Nov 22

Today’s News 22nd November 2020

  • The Triumph Of Mankind Over 'The Great Reset': Guns, Books, & The Social Contract
    The Triumph Of Mankind Over 'The Great Reset': Guns, Books, & The Social Contract

    Tyler Durden

    Sun, 11/22/2020 – 00:00

    Authored by Joaquin Flores via The Strategic Culture Foundation,

    In The Dystopic Great Reset and the Fight Back: Population Reduction and Hope for the Children of Men , our Part I, we developed on our previous essays on planned obsolescence and the problems of the old paradigm as we enter the 4th Industrial Revolution. We looked at how several science fiction works like ‘The Virus’ and ‘Children of Men’ in culture actually predicted and lent to us an understanding the new reified nightmare being built around us. Finally, we looked at Althusser’s ‘ISA’, Ideological State Apparatus and how this was developed towards a politically correct elite culture which opened the door to the so-called ‘new normal’, where slavery and self-harm are virtue signals.

    At the end of ‘The Dystopic Great Reset and the Fight Back […]’ we noted that it would be necessary to trace aspects of the history of the social contract in order to lay the foundation of understanding

    In our previous essay ‘Capitalism After Corona Lockdown: Having the Power to Walk Away’, we also then posed the question of the social contract itself.

    Because the vast majority of us today are born into civilization, we don’t always think about its origins in terms of the agency of individuals who joined or formed the first civilizations. We tend to be taught through our institutions that it was something in between voluntary and natural, and the great 19th century nationalist romanticism promoted a view of self-determination of peoples, a view that would later be taken up by nationalist and leftist movements around the world in the 20th century – later enshrined in the UN.

    But much of the story of the first state-building civilizations, understanding that people are a resource when organized and put to work, is that some balance between slavery and half-freedom rests at its foundation.

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    The mass production of books and guns, which came about within the same historical period, entirely upended the old foundation of class society. The mass production of guns and books may have, at a certain point, been seen as powerful reinforcements for the status quo. Larger armies could be effectively armed at lower cost. The Ideological State Apparatus, as we can infer from Althusser, could be disseminated and internalized more effectively. But as with technology, came its dual-use features. The very technologies developed with an eye at perfecting the control mechanisms within the status quo of oligarchic orders, in keeping up with the technologies that other competing power networks (countries, kingdoms, nations, etc.), can be turned on its head if these technologies were democratized and fell into the hands of the broadest possible numbers of people. Such was the process both in the American Revolution, and also for instance in the Vietnamese resistance to Japanese, French, and American colonialism in the last century.

    For the first time in many centuries, knowledge and brute force were no longer an insurmountable near-monopoly held by the state or those it could compromise. The gun – the great equalizer of men, and the book – the great liberator of minds.

    Since that epoch of great emancipation and promise, technology has continued with this contradictory path of dual-use. However, the balance of power and the natures of technologies hitherto developed has shifted tremendously, favoring the status quo and disempowering the broad masses. This lamentable condition, however, is upended by the applied technologies which the real 4th Industrial Revolution (not the World Economic Forum’s model) brings into being.

    In the last epoch of the 20th century, we had begun a dangerous trajectory to a blind-sighted overspecialization (compartmentalization/fachidiotizmus) which are the hallmarks of technocracy, and away from the liberatory epoch of centuries past which gave rise to constitutional republics.

    In the past, before the old liberatory epoch, just as a military class was reliant on exclusive access to armaments, today is characterized by a combination of pharmaceutical and social programming through media which are powers out of the reach of the people. This rise and perfection of what Heidegger would define and what Marcuse would characterize as a permanently stable techno-industrial bureaucratic mode of society, characterizes today’s world of social-media influencing, anti-depressants, mass psychological operations such as virtual or holographic pandemics (HIV, Covid-19, etc.), and the surveillance state.

    This part is most important in establishing that for the foreseeable future, escaping the 4th Industrial Revolution is an impossibility. At the same time, the dual-use nature of the technologies still hold some liberatory potential, but the past methods of arriving at these has changed.

    This means that the ideology of the ruling class is tremendously important. Unlike revolutionary republican and bolshevist conceptions of power and change which share an insurrectionist presumption premised in the liberatory age of guns and books (which made the ‘political soldier’ a possibility), we have increasingly entered a zenith point in social-control technologies wherein the likelihood of a controlled group winning a contest for power against the controlling group approaches zero, if we imagine this as a contest between armed groups wherein the military acts not in the interests of their extended families, but in the interests of those writing the checks.

    Such limitations were already understood by those influenced by bolshevism, such as Antonio Gramsci in his discussion of hegemony in his Quaderni del Carcere. Cultural hegemony is a war of attrition over the entire ideological terrain, a component of what today we might call full-spectrum dominance. This parallels (and must have influenced) the later Althusserian conception of the Ideological State Apparatus (ISA).

    The single-most revolutionary legal document to have arisen in the course of the last three-hundred years in the western tradition was the U.S. Constitution. At its foundation rests the assumption that man is born free, and enters into a social contract willingly, a view supported by a view of natural rights, natural law, and an equality of the soul endowed by the creator.

    It is a social contract that man enters into every-day, and can exit any-day.

    To understand the liberatory potential of a 4th Industrial Revolution is to understand the dual-use nature of technology in the history of liberatory epochs.

    Before the rise of computers and robots performing much of the labor in society, societies grew in strength as they grew in people. With automation and roboticization, human beings become a surplus cost of no consequence to production provided that society itself is not anthropocentric.

    The new normal being proposed, is one with no freedom of thought, let alone expression. It is one with social credit, tagging people as if they were animals on a wildlife reserve, and the total regimentation of every-day life. The contours of what techno-industrial civilization can lead to, of what scientific tyranny looks like, is not only visible to us now, but has been creeping into our lives for the past century.

    The response to this in the U.S. has been an increasing support for Trump and the phenomenon that can really be described as ‘Trumpism’, which despite the media hologram of a Biden victory will most probably result in a second Trump administration. Trumpism has become synonymous with Constitutionalism, despite the revenge-fantasy language and tropes employed by a disconcerting segment of its base. In England, we have seen a parallel movement of the post-left, and a rise in ‘common law’ activism and an activist education campaign surrounding the meaning of the Magna Carta. For these parallel reasons, we had also previously characterized the Trump phenomenon as the child of a frustrated Occupy Wall Street movement after its affair with the Tea Party, but back in numbers and strength by a dispossessed working class long ago betrayed by organized labor, the DNC, and imbalanced trade deals with China.

    But while these responses (with their defects and limitations) are a healthy sign, they do not yet have the depth to articulate a countering vision for society which also takes into account the state of technology as it exists today. That is why we have not seen a very thorough public discussion on the reality of technology, and the state of matters which are real and present.

    Instead, we see from the conservative reaction to the 4IR – a reaction which raises all of the correct concerns and levies all of the correct criticisms against the banker’s version of it. This historically parallels the Luddites, who saw at the start of the 19th century that mass industry was replacing the work of the skilled trades and craftsmen with machines.

    Their solution, to destroy the machines, failed primarily because machines produce more in volume than men. Even if they had won the political battle, it would have only been a matter of time before a competing society fully utilizing industry would over-take theirs. And perhaps this here tells the entire story of the conquest over nomadic and agriculturalist societies at the hands of the state-building, techno-industrial societies even thousands of years ago.

    And so we arrive at the stark truth – there is no running or hiding from the future.

    It is the task of free citizens to take a hold of the emerging new technologies into their own hands, for their own purposes: to live in society that acts towards human freedom and dignity of the soul. A world where our small children can grow up in a world without unnecessary humility or fear. A world where there is promise and hope, a promise truly justified by a real-existing society around them based upon what is true, what is beautiful, and what is good.

  • Navy To Test Resupply Drones For Warships 
    Navy To Test Resupply Drones For Warships 

    Tyler Durden

    Sat, 11/21/2020 – 23:30

    The Naval Air Warfare Center Aircraft Division (NAWCAD) recently launched a pilot program to assess just how useful delivery drones are for hauling critical cargo to surface ships, read a US Navy press release. 

    NAWCAD engineers and military pilots are set to evaluate a commercially procured logistics Unmanned Air System (UAS) prototype – called the Blue Water Maritime Logistics UAS – for long-range naval ship-to-ship and ship-to-shore cargo transport. 

    “The Blue Water logistics UAS will be further developed and tested by the Navy, for the Navy,” said NAWCAD Commander Rear Adm. John Lemmon.

    “NAWCAD has organic talent and facilities you can’t find anywhere else. Combined with increased acquisition freedom granted by Congress, this effort shows how we’re doing business differently,” Lemmon said. 

    “This requirement is unlike other cargo requirements that online retailers like Amazon are exploring,” said Blue Water’s project lead, Bill Macchione. 

    “Naval cargo transport requires vehicles that can successfully operate through difficult environments that include heavy winds, open water, and pitching vessels at sea,” Macchione said. 

    On the modern battlefield, cargo deliveries to warships are usually conducted via boats and or helicopters. The drone will revolutionize the delivery of critical goods to military vessels. Testing starts in early 2021 at Naval Air Station Patuxent River. 

    Blue Water logistics UAS can autonomously haul 20 pounds of cargo for a maximum distance of 25 miles. 

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    The announcement of the Blue Water logistics UAS pilot program comes as the Navy recently delivered supplies to a nuclear submarine for the first time using a drone. 

    Readers may recall, in September, a helicopter drone for private industry flew a 3D-printed part to an offshore gas platform off the coast of Norway. 

    In the next couple of years, the surge in flying drones will easily disrupt mobility and transportation. As shown above, the military and private corporations are already testing and or have implemented drones into their logistical chains. 

  • US Urgently Needs To Challenge China's Chokehold On Rare Earth Materials
    US Urgently Needs To Challenge China's Chokehold On Rare Earth Materials

    Tyler Durden

    Sat, 11/21/2020 – 23:00

    Authored by Lawrence Franklin via The Gatestone Institute,

    One of China’s most significant advantages in the race to dominate future hi-tech industrial production, among just about everything else, is its chokehold on “rare earth materials” (REM). These are materials — and the raw minerals from which they are extracted and processed — vital to the manufacture, for instance, of advanced weapons, fossil-free alternative energy systems, communication devices, computer products, and microelectronic networks.

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    It is an area in which China has already established dominance . The Chinese Communist Party’s near monopoly on most of these 17 rare earth materials is by now a US national security vulnerability of enormous strategic importance. China’s October 13 decision to curtail the export of these vitally needed rare earth materials should serve as an urgent warning to the US to seriously begin developing an independent supply chain of these materials.

    The good news is that the Trump Administration had the foresight in 2017 to issue an Executive Order to begin the process of decoupling the US from its dependency on the Communist Chinese regime for REM. This Executive Order was followed up in early October by a Presidential declaration of a national emergency in mining, in an apparent effort to establish a US domestic REM stockpile for military requirements. China’s announced intent to ban the export of strategic REM to foreign countries could spur the US quickly and fully to implement President Trump’s directive to establish an independent REM supply chain. The Defense Department has not acted with the sense of urgency demanded by the President. In short, the DOD is dragging its feet. Consequently, if US-China relations plummet to the point where conflict appears imminent, America’s military would be disadvantaged should the Chinese decide to sever exports of REM to the US.

    Presently, the US Air Force’s most advanced fighter jet, the F-35, requires about 1,000 pounds of rare earth materials, most of which are presently acquired from China. The US is also dependent on China for REM required for laser guidance missiles, other advanced weapons systems and space satellites.

    Many US quality-of-life domestic products — many medical devices, such as scanners, electric automobiles, and fluorescent lighting — also rely on the availability of the Chinese REM.

    To decouple, the US could establish new supply lines with countries that have unexploited deposits of REM. These include Australia, Afghanistan, India, Russia, Brazil and countries in Central Asia. The US also could capitalize on its considerable undersea technological expertise to extract REM deposits from the ocean floor. US allies, such as NATO nations, could invest in independent REM supply lines as well as create stockpiles of REM to lessen their own vulnerability regarding China,

    The US, to nurture a national and internationally competitive industry, could also borrow a tactic from China by subsidizing domestic companies to invest in REM extraction and processing enterprises. Current REM sites in the US that have the potential to expand rapidly, particularly if the government provides financial and tax-free incentives, include Elk Creek Mine in Nebraska, Bokan Mine in Alaska, and Bear Lodge Mine in Wyoming. Presently, the most profitable REM site in the US is Mountain Pass Mine in California. Potentially, the most valuable US site is an area in West Texas which contains 16 of the 17 known rare earth materials.

    Some of these REM and their related end products include:

    • Barite – fracking process for natural gas extraction

    • Cerium – camera lenses for telescopes

    • Dysprosium – magnets in electric vehicles and wind turbines

    • Erbium – nuclear power plant rods

    • Europium – lasers

    • Gallium – semiconductors

    • Lanthanum – specialized lighting

    • Lithium – batteries

    • Praseodymium – jet airplane engines

    • Promethium – batteries for nuclear powered systems

    • Yttrium – laser-guided missiles and bombs.

    In addition to these REM, there are other critical materials that the US no longer produces. Consequently, industries are forced to import these items. An additional benefit is that the natural gas extracted by fracking helps to keep the US energy independent. Graphite, a necessary ingredient for smartphone batteries, is another critical substance.

    If the US were to decide that breaking China’s monopolistic stranglehold on most of these materials was a national priority, Washington could also build REM processing plants and supply chains. Not only would these investments provide jobs, but also only then could the US proceed to transform these critical REM oxides into metallic alloys from which end products are created.

    If the US remains dependent on China for REM, there may come a time when America might be forced to sacrifice a foreign policy interest — a dilemma experienced by Japan, also heavily dependent on China for REM. When China and Japan became involved in a maritime fishing dispute, Beijing cut off shipments of REM to its neighbor. The dispute was settled only when Tokyo pleaded with China to resume the export of REM and the Japanese Coast Guard in the East China Sea released the captain of a Chinese trawler that had been fishing in disputed waters. The US would do well to avoid a similar predicament by quickly decoupling its economy from dependency on China for rare earth materials — and if possible, from everything else.

  • Struggling Retailers Owe $52 Billion In Overdue Rents 
    Struggling Retailers Owe $52 Billion In Overdue Rents 

    Tyler Durden

    Sat, 11/21/2020 – 22:30

    The virus pandemic – with its temporary and permanent store closures, strict social distancing requirements, e-commerce boom, and supply chain disruption – since March has fueled uncertainty among US retailers as many find themselves in a $52 billion hole.

    Bloomberg, citing new data via CoStar Group Inc., outlines how restaurants, gyms, and other businesses have accumulated insurmountable rent payments that have been deferred for months. This has resulted in landlords demanding outstanding balances be immediately paid, could drive some retailers into bankruptcy.

    “You’re going to have big bubbles that are going to be hitting next year or even in the fourth quarter,” said Andy Graiser, co-president of A&G Real Estate Partners, an advisory firm. “I’m not sure if they are going to be able to make those payments in addition to their existing rent.”

    The problem with overdue rents, totaling $52 billion as of November, is that retail sales growth in October slumped and is expected to wane into year-end. 

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    Furthermore, coronavirus cases are exponentially increasing in almost every US state. Local governments across the country are reimposing strict social distancing measures that will stymie retail sales and increase the threat of a double dip recession. 

    CoStar reveals the amount of rent collected from retailers rose from 54% at the end of April to 86% this month. Only 79% of rent due this month for malls was collected.

    “It’s going to take a period of years, not months, to get through this,” said Michael Hirschfeld, vice chairman at JLL, a real estate services firm.

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    From Signet Jewelers Ltd. to Red Robin Gourmet Burgers Inc. to Bed Bath and Beyond, Bloomberg lists the major retailers who have deferred rent payments. Their unpaid rents total in the tens of millions of dollars per company – the question, with slumping retail sales and a virus pandemic that continues to rage – how will these retailers ever pay back past rents? 

    Signet Jewelers Ltd., for one, deferred about $78 million of its rent payments, according to a September quarterly filing. In its most recent quarterly filing, Bed Bath & Beyond Inc. said it’s held back $50.6 million in rent payments and is in negotiations with landlords, while Francesca’s Holdings Corp. has said it owed $14.6 million in deferred rents and related costs as of Aug. 1. The women’s clothing chain has since said it plans to shutter about 140 locations by the end of January and that it’s in danger of financial collapse.

    Red Robin Gourmet Burgers Inc., meanwhile, said that it’s received default notices from some landlords after it stopped making full payments in April. Chief Financial Officer Lynn Schweinfurth told investors on a Nov. 5 call that the restaurant chain had negotiated amendments for about half of its leases by the end of its third quarter and continues in talks for the rest.

    Many of these unpaid bills won’t go away, but are instead being pushed into next year. Signet said it plans to pay back its overdue rent by the middle of next year, while Francesca’s plans to repay the amount over the course of next year, it said in a quarterly filing in September, and is asking landlords for more concessions.

    Representatives for Bed Bath and Beyond, Francesca’s, and Red Robin didn’t immediately respond to requests for comment. A representative for Signet didn’t have a comment beyond recent filings. -Bloomberg 

    Earlier this month, deferred rents and a tidal wave of tenants exiting leases helped two mall REITs, Pennsylvania Real Estate Investment Trust and CBL & Associates Properties file for Chapter 11 protection – together the two REITs account for 87 million square feet of real estate across the US. 

    Even though collections are improving at high-quality malls – mall giant Simon Property Group Inc. only collected 85% of rents in the third quarter, up from 72% in the previous quarter. Brookfield Property Partners LP said it collected 75% of rents from mall tenants over the same quarter. 

    Jay Indyke, a lawyer who chairs Cooley LLP’s restructuring practice, said landlords and lenders are willing to make accommodations out of court to resolve overdue rent payments because of the recent news of a promising vaccine. 

    “There are certainly some players that are willing to at least convert some of their debt to equity,” Indyk said.

    While the brick and mortar retail “apocalypse” was already a problem for the US economy ahead of the virus pandemic thanks to the destructive forces of Amazon and the e-commerce boom, the pandemic continues to complicate the outlook for retailers that may extend the bankruptcy wave well into 2021. 

  • Michigan AG Calls For Criminal Charges Against GOP Certifiers Who Won't 'Fall In Line'
    Michigan AG Calls For Criminal Charges Against GOP Certifiers Who Won't 'Fall In Line'

    Tyler Durden

    Sat, 11/21/2020 – 22:00

    Authored by Jonathan Turley,

    We have been discussing the campaign of The Lincoln Project and others to harass and abuse lawyers who represent the Trump campaign or other parties bringing election challenges. Similar campaigns have targeted election officials who object to counting irregularities.  Now, the Michigan Attorney General and others are suggesting that Republicans who oppose certification or even meet with President Donald Trump on the issue could be criminally investigated or charged. Once again, the media is silent on this clearly abusive use of the criminal code target members of the opposing party in their raising objections under state law.

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    Michigan AG Dana Nessel

    On Friday afternoon, leaders of Michigan’s Republican-controlled state legislature met with Trump in the White House at his invitation.  My column today explores the difficulty in any strategy to trigger an electoral college fight. However, the objections from legislators could focus on an host of sworn complaints from voters or irregularities in voting counts. I remain skeptical of the sweeping claims made by some Trump lawyers and I was highly critical of Rudy Giuliani’s global communist conspiracy claim at the press conference this week. State legislators have a right to raise electoral objections and seek resolution in the legislative branch.

    According to the Washington Post, Dana Nessel “is conferring with election law experts on whether officials may have violated any state laws prohibiting them from engaging in bribery, perjury and conspiracy.”  It is same weaponization of the criminal code for political purposes that we have seen in the last four years against Trump.  Notably, the focus is the same discredited interpretation used against Trump and notably not adopted by the impeachment-eager House Judiciary Committee: bribery.

    In Politico, Richard Primus wrote that these legislators should not attend a meeting with Trump because “it threatens the two Michigan legislators, personally, with the risk of criminal investigation.”

    This ridiculous legal claims is based on the bribery theory:

    The danger for Shirkey and Chatfield, then, is that they are being visibly invited to a meeting where the likely agenda involves the felony of attempting to bribe a public official.

    Under Michigan law, any member of the Legislature who “corruptly” accepts a promise of some beneficial act in return for exercising his authority in a certain way is “forever disqualified to hold any public office” and “shall be guilty of a felony, punishable by imprisonment in the state prison not more than 10 years[.]”

    We repeatedly discussed this theory during the Trump presidency. As I have previously written, a leading proponent has been former prosecutor and Washington Post columnist Randall D. Eliason, who insisted that “allegations of a wrongful quid pro quo are really just another way of saying that there was a bribe … it’s bribery if a quid pro quo is sought with corrupt intent, if the president is not pursuing legitimate U.S. policy but instead is wrongfully demanding actions by Ukraine that would benefit him personally.” Eliason further endorsed the House report and assured that “The legal and factual analysis of bribery and honest services fraud in the House report is exactly right” and “outlines compelling evidence of federal criminal violations.” 

    The theory was never “exactly” or even remotely right, as evidenced by the decision not to use it as a basis for impeachment. And yet, it’s back. Indeed, the greatest danger of the theory was not that it would ever pass muster in the federal court system but that it would be used (as here) in the political system to criminalize policy and legal disagreements. (Eliason recently defended the attacks on fellow lawyers who are represented those challenging election results or practices).

    In my testimony, I went into historical and legal detail to explain why this theory was never credible.  While it was gleefully presented by papers like the Washington Post, it ignored case law that rejected precisely this type of limitless definition of the offense.  As I told the House Judiciary Committee, the Supreme Court has repeatedly narrowed the scope of the statutory definition of bribery, including distinctions with direct relevance to the current controversy in cases like McDonnell v. United States, where the Court overturned the conviction of former Virginia governor Robert McDonnell. Chief Justice John Roberts eviscerated what he called the “boundless interpretation of the federal bribery statute.” The Court explained the such “boundless interpretations” are inimical to constitutional rights because they deny citizens the notice of what acts are presumptively criminal: “[U]nder the Government’s interpretation, the term ‘official act’ is not defined ‘with sufficient definiteness that ordinary people can understand what conduct is prohibited,’ or ‘in a manner that does not encourage arbitrary and discriminatory enforcement.’” 

    I will not repeat the litany of cases rejecting this type of broad interpretation. However, the case law did not matter then and it does not matter now to those who believe that the criminal code is endless flexible to meet political agenda.

    It doesn’t even matter that the Supreme Court reaffirmed prior rejections of such broad interpretations in a recent unanimous ruling written by Justice Elena Kagan. In Kelly v. United States, the Supreme Court threw out the convictions in the “Bridgegate” case involving the controversial closing of lanes on the George Washington Bridge to create traffic problems for the mayor of Fort Lee, N.J., who refused to endorse then-Gov. Chris Christie. The Court observed:

    “That requirement, this Court has made clear, prevents these statutes from criminalizing all acts of dishonesty by state and local officials. Some decades ago, courts of appeals often construed the federal fraud laws to “proscribe[] schemes to defraud citizens of their intangible rights to honest and impartial government.” McNally, 483 U. S., at 355. This Court declined to go along. The fraud statutes, we held in McNally, were “limited in scope to the protection of property rights.” Id., at 360. They did not authorize federal prosecutors to “set[] standards of disclosure and good government for local and state officials.” Ibid.”

    That is the argument that I raised in the impeachment against the proposed articles of impeachment — supported by a host of experts on MSNBC and CNN as well as Democratic members — that the Ukrainian allegations could be charged as mail and wire fraud as well as crimes like extortion.

    What is most disturbing is that, if there was an objection to voting irregularities or fraud, these legislators would be acting under their state constitutional authority. They would be investigated for carrying out their official duties under state law. Many of us can disagree with such objections. (I have stated repeatedly that I do not see the evidence of systemic voting problems to reverse such state results and  I have criticized President Trump’s rhetoric). However, when Democrats like Sen. Barbara Boxer (D., Cal.) challenged the certification of Ohio’s electoral votes in 2004, no one suggested criminal investigations. Nessel is threatening state legislators that, if they meet to discuss such objections, they might be targets of criminal investigations. That would seem an effort to use the criminal code for the purposes of intimidation or coercion. Imagine if this was U.S. Attorney General Bill Barr threatening Democratic legislators with possible criminal investigation for challenging Trump votes. The media would be apoplectic. Yet, when used against Republicans, major publications and politicians are celebrated for the use of the criminal code for such politically motivated threats.

    As with the attacks on Republican lawyers, the threats against Republican legislators has been met with utter silence in the media. Just the familiar sound of crickets.

  • More Than 200 Firearms Mysteriously Went Missing From Philadelphia Sheriff's Office, Investigation Finds
    More Than 200 Firearms Mysteriously Went Missing From Philadelphia Sheriff's Office, Investigation Finds

    Tyler Durden

    Sat, 11/21/2020 – 21:30

    More than 200 firearms mysteriously disappeared from a Philadelphia Sheriff’s Office between 1977 and 2015, a new report from the City Controller’s Office found last week.

    An investigation was sparked into the office after a confidential complaint was filed in 2019, according to CBS 3 Philly. The investigation took a year to unfold.

    The complaint initially alleged that 15 rifles and shotguns were missing from the office’s gun inventory, but the ensuing investigation revealed that 101 service firearms and 109 Protection From Abuse Act (PFA) weapons were also missing from the office’s inventory. 

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    City Controller Rebecca Rhynhart commented: “It’s unacceptable that more than 200 guns that should be in the Sheriff’s Office custody cannot be located. The public needs to trust that the Sheriff’s Office is a reliable steward of its own property, as well as the personal property given to the Sheriff’s Office for safekeeping.”

    She continued: “While many of the issues identified pre-date Sheriff Bilal’s administration, I hope that she will take quick action to track down the missing guns, if possible, and ensure proper maintenance of the gun inventory moving forward.”

    Sheriff Rochelle Bilal said changes will be implemented. The investigation revealed that many of the issued could be traced to inadequate record keeping and “no formal procedures” regarding inventory management.

    In the office’s armory, investigators found “guns piled on the floor as well as haphazardly in boxes, cabinets and barrels”. Some of the weapons were loaded. 

  • Every Sheriff In LA Region Refuses To Enforce Gavin Newsom's COVID Curfew
    Every Sheriff In LA Region Refuses To Enforce Gavin Newsom's COVID Curfew

    Tyler Durden

    Sat, 11/21/2020 – 21:00

    Authored by Thomas Lifson via AmericanThinker.com,

    Sheriffs in 5 Southern California counties with a total population of 17.25 million people – equivalent to the fifth most populous state – are defying that state’s governor. They will not arrest people for violating the statewide curfew that Governor Gavin Newsom has imposed starting today, apparently on the belief that the virus wakes up, and goes out at 10 PM.

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    Bill Melugin of KTTV, Fox 11 in Los Angeles (hat tip: Breitbart) contacted them about enforcing the statewide curfew:

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    Some city police departments are also demurring:

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    Newsom has lost all credibility for restricting activity in the name of suppressing the spread of Covid.  He was caught and exposed flouting his own ridiculous strictures on eating in restaurants (put your mask back on between bites of food).  Public exposure of his mask-less attendance at a party full of lobbyists at one of the fanciest restaurants in the world with no social distancing was bad enough. But his subsequent lying, smirking  non-apology apology may well be the death knell for his political career.

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    His behavior was in utter disregard of his own guidelines for Californians observing Thanksgiving:

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    Other sheriffs in Northern California, including Sacramento County, where the Governor now lives, are also refusing to enforce the curfew.

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    Newsom is facing an existing recall effort, with a deadline of March 17, 2021 to collect 1,495,709 valid signatures. In practice, because some signatures will be challenged, at least 1,700,000 signatures will be required to get the recall election on the ballot. According to Rescue California, which is sponsoring the recall effort, there is already a running start:

    In a telephone conversation with Paul Olson on November 18, whose company, GoCo Consulting, is doing the petition verification for the recall, he confirmed that his firm has already processed 494,000 signed petitions which have either just been turned in or are now being delivered to the county clerks around the state. Olson also confirmed that his firm is currently processing another 230,000 signatures.

    When combined with the 55,000 that were turned in earlier in the year, and the ones already signed but still being delivered, conservatively estimated at 60,000, this campaign has already collected over 800,000 signed recall petitions.

    Californians may go here and download hard copies of the recall petition and obtain up to 5 signatures for each copy, for submission.

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    Californians have already recalled one governor, Gray Davis, which ended his political career. Newsom, who long has had his sights on the Oval Office, and who is related by marriage to Nancy Pelosi, is now the focus of public resentment over arbitrary restrictions in the name of Covid. It is a status he has earned.

  • Growing Food Bank Lines Across America Signal Economic Crisis Far From Over 
    Growing Food Bank Lines Across America Signal Economic Crisis Far From Over 

    Tyler Durden

    Sat, 11/21/2020 – 20:35

    Millions of Americans face food and housing insecurity this holiday season. The unemployment rate stands around 6.9%, with more than ten million folks still out of work. Permanent job loss continues to soar, now about 3.8 million, as a double-dip recession becomes increasingly likely by year-end. 

    We recently pointed out that food bank lines continue to increase across the country as the virus-induced downturn continues to inflict financial devastation on the working poor. 

    Last weekend, the North Texas Food Bank (NTFB) handed out more than 600,000 pounds of food to 25,000 hungry people – one of the largest-ever food giveaways, explained NTFB officials. 

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    The Daily Mail has compiled a list of food banks across the country reporting a surge in demand ahead of the holidays next week. 

    On Friday, US military personnel handed out food in a “massive food drive” at a food bank in Arlington, Texas. 

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    Hundreds of cars were seen at the event organized by Tarrant Area Food Bank. It was described as the “largest food drive” in their history. 

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    Here’s a woman rummaging through a food bank set up inside a church in Wilkes-Barre, Pennsylvania. 

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    A food bank in Fort Washington, Maryland, handing out care packages to hungry people. 

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    Volunteers at a food bank in Los Angeles distributed 1,500 meals on Friday. 

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    People entering a drive-thru food bank in Montgomery, Alabama. 

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    In New York City, a food bank is handing out care packages to hungry folks as the city continues to deal with depressionary unemployment amid a Covid winter. 

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    On Saturday, hundreds of cars were lined up for a food bank distribution in North Jersey. 

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    A Twitter user records huge lines outside one food bank. No location was given. 

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    A Milwaukee food bank this morning has a traffic jam of hungry people waiting for care packages. 

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    Nationwide, food bank lines are surging ahead of the holiday season. 

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    This all comes as the Covid winter begins, and the economic recovery is faltering. JPMorgan warned Friday that a dark winter is ahead.

    Citi econ surprise index clearly shows the recovery is stalling. 

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    JPM chief economist Michael Feroli, who writes that while the economy powered through the July coronavirus wave, “at that time the reopening of the economy provided a powerful tailwind to growth. The economy no longer has that tailwind; instead it now faces the headwind of increasing restrictions on activity.” Meanwhile, “the holiday season—from Thanksgiving through New Year’s—threatens a further increase in cases. This winter will be grim, and we believe the economy will contract again in 1Q, albeit at “only” a 1.0% annualized rate.”

    In other words, the double-dip is about to hit.

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    So what about the “V-shaped” recovery?? 

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    Internet searches for “food bank” jump this past week. 

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    “Food bank near me” also surges. 

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    Remind you of anything? 

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    And for those wondering if the virus-induced downturn in the economy is over – well – you might want to listen to SoftBank CEO Masa Son’s latest warning about an imminent economic crash. 

  • Pennsylvania Judge Throws Out Trump Campaign Lawsuit, Setting Stage For Supreme Court Showdown
    Pennsylvania Judge Throws Out Trump Campaign Lawsuit, Setting Stage For Supreme Court Showdown

    Tyler Durden

    Sat, 11/21/2020 – 20:28

    A federal judge on Saturday dismissed the Trump campaign’s lawsuit in Pennsylvania seeking to invalidate millions of votes, rejecting the “startling” request due to a lack of evidence and ruling that the state can move forward with certifying its election results. U.S. Middle District Judge Matthew Brann, an Obama appointee, ruled that the campaign presented “strained legal arguments without merit and speculative accusations” that were “unsupported by evidence.”

    The ruling is a major blow to the Trump campaign’s efforts to overturn election results, with Biden leading Trump by more than 81,000 votes in Pennsylvania.

    “In the United States of America, this cannot justify the disenfranchisement of a single voter, let alone all the voters of its sixth most populated state. Our people, laws, and institutions demand more,” the judge wrote.

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    Trump’s personal attorney Rudy Giuliani personally argued against the state’s motion to dismiss before Brann on Tuesday, arguing that the commonwealth should not certify its results and making claims of a vast Democratic conspiracy to steal the election. In reaching his conclusion, Brann said the campaign was not “formidably armed with compelling legal arguments and factual proof of rampant corruption” needed to win such a case.

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    “This court has been presented with strained legal arguments without merit and speculative accusations, unpled in the operative complaint and unsupported by evidence,” the judge wrote.

    The suit’s core claim was that certain Democratic-led counties had more lenient rules in accepting “defective” ballots or letting voters “cure” such ballots than Republican-led ones, which the campaign claimed violated the Constitution’s due process and equal protection guarantees. The state denied those claims and also said the campaign’s proposed remedy of disenfranchising tens of thousands of voters was implausible.

    Pressed by Brann on Tuesday if he was actually alleging voter fraud, Giuliani acknowledged that he was not. The judge said in his decision that while Pennsylvania law doesn’t explicitly allow for election officials to let voters cure their ballot errors, it also doesn’t forbid it, and the state’s highest court declined to clarify the issue.

    The campaign has also suggested that hundreds of thousands of ballots in Philadelphia and Pittsburgh should be invalidated because they were allegedly counted without proper oversight by Republican observers, exposing them to potential fraud. Claims tied to such allegations were left out of an amended complaint filed on Sunday but partially reinstated in a second revised complaint filed on Wednesday.

    The second amended complaint also added a proposal that Brann declare the entire Pennsylvania vote “defective” and let the Republican-controlled state legislature decide the election in favor of Trump. Civil rights groups on Friday evening blasted the argument and urged the judge to dismiss the case, saying it was based on an “incoherent conspiracy theory.”

    “That plaintiffs are trying to mix-and-match claims to bypass contrary precedent is not lost on the court,” Brann wrote.

    “These claims were meritless from the start and for an audience of one,” Pennsylvania Attorney General Josh Shapiro said in a statement. “The will of the people will prevail. These baseless lawsuits need to end.”

    The ruling is the highest-profile courtroom defeat for Trump in his attempt to overturn the election outcome. Suits filed by the campaign and its GOP allies have failed in Michigan, Georgia, Nevada and Arizona as judges declined to toss out millions of votes based on vague assertions by lawyers and sworn affidavits from voters who interpreted perceived irregularities as evidence of a Democratic conspiracy.

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    After Georgia certified its results on Friday, Michigan and now Pennsylvania are both likely to do so on Monday, leaving the president an uncertain path to flip enough electoral votes to reverse his defeat.

    Trump will now likely petition the Supreme Court: as Bloomberg notes, Pennsylvania, the largest of the six battleground states, was a particular focus of the Trump campaign’s legal challenges, with suits filed in both state and federal courts. The Trump campaign has suggested it will appeal, and Giuliani has said he sees the case as a “vehicle” to get the U.S. Supreme Court’s 6-3 conservative majority to decide the election.

    In other words, it’s all up to the Supreme Court now. For now, however, the Trump campaign said that it will seen an expedited appeal to the Third Circuit according to a statement issued by Rudy Giuliani, who said that he hopes that “the Third Circuit will be as gracious as Judge Brann in deciding our appeal one way or the other as expeditiously as possible” rather than “simply trying to run out the clock.”

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    And, as expected, Giuliani said that the final showdown will be in the Supreme Court: “this is another case that appears to be moving quickly to the United State Supreme Court.”

  • Do Trump Supporters Live In An Alternate Universe?
    Do Trump Supporters Live In An Alternate Universe?

    Tyler Durden

    Sat, 11/21/2020 – 20:10

    Authored by Bryce Buchanan via The Burning Platform blog,

    On Monday, in her MSNBC show, “Deadline”, Nicolle Wallace said that “right wing media”, like Fox were creating an “alternate reality” for their viewers.  Nicolle said, “You now have a true, a true alternate reality…  I mean, they are pumping flagrant lies into millions of viewers. They’re interviewing lunatics..”  Nicolle’s guest, the brilliant Al Sharpton (of Tawana Brawley hoax fame) said, “We’re now in a nation where facts don’t matter. You make up facts. And not only do you have an alternative reality, how do you debate someone that is dealing with a totally fictitious premise?

    This talk of the alternate, fictional reality inhabited by Trump supporters has been expressed many times by those on the left.  After the Nunes memo was released, exposing parts of the Russia Hoax, CNN’s Brian Stelter said that Sean Hannity was promoting the Nunes lies and he called the story an “alternate reality”.  Stelter’s viewers knew for sure that Trump colluded with Russia,  just like the honorable Adam Schiff said.  Stelter was proud that his viewers knew the truth.

    Regarding the current claims of possible election fraud, Stelter said, “This is not an alternative reality. This is a parallel universe of disinformation.”  Other reporters have added that Fox is, “ presenting you with absolute utter lies and nonsense and conspiracy theories.  … These viewers slash victims are not able to differentiate between fantasy and reality. That’s dangerous.”

    It is instructive to make a list of ‘Things That Are True’, as asserted by the leftist media and contrast it with the ‘Delusions’ that are commonly held by the foolish Trump supporters. 

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    In the list below, “T” indicates the certainly ‘True Things’, as reported by the very wise people in leftist media.  “D” indicates the ‘Delusions’ held by the Trump supporters, who “are not able to differentiate between fantasy and reality.”

    The List:

    T:  This was a very clean and honest election.  There is no evidence of fraud. Claims to the contrary are baseless conspiracy theories.

    D:  There is massive evidence of election fraud of every type, including programmed computer cheating, dead people voting, and massive dumps of Biden votes in the middle of the night.  There is also extremely strong statistical evidence of vote total manipulation.

    *  *  *

    T: Biden is “President Elect” because the news media have declared that to be the case.  He will be the next President, and there is no room at all for dispute about that fact.

    D: The media do not determine who is President.  The next President will be determined when he has enough certified and unchallenged votes.  We are nowhere near that point.

    *  *  *

    T: The story about Hunter Biden’s laptop is “Russian disinformation”.  It’s designed to make you think Joe Biden did something wrong, but Joe doesn’t do things that are wrong.  Joe will bring integrity back to the White House.

    D: The laptop belongs to Hunter Biden.  Russia has nothing at all to do with it.  There is a massive amount of information on the laptop demonstrating schemes to enrich the Biden family by selling influence.  Tony Bobulinski, worked closely with the Bidens to set up some of the questionable transactions.  Tony met with Joe and said Joe was fully onboard with these business plans.  Joe got a percentage of the foreign money.  Hunter made deals with high ranking Chinese communists, plus lucrative deals with several other countries.  Joe is thoroughly compromised.  The way that the MSM and all of social media worked to hide this story is shocking.

    *  *  *

    T: President Obama set a good example of peaceful transition of power.  He did everything he could to help President Trump.

    D: President Obama, and ‘dirty cops’ at the head of his intelligence and law enforcement agencies planned and orchestrated a plan to damage the incoming President.  “The Resistance” has continued to this day.  Trump has never had a single day when he was not under attack by these forces.

    *  *  *

    T: Trump and his supporters are white supremacists.  Trump said the white supremacists in Charlottesville were “good people”.  He seems unwilling to condemn them.  Trumps desire to protect our southern border proves that he is racist.  His desire to ban all Muslims from the country proves that he is a bigot.

    D: Biden started his campaign with the Charlottesville lie and he repeated it often.  He once told a black audience that Republicans wanted “to put y’all back in chains”.  He works hard to keep blacks on the Democrat Voting Plantation, even going so far as to telling a black person, “you ain’t black” if you don’t vote for Joe.  Trump condemned white supremacists in Charlottesville and has done so many times since then.  Borders are not racist.  Countries have borders.  Trump did not ban Muslims.  He wanted to restrict entry from a few pro-Jihadist countries.

    *  *  *

    T: One of the biggest problems facing black people today is that police are shooting large numbers of innocent black people for no reason at all.  America is a racist country where black people have no chance because of institutional racism.  Obama said racism “is still part of our (white people’s) DNA that’s passed on”.  A few days ago, the twice elected President said racism was a “defining feature” of our country, adding that many Americans were, “a little disturbed by the advances that African Americans had made”.  “Whiteness” is the problem.  The Black Lives Matter movement may be the solution.

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    D: Racist whites killing blacks for no reason is as big a problem as nooses in Nascar garages; as big a problem as racist attacks on people like Jussie Smollett.  Black bodies are piling up in some American cities, but it’s black thugs doing the killing, not the police and not white people.   There is no political advantage in being concerned about these black lives, so they are ignored.  BLM is a Marxist hate group that does not even seek to create racial harmony.  If BLM worked to keep black families together or create better schools, that would be great, but that is not their true interest.

    *  *  *

    T: Trump caused the hate that we see in our country.  Trump and his supporter are filled with hate and deserve to be punished after Biden is President.  The violence we have seen during Trumps Presidency has mostly been cause by white supremacist Trump supporters.

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    D: The violence and hateful rhetoric have mostly come from the left.  From day 1, Trump, his family and his supporter have been subjected to vile attacks, both verbal and physical.  The violent mobs in the streets of many American cities are Antifa and BLM leftists.  Their “mostly peaceful” protests are the most costly manmade damage to American property in history.

    *  *  *

    T: Most of the big things that people need can be free if we get the right people in positions of power.  In a decent country, politicians will provide a guaranteed income, free school, free housing and food for people who want it, and free medical care.  Good politicians would also give most of these benefits, including free health care, to anyone who comes across our open border.  It’s the right thing to do.

    D: Nothing but the air you breathe is free.  Politicians cannot “provide” anything that they do not take from a productive citizen.  Politicians can only provide coercion and deficit spending.  Only  productive citizens can provide goods and services.  In countries where politicians take total control of the economy, economic devastation follows, always and everywhere.  It’s the wrong thing to do.

    *  *  *

    I agree with Nicolle Wallace that a huge number of Americans have a false impression of reality because they are being told lies by their media.  The people who constantly hear these lies do live in an “alternate reality”.

    I also agree that this is very, very dangerous.

  • Goldman Capitulates On "Major" Stimulus, Now Sees Just $700BN Fiscal Aid In Early 2021
    Goldman Capitulates On "Major" Stimulus, Now Sees Just $700BN Fiscal Aid In Early 2021

    Tyler Durden

    Sat, 11/21/2020 – 19:45

    Back on September 24, long after we repeatedly said that any hopes for another major stimulus before the election (and certainly after, absent a Democratic sweep) was nothing but a pipe dream, Goldman – which until that point had predicted that Congress would pass a $1.5-$2 trillion fiscal stimulus “shortly” – threw in the towel and said it’s “base case” no longer anticipates a stimulus before 2021, resulting in a 50% cut to its Q4 GDP forecast, from 6% growth to 3% (as a reminder, on Friday JPM slashed its Q1 2020 GDP estimate to negative 1%, i.e., a double dip recession; we expect Goldman will follow suit).

    Well, fast forward two months, when in its latest prediction, the overly optimistic Goldman Sachs has fully capitulated to the political reality, and in a note published on Saturday, its chief political economist Alec Phillips writes that with Congress having recessed for Thanksgiving without progress on fiscal relief measures, “the odds that Congress will pass a major fiscal package before year end” have been further reduced. Instead, Goldman now believes that “a much smaller package of temporary extensions looks more likely” although even that may be overly optimistic in light of the unprecedented polarization that is emerging in Congress, a “return” to fiscal conservatism among republicans (this usually happens any time a Democratic president is in power) and hopes that a covid vaccine may be imminent.

    Additionally, according to Goldman, “the longer Congress waits to pass further fiscal measures, the smaller the bill is likely to get” because while increasing virus spread poses near-term risks, by Q1 2021 the outlook for widespread vaccine distribution will restrain the amount of fiscal support Congress will want to provide.

    * *  *

    While we find it amusing that we predicted more than three months ago what the top political strategist at Goldman Sachs only now concedes, here are some excerpts from Phillips’ “eureka” moment, why he no longer expects any sizable stimulus:

    Additional fiscal support still looks likely but Congress has made virtually no progress since the election. With Congress now on Thanksgiving recess this further reduces the odds that Congress will pass major COVID relief legislation in December. Instead, it looks more likely that Congress will add provisions to the spending bill that Congress is likely to pass to fund the government past Dec. 11, when the current spending authority expires (there is a chance a one-week temporary extension could push the deadline to Dec. 18). This would likely include at least an extension of expanded unemployment benefits, which expire Dec. 26. We estimate that the expansion of eligibility and extended duration of benefits would affect 11-12 million individuals collecting benefits and add slightly more than $13bn/month to benefit spending compared with letting those provisions expire.

    However, in a preemptive backtracking, Phillips admits that “even a simple temporary extension of unemployment benefits is far from certain” since Congress failed to extend the $600/week extra benefit that expired in late July which, at the time, seemed likely to be a forcing event for broader fiscal action. Other deadlines, like the end of restrictions on airline furloughs, have also failed to spur action. So while Goldman believes the odds of an extension are fairly good, “there is a risk that Congress fails to extend these provisions.”

    The Georgie runoff elections on Jan 5 present another complication. As Goldman notes, “Republican campaign messages have emphasized the benefits of divided government, while Democrats have focused on Republican opposition to a large relief package as a reason to support Democrats in the runoff.” Senate Democratic Whip Durbin recently indicated that Democrats would emphasize Republican opposition to the House Democratic relief package, saying “if they do nothing in the post-election session on COVID relief, that may affect the vote on Jan. 5 in Georgia.”

    In assessing the outcome of the Georgia race, Goldman says that if Congress enacts a few short-term extensions in December, this would probably push the broader debate past President-elect Biden’s inauguration on January 20, 2021. For example, Congress might extend the unemployment provisions through February 2021, which would likely allow enough time to work out a broader agreement once the Georgia results are clear and President-elect Biden has taken office. In such a scenario, Goldman expects legislation to become law sometime in February, with provisions taking effect in February or March.

    The GA runoffs, which will determine control of the Senate, will also define the amount of total fiscal support, which will also depend on the extent of renewed virus spread, and the outlook for vaccine distribution. According to Phillips, “worse-than-expected virus spread and new restrictions on activity seem likely to lead to a higher total price tag for additional fiscal support, while good news on vaccine development and distribution is likely to limit the amount of additional support.” Separately, while developments in these areas could surprise to the positive or negative in the near-term, the outlook is likely to be on an improving trend over the next several months, as more of the population gets vaccinated. If so, the longer Congress waits to enact broad COVID-relief legislation, the smaller the total amount of additional fiscal support might be.

    Covid aside, Senate control remains by far the most important factor in determining the total amount of fiscal support. In the event that Democrats win both Georgia seats on Jan. 5, Goldman expects Congress to pass fiscal measures in the range of $2 trillion (still, “while a “Blue Wave” outcome in which Democrats won a Senate majority with seats to spare might have led to a larger package, a 50-50 Senate with Vice President-Elect Harris casting the tie-breaking vote might restrain the size somewhat.)

    As an side, the difference between 49 and 50 Democratic seats in the Senate is critical, for two reasons according to Goldman: First, with 50 seats Democrats would control the Senate agenda and would be able to bring a larger fiscal package to a vote. Second, even if enough Republicans did not support such a package, Democratic leaders could use the reconciliation process to pass most of those measures with only 51 votes (i.e., no Republican support).

    In any event, under a divided Congress fiscal stimulus is likely to be much smaller and the size is likely to grow smaller the longer it takes Congress to pass legislation. Under Goldman’s base case that Republicans hold at least 51 seats in 2021 (prediction markets imply a 77% probability of this), Goldman now assumes that Congress would pass fiscal measures totaling $1 trillion (just under 5% of GDP), with most of the spending in 2021.

    It gets worse: since by early 2021, it is virtually certain that we will have actionable positive vaccine news, this combined with a likely delay until early 2021 in passing major fiscal legislation, “suggests that the amount is likely to be smaller.”

    As a result, Goldman now assumes only $700bn in fiscal measures, in bad news for insolvent state and local governments which had been holding out hope for a $2.2+ trillion stimulus package as Nancy Pelosi demanded in October (Goldman still thinks such a package would still address the same components it had previously expected: unemployment benefit extension, small business support, a limited amount of aid to states (likely through education grants, as in the prior Senate Republican bill), and funds for public health efforts.)

    * * *

    One final point on the Treasury’s recent decision not to extend some emergency Fed facilities: according to Phillips this does not meaningfully change the prospects for stimulus.

    Treasury Sec. Mnuchin has called on Congress to reallocate the $455bn in ESF funds that he estimates have not been used by Fed facilities or direct lending programs. Along with $138bn in unspent Paycheck Protection Program (PPP) funds, there are $593bn in “unused” CARES Act funds that congressional Republicans propose to reallocate to other uses. However, these funds are relevant mainly for political purposes. Since none of those funds are expected to be spent for the original purposes, rescinding them would not change projected spending. Congress can reallocate these funds to new programs where they would then be spent – unemployment benefits or a second round of PPP loans, for example—but this would have the exact same budgetary effect as leaving the funds in place and spending “new” money on those programs.

    However, the reallocation of these funds might lead Republicans to support a larger package than they had previously. For example, if Republican leaders count the $593Nn in “reallocated” funds against a hypothetical $700bn package, they might announce that their legislation spends only $107bn. This would be true in one very narrow technical sense (a concept known in federal accounting as “budget authority”) but it would not actually reduce the impact on the deficit, nor the official cost estimate the Congressional Budget Office (CBO) would produce. Still, Republican support for reallocating these funds to new uses suggests openness to a package of nearly $600bn, slightly larger than the prior Senate Republican proposal of slightly more than $500bn. According to Goldman, the need to compromise with congressional Democrats and the incoming Biden Administration would likely push this total up slightly, to around the $700Bn the bank expects.

    * * *

    Bottom line: Nancy Pelosi’s stubborn unwillingness to compromise with either Senate or White House negotiators, and trim her “ask” from $2.2TN to the upper $1TN’s, means that Democrats are now facing a dramatically reduced stimulus, which in turn would have substantial consequences for net treasury issuance in 2021 (the Treasury already has access to some $1.6 trillion in cash mostly from Bill issuance), and potentially for stocks – which continue to expect a “major” stimulus – as well as the broader economy, which will continue to suffer as the tailwind from the massive stimulus passed in early 2020 wears off. In fact, one could argue that without a sizable stimulus, and with very likely delays in implementing nationwide covid vaccines, the GDP contraction in Q1 which JPM already expects in its base case, will only get worse in Q2 and eventually devolve into a full-blown double-dip depression.  What Congress does then will depend on just how vindictive a Republican Senate at that time with an ostensibly democrat administration.

    Of course, if Goldman is right and if Congress is indeed neutered, this means that the market will shift its expectations for a major stimulus to come from the Fed instead, with traders already expecting a doubling in QE some time in early 2021 so the central bank can monetize all the $2.4 trillion in net issuance in 2021.

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    But for that to happen, a new “crisis” will first have to take place as we explained last weekend…

  • UNICEF Finally Admits: "Schools Are Not Main Drivers Of COVID Among Children"
    UNICEF Finally Admits: "Schools Are Not Main Drivers Of COVID Among Children"

    Tyler Durden

    Sat, 11/21/2020 – 19:20

    Via 21stCenturyWire.com,

    One of the easier targets for social demolition by western authoritarians and bureaucracies has been schools.

    Aided and abetted by a hysterical mainstream media permanently geared towards maintaining a constant level of public fear, politicians have been able to deceive worried parents and teachers who may genuinely believe that COVID19 poses some sort of overall health threat to children (which it does not), as well as the widely-held canard that asymptomatic children are somehow ‘spreading the virus’ to other adults, the old and vulnerable.

    Numerous scientific studies have clearly shown how this is not the case. But by sustaining these widely held myths, governments have been able to successfully level primary and secondary education across the western hemisphere and retard the educational and social development of hundreds of millions of young people in the process.

    It is yet unclear why governments have been so keen to do this, but it’s not at all surprising that the populace has gone along with the theatre, especially after being primed by decades of ‘health and safety’ culture and corporatisation of public policy.

    It’s crucial to note: all of these findings literally destroy the argument for panic-driven policies like mass testing and mass vaccinations.

    After many months of sitting idle on the matter, some institutions, like UNICEF are now speak up.

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    Bianca Quilantan at Politico reports…

    Data from 191 countries shows no consistent link between reopening schools and increased rates of coronavirus infection, UNICEF reported in an analysis Thursday.

    In releasing its first comprehensive assessment of the pandemic’s effects on children, the United Nations agency said “there is strong evidence that, with basic safety measures in place, the net benefits of keeping schools open outweigh the costs of closing them.”

    “Schools are not a main driver of community transmission, and children are more likely to get the virus outside of school settings,” UNICEF said.

    The numbers: As of November, 572 million students — about 33 percent of all students — are being affected by 30 nationwide school closures, the report found. At their peak, school closures affected almost 90 percent of students around the world.

    Kids accounted for one in nine reported Covid-19 infections [ie. PCR positive tests] worldwide, the report found.

    “While children can get sick and can spread the disease, this is just the tip of the pandemic iceberg,” said Henrietta Fore, UNICEF executive director. “Disruptions to key services and soaring poverty rates pose the biggest threat to children. The longer the crisis persists, the deeper its impact on children’s education, health, nutrition and well-being. The future of an entire generation is at risk.”

    Dropoff in services: From surveys across 140 countries, UNICEF estimates that 70 percent of mental health services for children and adolescents have been disrupted during the pandemic, with 65 percent of countries reporting a decrease in home visits by social workers in September compared to last year.

    Nearly one-third of the countries saw a drop of at least 10 percent in coverage for health services. That includes routine vaccinations, outpatient care for childhood infectious diseases and maternal health services.

    Across 135 countries, there has been a 40 percent decline in the coverage of nutrition services for women and children. The number of children hurt by multidimensional poverty — characterized by poor health, education and living standards, in addition to the traditional monetary standards — is estimated to have increased by 15 percent globally by mid-2020.

    Transmission findings: Child-to-child transmission of the coronavirus in schools was “uncommon and not the primary cause” of infections among children who caught the virus while attending school, according to a July assessment of 31 countries conducted by the European Centre for Disease Prevention and Control…

    Continue this story at Politico…

    Perhaps they are finally waking up the catastrophic situation many societies now face because of the suicidal, reactionary policies that governments are pursuing.

  • Watch: Protesters Set Fire To Guatemala's Congress Building
    Watch: Protesters Set Fire To Guatemala's Congress Building

    Tyler Durden

    Sat, 11/21/2020 – 18:55

    Anti-government protesters stormed Guatemala’s congressional building on Saturday afternoon and set fire to it amid increasing frustrations with the government over a new budget that would slash educational and health spending, reported AP News.

    Videos on Twitter show hundreds of protesters cheering outside the building in Guatemala City as it erupts in flames. 

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    BBC reports, “fire services have managed to put the fire out, but the extent of the damage is not yet known.”

    The incident comes as thousands of demonstrators lined the front of the National Palace in Guatemala City. They say legislators secretly passed a budget for the next fiscal year during a period where the country was distracted by recent hurricanes (Hurricane Eta and Iota) and the virus pandemic. They also allege government officials prioritized infrastructure projects to companies with close ties with the government, adding that the new budget neglects to allocate monies for social and economic programs to help the working-poor amid the virus pandemic. 

    Vice-President Guillermo Castillo denounced the burning of the congressional building on his Twitter account: 

    “Anyone who is proven to have participated in the criminal acts will be punished with the full force of the law.” He said people have the right to protest, “but neither can we allow people to vandalize public or private property.”

    Mass protests were also seen nearby. 

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    President Alejandro Giammattei said meetings had been arranged with various groups to change the controversial budget.

    On Friday, Vice-President Guillermo Castillo condemned the budget and said that both the president and himself should resign “for the good of the country.”

    Guatemala’s human rights prosecutor Jordan Rodas said the budget was a “devious blow to the people because the country was between natural disasters, there are signs of government corruption, clientelism in the humanitarian aid.” 

    Roman Catholic Church officials in Guatemala were also displeased with the budget, asking the president to veto the budget on Friday. 

    Add Guatemala to the list of countries experiencing social unrest. 

       

      • Horseman: "The Bond Bull And Commodity Bear Markets Are Over" – Here's How To Trade It
        Horseman: "The Bond Bull And Commodity Bear Markets Are Over" – Here's How To Trade It

        Tyler Durden

        Sat, 11/21/2020 – 18:30

        After a remarkable start to the year, surging almost 30% when all other funds were tumbling, the fund formerly known as Horseman Global until its recent purchase by CIO Russell Clark (hence its current name Russell Clark Investment Management), has had a turbulent seven months, at one point in the summer even forcing the famously bearish hedge fund to throw in the towel on his well-known bearish/deflationary position and to not only turn net long for the first time in a decade (as we reported last month), but to shift its global outlook from deflationary to inflationary.

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        Unfortunately for Clark, just as he pulled a 180, going long such cyclical sectors as banks, mining and metals, and industrials while going aggressively short industrials (a bet on higher rates), a deflationary wave spurned by surging covid cacses hammered stocks and in October his fund lost 7.3%, bringing what was once a gain of as much as 25% YTD to just above 0%…

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        … something not lost on his LPs with the fund’s AUM dropping to just $91MM as of Oct 31, down 9% from the $100MM as of Sept 30.

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        And since for most funds, $100MM is the critical minimum capital that most hedge funds need to remain viable, Clark may soon be facing extinction unless he can quickly turn around his performance, which for years suffered from fighting the Fed head on.

        Which is not to say that Clark doesn’t think he can do it.

        In his latest letter, the hedge fund manager blames his recent volatility on the market’s wild swings from a deflationary to a reflationary mode and back again (incidentally he could have just bought bitcoin which goes up no matter which of the two themes is prevalent and already be up more than 160% for the year), and in his latest slow the flood of redemption requests, Clark writes that one thing he is good at “is working out when a bull market is over” (referring to the nearly 4 decade-long bull market in bonds), a skill which the formerly bearish hedge funder thinks will allow him to position appropriately for what comes next (which reminds us that David Einhorn did a similar thing last month when he said that the tech bubble burst when the Nasdaq cracked on Sept 2, only for the S&P to soar to new all time highs just weeks later).

        This is how Clark lays out his reflationary thesis, starting with the hayday of the carry trade era in the early 2000s:

        All bull markets (and bear markets for that matter) have some combination of currency, bond and commodity cycle that is working for or against them. In my first decade, which started at the top of the dot com bubble, the overwhelming trade was the tightening of commodity markets, with the standout trade being iron ore moving from USD 20 a tonne to USD 200 a tonne. The commodity bull market, and a dovish Federal Reserve allowed “carry trading” – a very popular hedge fund trade – to become extremely lucrative, and the hedge fund industry prospered. 2000 to 2010 was the decade of the hedge fund. Other carry trades such as convergence trades in Europe (short bund long peripheral bonds) and in the US (long mortgage backed securities, short treasuries) also took off, until 2008 marked the beginning of the end.

        Things changed after the financial crisis, but especially after the 2010 DOJ crackdown on expert networks (thanks in no small part to this website), which also ended the “information arbitrage” (read legal insider trading) popularized by Steve Cohen and countless spin off funds. To Clark, the defining feature of the last decade was not just the chronic inability of hedge funds to generate alpha (as they no longer had access to inside information presented as “expert networking”) but the collapse of the carry trade and the advent of the capital arbitrage trade, i.e., issuing debt to buyback stock, something we have spent hundreds of articles discussing over the past decade:

        The 2010s has really been the reversal of the 2000s carry trade. In fact, for many years we ran what could be called a negative spread trade – long bonds, and short emerging markets and cyclicals that worked fantastically well based off the oversupply of commodity markets. But if the 2000s was about the carry trade, then 2010s were about the capital arbitrage trade. Capital arbitrage is basically issuing debt to buy equity, either through M&A or buybacks to create “value”. Apple has been very successful at issuing large amounts of bonds to buy back shares. With 40-year Apple bonds only yielding 2.8%, this is a no brainer trade. The investment firms best placed to benefit from such arbitrage has been private equity, and without question the 2010s have belonged to the private equity industry.

        Which brings us to today when, as hinted above, Clark calls an end to the “cap arb” trade. It is here also that the formerly bearish investor explains why he shed his bearish bias, pointing to the Fed’s helicopter money which “essentially fixed yields to allow governments to spend as much as they want in order to maintain economic growth.” This took any fundamentally-based bearish trades off the table – for the simple reason that there is no longer anything to be bearish about when the Fed controls the bond market – and “the upshot of this is that” Clark no no longer has to worry about private sector shenanigans: “all I need to do is focus on government bond yields.”

        Covid-19 and the response to it by Western central banks have made calling the top in this “capital arbitrage trade” much easier. Previously, I would be looking at government bond yields, and wondering how much corporate bond spreads could widen, particularly if problems in clearinghouses and autocallables came to the fore. When they did come to the fore in March, the Federal Reserve essentially lashed corporate debt yields to treasury yields. It also essentially fixed yields to allow governments to spend as much as they want in order to maintain economic growth. The upshot of this is that I no longer need to worry about private sector shenanigans (of which there is plenty), all I need to do is focus on government bond yields.

        Which brings us to the punchline, and why after being a devout deflationist, Clark now sees inflation as inevitable and perhaps imminent: “I am bearish government bonds. As stated above, markets decided October was deflationary.” And yet, not everything traded deflationary in October: “commodity markets with the exception of oil were marking inflation. Many commodities were up, some significantly. US corn, Chinese corn, crude palm oil, natural gas, natural rubber, the CRB Raw Industrial Index, Chinese pork, Brazilian rice to name a few. Even the US oil market looks to be tightening rapidly.”

        Additionally, and as we noted yesterday when we showed the record disconnect between US and Chinese 10Y yields…

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        … Clark writes that Chinese bonds have also gone their own way this year, with rising interest rates: “Why buy a 40 year Apple bond, when a Chinese 2 year bond offers the same yield in a potentially appreciating currency?”

        There is another big change the former “Horseman” points out:

        When we look at money supply M2 measures in Europe and Japan, Japanese M2 is growing at the fastest pace since the 1980s. Eurozone has the fastest pace since 2007. If M2 is growing rapidly, then why do these nations still need negative interest rates? Especially if a vaccine has been found.

        While the answer is self-explanatory (the liquidity is not going into the broader economy but is merely serving to backstop risk prices), Clark derives two conclusions:

        • One is that the commodity bear market is over.
        • And two, the bond bull market is also over.

        Incidentally, Clark is not the only one who believes the commodity bear market is over. In his latest Bear Traps report, Larry McDonald quotes a hedge fund manager who makes an interesting point:

        The Fed could be in a tricky spot when they meet in December. The pressure to ease is significant given increased cases/mitigation measures, especially as fiscal impasse continues. However, financial conditions have never been easier.

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        It’s a problem central banks at ELB face post-market stabilization, how to be countercyclical. This month, US CCCs (junk of the junk) are outperforming everything in credit, Goldman FCIs on multi-year lows (easy financial conditions), NYSE stocks % above the 200-day ma at 82% (the 2016 – 2019 high was 75%!). Market participants don’t fear the downside. shorts are gone, options hedging not happening much, the sentiment is bullish, hedge funds have the most net exposure in 5 years. If there’s one thing the market teaches over and over, is it’s better to fade the crowd than to chase it. We are near term cautious, bullish (commodities, EM) for 2021.

        Clark admits that for now it is unclear what the immediate implications of these two “markets” being over are, noting that it is unlikely that we get another decade like 2010 of carry trades “given yields are so low everywhere, that could be a problem.” That said, he is confident that this “capital arbitrage” trade looks to have very poor risk reward from here.

        For that reason, Clark is now focusing his shorts on companies that have benefited from low bond yields and low commodity prices – utilities, private equity and infrastructure assets. To those one could also add growth and momentum stocks, which as we showed yesterday, have a record high duration, making them extremely vulnerable to rising rates.

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        His final message is to those who wonder how he can short Private Equity firms: “People who wonder how we can short Private Equity firms have forgotten what happened to listed hedge funds through the 2010s!”

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        Clark then muses some more on this topic in his Sector Allocation section:

        According to Deloitte, Private Equity assets have grown from less than USD 2 trillion in 2010, to over USD 4.5 trillion by 2019. Private Equity has many benefits over public funds. Leverage can be applied to companies, and short term losses can be tolerated while a firm builds market share. Private Equity managers can also choose when to sell assets. Over the decade, secondary buyouts, that is when a portfolio company owned by private equity is sold to another private equity buyer has increased from USD134bn in 2009 to USD600bn in 2019.

        One huge tailwind for private equity has been falling corporate bond yields. During the financial crisis, high yield debt yielded 18%. As of today, that yield is 4.9%, close to the lowest on record. Corporate debt to GDP has also reached a record share of US GDP at 55% in Q2 2020, well in excess of levels seen in 1991, 2000 and 2007. A change in the interest rate environment would likely be negative for the private equity industry.

        And while all that may be correct, and both listed hedge funds and the PE industry in general is facing the all too real danger of rising rates, at this point when every single redemption request matters a far more important question for Clark is what happens to one specific unlisted hedge fund namely his own, unless he manages a “home run” month in the very near future.

      • Do Not Trust Governments With The Control Of Money
        Do Not Trust Governments With The Control Of Money

        Tyler Durden

        Sat, 11/21/2020 – 18:00

        Authored by Richard Ebeling via The American Institute for Economic Research,

        If there one thing that is fairly certain in this life – besides the seeming inescapability of death and taxes – is that once someone is appointed to almost any position in the political and bureaucratic structures of a government they soon discover how important and essential is the organization of which they are a part for the well-being of the nation. The country could not exist without it, along with its increasing budget and expanded authority. This applies to the Federal Reserve, America’s central bank, no less than other parts of government. 

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        The news media has reported that the apparently unlikely appointment of Dr. Judy Shelton to the Federal Reserve Board of Governors probably will be successfully maneuvered through the full Senate confirmation process. Shelton would then sit on the Federal Reserve Board filling the balancing a term that ends in 2024 and then made eligible for a 14-year term. Hers has been one of the more controversial nominations to the Fed in recent years, with critics fervently expressing their negative views of her. 

        For instance, Tony Fratto, a former Treasury official and deputy press secretary under George W. Bush, was recently quoted as saying that Shelton’s appointment would be “a discredit to the Senate and the Fed. It screams. Nothing at all is serious. Not us. Not you. Not them.”

        Mainstream Economists Against Anyone for Gold

        Back in August of this year, over one hundred academic and business economists issued an open letter to members of the U.S. Senate calling for rejection of her nomination to the Fed. Among those who signed were some economics Nobel Laureates, including Robert Lucas and Joseph Stiglitz. They insisted on her unfitness for such an appointment. Why? They said: “She has advocated a return to the gold standard; she has questioned the need for federal deposit insurance; she has even questioned the need for a central bank at all.” 

        They also accused her of hypocrisy, saying that Shelton had changed her stance on Federal Reserve policy and the institution’s relevance based simply on a desire to be appointed to the Fed board, and to serve the wishes of the president who had nominated her. So, she stands damned if she opposes the Fed with her call for a gold-backed currency, and she is damned if she modifies her positions on monetary policy supposedly to be more palatable to the Senators deciding her professional fate. Clearly, her critics would only stop being critical if they were somehow convinced that Judy Shelton truly loved the Fed, hated the gold standard, and supported “activist” monetary policy and interest rate manipulation; and for the full 14 years of her term on the Fed Board. 

        Political campaigns are full of people who say that they are drawn to higher echelon government employment so they can “give back” to or “serve” the country, and no doubt there are some who are seriously sincere when they say so. But who can deny that what also appeals to such people, and many others who are far more crudely opportunistic, is the attraction of being a “player” and an “insider” in the various halls of political power and decision-making in determining the bigger picture of the “shape-of-things-to-come?” 

        And it may be that Judy Shelton, based on her own statements of desiring to “serve” the country in this particular capacity, truly wants to, even with all her apparent changing views and emphases. Or maybe it’s all a game to say what she thinks others want and need to hear so that will approve her as a Board member of the Federal Reserve, and then sit at the Big Boy’s – oh, I mean the Big Person’s – table.  

        The Real Issue is the Case for Gold, Not a Person’s Sincerity  

        Be that as it may, the real issues concern whether her views on gold and the Federal Reserve are reasonable or not as useful input into the decision-making process of Fed monetary policy. To begin with, there is a far longer history of human societies going back to the ancients in which gold or silver or some other “real” commodity has served as the medium of exchange, the money-good facilitating transactions. The period of history in which mankind has primarily relied upon fiat or paper money currencies only covers about the last one hundred years. 

        Now, merely because an idea or an institution has been around a long time does not prove its validity or continuing usefulness. A variety of bad ideas and bad institutions beclouded human betterment for many centuries until they were finally overturned and replaced by other ideas and institutions considered more in line with bringing about improvements in the human social, economic, and political condition. 

        Fundamentally, the case for a gold standard has been based on the idea that governments have been notorious in the misuse of their capacity to turn the handle of the monetary printing press to create the money needed to fund their expenditures, rather than fully rely upon the collection of taxes. By this means, governments are able to get around the necessity of telling their citizens the truth concerning the actual cost of the activities it wishes to undertake. This was understood by many economists of differing policy persuasions.

        “Progressive” Richard T. Ely Challenged Arbitrary Monetary Policy

        As an example, Richard T. Ely (1854-1943) is usually viewed as one of the early and successful proponents of the interventionist-welfare state in America in the late 19th and early 20th centuries. Having earned his bachelor’s and master’s degrees at Columbia University in New York in the second half of the 1870s, he went off to complete his studies in Imperial Germany. He came back imbued with the economic ideas and policy prescriptions of the German Historical School, with its emphasis on pragmatism and expediency as the needed basis for guiding governments in regulating industry and pursuing various forms of redistribution of wealth. He was also one of the founders of the American Economic Association in 1885 and a leading figure in the American Progressive Movement in the 1890s and early decades of the 20th century. 

        In his co-authored textbook, Outlines of Economics (1893, 4th revised ed. 1926) Ely highlighted the abuse with which governments – including the U.S. government during the Civil War of the 1860s – had used the issuance of paper or fiat money to fund expenditures with serious inflationary consequences for the citizens of countries experiencing such dangerous power by those in political authority. And why governments have little or no incentive to ever rein in their monetary mischiefs: 

        “The supply of gold, as we have seen, is subject to variations arising from such influences as the discovery of new deposits, the exhaustion of old ones, and changes in the methods of handling the ores. Variations in gold production are reflected in movements of the general level of prices.  

        “The supply of fiat money, it is argued, could be arbitrarily controlled by government and its purchasing power could be kept more nearly stable. Closely scrutinized, this particular argument for fiat money turns into the strongest of the arguments against it. Under practical conditions, experience has shown, governments find it much easier to expand than to contract their issues of paper money. 

        “Expansion permits larger expenditures; it is, for the time being a substitute for taxation; it raises prices and stimulates business. Contraction on the other hand, is at the expense of an immediate increase in taxation; it calls for rigid economy on the part of the government; it has for the time being a depressing effect upon business activities. 

        “With all of its shortcomings, the gold standard has the great advantage that its variations, largely the result of the play of the forces of the market, are beyond the arbitrary control of government.” (p. 259)

        J. Laurence Laughlin and the Perverse Incentives of Paper Money

        We may use one more example, but this time by an economist with nearly the exact opposite of Richard Ely’s public policy views. J. Laurence Laughlin (1850-1933) earned his PhD from Harvard University, and became a founder of the economics department at the University of Chicago in 1892. He was an advocate of the establishment of a central bank in the United States in the years leading up to the opening of the Federal Reserve in 1914. He is also often considered a critic of the traditional quantity theory of money. On general matters of economic policy, Laughlin was a strong proponent of a general laissez-faire, free market society. 

        In his Money and Prices (1919), Laughlin also emphasized the danger of paper currencies not connected to gold by redemption requirements to prevent governments from taking advantage of their capacity to increase the amount of paper money in circulation:  

        “The very existence of paper [money] issues, originating in a wrong method of borrowing [by the government], is a constant menace. The mere lapse of time in which no injury has been incurred unfortunately serves to lull the fear of anger. If retained, such issues are a suggestion for similar crude expansions in the future, when men are too excited to judge calmly of their acts. Their very presence is an incentive.

        “If legislators were all monetary experts, and never influenced by political considerations, there would be little risk in retaining for a time [such fiat money]; but we must take men as they are, and provide for probable acts of those who are incompetent and ill-advised. Obviously, these national guardians of our monetary system do not personally lose anything when they get the treasury into desperate straits . . . 

        “What is still more dangerous is the fact that the whim of the government is the only limit to its [paper money] issues . . . If a fancied need presses upon men inexperienced in monetary operations, especially if they have been inoculated with the fallacy that the more money a country has the better off it is, there will be excessive issues, followed by raids on the reserves.

        “The paper will depreciate – and the country will undergo rapid fluctuations in prices, an unsettling of contracts, a period of mad speculation, leading to the inevitable ruin of a commercial crisis . . . It being understood [therefore] that convertibility into gold is the prime prerequisite either of government or bank issues.” (pp. 265-266; 274)

        The 20th Century Failures of Paper Money Systems

        Is there anything in the history of the last one hundred years to invalidate the questions and concerns of such economists as Richard T. Ely or J. Laurence Laughlin, from so long ago, that led them to support and argue for a gold standard on political grounds? There was the monetary madness during and after the First World War, with paper money inflations to fund the expenses of the belligerent powers, and the destructive hyperinflations that followed the end of that conflict. (See my article, “The Lasting Legacies of World War I: Big Government, Paper Money and Inflation”.)

        There was the false sense of economic and monetary stability in the 1920s, followed by the Great Depression due to misguided Federal Reserve policy in the ’20s and disruptive government interventions and centralized planning schemes in the decade of the 1930s. Then more inflations to finance the Second World War, with a rollercoaster of inflations and recessions in the post-World War II period, followed by the new Federal Reserve monetary mismanagements that led to the financial and housing crises of 2008-2009, with continuing monetary manipulation over the next ten years of economic recovery. (See my article, “Ten Years On: Recession, Recovery and the Regulatory State”.)

        Institutions Restrict Potentially Harmful Behavior

        Unfortunately, the benefit of a gold standard has not been that it has always effectively prevented government monetary mismanagement and abuse; far from it. But, like many social, economic and political institutions, it sets limits and rules on the conduct of the societal participants that restrict everyday conduct that if allowed and regularly pursued can bring about changes in attitudes and actions that cumulatively brings damage to all in society.

        It can be easily argued that John Maynard Keynes’s “revolutionary” idea of governments balancing their budget over the business cycle – budget deficits in ‘bad” times and budget surpluses in “good” years – rather than on an annualized basis set loose the perverse political incentives of politicians never having to completely tell the citizenry from whence will come all the revenues to cover the costs of increasing government expenditures with which campaign contributions and votes are bought by politicians in the never-ending election cycles of modern democratic society. This institutional change has led to U.S. government budget deficits for 63 of the last 75 years since the end of the Second World War in 1945, with, now, annual trillion-dollar budget deficits likely to be the norm for as far as the fiscal eye can see. (See my articles, “Why Government Deficits and Debt Do Matter” and “Debt and Deficits are Out of Control” and “Debt, Deficits and the Cost of Free Lunches”.)

        The same has happened with mismanagement of the monetary system with, first, the weakening of the gold standard during and after the First World War, and then its abandonment in one country after the other beginning in the 1930s. The world is on fiat or paper money standards with total control in the hands of various monetary central planners with little or no external check on their policy decisions, other than the particular monetary theory fads and fashions that central bankers and their staff economic advisors currently hold as a guide for actual policy actions; along with the pressures of contemporary politics, regardless of how much it may be formally punctuated that the leading central banks around the world make their policy choices independent of the political climate. 

        Not having to worry about mandatory redemption of the bank notes and other monetary equivalents they issue being paid in gold “on demand” at a fixed rate of exchange by either domestic or foreign holders of their fiat currencies, central banks have been able to set loose what more than one economist has called the “age of inflation” since the end of the Second World War. 

        Gold an International Money vs. Fluctuating Paper Currencies

        The end to the gold standard also weakened the international quality of what had been in many ways a global monetary system in which gold was the world’s money and national currencies were merely different denominational ways of expressing relative amounts of the same money good. 

        The French social philosopher, political economist, and “futurist,” Bertrand de Jouvenel (1903-1987), in an article on “Money in the Market” (1955), recounted the experience of a British family vacationing in France before and then after the end of the gold standard in the 1930s:

        “In 1912, an English family spent its summer holiday in an out-of-the-way French village. A bill was presented, invoiced in francs; the English father had nothing but English gold sovereigns, then in circulation in Britain. This did not embarrass the innkeeper; true, he had never seen coins stamped with the British Monarch’s profile, but he was thoroughly familiar with the gold coins then circulating in France. 

        “Placing a 20-franc gold piece by the side of the sovereign, he found the latter heavier (123.27 grains to 99.56) and it seemed to him that two sovereigns made up about the same weight as a 50-franc gold piece (50 francs = 248.9 grains; 2 sovereigns = 246.54). Therefore, without consulting anybody, he made up his mind to accept two sovereigns as equivalent to 50 francs . . .

        “In 1932, the same English family returned to the same spot, again the head of the family had no other means of payment than those current in Britain at the time, i.e., pound notes. The aged innkeeper took these notes, laid them side by side with French notes, and this time learned nothing from the comparison . . . The ‘weighing’ of pounds had ceased to be a physical process, it was now a market process, a day-by-day confrontation of the French demand for pounds with the British demand for francs.

        “In the former case the rate of exchange depended upon the unchanging balance of physical weights in fine gold between the national coins: it was therefore inherently stable; in the second case it depended upon the changing balance of claims between two countries . . . it was therefore inherently unstable.” (See Bertrand de Jouvenel, Economics of the Good Life [Transaction Publishers, 1999], pp. 179-180.)

        The Changing Opinions of Economists on Monetary Policy

        When Great Britain in 1931 and then the United States in 1933 went off the gold standard, there was much hue and cry among a large majority of economists and many in the general public that a terrible policy mistake had been made in ending gold as the core money based on obligatory redemption of bank notes into a fixed weight of gold. 

        No doubt, the economists who issued that open letter in August of 2020 angrily protesting to the U.S. Senate their objection to Judy Shelton’s nomination to the Federal Reserve Board of Governors would all consider it the essence of monetary policy wisdom in the 1930s to have freed the British and American monetary systems from what Keynes had in the 1920s called that “barbarous relic” – gold. 

        By implication they would also be saying how misguided and wrong-headed were all those economists of the 1930s to oppose the leaving of the gold standard so governments might have wider discretion to wield monetary policy in the “activist” attempt to overcome the Great Depression. 

        Let me suggest that it is not outside the realm of the possible, perhaps the probable, that 50 years from now, many, maybe a significant majority, of economists will look upon the signers of that letter and think how misguided and foolish they were in thinking that governments and their central bankers had the knowledge, wisdom and ability to micromanage the economy through the macro-manipulation of money, credit and interest rates. 

        The Freedom to Choose the Currency to Use

        They will wonder how it was that so many in the economics profession could have suffered from the delusion that monetary central planning ever could be any more feasible than the failed Soviet-style system of general central planning of human affairs. Those future economists will be confounded that these economists of 2020 had not paid more attention to the reasoning of Austrian economist and Nobel Prize-winner, Friedrich A. Hayek (1899-1992), when he pointed out that nothing had been more wrong-headed than leaving the control of money in the monopoly hands of government.  

        That, as Hayek had argued in Choice in Currency (1976), nothing would be more reasonable and rational than letting everyone, anywhere, choose the money or monies that they found more convenient and advantageous to use in various and sundry transactions and exchanges. That such freedom to choose would be an invaluable institutional means to keep government monetary mismanagement and abuse in check, since any political authority which noticeably reduced the value or increased the uncertainty of its national currency’s future worth, would see a flight out of its use by its own and other citizens of the world. (See my article, “Government Monopoly Money vs. Personal Choice in Currency”.)

        Indeed, those future economists may also wonder why it was so difficult for those earlier economists of 2020 to fully appreciate the value and effectiveness of private competitive free banking as a replacement for the atavistic notion that a central bank was either necessary or desirable. They will be surprised at the general ignoring of an entire sub-field of monetary theorists that had emerged in the late 20th and early 21st centuries who demonstrated why central banks were the very institutional instrument to propagate the types of instabilities that monetary central planning was supposed to eliminate, or at least reduce. And why and how it was that the very stability and feedback needed for a functioning and growing economic order to flourish was far more likely and possible through monetary freedom. (See my eBook, Monetary Central Planning and the State.) 

        And who knows, if Judy Shelton is appointed to the Federal Reserve Board of Governors, and if she actually espouses and defends the ideas for which she is being condemned by so many of those “mainstream” economists today, it may be a useful step to the societal transformation to a freer society, a key long run element of which must be the freeing of money from political control.

      • Manhunt Underway After 69 Flee In Mass Lebanese Prison Break, 5 Fugitives Killed
        Manhunt Underway After 69 Flee In Mass Lebanese Prison Break, 5 Fugitives Killed

        Tyler Durden

        Sat, 11/21/2020 – 17:30

        A mass prison break in Lebanon on Saturday unleashed chaos outside capital of Beirut, including a high speed police chase of escaped convicts ending in a crash that left five dead.

        A largescale manhunt in and outside the city of Baabda – a mountain town that overlooks Beirut – is still underway given a total of 69 prisoners were able to escape.

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        Aftermath of crash following police chase in Lebanon, via Reuters

        At least 15 fugitives have been apprehended, with some others turning themselves in, however, it’s being reported that dozens of the escaped convicts are still on the run.

        As of late in the day Saturday (local) time, at least 40 are still believed to be at large. Police said “so far 15 inmates have been rearrested and four of the escaped prisoners handed themselves over,” Al Jazeera reports. 

        According to details in Reuters, police at one point gave chase after a group of five fugitives stole a car, leading to a chase: 

        The five died when a car they seized crashed into a tree in what the statement described as an accident while one prisoner was injured and taken to hospital.

        The state news agency NNA earlier said the prisoners had escaped from the prison at dawn after breaking open cell doors.

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        Prior reports by Amnesty International said the particular prison has witnessed riots and unrest in past months this year over worsening conditions related to the COVID-19 pandemic. The Baabda facility held pre-trial detainees. Prisoners and their families have been angered at the high-risk environment for exposure, and have demanded better precautions be taken in terms of prison conditions. 

        Saturday’s escape started with an organized attack against the jail guards, according to local police statements. 

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        The situation is considered dangerous enough to the public that President Michel Aoun has gotten involved, making a statement ordering that search and recovery efforts by security forces be intensified. 

        At least one of the escapees is said to be involved as part of a high profile Hezbollah case.

      • California Reports Record Jump As US COVID-19 Cases Top 12 Million; NY Sees Most New Cases In Months: Live Updates
        California Reports Record Jump As US COVID-19 Cases Top 12 Million; NY Sees Most New Cases In Months: Live Updates

        Tyler Durden

        Sat, 11/21/2020 – 17:15

        Summary:

        • NY reports another 5,972 new cases
        • California reports record jump
        • Wisconsin deaths top 3k
        • Illinois new cases top 13k
        • US cases top 12 million
        • US mortality rate rises
        • Germany tops 900k cases
        • Spain announces vaccination program start dates
        • US hospitalizations rise
        • Poland reopens malls
        • WHO criticizes Europe
        • Hungary deaths see new record

        * * *

        Update (1650ET): Gov Andrew Cuomo has just released the latest daily NY numbers, and for the first time since the spring, the Empire State has reported nearly 6k new cases in 24 hours.

        Meanwhile, in hard-hit El Paso, members of the Texas National Guard have been dispatched to help with “mortuary assistance.”

        For those who don’t understand what that means: they’re helping load up the bodies into refrigerated trucks.

        * * *

        Update (1550ET): Despite Gov Gavin Newsom imposing the tightest level of restrictions affecting 94% of California’s 40 million or so people, the Golden State still reported another record jump in new cases on Saturday, surpassing a daily record set months ago. 

        State health officials reported 15,442 new cases, bringing the statewide total to 1,087,714. Another 86 deaths were reported on Saturday, bringing the state’s death toll to 18,643.

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        Cali asn’t the only state to see record new numbers on Saturday. Wisconsin, one of the hardest hit states, just crossed the 3,000-death milestone after reporting 51 new deaths on Saturday for a total of 3,005. Wisconsin also reported another 6,224 new cases, while Illinois – another hard-hit midwestern state – topped 13k (13,012).

        Saturday’s numbers brought the US total case number north of 12 million less than a week after the tally topped 11 million.

        As the US continued to see record case numbers, the UK reported 19,875 new cases on Saturday, seeing its daily numbers duck back below 20k. After the mayor of Istanbul imposed tight new restrictions, Turkey also reported a record jump in new cases on Saturday with just over 5,500 new cases.

        * * *

        Now that Pfizer has officially filed for its emergency-use approval from the FDA, markets will be on tenterhooks until the approval is either handed down, or blocked for some ‘unforeseeable’ reason.

        In the meantime, markets’ attention has shifted back toward the numbers as new cases swell and 1 in 5 hospitals around the country are in danger of facing staff shortages.

        The US reported 1,870 fatalities on Friday, in a week in which the death rate increased pretty rapidly.

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        Hospitalizations in the US have reached a new record, with the midwestern prarie states seeing the highest rates of hospitalizations.

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        Across Europe, outbreaks have finally started to slow as new lockdown measures show their impact, though deaths and hospitalizations remain elevated.

        Spain’s campaign to vaccinate its population is slated to begin in January and will be voluntary, according to local media reports, citing Health Minister Salvador Illa.

        Spain expects to vaccinate about half its people by May, Illa said. The government plans to reveal further details of its vaccination strategy later this month.

        In Poland, a brief series of closures is coming to an end, as shopping malls will reopen while keeping restaurants, movie theaters and schools closed as Prime Minister Mateusz Morawiecki asks the population for ‘patience’ until a vaccine arrives.

        Over in Geneva, the WHO’s Special Envoy criticized the initial European response from the spring as “incomplete”, complaining that Europe failed to learn from Asian states like South Korea, which have successfully managed the virus since the beginning of the pandemic.

        As European countries started to report Saturday’s numbers, Germany’s RKI said the country added nearly 23,000 new cases on Saturday, lifting its total north of 900,000, and putting it on track to become the next European country to top 1 million cases.

        Here’s some more COVID-19 news from overnight and Saturday morning:

        Hungary suffers a record 121 deaths from the virus on Saturday though the number of hospitalized patients and new infections continued to level off (Source: Bloomberg).

        Russia sees record 467 deaths from the virus over the past 24 hours bringing the “official” death toll to 35,778 (Source: Bloomberg).

        CanSino said surging COVID cases around the world will allow it to quickly reach the infection thresholds to analyze the efficacy of its single-shot vaccine (Source: Bloomberg).

        Hong Kong added 45 new coronavirus cases Saturday, the highest daily toll in three months, after the city imposed new social restrictions (Source: Bloomberg).

      • Biden's Deep State
        Biden's Deep State

        Tyler Durden

        Sat, 11/21/2020 – 17:00

        Authored by Steve Brown via The Ron Paul Institute for Peace & Prosperity,

        Philosopher Hannah Arendt once wrote about the banality of evil, and there’s never been a more banal bunch than the foreign policy and security state crew Barak Obama surrounded himself with for eight years beside the possible exception of Bush’s own Neocons.

        Now after three years screaming about “Russian collusion” it appears the Evil Empire is about to regain its lost ground, championing new wars and more interventionist expansionism with a much greater role for the US military in the world.

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        Let’s name names.

        Pentagon

        For the defense chief post, the Washington Post has portrayed the banal face of Michele Flournoy as the pick to ‘restore stability’ to the Pentagon, an entirely false assertion. Recall that Fluornoy promotes unilateral global US military intervention, and advocated the destruction of Libya in 2011. By the military-industrial revolving door, Flournoy enabled many Corporate weaponry contracts amounting to tens of millions. Likewise Fluornoy is on the Booz-Hamilton board, where the swamp cannot get any deeper. As if this wretched example of an agent-provocateur for war and destruction were not bad enough, Biden is reportedly considering Lockheed-Martin banal kingpin Jeh Johnson for the DoD position, too.

        Lockheed director Johnson was employed by Rob Reiner and Atlantic editor arch-Neocon David Frum to run the Committee to Investigate Russia which mysteriously blew up as soon as the Mueller Report was released. Jeh Johnson has continued to warn of “Russian interference” in the US presidential election until now. Biden’s anointing as president-elect has ended that. As Homeland Security head, Johnson authorized cages for holding immigrant children. He also supported the assassination of General Suleimani, and has voiced support for US wars in Syria, Iraq, and Afghanistan.

        State

        From Libya to Syria, Yemen, Ukraine and beyond, the banality of evil is perhaps best personified by Susan Rice – apparently Biden’s premiere pick for Secretary. Rice was an abject failure at the United Nations, but all seems forgiven, probably at the behest of Biden’s donors. After her failure at the UN, Obama kicked Rice upstairs to be his National Security Advisor, a position that does not require Senate approval.

        An obvious war hawk in the mold of the Democrat’s donor class, a Rice appointment could reinforce the liberal mantra that women can be just as good at interventionism as men, and ensure full re-establishment of the Neoliberal agenda in Washington. John Kerry has been flagged as a potential for State (again) too, but at age 77 and subsequent to the failure of the JCPOA Kerry is an unlikely pick.

        Another potential pick among the banal Daughters of Darkness is Victoria Kagan-Nuland, architect of the 2014 debacle in Ukraine (among other things). Outed at State in an embarrassing act of what she called impressive statecraft and other embarrassing incidents, Nuland seems an unlikely choice. But Kagan-Nuland is as banal as banal can be, and Biden may somehow wish to reinforce his solidarity with the JTF and his donor class, on Israel.

        National Security Advisor

        Banality is certainly the mark of the beast here, in the form of Tony Blinken. Well in with Michele Flournoy (above) Blinken typifies the type of banality the Deep State engages in to promote its evil, with Blinken as successful as any other Deep State actor. A major hawk on Russia and war hawk in general, Blinken is an apologist for Israel. Blinken is a war hawk on Afghanistan and Syria too, and Blinken was directly involved in CIA operation Timber Sycamore. Oh, the banality.

        Another model of banality is Leon CIA Panetta who so far claims that cruising the Monterey peninsula is more fun that being in Washington. But we know that’s false and Panetta would be a logical pick. Besides being a hawk on everything, and laughing about the fact he has no idea how many wars Obama’s America was fighting – because he lost count – Panetta is simply another sycophant for evil like Hannah Arendt portrayed in her study of Adolf Eichmann.

        CIA

        Banal of the banal is of course Mike Morell. This incredibly vacuous excuse for a human being has been hate-mongering for years. Beside his blatant pandering support for another banal and brutal warmonger – Hillary Clinton – Mike Morell is one Neoliberal who still maintains that Saddam Hussein actively aided and abetted al Qaeda with regard to the 911 attacks. But Morell simply and ultimately represents the banality of evil, just as Arendt depicted Adolf Eichmann, but in Morell’s case succinctly summarized here by Ray McGovern.

        United Nations

        Outing the banality of the banal would be incomplete without mentioning Jen Psaki. Although a potential pick for White House Communications Director, why not promote an accomplished liar to a venue where accomplished lying really matters?

        Conclusion

        There is no indication that the United States as an entrenched warfare state will ever change its course until forced to. Mr Trump was incapable of enforcing that change. Sidelined by Russiagate psychosis, as a Beltway Neophyte and his own worst enemy at times, that sank Trump’s agenda. The actions of Mr Trump now – to end the wars in Syria, Iraq, Afghanistan and Yemen — should have been undertaken in earnest and without compromise years ago. Point being that Mr Trump’s new appointments to the Pentagon – and let’s hope CIA – will hopefully blunt the efficacy of Biden’s bad actors going forward.

        Regardless, characters the same or similar to the ones listed above will definitely infest Washington’s infernal Beltway cesspool once again via Joe Biden … make no mistake. …And they will be meaner and nastier than ever before! Guaranteed.
         

      • DoubleSpeak Is Here – Delusional MSM Praises GOP Lawmaker "Defending" CA Gov Newsom's "Idiotic Edicts"
        DoubleSpeak Is Here – Delusional MSM Praises GOP Lawmaker "Defending" CA Gov Newsom's "Idiotic Edicts"

        Tyler Durden

        Sat, 11/21/2020 – 16:35

        In a Wednesday speech from the House floor, Rep. Tom McClintock (R-CA) used what’s commonly known as sarcasm to mock California Governor Gavin Newsom’s hypocritical and “idiotic” COVID-19 restrictions, after he violated his own advice at an upscale dinner party over the weekend.

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        Newsom issued a misleading apology for breaking his own mandates during a dinner party at the French Laundry restaurant in Yountville, CA for a high-level lobbyist. In attendance were members of the California Medical Association.

        “I rise this morning in defense of Gov. Gavin Newsom, who recently defied his own idiotic COVID edicts as he partied at one of the few restaurants that’s not yet been forced out of business,” McClintock began, mockingly.

        “I defend him because he was doing what we once all did in a free society: make our own decisions over what risks we’re willing to run and what cautions we’re willing to take according to our own circumstances to protect our own health.”

        Now, before we get to the MSM’s ‘presentation’ of McClintock’s speech, here’s more of it followed by a clip for your edification:

        “Every time we step outside our homes, the risks that we face multiply. A free society assumes that it’s citizens are competent to assess those risks, balance them against the avoidance costs, and to manage their decisions in a generally responsible way. It’s called common sense. And it’s a necessary prerequisite for self-government and liberty. The choices that octogenarian with emphysema might be very different from those of a healthy governor of California. Only a fool would claim the omnipotence to make an informed judgement for every person in every circumstance in every community.

        Watch:

        Now – here’s how journalists for mainstream outlets presented it using what’s commonly known as “journalistic malpractice” in a world reduced to headlines, where nearly 60% of all links shared on social media have never actually been clicked.

        (Perhaps the Sacramento Bee was making amends for allowing an Op-Ed contributor to excoriate Newsom over the dinner).

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        Using a headline framing McClintock’s speech as a genuine defense of Newsom – a decision which would have gone through editors – is either willful deceit or tone-deaf stupidity.

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