- American Apparel Preparing Second Bankruptcy Filing In A Year
Less than 9 months after emerging from Chapter 11 proceedings, American Apparel is allegedly preparing for another bankruptcy filing after turnaround efforts by the previous plan of reorganization sponsors, including Standard General, Monarch Alternative Capital, Goldman Sachs Asset Management and Pentwater Capital, have apparently failed. While details are sparse given that the company is now privately held, a note from Bloomberg suggests that the company may be preparing a sale that would have to be implemented through a bankruptcy proceeding to allow new owners to shed leases and other liabilities associated with unprofitable stores.
American Apparel Inc. is preparing for its second bankruptcy filing in as many years, according to people familiar with the situation, capping a tumultuous stretch that included tumbling sales, red ink and a split with controversial founder Dov Charney.
The filing may come as soon as the next few weeks, according to the people, who asked not to be identified because the discussions aren’t public. The move could help set the stage for a sale of the Los Angeles-based company by letting it exit leases and shutter part of the retail operation, according to the people. Still, the plan isn’t yet final and could change as the holiday season approaches.
The clothing maker only emerged from bankruptcy in February, when former bondholders — led by Monarch Alternative Capital — took over the company. A turnaround plan to return to American Apparel’s roots and focus on basic items like T-shirts and skirts didn’t improve results enough, according to the people. The company also has hired restructuring firm Berkeley Research Group for guidance, the people said.
American Apparel hired investment bank Houlihan Lokey earlier this year to consider a sale after receiving interest, according to the people. The potential buyers are mainly interested in the company’s wholesale unit and the brand, they said. That leaves its roughly 200 retail stores in limbo.
Of course, American Apparel just emerged from a pre-arranged bankruptcy filing back in February with CEO Paula Schneider promising renewed financial strength via new products and revamped stores.
“By improving our financial footing, we will be able to refocus our business efforts on the execution of our turnaround strategy,” Chief Executive Officer Paula Schneider said in the statement. The company plans to create new products, introduce new design initiatives, invest in new stores and expand its e-commerce business, she said.
That said, given rumors of a new bankruptcy filing, we’re guessing that Moelis was “slightly” off in their financial projections filed in a Disclosure Statement with the court back in November 2015. Frankly, we’re shocked as it seems like a pretty “reasonable” forecast…no hockey stick there…though we’re not sure we would have been very excited about attesting to the “feasibility” of a plan tied to this particular projection.
And, like with many failed retail businesses, we suspect that the following liquidation analysis presented in the last disclosure statement now becomes the “upside” scenario for Monarch and Goldman.
- The Mayor Of London: "My Side" Versus Reality
Submitted by Janet Tavakoli via The Gatestone Institute,
- The number one reason British "Leave" voters backed Brexit was for self-determination. — Mega-poll by Lord Ashcroft.
- Every time a social problem arises, one can randomly assign blame to a host country for not providing enough social support to newcomers. That benchmark, however, creates a shifting goalpost: how much is "enough"?
- Mayor Sadiq Khan focused only on what Britain should provide to newcomers not on what newcomers should initiate on their own to fit into a country they entered willingly.
- Mayor Khan's presentation seemed designed to pacify Westerners and enable the spread of the rule of Islam.
Sadiq Khan, the Mayor of London, addressed the Chicago Council on Global Affairs (CCGA) on September 15. Although his topic was "The Breakdown of Social Integration – The Challenge of Our Age," some crucial components of that challenge were notably absent from his presentation.
Even though Mayor Khan said he believes that, "London is the powerhouse" for his country and is "proud that London was the only region in England to vote to remain in the European Union" (some boroughs voted 80% "Remain"), when it came to the United Kingdom as a whole, he said that "my side" lost the referendum.
That strikes one as an odd way for the mayor of any city to talk. Isn't he the Mayor of all of London? Aren't the Londoners who voted for Brexit included on his "side"?
Brexit Voters Want Self-Determination
Mayor Khan claimed that for "Leave" voters, "immigration was the number one issue." However, Lord Ashcroft's mega-poll says otherwise. According to it, the number one issue for "Leave" (pro-Brexit) voters across Britain was "the principle that decisions about the UK should be taken in the UK."
In other words, the number one reason they backed Brexit was self-determination. "Leave" voters did not like European Union officials –people they did not elect — making laws that could overrule laws passed by British Parliament. Immigration and trade concerns were apparently less important.
Mayor Khan Appears to Prefer "Social Integration" to "Assimilation"
Mayor Khan also observed that Britain's "levels of social integration are not keeping pace with our changing population and growing diversity." That is hardly surprising: according to Khan, "One of three Londoners were born outside the UK," and "the number of immigrants arriving in Britain every year has doubled between 1997 and 2015."
Mayor Khan also said that he advocates "building bridges rather than walls" — a remark that was heard by many as a gratuitous sideswipe at the U.S. presidential candidate, Donald Trump, who is against illegal immigration and for vigorous vetting of legal immigrants. Mayor Khan later added: "Nobody mentioned Donald Trump here, which is very good." But of course he just had.
Mayor Khan added that he would like more "asylum seekers" and "refugees," and advocated "social integration." "I don't mean assimilation," he stressed; "I mean social integration." He loosely defines social integration as "a level playing field" with a clear set of values and laws, but he left the difference between social integration and assimilation — perhaps intentionally — unclear. Doesn't Britain already have clear values and laws?
What Mayor Khan seemed to be saying by advocating "social integration" rather than "assimilation" is that he not eager for Muslims to become more like the British ("assimilation") but that he would be comfortable with the British adapting to the Muslim way of life. The presence of more Muslims might accelerate this process of the British having to adapt to the way of life of a Muslim majority ("social integration"). What that would be followed by is anyone's guess. The historical pattern has been to invite the non-Muslims to convert, and those who do not are relegated to the status of second-class citizens or dhimmis, who willingly live under different laws for those of a lower status, who pay a yearly tax (jizya) to subsidize Muslims, and who accept being dominated rather than face up the threats of violence that would come from not accepting it.
The Mayor never explained why assimilation — along the lines of the common culture melting pot of the United States — would not provide a level playing field and an even more harmonious society.
Every time a social problem arises, one can randomly assign blame to a host country for not providing enough social support to newcomers. That benchmark, however, creates a shifting goalpost: how much is "enough"? This lack of clarity leaves the door open for perpetual unrest. No matter how much support a welcoming society provides for newcomers, it can always be accused of not doing "enough." Khan focused only on what Britain should provide to newcomers, not on what newcomers should initiate on their own to fit into a country they entered willingly.
In a recent speech, London Mayor Sadiq Khan focused only on what Britain should provide to newcomers not on what newcomers should initiate on their own to fit into a country they entered willingly.
Mayor Says Muslim, Mufti Says Apostate
In the same speech, Mayor Khan claimed that being a Muslim is compatible with Western culture. That would only be true if "Muslim" meant one who ordered Islam à la carte. Islam means submission, and Muslims seem to disagree on how much submission is "enough." Also, at present, for non-Muslims in the West, zero submission to Islam is their right. Fundamentalist Muslim leaders such as Mufti Muhammed Aslam Naqshbandi Bandhalevi disagree with Mayor Khan's views that Muslims can accept laws in the West and still be called Muslim. Islam has never gone through a reinterpretation of its laws, or Reformation.
What many people may not realize is that the "Caliph" of ISIS, Abu Bakr al-Baghdadi, has a PhD in Islam from the University of Baghdad, and that every single thing he does, even those that horrify us in the West, has a totally legitimate precedent in the official Islam of the Koran and the Hadith, the two texts, considered of equal importance, on which Islam is based.
Contrary to what our leaders in the West have been telling us — that the murders and other atrocities we have been witnessing have "nothing to do with Islam" — they are, unfortunately, not only permitted in Islam but commended. This is what we have been seeing in Israel the past century, long before there was a dispute over territory. The fundamental dispute is over a people who have since the rise of Mohammad in the seventh century, refused to submit to Islam and who are therefore regarded as infidels.
Mayor Khan himself has encountered this problem. He mentioned that there was a fatwa against him, but he did not mention who issued it; one wonders why.
What occurred was that Mufti Muhammed Aslam Naqshbandi Bandhalevi, head imam of a mosque in Bradford, issued the fatwa declaring Khan an "apostate," one who has renounced Islam, because Khan supported same-sex marriage.
Quite simply, traditional Islam seems incompatible with Western values.
"What," asked the biologist Richard Dawkins "is the penalty for apostasy?"
Mohamad Mukadam, Chairman of the Association of Muslim Schools, replied: "If it is an Islamic country, the sharia is very clear. Apostasy is dealt with the death penalty."
When a mufti in Britain issues a fatwa, it is from the same Islam as that practiced in Muslim countries. In 2004, film director Theo van Gogh and Dutch Member of Parliament Ayaan Hirsi Ali made a movie critical of Islam. Mr. van Gogh was later murdered, shot and stabbed in Amsterdam. Amsterdam is in the Netherlands, not a Muslim country. Somali-born former-Muslim Hirsi Ali, now a naturalized U.S. citizen in the United States, still lives in the shadow of a death fatwa.
How many "asylum seekers" and "refugees" practice fundamentalist Islam and believe that sharia law should supersede laws passed by British Parliament?
Mayor Khan touts a fatwa as if it validates his liberal credentials, but he is far too coy about enumerating the dangers of flinging open one's borders to people who issue fatwas, much less to their followers who may fulfill them. Mayor Khan says being a Muslim is compatible with Western culture, but either he does not know Islam, a probability that is questionable, or he is misleading the British.
Khan also never once mentioned the social crisis of the rape of children in British cities, widely publicized in the British press. It is so shocking, with so many disturbing implications, that the Mayor's omission again seems to mislead Westerners about what immigration problems can occur.
Political Correctness Has Been Enabling Child Sex Abuse Gangs in Britain
The title of Khan's presentation was "The Breakdown of Social Integration – The Challenge of Our Age." However, isn't the epidemic rape of thousands of white children in Rotherham and other communities in England, and the official policy of ignoring the crisis for over a decade, the very definition of "breakdown of social integration"?
Officials were so unwilling to "rock the multicultural boat," that children were exploited, raped, and brutalized for more than a decade.
For several years, Sue Reid, a reporter for the Daily Mail, tried to expose these crimes. She was falsely accused of being a "liar and a racist."
In 2014, Home Secretary Theresa May blamed "institutionalized political correctness" for police and council agencies' failure in their duty to protect at least 1,400 chiefly white Rotherham children from chiefly Muslim Pakistani-heritage rape gangs from 1997-2013.
Similar crimes have occurred in other parts of the United Kingdom: Rochdale, Derby, Oxford, Bristol, Peterborough, and Keighley. In August, a fresh crisis was exposed in Telford, now dubbed the "child sex abuse capital."
Taken as a whole, Mayor Khan's presentation seemed to ignore unpleasant facts which suggest that there is more incompatibility of values than he is willing to admit — in the interest of pushing an immigration agenda favored by his "side."
Mayor Khan's presentation seemed designed to pacify Westerners and enable the spread of the rule of Islam.
- Why the Elite hate Russia
In our previous article The Secret Truth about Russia Exposed, we elaborated on how Russia is a convenient enemy for politicians and specifically the Democratic party, to create an enemy that really, well – doesn’t exist to distract and confuse voters. But like with any ‘enemy’ if you bomb a village, you may have some pissed off villagers. As we explain in our best selling book Splitting Pennies – the world doesn’t work the way you see on TV – in fact, it works more closely as seen on Zero Hedge. Although Russia simply is just a country in the wrong place at the wrong time (which, throughout Russian history, seems to be a theme for them) – there really is a reason the Elite hate Russia. It’s not because they’re Xenophobic, although there’s that too – it’s because of several key factors that make Russia a unique power in the world, compared to similar countries.
1. Russia is an independent country. It’s not possible to manipulate Russia via external remote control, like it is most countries. The Elite don’t like that! Russia kicked out Soros “Open Society”:
Russia has banned a pro-democracy charity founded by hedge fund billionaire George Soros, saying the organization posed a threat to both state security and the Russian constitution. In a statement released Monday morning, Russia’s General Prosecutor’s Office said two branches of Soros’ charity network — the Open Society Foundations (OSF) and the Open Society Institute (OSI) — would be placed on a “stop list” of foreign non-governmental organizations whose activities have been deemed “undesirable” by the Russian state.
2. Russia is not easy to cripple via clandestine means, whether it be CIA, MI6, or outright military conflict. Some other BRICs however, that’s not the case. Say what you will about Russia’s military – it’s on par and in many cases, advanced, compared to the US military. And that’s not AN opinion, that’s in the opinion of top US military commanders:
Late in September, we brought you “US Readies Battle Plans For Baltic War With Russia” in which we described a series of thought experiments undertaken by The Pentagon in an effort to determine what the likely outcome would be should something go horribly “wrong” on the way to landing the US in a shooting war with Russia in the Balkans.
The results of those thought experiments were not encouraging. As a reminder, here’s how Foreign Policy summed up the exercises:
3. Russian culture, and language, is too complex for the average “Elite” who pretends to be internationally well versed because they had a few semesters of French. For example, when the diplomat Clinton was Secretary of State, she presented a reset button translating the opposite meaning… ooops.
“I would like to present you with a little gift that represents what President Obama and Vice President Biden and I have been saying and that is: ‘We want to reset our relationship, and so we will do it together.’ …
“We worked hard to get the right Russian word. Do you think we got it?” she asked Lavrov, laughing. “You got it wrong,” said Lavrov, as both diplomats laughed.
“It should be “perezagruzka” [the Russian word for reset],” said Lavrov.”This says ‘peregruzka,’ which means ‘overcharged.’”
Yes, it’s almost a certainty that if Clinton by some horrible fate is President there will be Nuclear war. Wars have been started over much more subtle mistakes. One would think, that Clinton would have had an advisor CHECK THIS before presenting it in a public ceremony, in front of reporters? How much more blatantly unprofessional can one be? If politicians worked in the private sector, they wouldn’t last a day! How do these people advance so far in politics?
4. Plain and simple, the Elite do not control Russia. While there are backchannels of Russian oligarchs that work directly with Western Rothschild interests, for example, they simply don’t have the same level of control as they do European countries, like Germany for instance. Or another good example is China, there’s this fanatical talk that China can dump US Treasuries blah blah blah the fact is that China is completely dependent on USA and US Dollars, and will be for the rest of our lives. Maybe in 1000 years in the Dong Dynasty still to come they will rule the world but it’s not going to happen anytime soon.
Russia is one of the most highly misunderstood cultures in the West. Which is strange, because Russia is more like America than any European country:
- Both Russia and America share huge landmasses with large undeveloped territory
- Both Russia and America are predominantly white christian majorities (although in last decades, America tries to be more of a melting pot whereas Russia favors ethnic cleansing)
- Both Russia and America fought against Hitler and the Nazis during World War 2, the defining event of the last 60 years
There have been numerous interesting situations where Russia helped America and America helped Russia on a number of levels, to learn more about it checkout the following books:
Wall Street and the Bolshevik Revolution. Armand Hammer: The Untold Story
Most interestingly, during the Nixon administration Kissinger was prodding Nixon to partner with Russia that would, in Kissinger’s view would create an unstoppable alliance, that no one could compete with such a superpower axis. But, it didn’t happen, as there were ‘neo-cons’ who were against it, mostly Polish Catholics who have some deep genetic fear of any culture using the Cyrillic alphabet. Nixon instead chose China (what a mistake!) and created Forex. But the point being that, through a small slip of fate, “China” may have been in this alternative Kissinger reality the ‘Great Evil Enemy’ hacking our elections, as we drive across the Alaskan-Siberian highway without any speed limit, oil would be ten cents a gallon, and we wouldn’t need to war with the Middle East.
To learn more about how the world really works, checkout Splitting Pennies the book, or checkout Fortress Capital Trading Academy.
- New Evidence Links Voting Machines And Clinton Foundation
Submitted by Stefanie MacWilliams via PlanetFreeWill.com,
Could these connections be enough to implicate the Clinton Foundation in the alleged early vote rigging in Texas?
As usual, the internet has come through as the ultimate watchdog while the supposed safeguards of our democracy have failed.
A Gab user by the name “Special Prosecutor Will Logan” has found some stunning information.
Note: as Gab is a members only site, you’ll have to join to see his actual posts, but we included all pertinent information in the article.
Click to enlargeAccording to OpenSecrets, the company who provided the alleged glitching voting machines is a subsidiary of The McCarthy Group.
The McCarthy group is a major donor to the Clinton Foundation – apparently donating 200,000 dollars in 2007 – when it was the largest owner of United States voting machines. Or perhaps the 200,000 dollars went to paying Bill Clinton for speeches?
Either way, it doesn’t look good.
But there’s more.
As the same user notes in this post, Dominion Voting Systems and The Clinton Foundation did a 2.25 million dollar charity initiative in developing nations together called the DELIAN Project.
According to the project’s own website:
In 2014, Dominion Voting committed to providing emerging and post-conflict democracies with access to voting technology through its philanthropic support to the DELIAN Project, as many emerging democracies suffer from post-electoral violence due to the delay in the publishing of election results. Over the next three years, Dominion Voting will support election technology pilots with donated Automated Voting Machines (AVM), providing an improved electoral process, and therefore safer elections. As a large number of election staff are women, there will be an emphasis on training women, who will be the first to benefit from the skills transfer training and use of AVMs. It is estimated that 100 women will directly benefit from election technology skills training per pilot election.
Of course, this is all speculation, and we are not making any claims of illegal activity by the Clinton Foundation.
However, it presents a very troubling conflict of interest. Most Americans would certainly agree that voting machines should have zero connection to presidential candidates and their foundations.
Consider the implications further abroad, as well. Could this DELIAN Project be designed to influence elections in developing nations?
It can certainly be argued that electronic voting machines do not in fact provide an “improved electoral process” or provide “safer elections”
Again, this is speculation.
But we will be keeping an eye on this story if and when more information becomes available.
- Paul Craig Roberts Explains "What's At Stake In The Election"
Authored by Paul Craig Roberts,
Here Are The Presstitutes Who Control American’s Minds:
Several top journalists and TV news anchors RSVPed “yes” to attend a private, off-the-record gathering at the New York home of Joel Benenson, the chief campaign strategist for Hillary Clinton, two days before she announced her candidacy in 2015, according to emails Wikileaks has published from John Podesta’s purported accounts.
I just heard an NPR presstitute declare that Texas, a traditional sure thing for Republicans was up for grabs in the presidential election. Little wonder if this report on Zero Hedge is correct. Apparently, the voting machines are already at work stealing the election for Killary.
* * *
From my long experience in journalism, I know the American public is not very sharp. Nevertheless, it is difficult for me to believe that Americans, whose jobs, careers, and the same for their children and grandchildren, have been sold out by the elites who Hillary represents would actually vote for her. It makes no sense. If this were the case, how did Trump get the Republican nomination despite the vicious presstitute campaign against him?
It seems obvious that the majority of Americans who have been suffering terribly at the hands of the One Percent who own Hillary lock, stock, and barrel, will not vote for the people who have ruined their lives and the lives of their children and grandchildren.
Furthermore, if Trump’s election is as impossible as the presstitutes tell us – Hillary’s win is 93% certain according to the latest presstitute pronouncement – the vicious 24/7 attacks on Trump would be pointless. Wouldn’t they? Why the constant, frenetic, vicious attacks on a person who has no chance?
There are reports that a company associated with Hillary backer George Soros is supplying the voting machines to 16 states, including states that determine election outcomes. I do not know that these reports are correct. However, I do know for a fact that the oligarchic interests that rule America are opposed to Trump being elected President for the simple reason that they are unsure that they would be able to control him.
It is hard to believe that dispossessed Americans will vote for Hillary, the representative of those who have dispossessed them, when Trump says he will re-empower the dispossessed. Hillary has denigrated ordinary Americans who, she says, she is so removed from by her wealth that she doesn’t even know who they are. Clearly, Hillary, paid $675,000 by Goldman Sachs for three 20-minute speeches, is not a representative of the people. She represents the One Percent whose policies have flushed the prospects of ordinary Americans down the toilet.
What is really disturbing is the pretense by the presstitute scum that Trump’s lewd admiration for female charms is deemed more important than the prospect of nuclear war. At no time during the presidential primaries or during the current presidential campaign has it been mentioned that Russia is being assaulted daily by propaganda, threatened by military buildups, and being convinced that the United States and its European vassals are planning an attack.
A threatened Russia, made insecure by inexplicable hostility and Western propaganda, is a danger manufactured by the neoconservative supporters of Hillary Clinton.
If the American people are really so unbelievably stupid that they think lewd remarks about women are more important than avoiding nuclear war, the American people are too stupid to exist. They will deserve the mushroom clouds that will wipe them and everyone else off the face of the earth.
Donald Trump is the only candidate in the primaries and the general election who has said that he sees no point in conflict with Russia when Putin has shown nothing but desire to work things out to mutual advantage.
In contrast, Hillary has declared the thrice-elected president of Russia to be “the new Hitler” and has threatened Russia with military action. Hillary talks openly about regime change in Russia.
Surely, in a free media at least one person in the print and TV media would raise this most important of all points. But where have you seen it?
Only in my columns and a few others in the alternative media.
In other words, we are about to have an election in which the important issue has played no role. And yet allegedly we are the exceptional, indispensable people, a people’s democracy protected by a free press.
In truth, this mythical description of America is merely a cloak for the rule of the Oligarchs. And the Oligarchs are risking life on earth for their continual supremacy.
- Let Crude Crash: US Oil Producers Are Hedging At Levels Not Seen Since 2007
As warned here one month ago after the farcical OPEC meeting in Algiers, the cartel’s latest jawboning ploy to keep prices artificially higher – if only for one more month – is fast falling apart. Just a few hours ago, Bloomberg reporter Daniel Kruger penned the following assessment of the situation:
Production-Cut Talk Is as Good as It Gets for Oil. Some OPEC members are talking about cutting production again, and so prices are rising. Saudi Arabia and other producers both in and out of the cartel have done a good job fostering the storyline that there are terms under which parties can agree to pump less crude. Continuing signs of concord among producer nations have boosted oil prices to an average of $50 a barrel this month in New York. Yet several obstacles make it difficult for countries to commit to signing on to a deal. One obstacle is that sacrifices are needed for the agreements to succeed. Another is that those sacrifices aren’t shared equally.
Having successfully raised $18 billion in the bond market, Saudi Arabia is better positioned to withstand the loss of some revenue. Iraq, OPEC’s second-biggest producer, was the latest to plead for an exemption from a cut, citing its fight against Islamic State as a cause of hardship. Ultimately, no one wants to pump less because the upside is so limited. Saudi Arabia’s 2014 decision to double down on production in a drive for market share succeeded in making it more difficult for higher-cost producers to thrive as they once had. But having committed to that goal, they also locked themselves into a fight to keep what they’d won.
And while ConocoPhillips’ announcement this week that it plans to cut spending on major projects demonstrates the partial success of the Saudi plan to drive out rivals, it also shows producers see diminishing chances for crude to climb much above $60, said Wells Fargo Fund Management’s James Kochan. The big reason, of course, is latent U.S. supply. Baker Hughes data shows the most rigs at work in the Permian Basin since January. Sanford C. Bernstein analyst Bob Brackett suggests the per-acre price of drilling lease land will rise to $100,000 from about $60,000 now.
The one agreement players seem to have reached is that oil isn’t able to go much higher.
That oil’s upside is capped at this point is clear; in fact as both Goldman and Citi have warned, unless OPEC can come to a definitive and auditable agreement – no just another verbal can kicking – in which the member states, by which we mean almost entirely Saudi Arabia as most of the marginal producers are exempt or want to be, immediately curtail production, oil will promptly crash to $40 or below.
But an even more amusing twist is that a plunge in oil prices may be just what US shale producers are waiting for. The reason for that is that while OPEC has been busy desperately jawboning oil higher, US producers have been thinking of the inevitable next step, oil’s upcoming reacquaintance with gravity. As a result, as the EIA reports, the amount of WTI short positions held be producers and merchants is just shy of a decade high.
According to a recent EIA report, short positions in West Texas Intermediate (WTI) crude oil futures contracts held by producers or merchants totaled more than 540,000 contracts as of October 11, 2016, the most since 2007, according to data from the U.S. Commodity Futures Trading Commission (CFTC). Banks have tightened lending standards for some energy companies as crude oil prices declined throughout 2014 and 2015, and some banks require producers to hedge against future price risk as a condition for lending.
Short positions of WTI futures increased at a faster pace than futures contracts of Brent (an international crude oil benchmark) since summer 2016, suggesting U.S. producers are able to drill for oil profitably in the $50 per barrel range. In the Crude Oil Markets Review section of the October Short-Term Energy Outlook (STEO), the U.S. Energy Information Administration (EIA) discusses an increase in U.S. onshore producers’ capital expenditures that is contributing to rising drilling activity, which EIA projects will lead to an increase in U.S. onshore production by the second quarter of 2017.
* * *
Which closes the circle of irony: almost exactly two years ago, Saudi Arabia set off a sequence of events with which it hoped to crush US shale producers and its high cost OPEC competitors. It succeeded partially and briefly, however now the remaining US shale companies are more efficient, restructured, have less debt, a far lower all-in cost of production; and – best of all – they will all make a killing the next time oil plunges, as it will once OPEC’s hollow gambit is exposed.
Meanwhile, the last shred of OPEC credibility will be crushed, the truly high cost oil exporters within OPEC will suffer sovereign defaults and social unrest, as will Saudi Arabia. The good news for Riyadh is that at least it got a $17.5 billion in fresh cash from a bunch of idiots who will never get repaid. We are curious just how long that cash will last the country which burned through $98 billion just last year, before the threat of social unrest and financial system collapse returns? Two months? Three?
- "This Is About Whiteness" UC Berkeley Students Segregate Campus, Block Bridge With Human Wall
Submitted by Robby Soave via Reason.com,
Student protesters at the University of California-Berkeley gathered in front of a bridge on campus and forcibly prevented white people from crossing it. Students of color were allowed to pass.
The massive human wall was conceived as a pro-safe space demonstration. Activists wanted the university administration to designate additional safe spaces for trans students, gay students, and students of color. They were apparently incensed that one of their official safe spaces had been moved from the fifth floor of a building to the basement.
According to video footage of the protest, demonstrators blocked off the bridge completely. Students who needed to get to class had no choice but to cross the stream by jumping from rock to rock. Dozens of people can be seen doing so.
In the video, the activists appeared to let several students of color pass unmolested, but white students were forced to find other routes. A few who tried to force their way through were violently rebuffed. Protesters shouted "Go around! Go around!" at a white man on a bicycle.
Another student was told, "This is bigger than you," by a protester. "This is about whiteness."
Afterward, the protest moved to the campus bookstore, where activists posted an eviction notice informing the owners that their building was being reclaimed as a safe space for queer and trans students.
"You are hereby notified by the students of the University of California, Berkeley, to vacate the premises immediately," the eviction notice stated. "University administration wrongly allocated this two-story facility to a third-party corporation, keeping in line with its intensifying legacy of prioritizing financial profit over student needs."
The protesters then marched through the student union, reportedly disrupting students who were studying.
I get that they are trying to make a point—they don't think campus is a safe place for marginalized students, etc. – but racism in the service of activism is still racism. These students consider themselves progressives, but what's progressive about punishing people—making it more difficult for them to get to class—because they were born with the wrong skin color?
Indeed, leftist student activism has become increasingly backward on race and identity issues as of late. The Berkeley protesters are demanding formal, university-sanctioned safe spaces for students who belong to particular identity groups. They want what can only be described as a kind of official segregation: separate spaces for students of color, trans students, queer students, etc.
Students have the right to sort themselves into whatever groups they want. But it's baffling—to me, at least—that they would want these groups endorsed and managed by the administration, which creates the impression that identity-based division is some kind of university goal.
Berkeley's public areas—its quads, common rooms, parks, student union, libraries, classrooms, and yes, bridges—should be safe, welcoming spaces for all students. What happened over the weekend didn't look very inclusive to me.
- Trigger-Free Trick-Or-Treat Guide To Halloween Costumes
“It’s Halloween and that can only mean one thing… people who wear offensive costumes are literally Hitler.”
This Halloween, don’t be Hitler and have a trigger-free trick-or-treat by following the advice of Lauren and Faith from Rebel Media…
- "The Fed Failed…" And That Changes Everything
Submitted by Jeffrey Snider via Alhambra Investment Partners,
There is a growing body of public work that suggests Federal Reserve officials are prepared now for a very different sort of normalization than what had been envisioned up until this year. That comes, as noted earlier, with the realization that the economy is not just in rough shape but likely to remain that way for the foreseeable future.
The important caveat left off that bleak pronouncement is actually ceteris paribus. So long as the current policy and monetary system remains firmly in place, there is little hope the global economy will just spontaneously ignite. Since economists and central bankers have made it clear they aren’t going anywhere despite being wrong about everything up to now, here we are.
Even Janet Yellen has been forced to concede that even if the Fed does manage to get on with further rate hikes, the ultimate destination for them in nominal terms is much less than prior “cycles.” Current thinking seems to be aiming for around 3% for the federal funds rate rather than 5% as had long been accepted. The way things are going, and as the Japanese showed, they will be lucky to get even half that far.
But in what can be only another sign of just how twisted, upside down, and easily receptive to pretzel logic the mainstream is now, that is supposed to be a good thing especially for stocks. Writing today for BloombergView, Mohamed El-Erian, chief economic advisor for Allianz, makes this exact argument.
Equity investors have also been reassured by the growing — and correct — recognition that this Fed hiking cycle will depart drastically from historical norms. Instead of following a relatively linear path of increases at regular intervals, it will have pronounced “stop-go” characteristics. Also, and perhaps more importantly, the endpoint — or what economists call the “neutral rate” — will be considerably lower than recent historical averages.
How in the world is that a good thing that would “reassure” equity investors? Truly rational investors make decisions based on discounted information about the future, and what El-Erian suggests here (and he hasn’t been alone) is that stock investors show more preference for “accommodative” monetary policy than actual growth. A lower rate ceiling implies without much ambiguity continued awful economic conditions here and elsewhere around the world. But to the screwed up nature of mainstream thought, so long as monetary policy is lower overall continued stagnation is forgiven, perhaps even to be mildly celebrated?
What does it mean by claiming “accommodation” that gives “investors” so much apparent comfort? It can’t mean that in economic terms for obvious reasons; instead we are led to believe that low (meaning desperately insufficient) growth isn’t all that bad so long as interest rates don’t rise too far. Investors are supposed to be paying for growth, not the failure of interest rate “stimulus” to seed it. If the Fed feels it can’t raise rates all that much, with a true “ceiling” yet to be determined, it is a much riskier, not less risky, environment.
The idea of a lower R* or r-star is truly a defining defeat, though it is, like El-Erian’s attempt here, being spun into what is nothing more than rationalization. As I wrote in September, the falling R-star can mean nothing else:
There is more complexity when we talk about inflation, of course, but by and large it is commodity prices that have thwarted John William’s (or Janet Yellen’s) “normalizing” narrative. Commodities have been falling more intensely since the middle of 2014 but really dating back to the middle of 2011. Both of those inflections recall and are related to obvious eurodollar or global wholesale money events. Thus, even subscribing to Wicksell’s theory, the current rate must now be, as it has been, above the natural rate, unambiguously indicating “tight” money. Whether it is via Friedman’s interest rate fallacy or Wicksell’s natural rate hypothesis, both arrive at the same conclusion due to seemingly intractable market prices.
Central banks assume that means they have to “stimulate” more when in fact it is just their math telling them they haven’t stimulated at all – at least not where it counts and has been needed. Translating depression into econometrics is a long and costly affair, but it is at least starting to be done, slowly and in discrete pieces. R* may yet be of some great value, insofar as further calculating just how little monetary authorities know about money.
Reception of and belief about QE have been very much cult-like and it was thus too thinly constructed to withstand being so thoroughly debunked. This is not even close to making the best of a bad situation; it is instead claiming positive attributes that just don’t exist, being downright offensive to common sense. How anyone, let alone El-Erian, wrote that paragraph (contained within an article further rationalizing the latest of the “rising dollar”) without awareness of its very basic flaw can at best be described as intentionally obtuse while still bordering upon nakedly deceiving. The world of the near future is going to be bad, worse than everything “we” have been expecting, but take heart, the Fed’s monetary policy will reflect just that. Translating it from the original mainstream thought-bubble language truly reveals its truly absurd premise… The Fed failed, and that changes everything; including and especially what is to be made of “accommodation” and what it is that might have “reassured” equity investors in the past and might do so (or not) going forward.
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