- Luxury Good? Where The "Tampon Tax" Is Highest (& Lowest) In Europe
Luxury Good? Where The “Tampon Tax” Is Highest (& Lowest) In Europe
Tyler Durden
Mon, 06/01/2020 – 02:45Around the world, women pay high tax rates on period supplies like pads and tampons. These items are included in high sales tax brackets in many countries, ignoring possible reductions permissible for essential items or even declaring them luxuries before the law.
In the EU for example, countries have been free to depart from standard sales tax rates since 2007 and apply super discounted tax rates to feminine sanitary products. Still, as Statista’s Katharina Buchholz notes, many countries haven’t lowered their tax rates, with Hungary exhibiting the highest rate at 27 percent. Several Scandinavian countries, whether they are EU-members or not, tax at around 25 percent and Greece even raised the so-called “tampon tax” to 23 percent as part of the country’s austerity measures, according to Eurostat and media reports.
You will find more infographics at Statista
In the past 12 months, three Eastern and Central European countries – Poland, the Czech Republic and Lithuania – have lowered the “tampon tax” to 5 percent. Germany has also slashed taxes on feminine hygiene products to 7 percent from a high of 19 percent and Luxembourg has even gone as low as a 3 percent tax.
The UK and Cyprus already had their rate as low as 5 percent by 2018, similar to France, which charges 5.5 percent. Switzerland currently charges 7.7 percent but is looking to reduce that to 2.5 percent. Equally, Spain has been discussing changing the current 10 percent rate to 4 percent. The only country with no sales tax on period supplies in Europe is Ireland.
- Why The European Recovery Plan Will Likely Fail
Why The European Recovery Plan Will Likely Fail
Tyler Durden
Mon, 06/01/2020 – 02:00The 750 billion euro stimulus plan announced by the European Commission has been greeted by many macroeconomic analysts and investment banks with euphoria. However, we must be cautious. Why? Many would argue that a swift and decisive response to the crisis with an injection of liquidity that avoids a financial collapse and a strong fiscal impulse that cements the recovery are overwhelmingly positive measures. History and experience tell us that, indeed, the risk of disappointment regarding the positive impact on the real economy is not small.
The history of stimulus plans in the eurozone should alert us against excessive optimism.
As you may remember, the European Union launched in July 2009 an ambitious project for growth and employment called the “European Economic Recovery Plan”. A stimulus of 1.5% of GDP to create “millions of jobs in infrastructure, civil works, interconnections, and strategic sectors”. Europe was going to emerge from the crisis stronger than the United States thanks to the Keynesian impulse of public spending. However, 4.5 million jobs were destroyed and the deficit almost doubled while the economy stagnated. This was after the balance sheet of the European Central Bank had doubled between 2001 and 2008. That enormous plan not only did not help the eurozone get out of the crisis stronger, but we can debate whether it prolonged it, as by 2019 there were still signs of evident weakness. The tax rises and obstacles to private activity that accompanied this large package of expenses delayed the recovery, which in any case was slower than comparable economies.
We must also dismantle the idea that the European Central Bank did not support the economy in the 2008 crisis. Two huge sovereign bond buyback programs with Trichet as president of the ECB, rate cuts from 4.25% to 1% since 2008, and purchases of more than 115 billion euros in sovereign bonds. At the end of 2011, the ECB was the largest holder of Spanish debt, while it was accused of inaction.
During all this time, the balance of the ECB was greater than that of the Federal Reserve with respect to GDP, and in May 2020 it stands at 44% of GDP compared to 30% in the US.
Stimuli have never stopped in the eurozone. An additional ECB buyback plan in addition to the TLTRO liquidity programs with Draghi brought sovereign bonds to the lowest yields in history and to the ECB buying almost 20% of the total debt of the main states. This was such an excessive balance sheet expansion plan that, at the end of May 2020, excessive liquidity in the ECB was 2.1 trillion euros. Excessive liquidity was barely 125 billion euro when the so-called 2014 stimulus plan was launched.
No one can deny that the impact on growth, productivity, and employment of these enormous plans has been more than disappointing. Except for a brief period of euphoria in 2017, downward revisions to eurozone growth have been constant, culminating in the fourth quarter of 2019 with France and Italy in stagnation, Germany on the brink of recession, and a significant slowdown in Spain. The use of the excuses of Brexit and the trade war did not disguise that the economic result of the stimulus was already more than poor.
We have another important example for caution. The so-called “Juncker Plan” or “Investment Plan for Europe”, considered as the solution to the lack of growth of the European Union, also had an extremely poor result. It mobilized 360 billion euros, many for projects with no real economic return or real effect on growth. Estimates of growth in the euro zone fell sharply, productivity growth stagnated and industrial production fell in December 2019 to the lowest level in years.
We must also be cautious with the green plans. All of us are in favor of a serious and competitive energy transition, but we cannot forget that a very important part of the European Union’s “green” plan attacks demand via tax increases and protectionist measures such as a border tax on countries that have not signed the Paris Agreement (but not to those who do not comply, those have no risk). This limits the potential for recovery and increases the possibility of an additional trade war.
We cannot ignore the negative impact on industry and employment of the massive “green” policy plans of the euro area of 2004-2018, which caused the countries of the European Union to suffer electricity and natural gas bills for households that are twice as those in the USA, while growth stalled.
What is the problem with European stimulus plans compared to those of the United States? The first and most important is they come from directed economy central planning. These are plans with a very strong component of political decisions about where and how they are invested. Political planning is an essential part of the largest parts of these stimuli, and as such, they generate poor growth and weak results. Thus, one of the big problems is that sectors that are already suffering from overcapacity are being “stimulated”, or a false demand signal is generated via subsidies, which then generates working capital problems and an alarming increase in the number of zombie companies. According to the Bank of International Settlements, the number of zombie companies in Europe has exploded amid stimulus plans. The past is bailed out and the economy is zombified.
Another big problem is that the wrong sectors are stimulated while thousands of small companies that have no access to credit or political favour die. It is not a coincidence that the eurozone destroys more innovative companies or prevents them from growing when regulation forces 80% of the real economy to be financed through the banking channel while in the US it does not reach 30%. Can you imagine an Apple or Netflix growing via bank loans? Impossible.
Another big problem is the obsession with redistribution. By fiscally penalizing merit and success and sustaining public spending above 40% of GDP at any cost with higher taxes while subsidizing low-productivity sectors, the European Union incurs in a huge malinvestment risk when it rewards the subsidized sectors, or those close to political power while those with high productivity are penalized. It is no coincidence that Europe does not have technological champions. It scares them off by perpetuating the obsolete national champions and penalizing merit remuneration and alternative investment via taxation.
Nothing we just discussed changes in the newly announced plan package. It is the same, but much larger. And we cannot believe that this time will be different. While they tell us about green plans, the vast majority of the bailouts will go to aluminum and steel, autos, airlines, and refineries. Meanwhile, a huge tax increase in savings and investment may further drown start-ups, investment in research and development, and innovative companies.
The problem of the European Union has never been a lack of stimuli, but rather an excess of these. The European Union has chained one state stimulus plan after another since its inception. This crisis needed a strong boost to merit, innovation, private capital, and entrepreneurship with supply measures. I am afraid that, again, it has been decided to bail-out everything from the past and let the future die.
- Smith: Why The Public Should Rebel Against Forced Vaccinations
Smith: Why The Public Should Rebel Against Forced Vaccinations
Tyler Durden
Mon, 06/01/2020 – 00:00Authored by Brandon Smith via Alt-Market.com,
The debate over the morality and practicality of forced vaccinations has been raging for many years, long before the coronavirus ever hit the US population. With the advent of the pandemic the narrative has shifted to one of “necessity”. The media and the majority of governments around the world now act as if mass vaccinations are a given; the “debate is over”, as collectivists like to say when they are tired of having to deal with any logical or factual complaints.
In the case of the novel coronavirus there is no vaccine yet; unless of course the virus was engineered or evolved in a lab (as more and more evidence is suggesting), and then perhaps there is one already developed. Typically, vaccines take years to test and produce, and whenever a vaccine is rushed onto the market very bad things tend to happen.
The vaccine debate often revolves around the issue of safety. Is a particular inoculation safe or poisonous? Does it have long term effects that are dangerous? Does it harm children with highly sensitive and underdeveloped body systems? These are valid concerns, but ultimately the fight over vaccines has less to do with medical safety or effectiveness and more to do with individual rights vs government demands.
In other words, the more important questions are: Should social engineering by governments and elites be allowed? Do people have the right to determine how their bodies are medically augmented or manipulated? Does the “security of the majority” take precedence over the civil liberties of the individual? And if so, who gets to determine what freedoms will be taken away?
The Legal Argument
The purveyors of the forced vaccination philosophy usually make a legal or technical argument first before they appeal to the idea of “the greater good”. They do this because they know that public perception often assumes (wrongly) that legal authority is the same as moral authority.
In 1905, the US Supreme Court was presented with Jacobson vs. Massachusetts, a case involving the subject of state enforced smallpox vaccination. The defendant argued on the grounds of the 14th Amendment that his bodily liberty was being violated by the state if he was subjected to arbitrary vaccination without his consent. The state and the Supreme Court felt differently (of course). The Supreme Court ruled against Jacobson on the grounds that his refusal to take the vaccine put other people “at risk”, and that “for the common good” states have certain “police powers” that supersede personal liberties.
Whenever liberty movement activists argue against forced vaccinations on constitutional grounds, THIS is the counter-argument that the government and statists will make. They will bring up Jacobson vs. Massachusetts and then claim that is the end of the discussion.
Essentially, the Supreme Court argued that the federal government could not interfere with state imposed forced vaccinations on the grounds of states rights and the 10th Amendment. Most people in the liberty movement will find this rather ironic, as it is bizarre to hear about the federal government defending states rights. But, this support of the 10th Amendment is highly selective.
First, let’s not forget that the Supreme Court has been wrong many times in the past. In the Dredd Scott case in 1834, the Supreme Court ruled in favor of slavery and the right of states to enforce the institution. They also argued that the 5th Amendment protected slave owners because freeing slaves meant depriving owners of their “property”.
The Supreme Court’s habit is to defend states rights and the 10th Amendment when people’s individual liberties are being quashed. However, if a case involves states protecting citizens from federal intrusion, the court flips and attacks states rights when they work in favor of individual liberty or self determination.
The Jacobson vs. Massachusetts case may be the reason why Trump and the federal government have mostly left the lockdowns and emergency actions to the states. The legal precedence was already established in 1905 on quarantines and forcing vaccinations through state police powers, so it only follows that the establishment would utilize the states to carry out such measures in the near future.
The “states vs federal government” debate sets up a false paradigm. There is no separation between state and federal governments when it comes to tyranny – both sides love it, though they pretend to be opposed to each other at times. That is to say, whether it is the federal government violating your constitutional rights or the state government violating your constitutional rights, the Supreme Court is often comfortable with both.
The truth they don’t want to discuss is that at bottom the Bill of Rights overrules them regardless of federal precedent or the 10th Amendment. The key to the Bill of Rights is that each American citizen has INHERENT LIBERTIES that supersede both federal and state power. These rights are inalienable. They cannot be violated today, and the law cannot be adjusted to violate them tomorrow. These rights and freedoms are ETERNAL.
The Supreme Court hisses with a forked tongue about the “spirit of the constitution” but ignores the clear and concrete intent as stated by the Founders. Statists argue in favor of the “living document” philosophy when it suits them as a means to change the original meaning and laws put forth in the Bill of Rights because this allows them to violate citizen freedoms under the guise of “legality”. But “legality” is not the same a morality. Legality is meaningless, and the Supreme Court is meaningless if it acts against the constitutional bedrock of the Bill of Rights and individual liberty as they have done numerous times in the past.
The Moral Argument
So, if we cannot rely on legality to protect us from state tyranny, what can we rely on? Forced vaccine advocates will say that morality is on their side as well, for if a person does not vaccinate they are putting the rest of society at risk of infection. Therefore, your individual rights must be violated in order to protect the rights of the rest of society. The problem is that Jacobson vs Massachusetts makes no logical argument supporting this assertion, and neither do forced vaccine proponents.
Look at it this way: How can a person that is not vaccinated “harm” people that are vaccinated? How are they putting those people at risk? If the vaccine actually works, then vaccinated people are safe from infection, aren’t they? So, the only person “at risk” is the person that chose not to vaccinate. This comes down to personal choice, there is no question of “the greater good” or social risk.
I find it fascinating that the people that argue fervently in favor of forced vaccinations (people like Bill Gates) also tend to be the same people that argue in favor of abortion rights. So, “my body my choice” is acceptable when it comes to women ending the lives of unborn children, but “my body my choice” is not acceptable when it comes to mass vaccinations even though an unvaccinated person is a threat to no one.
Some vaccine advocates will then claim that unvaccinated people could be host to “mutations” that threaten herd immunity. The problem is that there is no evidence to support this argument. The vast majority of viruses tend to mutate into LESS deadly or infectious strains, not more deadly. The only mitigating factors would be if a virus was deliberately designed or engineered to mutate in an unnatural manner.
If a virus is designed to mutate into a vastly different and more deadly strain that can attack vaccinated persons then the vaccine was never useful to begin with, and forced vaccinations are pointless. Once again, if the vaccine is effective then there is simply no basis for the position that an unvaccinated person puts vaccinated people in danger.
The Conformity Argument
The next argument by pro-forced vaccination people is to ask “why”? Why do you care if you are vaccinated? What do you have to worry about? Just go along to get along, right…?
This argument reminds me of a common anti-gun narrative: Why do you need to carry a gun? Why frighten other people? The chances you will need it are slim, right…?
The most important answer to the gun question is “Because it’s my right to carry and I plan to exercise it. Also, your fear of guns does not take precedence over my constitutional freedoms.” The same goes for forced vaccination: Because it is my right to refuse to have ANY pharmaceutical product injected into my body. Your fears of infection do not matter to my constitutional rights. If you want to take the vaccine then that is your choice. Leave me out of it.
Arguing about hypothetical threats is a waste of time. I carry a firearm because I have the right to have a means of defense just in case I need it. I refuse vaccinations because I have a right to avoid potential bodily harm just in case I have suspicions of a faulty product.
And is there reason to be concerned about faulty vaccines? Absolutely. Mass vaccinations programs that were rushed to the public have a track record of harming people’s health.
With globalists like Bill Gates, an obsessive champion of depopulation at the forefront of the Covid-19 effort, I have no plans to accept any coronavirus vaccine. Bill Gates has funded numerous experimental vaccine trials through the World Health Organization, including Polio vaccination programs. It was these same programs that led to viral outbreaks of polio in various countries and hundreds of paralyzed children. In fact, the vaccines caused more cases of Polio than the wild-type virus. This if VERIFIED FACT, admitted by the WHO and other mainstream sources, though numerous leftist media outlets continue to deny it.
At most, the WHO and Gates can claim that the infections were “accidental”. But if this is the case, it would still suggest that vaccines developed by Gates Foundation programs and the WHO should not be trusted.
In 1976 a swine flu scare enabled the initiation of a government funded mass vaccination program. The vaccine was faulty and was canceled in less than 10 weeks after causing hundreds of cases of Guillain-Barre syndrome, a rare neurological condition that leads to temporary paralysis and sometimes death.
In 2008, Swiss company Novartis tested a Bird Flu vaccine on the homeless and poor population of Poland. The vaccine trial paid participants $2, and they were told the inoculation was for the “normal flu”. According a homeless center in the area at least 21 people died right after they participated in the trial.
A GlaxoSmithKline executive by the name of Moncef Slaoui was recently tapped by Donald Trump to head up the government’s effort to develop a coronavirus vaccine. This appointment should be highly concerning to the public. Why? Because Glaxo has a dark history in vaccine development, including an incident in Argentina in 2007-2008 when they were fined after a pneumonia vaccine trial allegedly caused the deaths of at least 14 babies. Slaoui was in charge of Glaxo’s vaccine division at the time.
Statists that argue in favor of forced vaccination will dismiss all of these examples as mere “accidents” that are “rare”. Others will claim that fighting the pandemic is worth the risk of a “few deaths” due to some faulty vaccines. But this does not address the core issue of the battle against forced vaccination programs. Does a minority of elites in government or even a majority of useful idiots in the general population have the right to declare ownership of your body in the name of an arbitrary “greater good”? I say no, which is why I will NOT be conforming to any forced vaccine measures and I am willing to take extreme actions to defend myself from them if necessary.
As mentioned above, if a vaccine works, then there is no need to force people to take it. It will protect those that want it and the only risk is to those that choose not to use it. Frankly, the people in charge of the vaccine effort are not to be trusted, they have open ideological agendas that are questionable to say the least. Allowing them to dictate what goes into our bodies is akin to slavery at best, and possible mass death at worst.
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- Plastic's Back! COVID Contamination Concerns Crush California's "Green" New Deal
Plastic’s Back! COVID Contamination Concerns Crush California’s “Green” New Deal
Tyler Durden
Sun, 05/31/2020 – 23:30Disposable plates, silverware, and straws are making a comeback in California. New guidelines issued by the CDC recommend restaurants use plasticware by default as a way to limit the spread of the virus upon reopening.
Environmental groups have become infuriated with the new recommendation, as it now means all their hard work to ban plastic straws and push a “Green” New Deal could come to an abrupt end (maybe temporarily) because according to the CDC, throwaway dishes, utensils, napkins, and tablecloths could reduce virus spread.
California recycling and clean water groups recently delivered a letter to Gov. Gavin Newsom, questioning how exactly plasticware diminishes the probabilities of contracting the virus and also accused petrochemical companies of “trying to influence CDC guidelines for reopening food establishments in their favor.”
“The idea that the CDC recommends that single-use disposable items should be preferred seems a little illogical to me,” Chris Slafter, interim coordinator of Clean Water Action’s ReThink Disposable program, which provides grants to restaurants and advises them on how to transition and replace plasticware to more sustainable products, told Politico. “Someone still has to handle that item before it goes into a customer’s hand.”
In pre-corona times, California and its green activists led the way in eliminating plastic straws and other petroleum‐based plastics from the restaurant industry as they have long criticized the items eventually end up in the oceans, polluting and killing wildlife.
We recently noted that microplastics have also ended up in human stool.
Now, in post-corona times, with California’s restaurant industry crashed (according to OpenTable data from late May), eateries that have been opened with carryout only and ones that have just fully reopened, have turned to plasticware over the CDC’s new sanitary guidelines.
OpenTable restaurant data through the end of May Restaurants in other states have also followed the new guidelines with the switch to disposable menus, plates, silverware, etc.
However, Stanford University epidemiologist Steven Goodman does not see a difference in plasticware from regular plating, in terms of reducing virus spread, as he notes, there’s still human staff behind the scenes making the food.
“It doesn’t sound like there should be a big difference if they’re handled carefully,” Goodman said. “Washing the plates well should get rid of [the virus], and so the only difference could be how they’re handled between the time when they are on the table and in the sink or in the washing machine.”
Sharokina Shams, the California Restaurant Association’s vice president of public affairs, told Politico in an email response that “many of the current local public health orders (which are a response to the coronavirus pandemic) do put an emphasis on single-use products, and cities have been moving to suspend the ban on plastic bags.”
“It’s also interesting to note that the number of delivery and takeout orders went up during stay-at-home/shelter-in-place orders. If that becomes a long-term pattern, you may see the demand for single-use products rise,” said Shams.
And just like that, who would’ve ever thought California’s green movement would get derailed by a virus.
- The Question Of Evidence When Governments Push Political Narratives
The Question Of Evidence When Governments Push Political Narratives
Tyler Durden
Sun, 05/31/2020 – 23:00Authored by Kevin Smith via Off-Guardian.org,
In the last 30 years, there have been many big events which have been questioned. Iraq is the classic example of where a relative few questioning the pretext of that invasion (Weapons of Mass Destruction – WMDs) were insulted and smeared but later vindicated.
Today, in the background of the risk of world conflict and threat to health and our way of life arising from Covid-19, it’s never been more important to be sceptical and understand evidence.
Earlier in my career, I used to adjudicate financial disputes between two parties, weigh up the evidence, and decide the most likely scenario.
So, in terms of what’s going on in the world, I’m interested in narratives which are open to challenge and the thinking and motives of those in power, the media, and experts behind them. And particularly how the public watching and listening process these messages.
First, before reading on, watch this clip, which I think is hilarious and vaguely relevant to what I’m going to say:
For those not familiar with the actors, this was a press conference held by Eliot Higgins of Bellingcat in 2018. Bellingcat is an Atlantic Council-funded online investigative website which has looked into the shooting down of the MH17 passenger plane, alleged chemical attacks in Syria, and the Sergei Skripal incident.
Graham Phillips, who crashed the event, is an independent UK journalist. He was there to ask Higgins what evidence he had for concluding Russia was responsible for the Skripal incident.
Someone unfamiliar with the background watching the clip might view Phillips as an amusing but disruptive, perhaps even unhinged, character who should have been escorted away by the police sooner.
Yet appearances can be deceiving. Those aware of Bellingcat, Higgins, and their highly suspect investigations, will know that the some of the questions Phillips was posing about the evidence for Skripal were pertinent.
Secondly, many people think they are not qualified to research or question the politics or science behind government decisions.
I can understand people with busy lives accepting narratives about events in far-away parts of the world. But Covid-19 should really change that given the impact that lockdown may have on our lives for years to come.
This is what Lord Sumption, former member of the English Supreme Court, said about Covid-19 on BBC Radio 4 recently:
What I say to them is I am not a scientist but it is the right and duty of every citizen to look and see what the scientists have said and to analyse it for themselves and to draw common sense conclusions.
We are all perfectly capable of doing that and there’s no particular reason why the scientific nature of the problem should mean we have to resign our liberty into the hands of scientists.
We all have critical faculties and it’s rather important, in a moment of national panic, that we should maintain them.
Lord Sumption is right. I often didn’t have expert knowledge of the area I was adjudicating on. It wasn’t necessary as we would rely on expert evidence, typically independent or from two sources. What I did was just weighing up information — an ability most of us have when applying ourselves.
Evidence comes in many forms: testimony, circumstantial, documents, and research or expert studies.
Below are some established concepts of assessing evidence as well as some pointers about the reality of today’s global scene that’s relevant when reviewing sharply conflicting narratives.
HISTORY AND TRACK RECORD
This is a good initial indicator. Similar to detectives investigating a murder, they will be guided towards a suspect who has a criminal record.
In the case of Western governments, their advisors, and media, a look at their previous record on a whole range of important issues will show they’ve been wrong.
However, we should be mindful that just because they’ve always been wrong, that it doesn’t follow they are this time around.
For example, based on their past track record, we should certainly view governments’ response to Covid-19 with scepticism initially and ask questions. The information which flows from this and other material will make up the main body of evidence.
ONUS OF PROOF
Taking Covid-19 as just one example, it amazes me when someone says, “you seem to think lockdown is not necessary, it states on the news that it’s working, so what proof do you have that it isn’t?”
I probably don’t need to elaborate on this lazy thinking except to say that the onus is on those who assert to prove. So, the duty is on the government to show that lockdown is working by directly reducing infection, and most importantly, is necessary in the big scheme.
The media is a main channel to communicate such evidence, but statements of “we don’t know” or “it’s too early to tell” or “trust the science”, contradictions, and scare stories have been typical of the entire Covid-19 response.
Meanwhile, many sceptical experts and independent commentators have brought much to the table in terms of scientific studies and the questioning proportionality of lockdown measures.
The sceptics as yet have not had the same air-time to put forward their case. But people need to remember that the government has not discharged the onus of proof over Covid-19, and historically, rarely do over other events.
MOTIVES
We go back again to our detectives. Who has most to gain from pushing a certain narrative? With Iraq, there were clear agendas in Washington to go to war, so much so that stories appeared in the press of links between Saddam Hussein and Al Qaeda. When this nonsense was dismissed, we moved to the threat of WMDs. We went to war out of a determination by Bush and Blair.
Today, I believe that the UK government is realising their lockdown response was driven by blind panic after receiving incorrect advice on potential mortality rates from their scientists.So, their main motive now is to prevent an angry backlash against the damage caused by lockdown.
Mixed up in all events from Iraq to Covid-19 are the combined interests of numerous parties such as NATO-funded NGOs and investigative sites such as Bellingcat, career journalists, arms industry lobbies, and big pharma. These vested interests include money, career advancement, power, and ideology.
For example, in deciding whether to get involved in Syria, selfish interests worked together. This is why one war after another has been a disaster.
Independent journalists and activists don’t generally have the same motivations and therefore their opposition to their government’s Syria policy is based on the horror of the destruction and threat to world peace.
Thus, understanding the main players and their motives is crucial to understanding evidence.
TACTICS
I recall when adjudicating disputes, the lengths one party would go to, to mislead or pressurise me.
The government, in pushing the narrative of the day, is no different, and has many tools in its armoury, not least a compliant media.
Blaming others, dumbing-down debate, and distracting their audience towards less important issues are classic tactics. For example, when the Covid-19 debate should be about whether lockdown is proportional and necessary, the media focus on scare stories, lack of equipment for health service staff, and blaming China.
The government and media also build a ‘unifying’ theme, encouraging weekly clapping for health workers and constant TV adverts telling us to “stick together to see it through”.
But the mask slips when dealing with the dissenters. Heavy-handed policing of lockdown and outright censorship of those who question the necessity for lockdown, even extending to the views of respected but non-government experts.
Twitter mobs sucked into the frenzy of fear and the new ‘unity’ emerge to smear and insult those questioning the government position.
These tactics have been used prior to every war and during every crisis, only for the narrative to later collapse.
A sign that these people are wrong is that if their position had merit, they wouldn’t censor and would debate.
One of their tactics is to label anyone who questions the prevailing narrative as “conspiracy theorists”. Unfortunately, some dissenters, rather than stick to the position that the government has serious questions to answer, go on to speculate and develop theories which can’t be proven. This provides the opportunity for those pushing official narratives to dismiss powerful arguments based on one error or supplementary theory.
EXPERTS AREN’T ALWAYS RIGHT
I know from experience that experts are often wrong — possibly due to a bias, an under- or over- emphasis on certain evidence, a method, or an inability to think a little outside of their field. The results can be seen in all professions, for example, in miscarriages of justice and the experts which advised governments on WMDs, chemical weapons use in Syria, and Covid-19.
As such, the government messages of “trust the experts” should be treated with caution.
[Especially when they are selective about who qualifies as an “expert”, and ignore prominent figures who disagree – ed.]
PREJUDICE
We all have conscious and unconscious prejudices or accepted viewpoints based on peer pressure. One example which comes to mind is among some even in alternative media circles. They say, “Assad is a brutal dictator, but didn’t gas his people”.
They’ve looked at the evidence to establish the latter, but have unconsciously swallowed the unsubstantiated media propaganda on Assad as a person.
Peer pressure, pre-determined positions, and ideology are barriers to independent thinking. But just being mindful of these pitfalls when reviewing evidence helps to get to a more open-minded mindset.
FINAL THOUGHTS
To those who’ve researched and studied evidence and applied this to global events, it’s apparent that mainstream thinking at all levels doesn’t resemble the reality. Nowadays, a mainstream position on the most important events can be ripped to shreds.
Covid-19 and lockdown are by far the biggest event which has affected all our lives. Therefore, I’d expect the important questions about the real risks and proportion to gather pace.
In the meantime, we should spend the time in lockdown looking at the evidence in the round.
- As China Fumes Over Trump's "Gross Interference" In Hong Kong, Here Are 6 Things It Can Do In Retaliation
As China Fumes Over Trump’s “Gross Interference” In Hong Kong, Here Are 6 Things It Can Do In Retaliation
Tyler Durden
Sun, 05/31/2020 – 22:30Following Trump’s Friday announcement of watered-down measures against China and Hong Kong, which included stripping Hong Kong of some of its privileged trade status as a result of Beijing’s crackdown on the island and threatening to kick out select Chinese students but falling well short of a “nuclear option” including sanctions on individuals and institutions and the expulsion of Chinese banks from SWIFT, Hong Kong’s government said actions threatened by President Donald Trump are “unjustified” and repeated that China is within its “legitimate rights” to pursue new national security laws that Beijing says will help quell months of unrest.
The People’s Daily, the official mouthpiece of China’s Communist Party, wrote that the plans outlined by Trump at the White House on Friday were “gross interference” in Beijing’s affairs and were “doomed to fail.” In a second commentary published Sunday on its front page, the newspaper accused the U.S. and Western politicians of “double standards” and “shameless hegemony” for their criticism of the legislation. Meanwhile, China’s ambassador to the U.S. wrote in a Bloomberg Opinion editorial that the central government has the ultimate responsibility for upholding national security in Hong Kong, and that the proposed legislation “will protect law-abiding citizens.”
And while Trump was widely seen as conserving ammo for future potential escalations, the market stormed higher on Friday amid optimism that the US president does not intend to pursue a more aggressive response over China’s de facto take over of Hong Kong. In fact, officials from Hong Kong wrote in a 949-word statement that they’re “not unduly worried” about the sanctions and trade restrictions proposed by Trump.
Hong Kong will continue to rely on rule of law, judicial independence, and a free and open trade policy, according to a statement issued Saturday evening local time.
The proposed legislation “does not give rise to fears of the loss of liberties by its people that will warrant international debate or interference by another country” and such fears are “simply fallacious,” the Hong Kong government said in its statement.
“We note with deep regret that President Trump and his administration continue to smear and demonize the legitimate rights and duty of our sovereign to safeguard national security in the Hong Kong Special Administrative Region which in turn is aimed at restoring stability to Hong Kong society,” the statement said.
Cui Tiankai, China’s U.S. ambassador, wrote on Saturday that Hong Kong was “a romantic fusion of the East and the West.”
“To our regret, such romance is evaporating,” the envoy wrote. The violent actions of protesters against police, citizens and property there there had crossed “a red line” for Beijing, he said. “Hong Kong is in disarray. China’s national security is at risk. That is why the central government has chosen to act.”
China’s rubber-stamp legislature on Thursday approved a proposal for sweeping new national security laws for Hong Kong, but it could take Chinese officials months to sort out details of laws banning subversion, secession, terrorism and foreign interference.
Meanwhile, the People’s Daily again underscored that China would be firm in responding to any U.S. moves, without specifying what actions Beijing might take. In Sunday’s commentary it said the proposed legislation is a rightful move to defend China’s sovereignty and compatible with international practice.
* * *
So what actions might Chinese policymakers take to deter these shifts in US policy, or in response to them?
According to Goldman’s economist Alec Philips, Chinese policymakers will take a somewhat reactive stance to US criticisms and demands on trade and other issues, at least publicly, in an effort not to escalate tensions. However, the forcefulness of the response could vary depending on how closely US actions strike at China’s strategic interests, and whether practical retaliation options exist that appear proportional and do not escalate frictions. For trade issues, the 2018-19 playbook of imposing retaliation only after the US has actually changed policy, and even then responding proportionately or slightly less than proportionately, will likely remain in force. Some possible retaliatory actions from Chinese policymakers in trade and other areas could include:
- Trade sanctions or tariffs on US exports. This particular Chinese response seems most likely in the event of a phase 1 deal breakdown. This was China’s response of choice during the trade war, although the scale of the response was typically less-than-proportional, reflecting both a desire to limit escalation and the smaller amount of US exports to China. If the trade deal were to break down and the Trump administration increased tariffs on China, expect to see a Chinese response of this type. (In theory, China also could conceivably impose formal or informal constraints on Chinese buying of US goods or “service exports” e.g. limit tourism or the flow of students studying in the US, as we have seen occur with some other regional trading partners in the context of political frictions–e.g. Chinese group tourism fell off sharply in Korea in 2017. However, such a response would have little impact at present given that tourism and international education have collapsed amid COVID-19.) It is doubtful that tariffs would be used as a response to other US actions beyond trade.
- Actions against US companies operating in China. US sanctions on Huawei recently expanded to include foreign companies selling a “direct product” of US technology, e.g. semiconductor chips made using US equipment. In response, Chinese policymakers might take actions unfavorable to US firms in China. These could include regulatory measures that complicate or prevent operation of a business. Chinese policymakers originally mooted the concept of an “unreliable entities list” about a year ago in the context of sanctions on Huawei and other Chinese companies; though it is unclear precisely what the consequences of being labeled “unreliable” would imply, presumably it would be very detrimental for sales within China. Retaliating in this way is not without cost: it could undermine policymakers’ efforts to present China as an attractive investment destination. It would also be outside WTO norms and could undermine China’s case for relief in that body.
- Export restrictions. Another possible response to US sanctions on particular companies, or other US actions constraining supplies to China, could be restrictions of Chinese exports to the United States. Rare earth minerals have been frequently cited in this context. China is a dominant supplier and substitution using other materials is difficult, so if China were to decide to restrict exports of rare earths to the US the effect could be significant. Indeed, Chinese state media threatened supply restrictions on rare earths following the initial round of sanctions on Huawei last year. That threat has prompted the US government to take measures to develop rare earth production and refining capacity in the United States. Another very sensitive area could be medical equipment and supplies, which are in great demand around the world given the coronavirus crisis, and where the US sources significant amounts from China. But the perception issues around curtailing supplies in this area would be significant, and third countries could potentially re-route such goods to the United States.
- Exchange rate depreciation. Chinese policymakers could choose to more readily accept currency depreciation, or even take active steps (such as weaker USDCNY fixings) to encourage it. Currently, the CNY is trading near multi-year lows against the USD but at more moderate levels against the CFETS currency basket…
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… reflecting broad USD strength. In recent days, policymakers have signaled moderate resistance to further depreciation by setting the daily USDCNY fixing stronger than other factors would imply.
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Currency weakness might help exports on the margin, but could also intensify capital outflow pressures; although policymakers appear to have quite good control of the capital account following the chastening experience of volatility in 2015-16, their appetite for experimentation in this area is likely limited. We think the chance of an engineered depreciation is very small, though policymakers would likely accept some modest depreciation if tensions continue to intensify, especially if there were a breakdown in the trade deal or a major increase in capital outflow pressures. - Large-scale sales of US asset holdings. At times of friction, the notion that China might sell its large holdings in US government securities as retaliation for trade actions surfaces in media commentary. (The latest Treasury International Capital data show Chinese holdings of $1.08 trn in US Treasuries as of the end of March, which are almost entirely from the official sector as China holds roughly $3 trn in FX reserves; in addition, agency holdings are on the order of $200bn and there could be additional assets held via custodians in other countries). For their part, US policymakers seem to have briefly entertained, but quickly discarded, the idea of trying to extract payment for damages related to the coronavirus from China’s holdings of Treasury debt. Here Goldman views disruptive actions by either the US or China in this area as unlikely. Abrupt large sales of Treasury securities or other US assets could tighten financial conditions well beyond the United States, so would appear an unattractive approach for Chinese policymakers for both political and economic reasons. However, a gradual reduction of US securities in the portfolios of SAFE and CIC is certainly a possibility-as overall reserve assets have been essentially flat, and the portfolio appears overweight US assets relative to trade weights. In fact, Chinese holdings of US debt have been unchanged for years, and while China is not dumping its TSY holdings, it certainly isn’t adding to them. Chinese policymakers might also choose to reduce the duration of their government securities holdings, which at least on the margin would push up long-term interest rates. Having said that, even a meaningful re-weighting of Chinese official assets out of US securities (say 5% of China’s total reserve assets per year or $150bn) would be small in comparison to the recent ramp-up in asset purchases by the Federal Reserve.
- Change in stance on geopolitical issues of concern to the United States. President Trump has in the past linked trade policy to foreign policy in his comments, for example in the case of China’s cooperation in managing North Korea’s nuclear ambitions. For example, in December 2018 he explained “I have been soft on China because the only thing more important to me than trade is war…If they’re helping me with North Korea, I can look at trade a little bit differently, at least for a period of time. And that’s what I’ve been doing. ” More generally, Chinese policymakers could choose to be more, or less, helpful in regard to geopolitical issues of interest to the United States as US policies towards China change. This sort of cooperation would presumably be evident to the intelligence community and senior US policymakers, but not necessarily to markets or the general public.
- Stocks Dancing On Deck For Titanic U.S.-China Clash
Stocks Dancing On Deck For Titanic U.S.-China Clash
Tyler Durden
Sun, 05/31/2020 – 22:00Authored by Bloomberg macro commentator Garfield Reynolds
Complexity is causing global investors to underprice the danger from U.S.-China confrontations over Hong Kong. Far from being just a regional issue, the world’s two largest economies are sliding toward a more markets-negative showdown than anything we saw in the first three years of Donald Trump’s presidency.
Global stocks are trading as though this round of tensions will be resolved in a similar fashion to the 2018-19 trade conflict. Even though that caused plenty of damage to the world economy, there were limits to the field of battle. And as the phase-one trade accord showed, a fudged resolution was possible. The market reactions were obvious despite the confusing ebb and flow of the underlying story – more tariffs meant lower stocks and yields, fewer tariffs the reverse. The yuan predictably weakened sharply when the tariff threat escalated in May/June 2018 and again in the summer of 2019.
This year’s geopolitical cage-match has the potential to develop into a winner-takes-all affair, as the superpowers spiral into a Thucydides trap.
The always-difficult task of pricing in the risk of an extreme outcome is further complicated by the backdrop of extraordinary stimulus and Covid-19. That may explain why, beyond H.K. assets, it’s only the yuan which seems to be showing a sustained reaction.
Trump’s mild China comments on Friday spurred a rebound in risk assets, but the longer-term outlook remains skewed to the downside, as witnessed by fresh rhetoric over the weekend.
There’s a real threat of the global economy splitting into competing camps, raising costs and cutting productivity across industries as companies are forced to diversify and duplicate supply chains while they balance politics and profits.
China accounted for almost a quarter of world economic growth this century and is central to sustained global rebound from the pandemic. Australia, Vietnam and South Korea stand out as Asian stock markets whose outperformance in May only makes them all the more vulnerable to a U.S.-China fallout.
- AUD/USD and the S&P/ASX 200 are surging now as Australia flattens its Covid-19 curve, but their longer-term outlook is clouded by disputes with the nation’s biggest trading partner.
- The Kospi is almost 40% above its March low, even as South Korean data remain dire. The U.S. and China account for ~40% of the country’s trade, and many of its semiconductor shipments to China go via Hong Kong.
U.S. equities will also be in the firing line. Some of the Chinese companies targeted by listing rules were key drivers for the Nasdaq’s recent surge. Wall Street banks may miss out on billions, while companies like Apple, Intel, Nvidia have strong China exposure. Nvidia gets more than half its revenue from Greater China; Apple’s supply chain is dependent on suppliers based in China, South Korea and Taiwan.
On a positive note, European assets will gain extra allure. The potentially game- changing moves toward fiscal unity on the continent are an attractive contrast to Washington and Beijing’s shift toward geopolitical confrontation.
Perhaps recent moves by both sides are just posturing and the story will fade away soon but the signs aren’t good. In just the past two weeks, China has shown an increased willingness to challenge the U.S., Australia, India and others on a diverse array of issues. On the U.S. side, China-bashing has bipartisan support in the context of November’s election.
The market impact to the latest iteration of U.S-China tensions is far more complex to analyze than the damage from the trade war. Investors are wrong to mistake that for meaning it will be less damaging.
- "We're All Suspects Now": A Look Inside The NSA's New "Contact Chaining" Tool
“We’re All Suspects Now”: A Look Inside The NSA’s New “Contact Chaining” Tool
Tyler Durden
Sun, 05/31/2020 – 22:00Submitted by Simon Black of Sovereign Man
New book explores NSA’s “contact chaining” tool
What happened:
We all know Edward Snowden revealed that the NSA collects and stores massive databases of information on Americans’ phone call and text metadata.
But then what? Most people think it sits on ice until and unless an alphabet agency like the FBI, CIA, or DHS wants to dig through it.
In reality, it is processed into a detailed map of your social contacts, constantly updating with new data.
Everytime you make a phone call or send a text, a new piece of data enters the government’s hands, and they update the map of your social contacts.
A new book explores the “contact chaining” tool, which is an essential second piece of the collection and storage of mass metadata.
What this means:
This tool allows the NSA to play “six degrees of separation” to connect you to almost anyone.
They call it “contact chaining,” as in, determining who you are linked to. They know better than us who is in our inner circle, who are our casual contacts, and who is a friend of a friend.
This is so much broader than the government seeing when you sent a text. They can map out your entire social life.
And as coronavirus “contact tracing” comes into effect, it would be wise to remember just how dangerous it is for the government to have such detailed information on all Americans.
Everyone is being investigated, before they are ever suspected of committing a crime. We’re all suspects now.
* * *
Ohio judge blocks state from enforcing lockdowns against gyms
What happened:
A week before the Ohio lockdown order was lifted, two dozen gyms that sued the state won the first round of the lawsuit.
A judge placed a preliminary injunction against the state, saying police and officials cannot enforce the lockdown orders against the gyms. Gyms could reopen, without threat of legal consequences.
The judge said government officials relied on faulty legal reasoning to say they had the authority to close down every gym in the state for two months.
The government’s powers to quarantine and isolate applies to individual instances. It cannot be used as a wide net to encompass every business and individual across the state, regardless of their coronavirus status.
What this means:
The governor said he didn’t “think it’s a big deal” since gyms were set to reopen less than a week after the ruling anyway.
That is tone deaf, as many politicians are at this point.
They have destroyed countless businesses with their authoritarian orders. So it is a big deal when courts strike them down.
Maybe governments won’t be able to overreach so far next time.
* * *
Judge rules FBI can’t even look at your phone’s lock screen without a warrant
What happened:
When police arrest a suspect, they inventory personal items like a cell phone.
During the process of powering down a phone, it is reasonable for law enforcement to see the phone’s screen.
That had already happened in this case.
But then an FBI agent went to the evidence locker, took out the suspect’s phone, and powered it on. The specific purpose was to gather evidence from the phone’s lock screen– the display that shows up before entering a passcode to access the phone.
But the FBI agent did not bother asking a judge for a warrant. And that made it an illegal search under the Fourth Amendment protections against unreasonable search and seizure, according to a judge.
The evidence was thrown out.
What this means:
When we are so used to the government doing whatever it wants, and not facing any consequences, little victories like these are encouraging.
There is a reason the Constitution attempted to restrict law enforcement and government powers when it came to the rights of the accused.
Otherwise, it is far too easy for the government to go digging around for a crime, without ever suspecting one in the first place.
And with the number of petty laws and victimless crimes out there, we are all guilty of something
- The FAAMGs Are Up 15% In 2020; The Remaining 495 S&P Stocks Are Down 8%
The FAAMGs Are Up 15% In 2020; The Remaining 495 S&P Stocks Are Down 8%
Tyler Durden
Sun, 05/31/2020 – 21:33One month ago, Goldman triggered a selloff in growth and momentum stocks, when it pointed out that the five largest S&P 500 stocks, the FAAMGS (or MSFT, AAPL, AMZN, GOOGL, FB) have risen to account for 20% of index market cap, representing the highest concentration on record…
… resulting in the lowest market breadth since the tech bubble…
… and warning that “narrow market breadth is always resolved the same way” as “narrow rallies lead to large drawdowns as the handful of market leaders ultimately fail to generate enough fundamental earnings strength to justify elevated valuations and investor crowding. In these cases, the market leaders “catch down” to weaker peers.”
In short, as we wrote – somewhat jokingly – in April that “The Market Is Now Just 5 Stocks“, that’s precisely what has happened, with investors flooding into the buyback-funded momentum of the largest tech names …
… and creating the biggest “hedge fund/mutual fund/retail/momentum hotel” ever assembled in the FAAMGs. And here is an update to one of the most amazing statistics of 2020 from Goldman: YTD the 5 biggest stocks are up 15% while the remaining 495 S&P500 companies are lower by a collective 8%, with the overall S&P400 index is down 5% YTD (compare to four weeks ago here).
Here are Goldman’s comments on this bifurcation in the market:
The return of the S&P 500 index overstates the performance of the typical stock. The equity capitalization-weighted S&P 500 index has rebounded by 35% from its low and now trades just 11% below its all-time high. The index return since the start of the year is -6%.
The average stock has returned -13% YTD. The equal-weighted S&P 500 index trades 15% below the record high and has lagged the cap-weighted index by 650 bp this year.
The stellar return of the five largest stocks in the S&P 500 — MSFT, AMZN, AAPL, GOOGL, and FB — is the primary explanation for the large difference between the cap-weighted index and the average stock.
While the FAAMGs may grow further, there is a hard limit on just how much bigger they can get:
At 20%, the current aggregate index weight of the five stocks with the largest market caps is the highest in history, exceeding the previous peak of 18% at the apex of the Tech Bubble in March 2000. However, we are approaching the practical maximum concentration of 25% given most long-only portfolio managers have diversification requirements and individual stock position limitations of roughly 5%.
Incidentally, this historic bifurcation of the “market” into two sets of stocks is also why Goldman is skeptical about further upside:
Broader participation in the rally will be needed in order for the aggregate S&P 500 index to climb meaningfully higher. Goldman Sachs equity research analysts currently forecast just 1% upside for the cap-weighted group of the five stocks. The modest upside for the largest stocks means the remaining 495 constituents will need to rally to lift the aggregate index.
Luckily, there is nothing like a weekend of nationwide looting and violence to spark a broad-based market rally and push the policy tool formerly known as the S&P500 back to all time highs to convince everyone that nothing is fucked here.
- As China PMI Disappoints, Another Major Problem Emerges
As China PMI Disappoints, Another Major Problem Emerges
Tyler Durden
Sun, 05/31/2020 – 21:30Overnight, China’s NBS reported that in May, manufacturing PMI signaled a continued recovery in factory activity, albeit at a slower pace than in April and below expectations (50.6, exp.51.0, down from 50.8). Sub-indexes in the manufacturing surveys suggest export order sub-index remained weak and employment deteriorated further.
Of note, the manufacturing employment sub-index weakened to 49.4 from 50.2, implying continued deterioration in the labor market. On the other hand, inventory indicators suggested a destocking trend, with raw material inventories declining to 47.3 from 48.2, and the finished goods inventory sub-index declined to 47.3 from 49.3 in April.
Yet even as China’s factories are starting to hum again, a new problem is emerging as executives are now worried that the rebound could falter on weak demand both at home but especially abroad, something we warned about some time ago when we warned that China’s push to produce at all costs will eventually backfire.
Justin Yu, a sales manager at Zhejiang-based Pinghu Mijia Child Product that makes toy scooters sold for American retailers, is among those seeing their order book improve from the depths of the coronavirus lockdown, but remain well below normal.
Quoted by Bloomberg, Yu said that “we are seeing more orders coming in this month as we get closer to our normal peak season,” Yu said. “But our orders are still 40-50% lower than last year.” The factory’s production capacity is running at about 70% to 80%, and Yu is making to order to avoid any build up in stock.
The disconnect between China’s recovering production and still dormant demand had shown up in data revealing a rise in inventories and once again contradicting the official PMI numbers which as noted above, show that to be easing. China’s fake data aside, the worry remains that sustained overproduction will lead China’s factories to keep cutting prices, compounding global deflationary headwinds and worsening trade tensions, before they eventually cut back on production and therefore even more jobs.
“The supply normalization has already outpaced demand recovery,” said Yao Wei, China economist at Societe Generale SA. “In other words, the recovery so far is a deflationary recovery.”
Which is another way of saying it is not a recovery at all, and the US, whose economy remains largely shut is not helping.
So given the weak export outlook, manufacturers such as Fujian Strait Textile Technology are switching their business models to target the home market, according to Bloomberg. It used to sell 60% of its products to Europe and the U.S. before the coronavirus crisis wiped out those sales. Now, Dong Liu, the company’s vice president, is looking for opportunities at home.
“Our company executives have started to visit the local market to make more potential clients know about us,” he said. “Since May 26, we have been producing 24 hours everyday at full capacity. All the inventory has already been sold and we’re rushing to make goods.”
Alas, the domestic-focused strategy also has numerous drawbacks: while China’s consumers are largely free to resume their regular lives as fresh virus cases slow to a trickle, they too aren’t spending like they used to (almost as if they also don’t believe Beijing’s solemn vows that everything is back to normal): retail sales slid 7.5% in April, more than the projected 6% drop. Restaurant and catering receipts slumped by 31.1% from a year earlier, after a 46.8% collapse in March.
“Although demand conditions are improving on the margin, they will still take a long time to recover to where they were before the virus crisis. Investment is picking up, domestic consumption improving and external demand is less bad than it was” said Chang Shu, analyst at Bloomberg Economics. The question, of course, is how much time.
In Zhenjiang, Jiangsu province, Melissa Shu, an export manager for an LED car lighting factory, said although orders are steadily improving, there’s no sense of urgency from her clients and the outlook remains uncertain. “We’re just making goods slowly,” Shu said. “We are worried about the coming months.”
* * *
As Bloomberg speculates, some producers may be hoping for a real-life enactment of Say’s law, a part of economic theory which suggests that ultimately supply will create its own demand, as long as prices and wages are flexible, although in China where every datapoint is manipulated and fake, nobody really knows what the current state of the economy is. Various real-time indicators continue to pain a mixed picture.
Another scenario proposed by UBS is that industry self-corrects adversely. The bank’s chief China Economist Wang Tao points to strong steel production during the depths of the coronavirus lockdown, even when demand was weak. Higher inventories means that even as demand recovers, steel production won’t show much of a pick up. And once producers know that orders are falling, they will adjust output.
“I do not think supply will outstrip demand for long – once inventories build up, or producers know orders are falling, production will come down as well,” she said.
Should unemployment continue rising, that could trigger a very messy feedback loop. Premier Li Keqiang in a press conference on Thursday highlighted job creation as a critical priority for the government. The urgency to create jobs may mean there’s even less likelihood of a shake up of state owned companies in the heavy industrial sectors that have historically fueled excess production. It also means that even more ghost cities may be coming.
The disconnect is already clear in data points that show, for example, stronger coal consumption by power plants and rising blast furnace operating rates by steel mills, while at the same time gauges for property and car sales are improving more slowly. That combination, according to Bloomberg, will drag on China’s growth over the coming months, according to economists at Citigroup.
The problem for China’s industrial sector is that it really needs both local and global demand to be strong. If both are weak, and only the government is “injecting” support, it’s a dire outlook. But if local demand recovers and global demand doesn’t, there are still problems.
The best summary of China’s “big problem” came from Viktor Shvets, head of Asian strategy at Macquarie Commodities and Global Markets: “At the end of the day, China’s economy is driven by demand and right now there is no demand,”
A scenario where manufacturers capacity originally dedicated to the export market is retooled to produce for the home market instead would still lead to overproduction. Then the supply-demand mismatch would end up adding to deflationary pressures and a pose fresh headwinds to economic growth, according to Bo Zhuang, chief China economist at research firm TS Lombard.
For now, China’s factory owners are hoping that won’t happen but their optimism is waning fast.
Grace Gao, an export manager at Shandong Pangu Industrial that makes tools like hammers and axes – around 60% of their goods go to Europe – is seeing orders come in as her clients get up and running again. But even as things pick up, Gao remains hesitant to call a full recovery. “Our clients are facing unprecedented problems,” she said. “It’s still hard to estimate when we’ll get back on our feet.”
- Where Is Ghislane Maxwell Now?
Where Is Ghislane Maxwell Now?
Tyler Durden
Sun, 05/31/2020 – 21:00Authored by Gabrielle Bruney via Esquire.com,
Jeffrey Epstein is dead, but the accused pedophile financier is still surrounded by multiple mysteries. The source of his vast wealth still isn’t entirely known, nor have rumors that he may have trafficked women and girls to some of the world’s most powerful men been resolved. But one of the biggest lingering unknowns in the story is the status of Ghislaine Maxwell, Epstein’s longtime companion, who’s been alleged by Epstein survivors to have recruited young women and girls into the multimillionaire’s circle and participated in their abuse.
Maxwell has denied all accusations of being involved in abuse, and she’s never faced criminal charges. But it’s hard to know much more than that when it comes to her recent years, because no one knows exactly where she is.
“I’ve heard she’s in Brazil, I’ve heard she’s in France, I’ve heard she’s in California,” Lisa Bryant, director of the Netflix docuseries Jeffrey Epstein: Filthy Rich, told Esquire.
“Who knows where she is, really?”
Who is Ghislaine Maxwell?
Maxwell is the youngest of Elisabeth and Robert Maxwell’s nine children, and was born in France in 1961. The family lived in an English mansion, and her father was the founder of a media empire and served in Parliament. Maxwell attended one of the UK’s most exclusive boarding schools and then Oxford University. As members of British high society, Maxwell mingled with some of the nation’s most celebrated families, and became friends with Prince Andrew.
Her father died in 1991, after falling off his yacht and drowning. It’s been speculated that his death may have been a suicide, as on the day he died he was due to meet with the Bank of England over the matter of his being in default on millions in loans. After his death, the British media dubbed him the “crook of the century,” when it was revealed that he’d taken hundreds of millions of pounds from his employees pension funds. Maxwell told one news outlet after her father’s death that she felt he was murdered.
She moved to the United States the year of her father’s death, and soon met Jeffrey Epstein. The relationship marked a second reversal of fortunes for Maxwell, whose family lost much of its wealth after her father’s death. In 2000, she moved into a $4.95 million Manhattan townhouse purchased “by an anonymous limited liability company, with an address that matches the office of J. Epstein & Co. Representing the buyer was Darren Indyke, Mr. Epstein’s longtime lawyer.” She was his companion for years, managing his households and introducing him to her society friends
Maxwell and her father in 1984.
According to a lawsuit she filed this year in hopes of winning funds from the late financier’s estate, “While under Epstein’s employ, Maxwell was responsible for managing Epstein’s properties located in New York, Paris, Florida, New Mexico, and the U.S. Virgin Islands.”
“During the course of their relationship, including while Maxwell was in Epstein’s employ,” the lawsuit reads, “Epstein promised Maxwell that he would support her financially. Epstein made these promises to Maxwell repeatedly, both in writing and in conversation.”
However, a 2003 Vanity Fair profile of Epstein denied that Maxwell was an employee.
After Epstein’s 2008 conviction for soliciting prostitution from an underage girl, the two appeared to end their public association. In 2009, accuser Virginia Roberts Giuffre filed a civil suit against Epstein accusing him and Maxwell of grooming her into their alleged sex trafficking ring. However, Maxwell remained a fixture in New York society until around 2015. In 2012, she founded an environmental nonprofit called The TerraMar project, which folded in late 2019.
Epstein with Maxwell in 1995
Has she been charged with any crimes?
Though multiple survivors have alleged that Maxwell participated in Epstein’s alleged crimes, she’s never been criminally charged. One thing that could stymie potential efforts to level charges against Maxwell is the infamous 2008 plea deal that Epstein struck with the US Attorney for Miami, Alexander Acosta, which found him serving just 13 months in prison after initially facing charges that could have garnered him a life sentence. Jeffrey Epstein: Filthy Rich producer Joe Berlinger described the deal to Esquire as “unprecedented, unheard of sweetheart deal” that “included a non-prosecution agreement for named and unnamed co-conspirators.”
In April, an appeals court upheld the 2007 deal, writing in its opinion that the decision was “not a result we like, but it’s the result we think the law requires.”
Maxwell is currently suing Epstein’s estate for money for her legal fees, and for the price of private security, alleging that her “prior employment relationship” with Epstein has caused to her be subjected to death threats.
Maxwell at a 2016 event.
Where is Ghislaine Maxwell now?
Though once a fixture of the global high-society, Maxwell has been spotted rarely in recent years. Last summer, she was photographed at a Los Angeles In-N-Out Burger, though the authenticity of the photo has been disputed. Her New York townhouse was sold in 2016.
This month, it was reported that lawyers for accusers seeking to file a civil suit against Maxwell have been unable to locate her. According to ABC news, one alleged victim’s “legal team dispatched process servers to five addresses previously connected to Maxwell, including a multi-million dollar brownstone on Manhattan’s Upper East Side, an apartment building in Miami Beach and Epstein’s mansion on Palm Beach Island.”
Maxwell is also contending with other civil lawsuits filed by alleged survivors. Just this month, she won the right to delay her questioning in a suit filed by Annie Farmer, the sister of fellow Epstein accuser Maria Farmer, on the grounds that her testimony could be used against her in a current criminal investigation. But with the FBI allegedly investigating Maxwell, her story could be far from over.
- "The Dollar Is Out Of Stock Everywhere": Hong Kong Money Exchangers Turn Away Clients Amid Run On US Dollars
“The Dollar Is Out Of Stock Everywhere”: Hong Kong Money Exchangers Turn Away Clients Amid Run On US Dollars
Tyler Durden
Sun, 05/31/2020 – 20:30Even before protests over a controversial extradition bill sparked the tumultuous pro-democracy movement that swept across Hong Kong last year, the notion that the city’s freedoms were under threat, and that China would soon move to curtail them, had been gestating since the 2014 Umbrella Movement. Last Spring, before the movement began in earnest, Kyle Bass published a paper entitled “the Quiet Panic” about how Hong Kong was a ticking time bomb. A few months later, it exploded.
Over the past 16 months, expats haven’t been the only ones fleeing Hong Kong. Virtually everyone who can afford to move has at least considered the possibility of selling their once extremely valuable Hong Kong real estate and fleeing elsewhere, perhaps to New Zealand, or Australia, or Malaysia – or Taiwan, which is currently drawing up plans to welcome expats.
As we reported on Friday, as more prepare to move before China tightens its grip, Sing Tao, Hong Kong’s second-largest Chinese-language newspaper observed that Hong Kong residents have been exchanging more of their HKD holdings into foreign currencies at banks and money exchange counters on Thursday.
It got so bad that according to a follow up report from the SCMP on Saturday, the rush for US dollars forced money exchangers in Hong Kong to turn away hundreds of customers after running out of the currency amid fears the United States could end the city’s preferential trading status.
According to money exchange store owners, demand for the US currency surged this week after China’s legislature endorsed a resolution for its top legislative body to craft a tailor-made national security law for Hong Kong which would criminalize acts and activities of secession, subversion, terrorism and foreign interference.
In kneejerk response, HK residents – fearing the Hong Kong dollar could be unpegged from its US counterpart – rushed to convert their local currency into something they view as more stable: the US dollar.
Long lines promptly formed at money changers in a number of Kowloon districts including Tsim Sha Tsui and Sham Shui Po on Friday, as residents waited for shop operators to replenish their US dollar supply. Eric Wong Wai-lam, who runs Rich Bird Currency Exchange in Sham Shui Po, was forced to turn away 600 customers who wanted to convert their local banknotes to the US currency.
Queues formed at money changers in a number of Kowloon districts including at this shop in Tsim Sha Tsui; Photo: Edmond So, SCMP “There will be no US dollars for exchange until next Tuesday or Wednesday,” he told customers, adding that his shop could only serve those who had previously placed an order. He explained that demand for the US currency had increased 10-fold this week, with more customers looking to switch large sums – hundreds of thousands or even millions of Hong Kong dollars – at a time.
“The US dollar is out of stock everywhere. We’ve offered every last bit of our supplies to our customers,” Wong said adding that residents also sought alternatives such as the pound, Euro and Australian dollar. “People will take anything you have,” he said.
As the SCMP further details, civil servant Mike Ma had hoped to change HK$35,000 (US$4,514) into US dollars, but had to make do with £1,000 (US$1,237) and NT$20,000 (US$666) instead. The 35-year-old British National (Overseas) passport holder said he had been keeping foreign banknotes since Hong Kong was gripped by anti-government protests last year, but had visited exchange stores more often this week because of uncertainties over the city’s economic future.
Kevin Chan, operator of an online shopping site, bought US$3,000 on Friday, saying he had been doing so from time to time since the social unrest broke out. “It’s like buying insurance,” the 31-year-old said.
A customer manages to get US dollars at Rich Bird (HK) Currency Exchange in Sham Shui Po. Photo: Edmond So, SCMP Chan said panic buying of the US dollar reflected how Hong Kong had found itself in the middle of a political tug of war between the world’s two superpowers. “[China and the United States] are bluffing now. You don’t know what stakes they will raise next. Hong Kong is in a passive position. It’s just a pawn to both sides,” Chan said.
“I’m not confident about the current situation, same as many others. In case the US dollar peg is reset, buying the US dollar beforehand gives me more confidence.”
The Hong Kong currency has been linked to the US dollar since 1983 and any change in the peg does not require approval from the US government. The Hong Kong government determines which currency the local dollar is pegged to. The currency is kept pegged in the range of HK$7.75 to HK$7.85 to the US dollar.
Eddie Yue Wai-man, chief executive of the local central bank, the Hong Kong Monetary Authority, said earlier this week the peg would remain the bedrock of the city’s financial system, with foreign reserves of more than US$440 billion. And while the city had yet to show any noticeable sign of fund outflows from the Hong Kong dollar or banking system, the market is starting to crack. Though spot HKD has been trading toward the strong end of its band as the Fed slashes rates to zero amid growing speculation the US central bank may soon follow through with negative rates, Kyle Bass’s bet against the currency peg, which critics once slammed as absurd and unlikely to pay off, is becoming increasingly popular as a trade as derivatives markets price in growing expectations for depreciation.
Even Hong Kong’s largest banks, HSBC, saw a small handful of its automated teller machines run out of US dollars, but was working to replenish them. The bank has 39 locations that offer foreign currency, but not all distribute US dollars. Customers can withdraw up to HK$80,000 per day per bank card.
“HSBC has sufficient supply of banknotes and is committed to supporting its customers and the smooth operation of the financial system in Hong Kong,” a HSBC spokeswoman said.
- Pompeo: China Is Intent Upon The Destruction Of Western Ideas, Western Democracies, And Western Values
Pompeo: China Is Intent Upon The Destruction Of Western Ideas, Western Democracies, And Western Values
Tyler Durden
Sun, 05/31/2020 – 20:13Looking at the Yuan, Bloomberg’s macro commentators Mark Cranfield correctly writes that “any downside extension for USD/CNH after President Trump left the phase one trade deal untouched will be short lived. There is enough uncertainty over the U.S.-China relationship to maintain an underlying bid for the dollar.”
Cranfield is right, if for another reason: while Trump may have left the Phase 1 trade deal in place for now, at this point this is purely theater, for the simple reason that China is woefully behind on its signed contractual commitments to import a set quantity of US agircultural, energy, and manufacturing exports.
As Goldman writes over the weekend, “there is a clear risk—if not a likelihood—that US exports to China will fall short of the Phase 1 deal.” So far, the Administration appears to be taking a wait-and-see approach to this and could continue to do so for a while, since the export targets were intended to be met over a 1-2 year timeframe, and the deal was only signed four months ago. But if Trump decides that China has not met its commitments under the Phase 1 trade deal – which it clearly hasn’t – he would take the initial step of taking the tariff rate on Tranche 4A back to 15%, according to Goldman.
As a result, while ignoring Trump headlines looks to be the right strategy in the short term for traders, Cranfield notes that this “may change when the U.S. election race gets into prime time.” So while record highs for USD/CNH may have been delayed after last week’s all tim ehigh, “they are still the path of least resistance in the weeks ahead”, according to the Bloomberg commentator.
And just to give the yuan selling a kickstart higher, here is Mike Pompeo on Fox News, pouring some more gasoline on the raging dumpster fire that is US-China relations, saying that “this is a Chinese Communist Party that has come to view itself as intent upon the destruction of Western ideas, Western democracies, and Western values. It puts Americans at risk, whether it’s stealing American intellectual property or destroying jobs here in the U.S.”
This is a Chinese Communist Party that has come to view itself as intent upon the destruction of Western ideas, Western democracies, and Western values. It puts Americans at risk, whether it’s stealing American intellectual property or destroying jobs here in the U.S. pic.twitter.com/89JlUuARro
— Secretary Pompeo (@SecPompeo) May 31, 2020
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Hardly the stuff one hears if de-escalation is just around the corner.
- Schlichter: This Election Is Republicans Versus China
Schlichter: This Election Is Republicans Versus China
Tyler Durden
Sun, 05/31/2020 – 20:00Authored by Kurt Schlichter, op-ed via Townhall.com,
It’s pretty clear who the commie bastards known for their shoddy lab practices and their weird fetish for gnawing on pangolins badly want to win in November, and it’s not Trump and the Republicans. The Chinese communists want their money’s worth, and they will go all-in for the Democrats who find the chance to hurt Trump at the same time they hurt America too delicious to pass up. Plus, the Dems heartily approve of what Mao’s Pals are doing to freedom-loving Hong Kongers, seeing it as a template for what they would love to do to freedom-loving us.
We need to understand and accept that a vote for anyone with a “D” is a vote for Xi.
Now, some people who are stupid and/or liars will whine that this is mean and unfair and totally unlike the last four years of accusations about Trump and his folks being the pet of Vladimir Putin whose treason has perpetually had the walls closing in whilst the Grand Marshal of the Supreme Court was poised to frog-march them all to a C-130, next stop Gitmo. And it is totally unlike the Obamagate/Russiagate thing, in that with the Obamagate/Russiagate thing was a manifest lie and the accusation that the CCP is holding the pink slip of the Donkey Party in its bat soup-moistened hands is true.
Let’s look at Joe Biden for a moment, though it will have to be on video since the Geppettos holding his strings are not letting him out of his Delaware dungeon unless a miracle happens and he becomes a real boy.
This is the guy that went publicly incontinent when the Great Wall Gang was shipping Typhoid Mulans over here and Trump cut off that insanity. Travel bans were racist, you know, until they weren’t. And this guy wants to be president, when he remembers he is running for president, though his priority was not saving American lives but not vexing Beijing. This guy is so far in the Red Menace’s pocket that he’s risking lint poisoning.
They channel the digital Dem, asking, “Come on man, is it too much to want a president who takes America’s side?
Well, to the Democrats, the answer is a responding, “Yes, and don’t assume my gender.”
Now, Biden always sides with the PRC because, like the elite whose Guccis he slurps, he’s totally comfortable with the Chinese supplanting the USA as the world’s preeminent nation – that’ll show those flag-waving flyover rubes who’s not boss! The totally-not-senile politician opposed Trump’s tariffs and his attempts to level the playing field, and Hi-Bidder Biden would sign agreements to lock in the former Deliverance trade model. His response to the People’s Liberation Army arms build-up that threatens our Pacific Fleet would be, “Hey man, I believe in building-up arms! I work out and I am strong and I can do more push-ups than you, fat!”
Here’s the other thing. Remember all that idiotic babble about the Russki kompromat of Trump? That somewhere, Putin had this video library of Trump water-sporting with Muscovite rent girls? Well, we all know Joe’s pride n’ joy Hoover went to China and did a big-bucks deal, probably because he’s such a super-achiever who got where he is on his own talents and not at all drafting after his daddy. So, what else do you think he did when he was there? Explored the Great Wall? Marveled at the Forbidden City? Cavorted with every skeeze the ChiCom intel guys could throuple him up with on video?
Did it happen? You want to bet it didn’t? We know the guy got booted from the Navy for dope. We know he got zillions from some Ukrainian oligarch. We know he was accused of forgetting his crack pipe in a rental car. We know he impregnated a stripper. We know he was voted “Least Likely to be the Centerfold of Good Judgment Monthly.”
What are the chances the Chinese Gestapo didn’t try to honey-trap the guy who’s the Winnie the Pooh of hookers n’ blow? What do you think they probably caught him doing on Candid Commie Camera? It’d be like a home movie from Memorial Day weekend in Lake Havasu on Bob Crane’s houseboat.
But Biden’s not the only guy in hock to the reds. There’s Diane Feinstein, whose Chinese mole chauffer for the better part of two decades was starring in “Driving Senator Oblivious.” And you got the always accommodating Kamala Harris carrying enough water for the reds to top the Three Gorges Dam. Her latest ploy to please her powerful political patrons is to echo the commie agitprop designed to distract from the country’s criminally negligent (or worse) behavior in connection with the bat biter disease by offering a bill to declare calling it the “Wuhan Flu” to be RACISM!
And there’s Martha McSally’s opponent in the Arizona Senate race who’s a Chinese Communist Party dream come true. Even the media, and you know how it sucks, is reporting that Mark ChiCom Kelly has investments in Chinese tech. He supports Joe Biden and Joe’s policies, which we have seen are Xi’s policies. When Nancy Pelosi tried to pass a $3 trillion “pandemic relief” bill that gave dough to illegals and pot purveyors, did you see him complain that it ignored American defense and contained no spending to put American workers back to work building the equipment we need to oppose his party’s pals? Nah. His focus is on disarming Americans. Not surprisingly, ChiCom Kelly shares the Chinese Communist Party’s position on the Second Amendment – he’s against it.
“But but but but he was in the Navy and he was an astronaaaaaauuuuuutttt!”
Okay, that does not make it better. It makes it much, much worse.
The fact is that the Democratic Party has a recent hatred of Trump but a long tradition of hating the United States. Its goal for the last half-century has been to supervise the decline of America as a world power, and the fact that the Chinese communists take good care of their friends makes it easier. There is zero doubt that the Chinese government is already all-in on a Biden puppet presidency and that it backs Senate candidates like ChiCom Kelly because it knows it can rely on them to place Xi’s interests ahead of America’s.
They’ll deny it, of course. But here’s the hard and indisputable truth: This November, you can vote for the Republican Party, or you can vote Chinese Communist Party under another name.
* * *
Join Townhall VIP and pre-order my new Regnery book, The 21 Biggest Lies about Donald Trump (and You!), then check out my hit conservative novels People’s Republic, Indian Country, Wildfire and especially Collapse, where the ChiComs side with the libs. Wait, that makes it nonfiction. Also, Townhall VIP members should get my podcast “Unredacted” every Monday and my free podcast “Fighting Words” on Wednesdays to reach peak awesome!
- NYC Mayor De Blasio's Daughter Arrested At Protest; Fire Next To White House; California Hit With Looting, Violence
NYC Mayor De Blasio’s Daughter Arrested At Protest; Fire Next To White House; California Hit With Looting, Violence
Tyler Durden
Sun, 05/31/2020 – 19:39Update (2150ET): The daughter of New York Mayor Bill de Blasio, Chiara de Blasio, was arrested at a Saturday night protest in Manhattan, according to the New York Post.
Chiara de Blasio, 25, was taken into custody around 10:30 p.m. after cops declared an unlawful assembly at 12th Street and Broadway in Lower Manhattan, the sources said.
“That was a real hotspot, police cars were getting burned there, people were throwing and yelling, fighting with cops. There were thousands of people in that area at that time,” the source said.
She gave 181 East End Avenue as her address, otherwise known as Gracie Mansion, the mayor’s Upper East Side residence. –New York Post
The very next day, de Blasio warned that “Change is coming in this city.”
NYC Mayor Bill de Blasio: “Change is coming in this city.” pic.twitter.com/SDfFEgtx5u
— The Hill (@thehill) May 31, 2020
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Meanwhile, a fire has broken out near the White House:
Breaking: A fire has been started outside of the White House pic.twitter.com/u5iJdjbXyJ
— Daniel Uhlfelder (@DWUhlfelderLaw) June 1, 2020
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* * *
Update (2100ET): Tensions continued to flare in Los Angeles, where a police SUV was filmed ramming through a blockade of protesters – nearly running over one in the process.
Omg. It’s happening. pic.twitter.com/ynNwkT7Crs
— Sophia Lee 소현 (@SophiaLeeHyun) May 31, 2020
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Elsewhere in Los Angeles:
Law enforcers blocking off the highway. pic.twitter.com/N8j9PiCmDJ
— Sophia Lee 소현 (@SophiaLeeHyun) May 31, 2020
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Businesses are boarding up their windows in preparation for another possibly chaotic night. pic.twitter.com/LJuctv1DBk
— Sophia Lee 소현 (@SophiaLeeHyun) May 31, 2020
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500 miles to the north in the East Bay, residents of upscale Walnut Creek have been advised to avoid Broadway Plaza.
Since they’re so vague here’s a glimpse. https://t.co/cx4SsloewO https://t.co/UBY1MKqo1K
— Roxie Joyce (@RoxieCorleone) June 1, 2020
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Looting st the Vans and Urban Outfitters in downtown Walnut Creek. @EastBayTimes pic.twitter.com/JX3f5c3h4u
— Jose Carlos Fajardo (@jcfphotog) June 1, 2020
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Breaking into the Macy’s in Walnut Creek. pic.twitter.com/h7mvsQjmj1
— Jose Carlos Fajardo (@jcfphotog) June 1, 2020
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* * *
Update (1950ET): The driver in the Minneapolis incident has been arrested.
DPS: Driver of truck that drove into mass of protest marchers on I-35W has been arrested, and received minor injuries. It doesn’t appear any protesters were hit by the truck. | https://t.co/DagxLlPuA7 pic.twitter.com/xHcLuWZ3Vj
— WCCO – CBS Minnesota (@WCCO) May 31, 2020
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* * *
Update (1911ET): A little over an hour has passed since Philadelphia’s 6pmET curfew went into effect – because nothing says “deescalation” like a daytime curfew – Sunday night’s “demonstrations” are already devolving into sickening violence on par with what we saw last night.
Around 1pm local time, looting broke out at a strip mall in Santa Monica and elsewhere across LA, while the situation in West Philadelphia worsened, with the rioters and looters spreading – while peaceful demonstrators continued their demonstrations in some cases offering a convenient cover for the criminality of looters – in LA, Philly and elsewhere.
The situation is getting so bad, Santa Monica just moved its curfew to 4pm – 30 minutes ago – because of the looting. LA County moved its curfew to 6pm local time. Tampa Florida announced a curfew starting at 7pmET (45 minutes ago).
One notable scene in Santa Monica showed looters attacking an Amazon van and running off with packages.
BREAKING: Amazon vans looted in California pic.twitter.com/rovyLznohK
— Breaking News Global (@BreakingNAlerts) May 31, 2020
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Why are the drivers even out after Amazon asked them to turn back? Could it have something to do with the company’s plans to end COVID hazard pay?
A report from California officials claimed the situation in Santa Monica was “deteriorating rapidly”, and that “police have been called in from other parts of California to assist.”
More looting going on in West Philly with nobody coming in to stop them. Some exasperated locals wondered whether the elected Democrats in the city would use force to protect small businesses, as videos showed several big box stores, including a family dollar, being looted.
FAMILY DOLLAR LOOTED IN PHILLY
pic.twitter.com/bFj8Xhkbdt— The_Real_Fly (@The_Real_Fly) May 31, 2020
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Protests broke out across New York City, with groups in Manhattan and Brooklyn. One notable scene that emerged on social media: vandals attacked St. Patrick’s Cathedral in midtown, one of the most sacred Catholic Churches in the world.
If you’re upset about this wait till you hear what the priests have been doing to children https://t.co/jV9DIQirQW
— Joshua Topolsky (@joshuatopolsky) May 31, 2020
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Though, notably, protests in brownstone brooklyn, home to mostly white yuppies and trust fund babies who live on hand outs from their parents (leaving them plenty of free time to protest), remained mostly peaceful, at least during the early hours, with only small pockets of vandalism and violence across the city.
WILLIAMSBURG BROOKLYN pic.twitter.com/8BfCkIeRKj
— The_Real_Fly (@The_Real_Fly) May 31, 2020
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Video from Chicago showed looters packing cars with stolen goods.
LOOTERS PACK CARS WITH GOODS IN CHICAGO
pic.twitter.com/rOGvgO9kUS— The_Real_Fly (@The_Real_Fly) May 31, 2020
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One looter traveled all the way from Indiana to Santa Monica to join in the looting.
LOOTER TRAVELED FROM INDIANA TO SANTA MONICA TO STEALpic.twitter.com/rtHsDzfRiu
— The_Real_Fly (@The_Real_Fly) May 31, 2020
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LOOTERS PACKING STOLEN GOODS INTO CAR IN SANTA MONICA pic.twitter.com/s6YLLeMoK7
— The_Real_Fly (@The_Real_Fly) May 31, 2020
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Intermingled with familiar images of nonviolent demonstrators were clips of looting and unprovoked cruelty, like this gang of street hooligans setting a homeless man’s belongings on fire in Austin, Texas.
Rioters burn a homeless person’s belongings.
Reportedly from Austin, Texas. pic.twitter.com/jgxm35XbSF
— Orwell & Goode (@OrwellNGoode) May 31, 2020
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Twitter users flew into hysterics over this video of a tanker truck “plowing” into a crowd of protesters. Except nobody was seriously injured – at least not according to initial reports – and a closer examination merely shows the driver approaching a crowd, then stopping, before being mobbed by “peaceful demonstrators”.
BREAKING: Tanker truck plows into crowd of demonstrators on Minneapolis highway. Protesters scrambled as truck battled toward them. pic.twitter.com/Q5cTF9AGB2
— David Begnaud (@DavidBegnaud) May 31, 2020
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Minnesota had reportedly closed its highways an hour before the incident took place, but vehicles were still apparently trying to make their way through amid crowds of pedestrians – an extremely dangerous mix.
Here’s an eyewitness who says the man driving the tanker truck that drove into a crowd of people in Minneapolis bridge appeared agitated and appeared to be trying to drive on but was stormed by protesters who had been demonstrating peacefully.
KSTP-TV pic.twitter.com/pDmjjQGefm— David Begnaud (@DavidBegnaud) May 31, 2020
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Once again, violence erupted outside the White House, where tear gas was liberally shared.
VIOLENCE ERUPTED OUTSIDE THE WHITE HOUSEpic.twitter.com/JSPDnpiOP6
— The_Real_Fly (@The_Real_Fly) May 31, 2020
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TEAR GAS LIBERALLY SHARED BY SECRET SERVICE OUTSIDE WHITE HOUSEpic.twitter.com/94srhrPP7N
— The_Real_Fly (@The_Real_Fly) May 31, 2020
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Meanwhile, more market analysts are questioning whether the market can simply shrug off all of this carnage.
Agree, but the Fed is a helluva drug
— Eric Balchunas (@EricBalchunas) May 31, 2020
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* * *
As America braces for a third night of “protests”, governors and mayors across the country are calling in the national guard, imposing curfews and taking other more aggressive measures to stop a third night of chaos and destruction that’s virtually guaranteed to rattle investors in the US – and possibly around the world – when markets open in a few hours.
Already, crowds have returned to downtown Philadelphia where the situation was already starting to spin out of control on Sunday afternoon. The city experienced the same type of mass violence – looting, rioting, skirmishes between black-clad anarchists and the police, and, of course, molotov cocktails – last night as the violence spread from Minneapolis to more cities across the country.
Ahead of what’s shaping up to be a second night of violence in the city of brotherly love (soon to be renamed the city of brotherly muggings), police have released an update on the number of arrests made last night, as well as details of injuries sustained by police officers.
Arrest Update: From 1200PM, Sat, May 30th until 1200PM, Sunday, May 31st :
(138) curfews (11) CVNs
(4) Assault on police
(3) Firearm Violations
(4) Theft
(48) Looting/Burglary— Philadelphia Police (@PhillyPolice) May 31, 2020
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Fifteen police officers were injured last night, with one officer admitted to the hospital with a broken arm broken ribs after he was struck by an SUV.
Only a few hours have passed since several “peaceful” protests commenced down town, and already looters are tearing up Kensington Avenue.
Looters robbing Looters. Kensington. #riots2020 #philly @CBSNews @CBSPhilly pic.twitter.com/BoyYfiMOFI
— manuelsmith (@manuelsmith) May 31, 2020
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And it’s only getting worse.
And still more looting. Kensington Avenue. #riots2020 #philly @CBSNews @CBSPhilly pic.twitter.com/6TC7WeeW9G
— manuelsmith (@manuelsmith) May 31, 2020
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Police have begun to respond to “select break in incidents” according to a reporter covering the unrest.
Day two. A large @PhillyPolice response along Kensington and Aramingo Avenues as they respond to select break-in and looting incidents. #protests2020 #Philly @CBSPhilly @CBSNews pic.twitter.com/UQ9EFEz9oD
— manuelsmith (@manuelsmith) May 31, 2020
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In parts of the city, the looting hasn’t stopped, as looters returned in the morning and afternoon as battles with police escalated.
LOOTING CONTINUES: Looting continued this morning in Center City Philadelphia and has now moved into the city’s Kensington and Port Richmond neighborhoods.
MORE: https://t.co/5yfQFokxpW https://t.co/jAEDiA3RX6
— FOX 29 (@FOX29philly) May 31, 2020
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With eagle eyes of @PhillyPolice helicopter, officers arrive as Modell’s Aramingo Avenue being looted. Large crowd runs out back of store after police arrive in both front and at back of store. @ppddavebonk @FOX29philly pic.twitter.com/YPYAzJ0Ra3
— Steve Keeley (@KeeleyFox29) May 31, 2020
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As a peaceful demonstration moved toward city hall, a tense exchanged erupted as locals confronted two “professional” protesters who were urging the crowd to “take it further” – ie escalate violence against the police – in retribution for George Floyd.
During the peaceful protest 2 protestors on the side are calling for people to “take it further”
In a tense exchange the crowd shut them down “this is not your protest” “you’re not from philly”
Worth noting a qpoc stepped in to keep things from escalating @NBCPhiladelphia pic.twitter.com/Hgbu7FSOj7
— Miguel Martinez-Valle (@MiguelMValle) May 31, 2020
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To be sure, not all of the demonstrations in the Greater Philly area were violent: Some marches on Sunday afternoon remained largely peaceful, like in Atlantic City…
More from the Boardwalk in Atlantic City pic.twitter.com/xzhC2glR1K
— Amy S. Rosenberg (@amysrosenberg) May 31, 2020
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…where police shut down traffic, preventing outsiders, who reportedly cause most of the trouble, from entering.
Police have shut down traffic into Atlantic City. pic.twitter.com/lDkN8botV6
— Amy S. Rosenberg (@amysrosenberg) May 31, 2020
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Protestors will gathered at 1 pm on Sunday in front of City Hall for a peace rally advocating for justice and a change to policies that provoke police brutality. A march from the Ben Franklin Bridge to the Liberty Bell at 5th and Markets Street also started around noon, according to local media reports.
But by mid-afternoon the situation had already turned violent. In response to the riots and violence, Mayor Kenney and Commissioner Outlaw addressed citizens Sunday afternoon, announcing a mandatory, city-wide curfew set to resume at 8pm Sunday, and last until 6am.
“The peaceful protests earlier were touching showings of our collective grief. The anger being displayed now cannot continue. Please have respect and dignity for each other and return home,” Kenney stated.
However, as the looting and violence intensified in the afternoon (in Philadelphia at least, it never really stopped) the city moved the curfew up to 6pm.
BREAKING: Philadelphia has moved up the citywide curfew to 6 p.m. Sunday. It will last through 6 a.m. Monday. https://t.co/ftKCH2dz0x pic.twitter.com/bsEg0R7rz2
— NBC10 Philadelphia (@NBCPhiladelphia) May 31, 2020
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In addition, all retail stores have been ordered to close immediately. Many that haven’t even reopened from COVID yet started to board up windows “as a precaution”.
We saw Cuba Libre and other 2nd St businesses in Old City are boarding up windows and doors as a precaution tonight. Keep in mind some of these places plan to reopen next week after the #Covid hiatus. @NBCPhiladelphia pic.twitter.com/2eqWqscJev
— Brandon Hudson (@BHudTV) May 31, 2020
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As the violence begins not just in Philly but in Pittsburg and in other cities around PA and the rest of the country, the state police said they were calling troopers from the surrounding area to converge on the cities.
For instance, neighboring Troops around Philadelphia, Pittsburgh, and Harrisburg are sending a sufficient amount of troopers to assist in those specific municipalities.
— PA State Police (@PAStatePolice) May 31, 2020
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PA Gov. Tom Wolf signed a disaster emergency declaration Saturday authorizing the adjutant general of the state National Guard and the Pennsylvania State Police Commissioner to activate personnel to help cities.
Philly police have already released their first arrest update.
Arrest Updates beginning today, 5/31 12:01PM: (2) CVN, (6) Looting/Burglary
— Philadelphia Police (@PhillyPolice) May 31, 2020
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During Sunday’s briefing, Kenney and other city officials praised the volunteers who came out Sunday morning to help clean up the damage. “I hope that the story of May 30-31 isn’t about what happened last night but about what happened this morning,” Managing Director Brian Abernathy said.
To try and prevent a repeat of Saturday’s violence, Outlaw said much of Center City “from South (street) to Vine (street), from river to river’ — from the Schuylkill River to the Delaware River, and including the Ben Franklin Bridge — would be blocked off, affecting roads, bridges and expressway entrances and exits as well as the city’s transit agency, according to the AP.
While local officials in the US have blamed foreign influence for instigating the violence, it looks like the protests are spreading around the world, to the US embassies in London and Berlin, and beyond.
This is huge.
London marching for George Floyd outside of the US embassy right now.
Incredible scenes. #protests2020 pic.twitter.com/8XstqCRSKj
— Sarah Abdallah (@sahouraxo) May 31, 2020
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In Chicago, national Guard troops have been deployed to help the police try and restore order to the chaotic scene, as the city’s progressive mayor Lori Lightfoot pleaded with “protesters” for calm.
Though many of the rioters, looters and protesters have worn masks, as the country braces for another night of chaos, it should be interesting to see how the infection/hospitalization numbers out of some states change in the coming days and weeks, especially considering that LA County reported some record numbers on Sunday.
- NBA Star JR Smith Expresses His Disappointment At "Motherf**king White Boy" Damaging His Truck
NBA Star JR Smith Expresses His Disappointment At “Motherf**king White Boy” Damaging His Truck
Tyler Durden
Sun, 05/31/2020 – 19:34Every rioting liberal muppet has a plan until someone punches them in the face…
…and that bastardization of Mike Tyson’s infamous quote could not apply any better to NBA star JR Smith and the young white dude who decided – for now apparent reason – to damage a truck parked in a residential area in LA.
As TMZ Sports reports, the 6’6″, 225-pounder unleashed a barrage of violent kicks on the man – landing several times in the head. When the guy finally stands up on his feet, Smith delivered a final punishing overhand right to the guy’s noggin.
NBA player JR Smith just smashed and beat up a rioter who broke his car window #protests2020 #SantaMonica #JRSmith
— Sheeraz Raza (@SheerazRaza) May 31, 2020
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After the event, Smith explained the attack in an emotionally charged video – saying:
“One of these motherfu**king white boys didn’t know where he was going and broke my f**king window in my truck.”
“I chased him down and whooped his ass,” Smith said.
“He didn’t know whose window he broke and he got his ass whooped.”
JR Smith’s response to the video out there of him beating someone up bc they broke his car window (via @TNHTalk) pic.twitter.com/LIiyTzO7Fr
— Alex B. (@KnicksCentral) May 31, 2020
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Notably, Smith says the incident was not fueled by race or hatred – it was simply revenge for messing with his truck.
We have one awkward question – as much right as Mr. Smith had to punish this mindlessly-violent idiot for damaging his property… we wonder what the reaction among the media and intelligentsia on Twitter would have been if a 6’6″, 225lb white guy was kicking the crap out of skinny young black dude who damaged his car (or store?).
- Citi Warns "Markets Are Way Ahead Of Reality", Urges Clients To Raise As Much Money As They Can Before The Next Crash
Citi Warns “Markets Are Way Ahead Of Reality”, Urges Clients To Raise As Much Money As They Can Before The Next Crash
Tyler Durden
Sun, 05/31/2020 – 19:30If the 35% surge in the S&P in the past two months seems too good to be true as even hard-core optimists like JPM’s Marko Kolanovic now admits, announcing that he is “dialing down” his optimism while Goldman sees little upside for stocks from here…
… it’s probably because it is, as the latest Wall Street professional to join the chorus of naysayers and skeptics including such luminaries as David Tepper and Stanley Druckenmiller, claims.
In an interview with the Financial Times, Manolo Falco, Citigroup’s co-head of investment banking said that financial markets were “way ahead of reality” with tougher times to come, and is warning corporate clients that they should raise as much money as they could before the pandemic’s true cost is factored in by investors.
“We definitely feel that the markets are way ahead of reality. We really are telling every client to tap the market if they can because we think the pricing now couldn’t get any better,” Falco said, adding that “as the second quarter comes along and we start seeing the pain, and the collateral effects of that, we think this is going to be much tougher than it looks.”
Manolo Falco, Citigroup’s co-head of investment banking. His comments came at the end of a week when stock markets largely rallied even as relations between the US and China just hit rock bottom, as riots were about to break out across the US which now has more than 40 million unemployed, and as millions of businesses around the world remained shut and economies lurched towards their worst recessions in memory.
“Markets are pricing a V [shaped recovery], everyone’s coming back to work, and this is going to be fine,” Mr Falco said. “I don’t think it’s going to be that easy quite frankly” said the investment banking icon who just made Robinhood’s shitlist.
Investors’ optimism led investment grade companies to raise a record $1 trillion of debt in the first five months of the year, putting investment banks such as Citi on course for a surge in debt capital markets revenues in the second quarter of the year compared with 2019.
Citi is not the only bank to take advantage of the bond issuance feast, which has been explicitly backstopped by the Fed which as we learned last week has been busy buying up over a dozen ETFs.
Last week senior bankers predicted another strong quarter for trading. This was especially true at JPMorgan Chase, whose investment bank boss Daniel Pinto said trading revenues in the second quarter could be up as much as 50% compared with a year earlier.
Falco was more circumspect on the prospect of a wave of activist investment in the aftermath of the coronavirus crisis. Low asset prices can tempt activist investors to buy into companies on the cheap and then look for ways to make them more profitable, often by cutting costs and jobs, but mostly issuing more debt (although with corporate leverage now at even record-er levels than just 2 months ago it is unclear just who has the capacity for even more debt).
“You gotta be careful though because an activist can become very quickly a focus of governments if they really step in too hard at a time when people, what they want is to protect employment and to actually get things going in the economy,” Falco said. “We’ve got to be careful because in some cases . . . maybe those [investments] are at the wrong time and could create a lot of anger.”
We doubt that: in fact, if activist investors step up and end up causing millions more to be fired, it will simply mean that the government’s free handouts will have to be extended even further, Congress will have to pass even more stimulus bills, and the Fed will have to monetize even more debt bringing us that much closer to the period of runaway inflation so eagerly sought by the Federal Reserve.
In other words, more layoffs mean win, win, wins for everyone, except those who still believe in working hard and saving, of course.
- Buybacks Are Back: Here's Who Is Repurchasing The Most Stocks
Buybacks Are Back: Here’s Who Is Repurchasing The Most Stocks
Tyler Durden
Sun, 05/31/2020 – 19:25On Friday, Citi rekindled a mystery, or as we called it – a conundrum – that plagued markets for much of 2019: how was it possible that stocks have been rising (shaprly) even as outflows from equity funds have soared?
Source: @sbarlow_ROB Citi’s explanation was simple: according to strategist Robert Buckland, the 31% global equity rally since March lows has probably been driven by short covering, given the $120b outflows the asset class suffered over the period.
Perhaps too simple, because while one of the concerns in recent weeks has been that companies have tapered stock buybacks, that’s not exactly true as the following table of recent buyback announcements indicates.
And while most sectors have indeed frozen buybacks, one group of companies stands out: we’ll let readers spot it.
Which is why to Citi’s assumption that it is all short covering, we will just add that the $65 billion in tech buybacks did not hurt. Oh, and incidentally, it just may explain the dramatic divergence between tech and everyone else.
- "It's A Setup": Mysterious Brick Piles Appear Throughout Major Protest Cities
“It’s A Setup”: Mysterious Brick Piles Appear Throughout Major Protest Cities
Tyler Durden
Sun, 05/31/2020 – 19:15Mysterious pallets of bricks have been filmed throughout major riot hotspots across the country, in what appears to be more evidence that organized groups are using the George Floyd protests to incite chaos and terrorism throughout the US.
Nc Fayetteville it real pic.twitter.com/WJTdhrOVdW
— Dolo (@64hunblock) May 31, 2020
“Yo, we got bricks. We got bricks!”—#Rioters in Manhattan chanced upon a cache in the street equipped with bricks and a shovel at 10:01 p.m. on Second Ave between St. Marks Pl. and Seventh St. pic.twitter.com/dYB7vHdYqL
— Kevin R Hogan (@KRHogan_NTD) May 31, 2020
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Still think these riots are fluid? Still think they weren’t coordinated ? Who the heck left pallets of bricks throughout different cities Across the Nation on sidewalks? #Riot2020 pic.twitter.com/afJa0oDHlD
— 𝐉.𝐈𝐍𝐅𝐀𝐍𝐓𝐄 𝐆𝐑𝐎𝐔𝐏 (@JInfanteGroup) May 31, 2020
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Where did the bricks come from? Who delivered them? And are any official investigations underway?
So who’s donating the pallets of bricks to these riot ravaged areas? Surely there’s surveillance footage, and surely they arent being brought in by hand. Start checking camera footage, run license plates. pic.twitter.com/QFHgwHVz0f
— Jerome Russell (@JeromeRussell5) May 31, 2020
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I still have not heard from one mayor or governor stating they will open an investigation into what organization is placing pallets of bricks in cities used for the sole purpose of destruction.
— Kambree (@KamVTV) May 31, 2020
Need more evidence of an operation? What’s this:
ANTIFA is a virtually all-white terror organization of cowards who pay minorities to commit their terrorism for them.
This is demonstrated perfectly in the video below.
ANTIFA are the scum of the earth and every one of their members should be in jailpic.twitter.com/s3nyNBvK1x
— Benny (@bennyjohnson) May 31, 2020
And who’s this guy?
Here is video of the guy at Auto Zone in Minneapolis who broke out all of the windows. This is weird…pic.twitter.com/4mJHqmQrhh
— Rex Chapman🏇🏼 (@RexChapman) May 28, 2020
Meanwhile:
Black Lives Matter activist *shocked* to find pasty white ANTIFA members infiltrating their cause and committing crimes in the name of their movement.
She calls the cowards out & ANTIFA yell at her!
“They’re gonna blame black people for that,” activist says, “You ain’t black!” pic.twitter.com/q1RzrI04hO
— Benny (@bennyjohnson) May 31, 2020
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Perhaps President Trump’s decision to designate Antifa a terrorist organization will yield some answers.
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