.

  In the aggregate, these policies represent a decision by the U.S. political elite to try to hamstring China, rather than to invest in strengthening America’s ability to compete with it.  There is no reason whatsoever to believe this approach can succeed.  China’s foreign direct investments have more than doubled over the past three years.  Third countries are openly declining to go along with U.S. opposition to intensified economic relations with China.  They want the capital, technology, and market openings that Chinese investment provides.   U.S. denunciations of their interest in doing business with China are seldom accompanied by credible offers by American companies to match what their Chinese competitors offer.  You can’t beat something with nothing.

  It’s also not clear which country is most likely to be hurt by U.S. government obstruction of collaboration between Chinese and American STEM workers.  There is a good chance the greatest damage will be to the United States.  A fair number of native-born Americans seem more interested in religious myths, magic, and superheroes than in science.  U.S. achievements in STEM owe much to immigration and to the presence of Chinese and other foreign researchers in America’s graduate schools.  The Trump administration is trying to curtail both.

  China already possesses one-fourth of the world’s STEM workforce.  It is currently graduating three times as many STEM students annually as the United States.  (Ironically, a significant percentage of STEM graduates in the United States are Chinese or other Asian nationals.  Around half of those studying computer sciences in the United States are such foreigners.)  American loss of contact with scientists in China and a reduced Chinese presence in U.S. research institutions can only retard the further advance of science in the United States.

  China is rapidly increasing its investments in education, basic science, research, and development even as the United States reduces funding for these activities, which are the foundation of technological advance.  The pace of innovation in China is visibly accelerating.  Cutting Americans off from interaction with their Chinese counterparts while other countries continue risks causing the United States to fall behind not just China but other foreign competitors.

  Finally: the U.S. military is in China’s face.

  The U.S. Navy and Air Force patrol China’s coasts and test its defenses on a daily basis.  U.S. strategy in the event of war with China – for example, over Taiwan – depends on overcoming those defenses so as to be able to strike deep into the Chinese homeland.  The United States has just withdrawn from the treaty on intermediate nuclear forces in part to be able to deploy nuclear weapons to the Chinese periphery.  In the short term, there is increasing danger of a war by accident, triggered by a mishap in the South China Sea, the Senkaku Archipelago, or by efforts by Taiwanese politicians to push the envelope of mainland tolerance of their island’s unsettled political status quo.  These threats are driving growth in China’s defense budget and its development of capabilities to deny the United States continued military primacy in its adjacent seas.

  In the long term, U.S. efforts to dominate China’s periphery invite a Chinese military response on America’s periphery like that formerly mounted by the Soviet Union.  Moscow actively patrolled both U.S. coasts, stationed missile-launching submarines just off them, supported anti-American regimes in the Western Hemisphere, and relied on its ability to devastate the American homeland with nuclear weapons to deter war with the United States.  On what basis does Washington imagine that Beijing cannot and will not eventually reciprocate the threat the U.S. forces surrounding China appear to pose to it?

  Throughout the forty-two years of the Cold War, Americans maintained substantive military-to-military dialogue with their Soviet enemies.  Both sides explicitly recognized the need for strategic balance and developed mechanisms for crisis management that could limit the risk of a war and a nuclear exchange between them.  But no such dialogue, understandings, or mechanisms to control escalation now exist between the U.S. armed forces and the PLA.  In their absence Americans attribute to the PLA all sorts of intentions and plans that are based on mirror-imaging rather than evidence.

  The possibility that mutual misunderstanding will intensify military confrontation and increase the dangers it presents is growing.  The chances of this are all the greater because the internal security and counterintelligence apparatuses in China and the United States appear to be engaged in a contest to see which can most thoroughly alienate the citizens of the other country.  China is a police state.  For Chinese in America, the United States sometimes seems to be on the way to becoming one.

  It’s hard to avoid the conclusion that, if Washington stays on its current course, the United States will gain little, while ceding substantial ground to China and significantly increasing risks to its wellbeing, global leadership, and security.

  Economically, China will become less welcoming to American exports.  It will pursue import substitution or alternative sourcing for goods and services it has previously sourced in the United States.  With impaired access to the world’s largest middle class and consumer economy, the United States will be pushed down the value chain.  China’s ties to other major economies will grow faster than those with America, adversely affecting U.S. growth rates.  Any reductions in the U.S. trade deficit with China will be offset by increases in trade deficits with the countries to which current production in China is relocated.

  China’s role in global governance will expand as it adds new institutions and funds to the existing array of international organizations and takes a larger part in their management.  The Belt and Road initiative will expand China’s economic reach to every corner of the Eurasian landmass and adjacent areas.  The U.S. role in global rule-making and implementation will continue to recede.  China will gradually displace the United States in setting global standards for trade, investment, transport, and the regulation of new technologies.

  Chinese technological innovation will accelerate, but it will no longer advance in collaboration with American researchers and institutions.  Instead it will do so indigenously and in cooperation with scientists outside the United States.  U.S. universities will no longer attract the most brilliant students and researchers from China.  The benefits of new technologies developed without American inputs may be withheld rather than shared with America, even as the leads the United States has long enjoyed in science and technology one-by-one erode and are eclipsed.  As cordiality and connections between China and the United States wither, reasons for Chinese to respect the intellectual property of Americans will diminish rather than increase.

  Given the forward deployment of U.S. forces, the Chinese military has the great advantage of a defensive posture and short lines of communication.  The PLA is currently focused on countering U.S. power projection in the last tenth or so of the 6,000-mile span of the Pacific Ocean.  In time, however, it is likely to seek to match American pressure on its borders with its own direct military pressure on the United States along the lines of what the Soviet armed forces once did.

  The adversarial relationship that now exists between the U.S. armed forces and the PLA already fuels an arms race between them.  This will likely expand and accelerate.  The PLA is rapidly shrinking the gap between its capabilities and those of the U.S. armed forces.  It is developing a nuclear triad to match that of the United States.  The good news is that mutual deterrence seems possible.  The bad news is that politicians in Taiwan and their fellow travelers in Washington are determinedly testing the policy frameworks and understandings that have, over the past forty years, tempered military confrontation in the Taiwan Strait with dialogue and rapprochement.  Some in Taiwan seem to believe that they can count on the United States to intervene if they get themselves in trouble with Chinese across the Strait.  The Chinese civil war, suspended but not ended by U.S. unilateral intervention in 1950, seems closer to a resumption than it has been for decades.

  As a final note on politico-military aspects of Sino-American relations, in the United States, security clearances are now routinely withheld from anyone who has spent time in China.  This guarantees that few intelligence analysts have the Fingerspitzengefühl – the feeling derived from direct experience – necessary to really understand China or the Chinese.  Not to worry.  The administration disbelieves the intelligence community.  Policy is now made on the basis of ignorance overlaid with media-manufactured fantasies.  In these circumstances, some enterprising Americans have taken to combing the dragon dung for nuggets of undigested Chinese malevolence, so they can preen before those in power now eager for such stuff.  There is a Chinese expression that nicely describes such pretense: 屎壳螂戴花儿—又臭又美 – “a dung beetle with flowers in its hair still stinks.”

  All said, this does not add up to a fruitful approach to dealing with the multiple challenges that arise from China’s growing wealth and power.  So, what is to be done?  该怎么办？

  Here are a few suggestions.

  First, accept the reality that China is both too big and too embedded in the international system to be dealt with bilaterally.  The international system needs to adjust to and accommodate the seismic shifts in the regional and global balances of wealth and power that China’s rise is causing.  To have any hope of success at adapting to the changes now underway, the United States needs to be backed by a coalition of the reasonable and farsighted.  This can’t happen if the United States continues to act in contempt of alliances and partnerships.  Washington needs to rediscover statecraft based on diplomacy and comity.

  Second, forget government-managed trade and other forms of mercantilism.  No one can hope to beat China at such a statist game.  The world shouldn’t try. Nor should it empower the Chinese government to manage trade at the expense of market forces or China’s private sector.  Governments can and – in my opinion – should set economic policy objectives, but everyone is better off when markets, not politicians, allocate capital and labor to achieve these.

  Third, instead of pretending that China can be excluded from significant roles in regional and global governance, yield gracefully to its inclusion in both.  Instead of attempting to ostracize China, leverage its wealth and power in support of the rule-bound order in which it rose to prosperity, including the WTO.

  Fourth, accept that the United States has as much or more to gain than to lose by remaining open to science, technology, and educational exchanges with China.  Be vigilant but moderate.  Err on the side of openness and transnational collaboration in progress.  Work on China to convince it that the costs of technology theft are ultimately too high for it to be worthwhile.

  Fifth and finally, back away from provocative military actions on the China coast.  Trade frequent “freedom of navigation operations” to protest Chinese interpretations of the U.N. Convention on the Law of the Sea for dialogue aimed at reaching common understandings of relevant interests and principles.  Ratify the Convention on the Law of the Sea and make use of its dispute resolution mechanisms.  As much as possible, call off military confrontation and look for activities, like the protection of commercial shipping, that are common interests.  Seek common ground without prejudice to persisting differences.

  In conclusion: both China and the United States need a peaceful international environment to be able to address long-neglected domestic problems.  Doing more of what we’re now doing threatens to preclude either of us from sustaining the levels of peace, prosperity, and domestic tranquility that a more cooperative relationship would afford.  Hostile coexistence between two such great nations injures both and benefits neither.  It carries unacceptable risks.  Americans and Chinese need to turn from the path we are now on.  We can – we must – find a route forward that is better for both of us.

  Thank you.

  

• Visualizing The 150 Apps That Power The Gig Economy

  Go back in time a decade, and you’d have a tough time convincing anyone that they would be “employed” through an app on their phone.

  And yet, as Visual Capitalist’s Jeff Desjardins explains, in a short period of time, the emergence of the smartphone has enabled the gig economy to flourish into a multi-trillion dollar global market. And by leveraging apps like Uber, Airbnb, and Etsy, it’s estimated that 57 million people in the U.S. now participate in the gig economy each year in some shape or form.

  What apps do these people use to turn their time, skills, hobbies, or assets (cars, home, parking spaces, etc.) into additional income streams?

  App Examples

  Today’s infographic comes to us from TitleMax, and it lists 150 different apps that are used within the gig economy – including many that pay gig workers directly.

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  Here are just some of the apps that are used in some of the major categories above:

  Ridesharing
  Uber and Lyft are what many think of when they hear about the gig economy. However, there are now dozens of rideshare apps out there to fill different niches – for example, Wingz offers flat-fee rides to the airport, while Curb connects riders with professional taxi drivers.

  Errands
  TaskRabbit, which was bought by IKEA, turns errands such as assembling furniture or cleaning a gutter into payable gigs. Meanwhile, apps like Dolly and Bellhops will connect you with movers, and LawnLove is for lawn care.

  Art, Design, and Crafting
  Etsy, a marketplace for handmade goods, is one the of the best known brands in this category. However, there are many other niche options here as well – for example, UncommonGoods specializes in unique gifts, while Society6 focuses on gallery quality art prints.

  Writing and Editing
  Lulu and Kindle Direct allow you to publish eBooks online and sell them, while proofreaders and editors can get paid for their copy editing services through Gramlee.

  Delivery
  Fast and efficient delivery services are a centerpiece to the gig economy, and there are no shortage of options here. DoorDash, UberEats, Caviar, and GrubHub allow users to get food delivered to their doors, while apps like Instacart focus on grocery delivery.

  Multimedia
  We all know that you can create videos and monetize them on places like YouTube or Twitch, but did you know you can be a voice actor through services like VoiceBunny? You can also sell rights to your photos via Foap, or do freelancing work through Upwork or Fiverr.

  Whether you are tapping into the gig economy for an extra income stream or you are incorporating gig economy services into your life for added convenience, there is no shortage of options to choose from.

  

• Exposing The Regulatory-Industrial Complex

  Authored by Llewellyn Rockwell via The Mises Institute,

  Socialists want socialism for everyone else, but capitalism for themselves, while capitalists want capitalism for everyone else, but socialism for themselves.

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  Neither Ted Kennedy nor Jane Fonda practices a vow of poverty, nor are they taking any homeless into their mansions, while too many big companies try to short-circuit the market with government privileges. And one way they do it is through the regulatory agencies that acne Washington, DC.

  If I may make a public confession (counting on the charity of Mises Daily readers): I used to work for the US Congress. I’ve since gone straight, of course, but the experience had its value, much as the future criminologist might benefit from serving with the James Gang.

  For one thing, being on Capitol Hill showed me that, unlike the republic of the Founding Fathers’ vision, our DC Leviathan exists only to extract money and power from the people for itself and the special interests.

  Ludwig von Mises called this an inevitable “caste conflict.” There can be no natural class conflict in society, Mises showed, since the free market harmonizes all economic interests, but in a system of government-granted privileges, there must be a struggle between those who live off the government and the rest of us. It is a disguised struggle, of course, since truth threatens the loot.

  When I worked on Capitol Hill, Jimmy Carter was bleating about the energy crisis and promising to punish big oil with a “windfall profits tax.” But I saw that the lobbyists pushing for the tax were from the big oil companies.

  And, after a moment’s thought, it was easy to realize why. There was no windfall-profits tax in Saudi Arabia, but it did fall heavily on Oklahoma. And as intended, the tax aided the big companies that imported oil by punishing their competitors, smaller, independent firms.

  In the ensuing restructuring of the industry, also brought about by the price and allocation regulations of the Department of Energy, the big firms bought up domestic capacity at fire-sale prices, and then the Reagan administration repealed the tax and the regulations. Meanwhile, the big companies received contracts from the Department of Energy to produce money-losing “alternative fuels.”

  In every administration, the tools of inflation, borrowing, taxation, and regulation are used to transfer wealth from the people to the government and its cronies.

  At times, one or another of these tools becomes politically dangerous, so the government alters the mix. That’s why the Reagan administration switched from taxes and inflation to borrowing, and it’s why the Bush administration, with the deficit a liability, calls for more taxes, inflation, and regulation.

  A tremendous amount is at stake in the re-regulation of the economy advocated by the Bush administration. Just one clause in the Federal Register can mean billions for a favored firm or industry, and disaster for its competitors, which is why lobbyists cluster around the Capitol like flies around a garbage can.

  While claiming to need more money for — among other vital projects — a trip to Mars supervised by Dan Quayle, the president is boosting the budget of every regulatory agency in Washington.

  Here are just some of those agencies, and the way they function: Founded by Richard Nixon, the Occupational Safety and Health Administration is an antientrepreneur agency. Not only does OSHA target small- and medium-sized businesses, its regulatory cases are easily handled by Exxon’s squad of lawyers, while they can bankrupt a small firm.

  Also founded by Nixon, the Consumer Product Safety Commission issues regulations drawn up in open consultation with big business — regulations that often conform exactly to what those firms are already doing. Small businesses, on the other hand, must spend heavily to comply.

  Another Nixon creation is the Environmental Protection Agency, whose budget is larded with the influence of politically connected businesses, and whose regulations buttress established industries and discriminate against entrepreneurs — by, for example, legalizing pollution for existing companies but making new firms spend heavily.

  The Department of Housing and Urban Development was founded by Lyndon B. Johnson, but its roots stretch back to the housing policy of the New Deal, whose explicit purpose was to subsidize builders of rental and single-family housing. Since LBJ’s Great Society, HUD has subsidized builders of public-housing projects, and of subsidized private housing. How can anyone be surprised that fat cats use HUD to line their pockets? That was its purpose.

  The Securities and Exchange Commission was established by Franklin D. Roosevelt, with its legislation written by corporate lawyers to cartelize the market for big Wall Street firms. Over the years, the SEC has stopped many new stock issues by smaller companies, who might grow and compete with the industrial and commercial giants aligned with the big Wall Street firms. And right now, it is lessening competition in the futures and commodities markets.

  The Interstate Commerce Commission was created in 1887 to stop “cut-throat” competition among railroads (i.e., competitive pricing) and to enforce high prices. Later amendments extended its power to trucking and other forms of transportation, where it also prevented competition. During the Carter administration, much of the ICC’s power was trimmed, but some of this was undone in the Reagan administration.

  The Federal Communications Commission was established by Herbert Hoover to prevent private property in radio frequencies, and to place ownership in the hands of the government. The FCC set up the network system, whose licenses went to politically connected businessmen, and delayed technological breakthroughs that might have threatened the networks. There was some deregulation during the Reagan administration — although it was the development of cable TV that did the most good, by circumventing the networks.

  The Department of Agriculture runs America’s farming on behalf of producers, keeping prices high, profits up, imports out, and new products off the shelves. We can’t know what food prices would be in the absence of the appropriately initialed DOA, only that food would be much cheaper. Now, for the first time since the farm program was established by Herbert Hoover, as a copy of the Federal Food Administration he ran during World War I, we are seeing widespread criticism of farm welfare.

  The Federal Trade Commission — as shown by the fascist-deco statue in front of its headquarters — claims to “tame” the “wild horse of the market” on behalf of the public. Since its founding in 1914, however, it has restrained the market to the benefit of established firms. That’s why the chief lobbyists for the FTC were all from big business.

  When then-Congressman Steve Symms (R-ID) tried to partially deregulate the Food and Drug Administration in the 1970s to allow more new drugs, he was stopped by the big drug companies and their trade association. Why? Because the FDA exists to protect them.

  OSHA, CPSC, EPA, HUD, SEC, ICC, FCC, DOA, FTC, FDA – I could go on and on, through the entire alphabet from Hell. I have only scratched the villainous surface. But according to the average history or economics text, these agencies emerged in response to public demand. There is never a hint of the regulatory-industrial complex. We’re told that the public is being served. And it is: on a platter.

  *  *  *

  This article was originally printed in the Free Market, September 1990. It is reprinted in The Left, the Right, and the State (2008).

  

• America's Top Cities Swamped In Debt, Chicago Leads The Way 

  Taxpayers in America’s ten biggest cities face an average per taxpayer burden of $50,000 in debt incurred by the county, state and or “off-balance-sheet” transactions by city government entities, according to Truth in Accounting (TIA).

  The taxpayer burden, TIA explains, is the amount residents would have to pay to cover all of a government’s debt. “When the unfunded debt of these underlying government units is combined with the county, municipal, and state debt, city taxpayers are on the hook for much more than they think,” according to TIA.

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  The cities are ranked from top to bottom, on net position, explained Bill Bergman, director of research for TIA. “And it’s on that basis that Chicago ranks dead last,” he said.

  Chicago taxpayer burden equates to $119,110 in debt per taxpayer, a number that includes debt from Chicago Public Schools (CPS) and the state of Illinois. Bergmans said the most significant burdens on taxpayers is from CPS. He added, CPS has separate financial ledgers.

  “As bad as the picture is for the city, you add a significantly higher debt load once you include the Chicago Public Schools,” he said.

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  The massive debt load could affect Chicago’s S&P Global Ratings, was warned several years ago that its rating could sink into junk unless it passes a budget that addresses the fiscal situation.

  “Taxpayers are on the hook for the debts accrued by these underlying government entities, but you would not know it just by looking at the reported data for the city,” the report states.

  Following Chicago, New York City’s combined Taxpayer Burden: $85,600; Los Angeles’ combined Taxpayer Burden: $56,390; Philadelphia’s combined Taxpayer Burden: $50,120.

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  “The debt facing school districts in Dallas, Houston and San Antonio don’t add nearly as much to the total debt burden facing taxpayers in those cities as most others of the largest 10 cities we studied,” Bergman added. “Still, one might have expected better overall financial conditions for those Texas cities in light of economic and demographic trends in the last decade.”

  For these cities to pay off its debt, each taxpayer would need to fork over around $50,000 each. Zerohedge readers understand, 60% of millennials don’t have $500 in savings ahead of the next recession. So obviously this deadbeat generation that is expected to take over the workforce by 2024 won’t have the ability to bail out America’s deadbeat cities in the next downturn.

  Which leaves us with the question of the day: Will the Federal Reserve bailout heavily indebted cities in the next crisis?

  

• Prescription For Violence: The Corresponding Rise Of Antidepressants, SSRIs & Mass Shootings

  Via Ammo.com,

  According to the Federal Bureau of Investigation (FBI), a mass murder occurs when at least four people are murdered, not including the shooter, over a relatively short period of time during a single incident. Over the last 30 years, the United States has seen a significant increase in mass shootings, which are becoming more frequent and more deadly.

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  Seemingly every time a mass shooting occurs, whether it’s at a synagogue in Pittsburgh or a nightclub in Orlando, the anti-gun media and politicians have a knee-jerk response – they blame the tragedy solely on the tool used, namely firearms, and focus all of their proposed “solutions” on more laws, ignoring that the murderer already broke numerous laws when they committed their atrocity.

  Facts matter when addressing such an emotionally charged topic, and more gun controllegislation has shown that law-abiding Americans who own guns are not the problem. Consider the following: The more gun control laws that are passed, the more mass murders have occurred.

  Whether or not this is correlation or causation is debatable. What is not debatable is that this sick phenomenon of mass murderers targeting “gun-free zones,” where they know civilian carry isn’t available to law-abiding Americans, is happening. According to the Crime Prevention Research Center, 97.8 percent of public shootings occur in “gun-free zones” – and “gun-free zones” are the epitome of the core philosophical tenant of gun control, that laws are all the defense one needs against violence.

  Therefore, when the media and politicians focus their ire on guns, specifically what types of guns are used, such as AR-styles, carbines, semi-automatics, and “high capacity” handguns, in the wake of such tragedies the American public are being intentionally drawn into an emotionally charged debate about legal gun ownership (irrespective of whether the murderer’s gun was legally or illegally obtained). This debate leads them away from the elephant in the room and one of the real issues behind mass shootings – mental health and prescription drugs.

  Ignoring what’s going on in the heads of these psychopaths not only allows mass shootings to continue, it leads to misguided gun control laws that violate the Second Amendment and negate the rights of law-abiding U.S. citizens. As Jeff Snyder put it in The Washington Times:

  “But to ban guns because criminals use them is to tell the innocent and law-abiding that their rights and liberties depend not on their own conduct, but on the conduct of the guilty and the lawless, and that the law will permit them to have only such rights and liberties as the lawless will allow.”

  Violence, especially random violence, is a complex manifestation of various thoughts, feelings, and external factors. When a multivariate analysis of these factors is conducted, it becomes apparent that it’s not just mental health issues that are leading to such an increase. There may be an underlying substance which plays a role in a high percentage of these violent acts – the use of prescription antidepressants, specifically selective serotonin reuptake inhibitors, or SSRIs.

  At first glance, it makes sense that those involved in mass shootings may be taking antidepressants, as they’re clearly suffering from some sort of mental health issue. But the issue with SSRIs runs much deeper than just a random mental health break. These drugs are a prescription for violent crimes, and that’s a story the anti-gun media and politicians don’t want to talk about.

  History of Antidepressant Use in the U.S.

  To understand the rise in antidepressant use, one must first understand depression. Everyone, no matter how great their life, has periods of sadness, times when they feel down or low. This is especially true when faced with hardships or going through things like a divorce, the loss of a job, or the death of a parent.

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  This is not clinical depression. Clinical depression is a serious mental disorder that impacts how a person functions on a daily basis. Depression makes it hard to get out of bed. It makes it hard to go to work. It makes it hard to take a shower or answer the phone. It stops a person from functioning on the basic levels.

  Understanding Depression

  According to the Diagnostic and Statistical Manual of Mental Disorders, commonly referred to as the DSM-5, to be considered clinically depressed, a patient must experience five of the following symptoms most of the day, every day, for at least two weeks. What’s more, these symptoms must be so severe, they interfere with normal functioning:

  • Sadness
  • Anxiety
  • Feeling hopeless
  • Feeling worthless
  • Feeling helpless
  • Feeling “empty”
  • Feeling guilty
  • Irritable
  • Fatigue
  • Lack of energy
  • Loss of interest in hobbies
  • Slow talking and moving
  • Restlessness
  • Trouble concentrating
  • Abnormal sleep patterns, whether sleeping too much or not enough
  • Abnormal weight changes, either eating too much or having no appetite
  • Thoughts of death or suicide

  Depression is a serious, and sometimes life-threatening, illness. But in the modern world, it’s highly over-diagnosed. A study published in Psychotherapy and Psychosomatics looked at 5,639 patients in the U.S. who were diagnosed with depression by their clinician and compared their symptoms to the DSM criteria for clinical depression. Of these patients, only 38.4 percent met the criteria, even though the majority of the 5,639 patients were prescribed depression medication.

  Today, with the way antidepressants are prescribed, nearly one in four Americans will meet the criteria to be diagnosed with depression within their lifetime, and will be prescribed medications that interfere with how their brain functions.

  The Rise of Antidepressants

  In the 1950s, the first generation of antidepressants hit the market. The introductory class of antidepressants to gain Food and Drug Administration (FDA) approval were monoamine oxidase inhibitors, known as MAOIs. Although highly effective, MAOIs can cause extremely high blood pressure when paired with certain foods or medications, and therefore require diet restrictions. Because of these restrictions, they’re rarely used today to treat depression except in cases where other treatments fail.

  By the late 1950s, a new class of antidepressants became available – tricyclic antidepressants. Tricyclic antidepressants are also highly effective for treating depression, but are prone to side effects. Even so, this class of antidepressants remained the go-to depression treatment for years. Other drugs were tested for depression treatment, but they hadn’t proved more effective than tricyclic and MAOI antidepressants, especially for severe depression.

  Fast forward to the 1980s. America’s tranquilizer dependence was becoming problematic. Quaaludes were heavily over-prescribed for anxiety, resulting in overdose deaths, as well as an increase in deaths from vehicle accidents. The Feds stepped in and in 1984, classified Quaaludes as a Schedule 1 drug, making them illegal to sell, buy, and use.

  Valium, a benzodiazepine prescribed for anxiety, was also extremely popular, and was the most prescribed medication in the U.S. from 1969 through 1982. In 1978, the year the medication peaked, more than 2.3 billion pills were sold in the U.S. But Valium was highly addictive and it was believed that a serotonergic medication was a better option to fill the void that was left when Quaaludes were outlawed.

  In 1987, Prozac, the first SSRI, was released for depression. Along with it came the idea that depression could be the underlying cause of anxiety. The idea took off, as did the sales of Prozac, and within a few years, it overtook the antidepressant market. Soon, other SSRIs followed.

  Along with these SSRIs came direct-to-consumer advertising, which became legal in 1985. By the mid-1990s, the FDA regulations became looser and direct-to-consumer ads exploded into the market. Prozac and other medications showed Americans through glossy advertisements that unhappiness, stress, and anxiety could be treated with a pill.

  Instead of doctors recommending a specific medication, patients started coming in, requesting a medication they saw in a magazine or on television.

  SSRI sales skyrocketed.

  By 2010, 11 percent of Americans over the age of 12 were prescribed an antidepressant, making it the third most prescribed medication, topped only by nonsteroidal anti-inflammatory drugs (NSAIDs) like ibuprofen and naproxen. When looked at over time, there has been a 400-percent increase in antidepressant use from 1988 through 2008.

  SSRIs 101: What You Should Know

  Selective serotonin reuptake inhibitors, a class of drugs commonly referred to as SSRIs, are the most prescribed antidepressant in the United States. These second-generation antidepressants are marketed to doctors and patients as safe and effective, with relatively minimal side effects. SSRIs are designated to treat mild to moderate depression, as well as anxiety, obsessive compulsive disorder, and bulimia nervosa.

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  How do SSRIs work?

  SSRIs work to increase the amount of serotonin in the brain. A neurotransmitter that helps neurons communicate, serotonin is associated with many different body functions, but is best known for its influence on mood. Sometimes called “the happy chemical,” serotonin plays a role in a person’s happiness and general feelings of wellbeing.

  Low levels of serotonin are linked to depression, although the relationship is not clear. Research has not determined if the low neurotransmitter level causes depression or if depression causes the level of serotonin to drop. It should also be noted that a large amount of serotonin, up to 90 percent, is produced in the gut and may be influenced by what a person eats and drinks.

  SSRI medication does exactly what its name says. When two neurons communicate, one releases neurotransmitters, which causes the other neuron to react in a certain way. Because this is constantly going on, these chemicals are always present in the brain. To keep the brain’s chemical balance correct, neurons regulate the amount of neurotransmitters released by a process called reuptake, which involves the reabsorption of the chemical by a neuron.

  For instance, if there’s a high level of serotonin, the neuron knows to release less through reuptake, keeping the level balanced. If levels of the neurotransmitter are low, reuptake tells the neurons to release more.

  SSRIs inhibit the reuptake of serotonin, causing neurons to release more of the neurotransmitter, therefore increasing the amount of the chemical found in the brain.

  The Food and Drug Administration (FDA) has approved a variety of SSRIs, including:

  • Citalopram (Celexa)
  • Escitalopram (Lexapro)
  • Fluoxetine (Prozac)
  • Paroxetine (Paxil and Pexeva)
  • Sertraline (Zoloft)
  • Vilazodone (Viibryd)

  When it comes to effectiveness, SSRIs don’t appear to have an influence on those with moderate to severe depression, with virtually no improvementseen when comparing SSRI use to placebos. Instead of a popular drug with a high efficiency, modern SSRIs have become popular based on an effective marketing campaign and little more.

  Too Much of a Good Thing: Serotonin Syndrome

  Sometimes serotonin levels become too high, causing Serotonin Syndrome. A potentially life-threatening disease, it occurs when serotonin levels in the brain increase to a toxic level, often caused by too much medication or taking two serotonin-increasing medications that use different mechanisms to increase the neurotransmitter.

  Along with physical symptoms of excessive nerve activity, such as dilated pupils, elevated heart rate, and high blood pressure, those with the syndrome may also experience:

  • Agitation
  • Restlessness
  • Confusion
  • Anxiety
  • Disorientation
  • Excitement

  The Connection Between SSRIs and Violence

  Regardless if depression is overdiagnosed and America has a habit of over-prescribing mind-altering medications, there’s little doubt that SSRIs have a risk of increasing violence in patients, even in patients who have no previous history of violence or aggression before taking the medication.

  This risk of violent behavior, both to the individual taking the medication and those around them, is so significant, it has led to the FDA mandating a black box warning on all SSRI medications. These black box warnings are designed to provide information and draw attention to the fact that the medication has serious and life-threatening risks.

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  As of 2004, all antidepressants in the U.S. are labeled:

  “Anxiety, agitation, panic attacks, insomnia, irritability, hostility, aggressiveness, impulsivity, akathisia, hypomania, and mania have been reported in adult and pediatric patients being treated with antidepressants for major depressive disorder as well as for indications, both psychiatric and nonpsychiatric.”

  SSRIs Can Increase the Risk of Suicide

  In one study published in the American Journal of Psychiatry, patients suffering from depression, but free of serious suicidal ideation, were given fluoxetine. Within two to seven weeks of starting the medication, six patients developed an intense, preoccupation with violent suicide. Although all were immediately taken off the medication, this preoccupation persisted from three days to three months, depending on the case. In all six cases, the patient had never experienced such a severe level of depression or troubled state of mind before or with other psychotropic prescriptions.

  According to the Centers for Disease Control and Prevention Surveillance for Violent Deaths, in 2013, 35.3 percent of those who committed suicide tested positive for antidepressants at the time of their death.

  The risk of SSRIs and suicide is most prevalent in patients under the age of 25. It’s also more likely to occur shortly after starting the medication, after a dosage increase, or after a patient stops taking the medication.

  SSRIs Can Increase the Risk of Violence Against Others

  Some of the side effects caused by SSRIs can increase the risk of violence against others. Perhaps the most risky, emotional blunting (or detachment) has been linked to SSRI use and many people who’ve taken the drugs report “not feeling” or “not caring” about anything. There’s also been an established causal relationship between SSRI use and psychosis and hallucinations, both of which are known to increase the risk of violence in individuals.

  According to a review of the FDA’s database, 484 drugs were identified as triggers to serious adverse events significant enough to warrant a case study during the five-year period from 2004 through 2009. Of these 484 medications, 31 were identified to have a “disproportionate” association with violence. These 31 drugs make up 78.8 percent of all cases of violence toward others in the FDA’s database and included multiple psychotropic medications:

  • 11 antidepressants
  • 6 hypnotic/sedatives
  • 3 ADHD medications
  • 1 smoking cessation drug

  Researchers concluded that violence against others was a “genuine and serious adverse drug event” and that of the 484 medications, the drugs that were most consistently and strongly associated with violence were the smoking cessation medication, varenicline (Chantix), and SSRIs.

  The list includes five SSRI antidepressants:

  • Fluoxetine: Prozac increased aggressive behavior 10.9 times
  • Paroxetine: Paxil increased violent behavior 10.3 times
  • Fluvoxamine: Luvox increased violent behavior 8.4 times
  • Venlafaxine: Effexor increased violent behavior 8.3 times
  • Desvenlafaxine: Pristiq increased violent behavior 7.9 times

  While a surprise to the American public, this shouldn’t have been a surprise to the drug companies. During the clinical trials for paroxetine, hostility, which was the term to include homicidal idealization and aggression, presented in 60 of the 9,219 participants (.65 percent). Hostile acts were documented both while taking the medication and after tapering off. Children with obsessive-compulsive disorder (OCD) taking the medication were the most at risk for becoming hostile, with a 17-times higher probability than the rest of those in the clinical study.

  In a Swedish study published in PLoS, researchers looked at information on over 850,000 patients prescribed SSRIs in the Swedish Prescribed Drug Register, which is a national database of all dispensed medications. They then compared the violent crimes committed during a three-year period and compared it to violent crimes committed by the same individuals when not taking the medications. When age was taken into effect, a significant association was apparent between violent crime convictions and SSRI use in patients between the ages of 15 and 24.

  In one 2001 case, Cory Baadsgaard, a 16-year-old who attended Wahluke High School in Washington, was first prescribed Paxil, which caused hallucinations, and then was switched to Effexor. He started at a 40 mg dosage that, over the course of three weeks, increased to 300 mg. On the first day of that high dose, he woke with a headache and returned to bed. He then got up, took a rifle to his high school, and held 23 classmates hostage.

  Baadsgaard’s testimony claims he has no recollection of the event, or of his principal convincing him to put the gun down and release the hostages.

  In 2002, the BBC aired the documentary Panorama, which focused on paroxetine. The producers received 1,374 emails from viewers, the majority of whom told stories of violence or self-harm while taking the medication, particularly when starting and when increasing the dosage.

  What’s more, in 2009, after investigating the connection between SSRIs and violence, the Japanese Ministry of Health, Labor, and Welfare revised the label warnings on these drugs to read: “There are cases where we cannot rule out a causal relationship [of hostility, anxiety, and sudden acts of violence] with the medication.”

  Connection Between SSRI and Murder

  In most cases, the vast majority of people who suffer from mental illness are nonviolent. Even those who self-harm are highly unlikely to hurt others. In fact, these individuals are more likely to become victims of violent crimes than the general public.

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  Yet after each mass shooting tragedy, the media fills with psychiatrists who say that the individual didn’t seek the help they needed and that with the proper treatment, the tragedy may have been prevented. But research doesn’t support that philosophy.

  In fact, depression in particular doesn’t lead to violence, yet since the increase in SSRI antidepressants being widely prescribed, the rise in mass shootings has increased right along with it. And evidence shows that many mass shooters were either taking or had recently taken SSRIs.

  Here are just some examples:

  • 1989: Joseph T. Wesbecker walked into his former employer Standard Gravure Corp and shot 20 workers, killing nine. He had been taking Prozac for a month. This shooting led to a landmark case, where the survivors sued the makers of Prozac, Eli Lilly. Wesbecker used a semiautomatic Chinese AK-47-style firearm, a 9mm pistol, and a .38 Special snubnose revolver – all of which he purchased legally, passing his background check.

  • 1995: Jarred Viktor was 15 when he was prescribed Paxil. Ten days after starting it, Viktor stabbed his grandmother 61 times.

  • 1996: At 18, Kurt Danysh murdered his father just 17 days after being prescribed Prozac by his family doctor, who failed to do even one psychological test. During his police confession, Danysh told police the medication made him feel odd, “I just act differently. I don’t have the energy or personality I used to. I spend half the time in a trance.”

  • 1997: Luke Woodham stabbed his mother, then traveled to Pearl High School, where he was enrolled, using a .30-30 to shoot two students and wound six others; he was stopped by his assistant principal (aka a good guy with a gun) who used his own .45 ACP handgun to force Woodham’s surrender.

  • 1998: 15-year-old Kip Kinkel shot both of his parents, then carried a 9mm handgun, .22 rifle, and a .22 pistol to his Thurston High School, where he murdered two classmates and injured 22 more, all while taking Prozac.

  • 1999: Eric Harris, 17, with Dylan Klebold, killed 12 students, one teacher, himself, and wounded 23 others during the Columbine school shooting; he had been prescribed Zoloft and then Luvox before he used a 12 gauge shotgun received through a straw purchaser and a 9mm TEC-DC9.

  • 2001: Christopher Pittman, a 12-year-old, was prescribed Zoloft, which caused him to become agitated, jittery, and experience tactile hallucinations; Pittman told psychiatrist Dr. Lanette Atkins that he heard voices telling him, “Kill, kill, do it, do it.” He took a .410 shotgun and shot his grandparents, then burned their house down.

  • 2001: Andrea Yates drowned all five of her children. She was taking Effexor and was suffering from delusions about satanic possession. The murder of her children led Effexor to list homicidal thoughts in the medication’s side effects. Although it’s a rare side effect, manifesting in one in 1,000 patients, over 19 million prescriptions were written and filled in 2005. That’s an estimated 19,000 people suffering from homicidal thoughts because of the medication.

  • 2005: 16-year-old Jeff Weise was taking 60 mg/day of Prozac, the highest dosage for adults, when he shot his grandfather, his grandfather’s girlfriend, murdered 10 students at Red Lake, Minnesota, and wounded 12 more, before shooting himself. He was armed with a .40 caliberpistol, .22 pistol, and a 12 gauge shotgun.

  • 2008: Steven Kazmierczak was prescribed Prozac, Xanax, and Ambien, a sleeping medication, three weeks before walking into Northern Illinois University, killing six people and wounding 21, with three pistols (one chambered in 9mm and two in .380 ACP) and a shotgun. Kazmierczak had stopped taking the antidepressant “because it made him feel like a zombie.”

  • 2009: Two weeks after starting Lexapro, Robert Stewart walked into his estranged wife’s work at Pinelake Health and Rehab, and opened fire. He killed eight elderly patients and wounded three others. He doesn’t remember the incident.

  • 2012: James Holmes, also known as the Batman Movie killer, was taking sertraline when he walked into the showing of The Dark Knight with two .40 caliber pistols, an AR-style .223 rifle, and a 12 gauge shotgun, killing 12 people and injuring 70 others. In his personal notebook, which he sent to his psychiatrist the same day as the shooting, shows that as the medication decreased his anxiety, he lost his fear of consequences. As the dosage became higher, his thoughts became more obsessive and psychotic.

  • 2013: At the time of the Washington Navy Yard shooting, Aaron Alexis was a civilian contractor working at the yard and was prescribed trazodone, a serotonin antagonist and reuptake inhibitor (SARI) that works much like an SSRI to increase serotonin levels in the brain. He killed 12 people and injured eight others.

  • 2014: Ivan Lopez was a 34-year-old U.S. soldier who shot 15 of his comrades, killing three of them, at his base in Fort Hood, Texas. He was undergoing mental health treatment through the Veterans’ Administration, which is known for over-prescribing medication. The VA confirmed that Lopez was taking antidepressants (the VA only uses SSRI antidepressants) during the time of the shooting and his subsequent suicide.

  • 2015: From the moment it occurred, the Charleston Church shooting has been deemed an act of white supremacy, a race crime against blacks. But two years after Dylann Roof shot and killed nine people and injured another, the court released documents that show it was more mental health than hatred that led to the murders. The documents confirmed he was taking antidepressants.

  • 2016: Arcan Cetin, who was just 20 years old, walked into the Cascade Mall where he shot and killed four women, one just a teen, and shot one man, who later died at the hospital. Records show that Cetin was under the care of a psychiatrist and taking medication for depression and ADHD, including Prozac.

  The list goes on and on. And with the implication of patient privacy laws, getting information on the medication and mental health diagnoses of people has become harder and harder, even with mounting evidence that there’s a connection between SSRI use and violence.

  In 1996, the Health Insurance Portability and Accountability Act commonly referred to as HIPAA, was set in place. HIPAA represents the U.S.’s first attempt at national regulations for the use and disclosure of a person’s personal health information, or PHI. HIPAA makes it more difficult for medical personnel to release information regarding a person’s medical care, diagnosis, and prescription drugs, including those involved with mental health related crimes.

  For example, in the 2008 Virginia Tech shooting, perpetrator Seung Hui Cho had multiple interactions with the mental health department on campus, some for suicidal ideation, but yet his parents nor authorities were never notified. University officials stated privacy laws restricted them from sharing the information.

  Beyond the necessity for communication prior to these horrific shootings, after the incident, the person’s records are often protected. Even in situations where the perpetrator dies during the shooting, HIPAA protects their records for 50 years.

  Because of this, the American public doesn’t know what kind of medications these people were taking and if it may have had an affect on their actions. Just looking at public shootings over the last five years, there’s a huge list of murderers who were likely on SSRIs. Here are a few:

  • Zephen Xaver and the SunTrust Bank shooting
  • Ian David Long and the Thousand Oaks Nightclub shooting
  • Travis Reinking and the Waffle House shooting
  • Nikolas Cruz and the Parkland, Florida school shooting
  • Devin Patrick Kelley and the Texas church shooting

  The Push for Stronger Mental Health Legislation

  With the media’s coverage of mass shootings, more and more legislation arises limiting the rights of those with mental health issues. While no one wants firearms in the hands of the mentally ill, the lack of clear language surrounding mental illness, and the limitations caused by government red tape, make knee-jerk mental health legislation dangerous and lay a path for more government control.

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  In general, people with mental illness are rarely violent to other people. Many mental health experts and advocates agree that policies that focus on the violence of mental illness make scapegoats of the individuals, who are likely to never act violently against another person.

  What’s more, according to the MacArthur Violence Risk Assessment Study (MVRAS), substance abuse was significantly more responsible for violence committed by discharged psychiatric patients than their mental health. Those patients who didn’t abuse drugs or alcohol showed no higher risk for violence than the others in their communities without mental health issues.

  Laws are being created that don’t focus on the research, but on the fear of guns, thinking that stricter gun laws will keep people safer.

  Red flag laws are the newest gun legislation making their way through Congress. Considered a “protective order,” red flag laws will allow a family member or law officer to petition a temporary seize on someone’s firearms if they’re deemed a threat. What a “threat” consists of isn’t clearly defined.

  There’s also a push for universal background checks on all gun sales, even those sold between private individuals, and the FixNICS campaign. The philosophy behind FixNICS is that the background check system can only be as strong as the records it contains. And it’s currently missing a lot, especially when it comes to mental health issues and domestic violence.

  For instance, documentation of an individual diagnosed as “mental defective,” having been involuntarily committed to a mental health setting, or having engaged in domestic abuse disqualifies that person from purchasing or owning a firearm. When this information is present in the NICS, it flags the background check and stops the sale of the firearm. But too many of these records are missing.

  That was the case with the 2017 Sutherlands Springs church shooting. The gunman Devin Patrick Kelley was prohibited from purchasing firearms due to a 2012 court martial for two counts of domestic abuse. The U.S. Air Force failed to provide this information to the NICS, allowing Kelley to erroneously pass his background check and to purchase an AR-style 5.56 rifle – which he used to kill 26 people and injure 20 more. He was confronted and pursued by a neighbor, another good guy with a gun.

  Gun Control, Mental Health, and SSRIs: What’s the Solution?

  When it comes to mass shootings, there’s no easy solution. Violence, especially random violence, is a complex manifestation of various thoughts, feelings, and external factors. While it may be impossible to fully stop mass murders, ignoring the fact that certain medications, including SSRIs, play a role in a high percentage of these violent acts, no justice is being served.

  Gun control is obviously not the solution, as the rate of mass shootings has increased over  the last 30 years, at a time when multiple gun control lawshave been implemented. Taking firearms away from law abiding citizens has not and will not stop the problem.

  Personal Responsibility

  Instead, doctors need to educate patients and make them aware of the risks, as well as take the time to explain warning signs to loved ones. If patients are taking medication for a mental health disorder, including depression, then they should see a mental health professional and be involved in mental health treatment. After all, medication – even mental health medication – does nothing to fix the problem, it only masks the symptoms.

  Patients need to take some responsibility for their lives, improving their health before reaching for a mind-altering pill to make them feel good about themselves. A healthy diet, physical activity, and time spent in nature are ways to boost the mood that can help relieve the symptoms of mild depression.

  The FDA-Big Pharma Connection

  Lastly, the government and big pharmaceutical companies need to be held accountable for not sharing what they know about the medications they create. A study published in The New England Journal of Medicine (NEJM) looked at drug company sponsored clinical trials on antidepressants.

  Of the 74 FDA-registered trials the study looked at, 38 had positive outcomes, 36 had negative outcomes. Thirty-seven of the positive outcome trials were published, but of the 36 negative outcomes trials, 22 were not published and 11 were written in a way that initially presented the data to convey a misleading positive outcome. Only three were published with unbiased and accurate information about the drug.

  With this type of misrepresentation of clinical trials on medications, particularly antidepressants, the medical community and the public can’t trust medical literature for honest and reliable drug information, nor the government agency that’s designed to monitor new pharmaceuticals for safety. When medical professionals can not rely on the FDA to provide unbiased and honest clinical trial information, a true risk-benefit ratio can’t be determined and patients suffer the consequences.

  Political Influence of Big Pharma

  The connection between the FDA and big pharma goes beyond clinical studies. Drug companies lure FDA employees to sit on their regulatory boards. They hire their spouses. These pharmaceutical giants utilize the field’s leading experts, who happen to be the same experts who are invited by the FDA to sit on screening panels.

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  Big pharma’s influence over the FDA goes even deeper. Drug companies spend billions of dollars on political lobbying and campaign contributions. Direct payments support the FDA budget. And in response, the FDA conceals risks and looks the other way when necessary.

  The FDA also gives its own kickback to the drug companies. Only FDA-approved medications can be prescribed for government health insurance programs like Medicare, Medicaid, and through the VA. And to ensure Big Pharma continues to sell its drugs, the federal program only allows treatment claims on FDA-approved drugs.

  The FDA Approval Process

  The FDA approval process is a laborious and expensive endeavor, which typically takes more than a year and can cost up to a million dollars to complete. The process allows drug companies to patent their product. But when it comes to natural supplements, they can’t be patented, and therefore don’t go through the FDA approval process. Therefore supplements, which are often highly effective with little to no side effects, can not claim to “treat” a condition, even when there’s research that supports that claim.

  On the surface, this may not seem like too big of a deal, but let’s circle back to Prozac, which hit the market in 1988. In the fall of 1989, the FDA recalled the supplement L-tryptophan, an amino acid that’s a precursor for serotonin and highly effective in treating depression. The recall occurred after one supplement company had an additive that caused a flu-like reaction. On March 22, 1990, the FDA issued a complete ban of L-tryptophan for public sale. Four days later, on March 26, 1990, Prozac was featured on the cover of Newsweek, along with a lead article about its benefits.

  In 2001, the ban on L-tryptophan was lifted and since, research has shown it has huge therapeutic potential in the treatment of pain, insomnia, depression, seasonal affective disorder (SAD),  bulimia, premenstrual dysphoric disorder (PMDD), attention disorders, sleep disorders, and chronic fatigue.

  A quick note about PMDD. Premenstrual dysphoric disorder is a severe form of premenstrual syndrome, otherwise known as PMS. It officially became a medical condition in 2013 with the newest addition of the DSM-V. Yet in July of 2000, the FDA approved a new medication from Eli Lilly, the same pharmaceutical company that created Prozac. The drug was Sarafem and it was marketed to treat PMDD, which technically wasn’t even a fully recognized medical condition at the time.

  Sarafem is, quite literally, the exact same medication as Prozac, only in a different color capsule. Why would Eli Lilly issue the exact same drug under a different name? It just so happens that the patent for Prozac expired in August of 2001, which allowed generic versions to be made. Eli Lilly changed the medication’s name, indicated it for this “new” disease, and the company had a new patent for Sarafem that would last until 2007.

  Situations like this demonstrate that the more aspects the government controls, the worse this corruption and mismanagement becomes. Federal agencies in the hands of big pharmaceutical companies, and politicians using gun control to give a false hope to the American people, distracts them from the real cause of the current state of the nation and the frequency of mass shootings.

  It’s time to personally explore the evidence surrounding the issues and come to your own conclusions.

  

• One Bank Asks "Was That It" For The Selloff… And Answers

  One week after Deutsche Bank’s fund flow strategist Parag Thatte noted that the sharp market drop to start May, the worst in 50 years, was “overdue” as (i) the rally since late December had been unusually long (91st percentile) and strong (96th percentile); (ii) equities at the recent peak had already priced in a rebound in growth; and (iii) positioning had become extended according to a number of indicators, he is back late on Friday, wondering whether “this was it” for the correction. 

  The reason: following an almost record rally to start the year, so far the selloff has been smaller and the rebound quicker than usual.

  As shown in the chart below, at the recent bottom on Monday, the market was down almost 5% from the peak, in-line with normal selloffs (3-5%) which occur every 2-3 months but somewhat less than the 5-7% selloffs which typically follow long and strong rallies. If Monday indeed marked the bottom, Thatte notes that “the selloff would also be much shorter than the usual 2-3 weeks the market takes to find a bottom” although considering the escalating trade war with China, which now appears set to last for months, the probability of another sharp move lower is increasing by the day.

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  Meanwhile, at the recent peak the market had run ahead and was already pricing in a strong rebound in macro as well as earnings growth, according to DB estimates. Alternatively, at the Monday bottom, the market was back in line with current growth but with the latest modest rebound, it is again slightly ahead, leaving it vulnerable in the near term.

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  Last week’s muted drop in S&P500 stood out starkly against the backdrop of yet another massive equity fund outflow (which hasn’t stopped since the start of the year) at -$19.5 billion was the largest since December, taking the total in the last two weeks to -$40 billion, the largest since December. 

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  As the Deutsche Bank strategist notes, outflows were very broad based across regions and countries this week except for one notable outlier: China equity funds saw a large $2.6bn inflow, similar to those seen during market selloffs in October and December last year. Excluding China, the rest of EM saw large  outflows (-$4.3bn) as did the US (-$8.1bn), Europe (-$4.5bn) and Japan (- $1.8bn). As the market turned around on Tuesday, equity ETFs saw inflows return on Wednesday and Thursday.

  Perhaps in delayed response to the sharp escalation in trade war, last week saw modest cuts in equity positioning, with equity futures net long positions which were at the top of their historical range going into the selloff, now reduced but only modestly so and remain elevated. Following the recent spike in VIX, vol control funds sold  $13-$15bn in equities on the sell-off but then partially reversed that buying  $5-7bn back this week as VIX moderated.

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  As discussed last week, trend-following CTAs trimmed S&P 500 exposure but are still long.  In aggregate, the complex remains net long S&P 500 but with lighter positioning relative to 2018. CTA positioning is most crowded in long USD and long Treasuries. Risk Parity bought-the-dip to add equity beta.  Equity L/S trimmed gross leverage despite low net beta.

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  Derivatives metrics like put/call ratios, S&P 500 option skew, and VIX jumped very quickly from indicating bullish equities positioning to more bearish but have now moderated. Investor sentiment surveys also swung sharply from bullish to bearish in the space of a week and it would be interesting to see if the subsequent market rebound leads to optimism again.

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  Looking at the latest CFTC data, the record short in VIX futures at the end of April reverted in May as volatility increased and long VIX ETPs saw corresponding outflows. VIX futures positioning is now in-line with historical averages.

  Positioning and flows aside, the bigger risk is that liquidity remains very low which means outsized reactions to small changes in positioning and flows. Despite high futures volumes relative to cash this week, on-screen liquidity in S&P 500 futures is still very low relative to history.

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  Bid-ask quotes within 1 index point of spot have been less than 50% of their previous 5Y average since February 2018.

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  According to Deutsche, this low liquidity means small changes in positioning can have outsized market impact, similar to the dynamics in late December 2018 when low liquidity exacerbated the volatility spike and sell-off.

  Which means that with both volume, volatility and liquidity sliding, all that would take for another major selloff a la December 2018, is another surprise tweet, similar to Trump’s May 5 shocker, for the simple reason that, as Deutsche Bank concludes, the “rebound has been quicker than typical, with market pricing again ahead of current growth and much of the cut in positioning has already reversed… leaving the market vulnerable to negative catalysts.”

  

• Myths & Misconceptions About Bitcoin (Finally) Debunked

  Via Crypterium,

  Cryptocurrencies have been in the market for a decade now, and its introduction saw them join the ranks of fiat currencies as a viable mean of payment. However, even with all the benefits that crypto offer today against traditional currencies, not many are enthusiastic about them. Why? While there is not a single answer to this question, one of the reasons might be the wrong beliefs around cryptocurrencies and their underlying technology, blockchain.

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  A recent study shows that more than 60 percent of internet users are currently familiar with cryptocurrencies. Since familiarity breeds contempt, a lot of ‘familiarities’ and not enough information has bred some misconceptions about cryptocurrency.

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  For that reason, we’ve taken the time to debunk the most common myths and misconceptions about Bitcoin and other cryptocurrencies. Ready? Let’s get to it!

  Crypto is a Replacement of FIAT Currencies

  There was a time when TV was thought to kill radio; the US dollar was once anticipated to replace gold. And now cryptocurrencies are said to be a replacement for fiat money. Don’t get us the wrong way. We are all-in for this to happen, but the truth is that fiat currencies are not going anywhere anytime soon.

  Nowadays, paying with cryptocurrencies is a truly seamless experience. You can either load them to a prepaid crypto card like the Crypterium Card or cash out directly to a regular bank card using an instant payouts service.

  However, many people around the world continue to rely on traditional paper money. Brazil is a good example of strong cash dependency. Only last year, Brazil’s Central Bank published a report that reveals nearly half of the country’s workforce continues to get paid in cash. And that isn’t all. An additional research by the Brazilian Service to Support Micro and Small Enterprises outlined that 60% of local businesses doesn’t have POS terminals to enable card payments.

  Bitcoin is Anonymous

  Bitcoin is often described as ‘anonymous’ as it’s possible to move funds without providing any personal information. But that’s not entirely true. In fact, you should think of Bitcoin as ‘pseudonymous’ instead. Each transaction is registered on the blockchain under a wallet address. If that address is ever linked to your real identity, then you’re exposed!

  Moreover, there are sophisticated instruments that are used by government and financial entities to track identities and that provide blockchain forensics for illegal activities.

  Monero and Dash, for example, are regarded as the best privacy coins for offering higher ‘anonymity’ to their holders. In the case of Monero, transactions are divided into randomized amounts and mixed between stealth address, making it impossible to track the real origin.

  Cryptocurrencies have no “Intrinsic Value”

  “The idea that [Bitcoin] has some huge intrinsic value is just a joke in my view,” said Warren Buffett, one of the world’s most influential investors. And guess what? He is right.

  Now, do you think FIAT currencies have “intrinsic value”? Almost nothing in the world of trading and money has it. The value of FIAT money, issued by nations, largely depends on the support fixed by governments. Bitcoin, unlike the dollar or the euro, has a limited supply, which is certainly a point on its side as it can’t be easily manipulated.

  Let’s stop for a moment and see if Bitcoin and crypto actually fit the attributes of money:

  • Acceptability: Money needs to be accepted by most people. Thanks to solutions like the Crypterium Card, you can spend cryptocurrencies all over the world.

  • Scarcity: For a currency to have value, it should be limited. Only 21 million Bitcoins will ever be mined, which means that supply is indeed limited.

  • Interchangeable: You can trade crypto against other cryptocurrencies, as well as the US dollar, the Euro, the British Pound, etc.

  • Transferability: Blockchain technology makes cryptocurrencies the easiest, fastest and cheapest way to send and receive money internationally.

  • Durability: Cryptocurrencies are stored on decentralized networks which guarantees longevity as long as these networks stay active.

  • Divisibility: You can conveniently buy fractions of cryptocurrencies. For example, you can buy 0.001 Bitcoin.

  Cryptocurrencies are Untaxable

  Although some countries such as Liechtenstein, the Netherlands, and South Korea don’t impose taxes on cryptocurrencies, other nations like Spain have already alerted tax payers about required contributions to the government arcs linked to their crypto activities.

  Taxation on cryptocurrencies varies depending on how countries perceive digital assets. For example, in the United Kingdom, United States, and Australia, it is taxed as a capital gain. In Germany, on the other hand, the taxation will depend on whether you are buying or selling it.

  Cryptocurrencies are illegal

  Back in the 1970’s, the Medellín Cartel — one of the largest organized drug cartels in history — was making $60 million in drug profits per day. Does it make the dollar an ‘illegal’ currency?

  The fact that criminals use a certain currency doesn’t make it illegal. It is true that crypto is highly associated with illegal transactions. For instance, a study carried out in Australia showed that 46% of Bitcoin transactions were involved in unlawful activities. But this does not mean that it’s solely used for illegal dealings. Any other currency can also be used for illegal transactions.

  The Government can shut down Cryptocurrencies

  Since cryptocurrencies are hosted in decentralized networks, there is no specific person to ‘take down’ or arrest. The only way this can happen is if the entire internet infrastructure is shut down.

  Bitcoin is Blockchain

  Okey. Let’s not put everything on one bag. Bitcoin is a cryptocurrency and, just like any other crypto, runs on blockchain. Blockchain is not the same thing as Bitcoin. Blockchain is a distributed ledger technology that is used in many different industries, not just finance.

  If we were to assume that Bitcoin is a train, then, in this case, blockchain will be the train tracks. As mentioned above, blockchain allows information to be stored in a decentralized database.

  Cryptocurrency is a reward that the blockchain offers miners for developing the network. To date, there are more than 1500 available coins and there is a blockchain behind each of them. That said, we can conclude that blockchain can exist in other contexts than crypto; however, crypto cannot exist outside a blockchain.

  The Crypto Market is a Bubble

  We get it. When you see an asset fall in value by half in a few days, bubble is the first thing that comes to mind. But bubbles aren’t always a bad thing. In fact, when bubbles have the power to boost mass adoption. Just like it happened with the dotcom or internet bubble back in the 90s.

  Once the bubble bursts, it helps the market get rid of certain players, especially the ones without strong value propositions. The crypto market has experienced a speculative bubble, but as predicted by Crypterium analysts back in December, the market is recovering consistently.

  

• Impossible Foods, Now Valued At $2 Billion, Is The New Beyond Meat

  Following in the footsteps of easily the most successful IPO in recent history, Beyond Meat, Impossible Foods, maker of vegan meat substitutes, has just raised another $300 million. The company is now valued at about $2 billion, according to FT.

  The latest round of funding raised by Impossible Foods was led by Temasek of Singapore and Li Ka-shing’s Horizons Ventures and has taken the company’s total cash raised to over $750 million. Meanwhile, Beyond Meat’s share price has tripled since two weeks ago when it listed at $25 per share. It now has a market cap over $5 billion and was last trading with a $90 handle. 

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  Impossible Foods’ fundraising comes after the company just announced a partnership with Burger King, who is rolling out the “Impossible Whopper” to more than 7,000 restaurants, doubling Impossible’s US footprint. The “Impossible Whopper” is just like the classic Whopper, but made with an Impossible patty, according to Impossible’s promotional website for the partnership.

  “What’s in the patty? Mostly soy protein, potato protein, coconut oil, sunflower oil, and heme,” the site reads. 

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  José Cil, chief executive of Restaurant Brands, Burger King’s owner, said that the offering will attract new customers and that Burger King is targeting an international rollout before the end of the year.

  Demand for Impossible burgers has led to shortages at some restaurants. The company is going to be using its newly raised capital to meet this demand.

  David Lee, chief financial officer for Impossible, said the capital will be used to bolster production capacity: “We are challenged with unprecedented increase in demand. We’re doing everything to increase our supply.”

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  Impossible Foods was founded not even a decade ago in 2011 by Pat Brown, a Stanford University biochemistry professor.

  The company is targeting eliminating the need for animals in the food chain by the year 2035. It will be adding a second production line in California, where it already has a plant. Since the company launched in Singapore in March, sales have tripled in Asia with the substitute being used in traditional meat dishes, like dumplings.

  Both Impossible Foods and Beyond Meat have based their meat substitutes on molecular science, using cells that mimic animal protein using plant nutrients. The companies both claim that their products have the same taste and texture as beef. The products even “bleed” like regular burgers – except the “blood” is a protein created through genetic engineering in Impossible’s burgers. Beyond Meat dumbs the “bleeding” down and simply uses beetroot juice.

  Whether or not the substitutes will ultimately be a fad remains to be seen. But judging by BYND’s trading and Impossible’s ability to raise capital, investors don’t look like they’re going to be waiting for “beetroot juice in the streets” before buying anytime soon. 

  

• Why An Economic War With The US Blows China Up

  Submitted by Michael Every of Rabobank

  So say we all

  “By putting more barriers in China’s path to US markets and, in the process, risking some short-term damage to the domestic and global economies, President Donald Trump could exact a heavy long-term cost on the world’s second-largest economy. Indeed, he may even threaten China’s chances of eventually entering the ranks of high-income countries. Chinese leaders have long known that they need to change their development model if they are to make this difficult transition, powering through the dreaded “middle-income trap” that’s tripped up so many other developing countries…

  With external tailwinds turning into headwinds, China will need to rely far more on domestic demand to generate prosperity. To do so without building up risks in the financial system, Beijing would need to promote far greater household consumption and private investment, rather than relying on the debt-fuelled government investment and inefficient state owned enterprises that have helped drive domestic engines of growth for most of the last several decades.”

  So says Mohamed El-Erian, writing for Bloomberg, after the US shut Huawei out of its markets, legislation to apply the same export restrictions to ALL firms listed under ‘Made in China 2025’ progresses through Congress, and suggestions fly the US might even go as far as placing Iran-style sanctions on any third party that IS prepared to sell crucial inputs to Huawei. Given Chinese households are swimming in debt and its housing bubble is the world’s largest, and that boosting lending to private firms is out of line with local banks resources, I say “Checkmate, Mr Trampoline.”

  “China’s economic growth could tumble, debt surge and foreign companies flee in a deepening trade war, economists warn as a week of escalating tensions forces them to ponder worst-case scenarios…Analysts are assessing the damage to China’s role as the world’s supply hub as tariffs drive manufacturers overseas.”

  So says Bloomberg in ‘China’s Trade Worst Case: Growth Slows, Debt Rises, Companies Exit’.

  “Altogether, an economic war with the US blows China up. China would be cut off from Western markets, ideas, technology, and US dollar-flow long, long before it’s ready to replace the US for real.”

  So say I in the aforementioned article, echoing something I have been pointing out to a then-sceptical audience since late 2017.

  “President Donald Trump’s new tariffs are helping to erode China’s appeal as a place where stuff gets made…a chorus of executives…are citing the trade war as the final straw in their shift out of China, with margins already squeezed by rising labour costs, tougher environmental standards and domestic competition. Last week Trump hiked tariffs on USD200 billion of Chinese imports and the US is readying the expansion of that treatment to the remainder. Even Chinese firms are moving to dodge the tariffs….”

  So says Bloomberg again in ‘Trump Tariffs Seal the Deal for Companies Looking to Quit China’.

  “Western companies, including brand name apparel makers and food companies, have become entangled in China’s campaign to forcibly assimilate its Muslim population….at the end of long, often opaque supply chains that travel through China’s northwest region of Xinjiang. Residents there are routinely forced into training programs that feed workers to area factories, according to locals, official notices and state media.”

  So says the Wall Street Journal in ‘Western Companies Get Tangled in China’s Muslim Clampdown’. So let’s add a serious reputational risk to those huge economic problems, US tariffs forcing, and a technology squeeze.

  China should ‘stop selling rare earths to the US; sell off its US Treasuries; and shut US firms out its lucrative concentration camps markets’.

  So says China’s Global Times in an op-ed, ‘China has three trump cards to win trade war with US’. Well, the second threat is nonsense, as we keep explaining, and doesn’t boost the credibility of the Global Times, to put it mildly; the last will accelerate the flood of firms out of China; and the first means the US will just buy rare earths from Mexico, Vietnam–notice how these two keep winning?–or Australia and in the future Japan, as well as developing its own resources. The economic divorce will simply accelerate.

  “I’m going to go for it. Of course I’m going to go for it.”

  So says Trump regarding tariffs Boris Johnson in regards to the Tory leadership now that PM May is likely to be out the door by the end of June: May-xit? She first has to fail in her last attempt to get her Withdrawal Agreement through Parliament, after which a short timetable for her departure will be imposed. And won’t the EU be pleased with a sweeping victory for The Brexit Party in the EU polls next week and then new hard-line PM Johnson?

  “Prepare for proxy war”

  So says the EU regarding Boris a top Iranian military leader, according to the Guardian, suggesting it isn’t just John ‘Gulf of Tonkin’ Bolton looking for a scrap in the region.

  “It’s always time to buy stocks.”

  So say brokers in the US–for a change–where the Dow closed up 0.8% regardless, while Shanghai dared to see some slight selling (I want names!) after a large rally yesterday that was in no way intended by the authorities to display to the world that China-will-be-just-fine-regardless-of-the-trade-war, thank-you-very-much. CNH touched 6.9464 on Friday, which is perhaps of more interest, as is AUD breaking below 69c and staying there at the time of writing. That doesn’t match its January low of 0.6740. But we will get there soon enough, trust me.

  

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