- Burundi Has The Lowest GDP-Per-Capita In The World, US The Highest
Burundi Has The Lowest GDP-Per-Capita In The World, US The Highest
GDP per capita has steadily risen globally over time, and, as Visual Capitalist’s Avery Koop notes, in tandem, the standard of living worldwide has increased immensely.
This map using data from the IMF shows the GDP per capita (nominal) of nearly every country and territory in the world.
GDP per capita is one of the best measures of a country’s wealth as it provides an understanding of how each country’s citizens live on average, showing a representation of the quantity of goods and services created per person.
The Standard of Living Over Time
Looking at history, our standard of living has increased drastically. According to Our World in Data, from 1820 to 2018, the average global GDP per capita increased by almost 15x.
Literacy rates, access to vaccines, and basic education have also improved our quality of life, while things like child mortality rates and poverty have all decreased.
For example, in 1990, 1.9 billion people lived in extreme poverty, which was 36% of the world’s population at the time. Over the last 30 years, the number has been steadily decreasing — by 2030, an estimated 479 million people will be living in extreme poverty, which according to UN population estimates, will represent only 6% of the population.
That said, economic inequality between different regions is still prevalent. In fact, the richest country today (in terms of nominal GDP per capita), Luxembourg, is over 471x more wealthy than the poorest, Burundi.
Here’s a look at the 10 countries with the highest GDP per capita in 2021:
However, not all citizens in Luxembourg are extremely wealthy. In fact:
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29% of people spend over 40% of their income on housing costs
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31% would be at risk of falling into poverty if they had to forgo 3 months of income
The cost of living is expensive in Luxembourg — but the standard of living in terms of goods and services produced is the highest in the world. Additionally, only 4% of the population reports low life satisfaction.
Emerging Economies and Developing Countries
Although we have never lived in a more prosperous period, and poverty rates have been declining overall, this year global extreme poverty rose for the first time in over two decades.
About 120 million additional people are living in poverty as a result of the pandemic, with the total expected to rise to about 150 million by the end of 2021.
Many of the poorest countries in the world are also considered Least Developed Countries (LDCs) by the UN. In these countries, more than 75% of the population live below the poverty line.
Here’s a look at the 10 countries with the lowest GDP per capita:
Life in these countries offers a stark contrast compared to the top 10. Here’s a glance at the quality of life in the poorest country, Burundi:
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80% of the population works in agriculture
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1 in 3 Burundians are in need of urgent humanitarian assistance
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Average households spend up to two-thirds of their income on food
However, many of the world’s poorest countries can also be classified as emerging markets with immense economic potential in the future.
In fact, China has seen the opportunity in emerging economies. Their confidence in these regions is best exemplified in the Belt and Road initiative which has funneled massive investments into infrastructure projects across multiple African countries.
Continually Raising the Bar
Prosperity is a very recent reality only characterizing the last couple hundred years. In pre-modern societies, the average person was living in conditions that would be considered extreme poverty by today’s standards.
Overall, the standard of living for everyone today is immensely improved compared to even recent history, and some countries will be experiencing rapid economic growth in the future.
Tyler Durden
Mon, 08/02/2021 – 02:45 -
- Craig Murray's Jailing Is The Latest Move In A Battle To Snuff Out Independent Journalism
Craig Murray’s Jailing Is The Latest Move In A Battle To Snuff Out Independent Journalism
Craig Murray, a former ambassador to Uzbekistan, the father of a newborn child, a man in very poor health and one who has no prior convictions, handed himself over to the Scottish police on Sunday morning.
He becomes the first person ever to be imprisoned on the obscure and vaguely defined charge of “jigsaw identification”.
Murray is also the first person to be jailed in Britain for contempt of court for their journalism in half a century – a period when such different legal and moral values prevailed that the British establishment had only just ended the prosecution of “homosexuals” and the jailing of women for having abortions.
📢PRESS RELEASE: Craig Murray to be first person incarcerated in the UK over media contempt case in 50 years, setting dangerous legal precedent for freedom of speech and equality before the law.
— Craig Murray Justice campaign (@cmurrayjustice) July 29, 2021
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Murray’s imprisonment for eight months by Lady Dorrian, Scotland’s second most senior judge, is of course based entirely on a keen reading of Scottish law rather than evidence of the Scottish and London political establishments seeking revenge on the former diplomat. And the UK supreme court’s refusal on Thursday to hear Murray’s appeal despite many glaring legal anomalies in the case, thereby paving his path to jail, is equally rooted in a strict application of the law, and not influenced in any way by political considerations.
Murray’s jailing has nothing to do with the fact that he embarrassed the British state in the early 2000s by becoming that rarest of things: a whistleblowing diplomat. He exposed the British government’s collusion, along with the US, in Uzbekistan’s torture regime.
His jailing also has nothing to do with the fact that Murray has embarrassed the British state more recently by reporting the woeful and continuing legal abuses in a London courtroom as Washington seeks to extradite Wikileaks’ founder, Julian Assange, and lock him away for life in a maximum security prison. The US wants to make an example of Assange for exposing its war crimes in Iraq and Afghanistan and for publishing leaked diplomatic cables that pulled the mask off Washington’s ugly foreign policy.
Murray’s jailing has nothing to do with the fact that the contempt proceedings against him allowed the Scottish court to deprive him of his passport so that he could not travel to Spain and testify in a related Assange case that is severely embarrassing Britain and the US. The Spanish hearing has been presented with reams of evidence that the US illegally spied on Assange inside the Ecuadorean embassy in London, where he sought political asylum to avoid extradition. Murray was due to testify that his own confidential conversations with Assange were filmed, as were Assange’s privileged meetings with his own lawyers. Such spying should have seen the case against Assange thrown out, had the judge in London actually been applying the law.
Actually what I found most shocking about that was the peculiar determination of the judges to make sure that, during the three weeks we have to lodge the appeal, I am not allowed to go to Spain to testify in the criminal prosecution for the CIA spying on Assange’s legal team.
— Craig Murray – 1st day in prison (@CraigMurrayOrg) May 11, 2021
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Similarly, Murray’s jailing has nothing to do with his embarrassing the Scottish political and legal establishments by reporting, almost single-handedly, the defence case in the trial of Scotland’s former First Minister, Alex Salmond. Unreported by the corporate media, the evidence submitted by Salmond’s lawyers led a jury dominated by women to acquit him of a raft of sexual assault charges. It is Murray’s reporting of Salmond’s defence that has been the source of his current troubles.
And most assuredly, Murray’s jailing has precisely nothing to do with his argument – one that might explain why the jury was so unconvinced by the prosecution case – that Salmond was actually the victim of a high-level plot by senior politicians at Holyrood to discredit him and prevent his return to the forefront of Scottish politics. The intention, says Murray, was to deny Salmond the chance to take on London and make a serious case for independence, and thereby expose the SNP’s increasing lip service to that cause.
Relentless attack
Murray has been a thorn in the side of the British establishment for nearly two decades. Now they have found a way to lock him up just as they have Assange, as well as tie Murray up potentially for years in legal battles that risk bankrupting him as he seeks to clear his name.
And given his extremely precarious health – documented in detail to the court – his imprisonment further risks turning eight months into a life sentence. Murray nearly died from a pulmonary embolism 17 years ago when he was last under such relentless attack from the British establishment. His health has not improved since.
At that time, in the early 2000s, in the run-up to and early stages of the invasion of Iraq, Murray effectively exposed the complicity of fellow British diplomats – their preference to turn a blind eye to the abuses sanctioned by their own government and its corrupt and corrupting alliance with the US.
Later, when Washington’s “extraordinary rendition” – state-sponsored kidnapping – programme came to light, as well as its torture regime at places like Abu Ghraib, the spotlight should have turned to the failure of diplomats to speak out. Unlike Murray, they refused to turn whistleblower. They provided cover to the illegality and barbarism.
For his pains, Murray was smeared by Tony Blair’s government as, among other things, a sexual predator – charges a Foreign Office investigation eventually cleared him of. But the damage was done, with Murray forced out. A commitment to moral and legal probity was clearly incompatible with British foreign policy objectives.
Murray had to reinvent his career, and he did so through a popular blog. He has applied the same dedication to truth-telling and commitment to the protection of human rights in his journalism – and has again run up against equally fierce opposition from the British establishment.
Two-tier journalism
The most glaring, and disturbing, legal innovation in Lady Dorrian’s ruling against Murray – and the main reason he is heading to prison – is her decision to divide journalists into two classes: those who work for approved corporate media outlets, and those like Murray who are independent, often funded by readers rather than paid big salaries by billionaires or the state.
According to Lady Dorrian, licensed, corporate journalists are entitled to legal protections she denied to unofficial and independent journalists like Murray – the very journalists who are most likely to take on governments, criticise the legal system, and expose the hypocrisy and lies of the corporate media.
In finding Murray guilty of so-called “jigsaw identification”, Lady Dorrian did not make a distinction between what Murray wrote about the Salmond case and what approved, corporate journalists wrote.
That is for good reason. Two surveys have shown that most of those following the Salmond trial who believe they identified one or more of his accusers did so from the coverage of the corporate media, especially the BBC. Murray’s writings appear to have had very little impact on the identification of any of the accusers. Among named individual journalists, Dani Garavelli, who wrote about the trial for Scotland on Sunday and the London Review of Books, was cited 15 times more often by respondents than Murray as helping them to identify Salmond’s accusers.
The polling was conducted by Panelbase as an extra question in one of their standard Scottish opinion polls. I paid for the question but there was no mechanism by which I could affect the results.
Is showed Dani Garavelli as by far the biggest source of identification. https://t.co/sAqY9tbJw0 pic.twitter.com/D1D6o9A7i7— Craig Murray – 1st day in prison (@CraigMurrayOrg) February 3, 2021
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Rather, Lady Dorrian’s distinction was about who is awarded protection when identification occurs. Write for the Times or the Guardian, or broadcast on the BBC, where the audience reach is enormous, and the courts will protect you from prosecution. Write about the same issues for a blog, and you risk being hounded into prison.
In fact, the legal basis of “jigsaw identification” – one could argue the whole point of it – is that it accrues dangerous powers to the state. It gives permission for the legal establishment to arbitrarily decide which piece of the supposed jigsaw is to be counted as identification. If the BBC’s Kirsty Wark includes a piece of the jigsaw, it does not count as identification in the eyes of the court. If Murray or another independent journalist offers a different piece of the jigsaw, it does count. The obvious ease with which this principle can be abused by the establishment to oppress and silence dissident journalists should not need underscoring.
And yet this is no longer Lady Dorrian’s ruling alone. In refusing to hear Murray’s appeal, the UK supreme court has offered its blessing to this same dangerous, two-tiered classification.
Credentialed by the state
What Lady Dorrian has done is to overturn traditional views of what constitutes journalism: that it is a practice that at its very best is designed to hold the powerful to account, and that anyone who engages in such work is doing journalism, whether or not they are typically thought of as a journalist.
That idea was obvious until quite recently. When social media took off, one of the gains trumpeted even by the corporate media was the emergence of a new kind of “citizen journalist”. At that stage, corporate media believed that these citizen journalists would become cheap fodder, providing on-the-ground, local stories they alone would have access to and that only the establishment media would be in a position to monetise. This was precisely the impetus for the Guardian’s Comment is Free section, which in its early incarnation allowed a varied selection of people with specialist knowledge or information to provide the paper with articles for free to increase the paper’s sales and advertising rates.
The establishment’s attitude to citizen journalists, and the Guardian’s to the Comment is Free model, only changed when these new journalists started to prove hard to control, and their work often highlighted inadvertently or otherwise the inadequacies, deceptions and double standards of the corporate media.
Now, Lady Dorrian has put the final nail in the coffin of citizen journalism. She has declared through her ruling that she and other judges will be the ones to decide who is considered a journalist and thereby who receives legal protections for their work. This is a barely concealed way for the state to license or “credentialise” journalists. It turns journalism into a professional guild with only official, corporate journalists safe from legal retribution by the state.
If you are an unapproved, uncredentialed journalist, you can be jailed, as Murray is being, on a similar legal basis to the imprisonment of someone who carries out a surgical operation without the necessary qualifications. But whereas the law against charlatan surgeons is there to protect the public, to stop unnecessary harm being inflicted on the sick, Lady Dorrian’s ruling will serve a very different purpose: to protect the state from the harm caused by the exposure of its secret or most malign practices by trouble-making, sceptical – and now largely independent – journalists.
Journalism is being corralled back into the exclusive control of the state and billionaire-owned corporations. It may not be surprising that corporate journalists, keen to hold on to their jobs, are consenting through their silence to this all-out assault on journalism and free speech. After all, this is a kind of protectionism – additional job security – for journalists employed by a corporate media that has no real intention to challenge the powerful.
But what is genuinely shocking is that this dangerous accretion of further power to the state and its allied corporate class is being backed implicitly by the British journalists’ union, the NUJ. It has kept quiet over the many months of attacks on Murray and the widespread efforts to discredit him for his reporting. The NUJ has made no significant noise about Lady Dorrian’s creation of two classes of journalists – state-approved and unapproved – or about her jailing of Murray on these grounds.
But the NUJ has gone further. Its leaders have publicly washed their hands of Murray by excluding him from membership of the union, even while its officials have conceded that he should qualify. The NUJ has become as complicit in the hounding of a journalist as Murray’s fellow diplomats once were for his hounding as an ambassador. This is a truly shameful episode in the NUJ’s history.
Calling all NUJ Members – When a country’s main union for journalists polices the Overton window, you are in a society well on the way to authoritarianism. For four months I have been excluded from the National Union of Journalists and, despite repeated https://t.co/RrdjiXUmmo
— Craig Murray – 1st day in prison (@CraigMurrayOrg) July 16, 2020
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Free speech criminalised
But more dangerous still, Lady Dorrian’s ruling is part of a pattern in which the political, judicial and media establishments have colluded to narrow the definition of what counts as journalism, to exclude anything beyond the pap that usually passes for journalism in the corporate media.
Murray has been one of the few journalists to report in detail the arguments made by Assange’s legal team in his extradition hearings. Noticeably in both the Assange and Murray cases, the presiding judge has limited the free speech protections traditionally afforded to journalism and has done so by restricting who qualifies as a journalist. Both cases have been frontal assaults on the ability of certain kinds of journalists – those who are free from corporate or state pressure – to cover important political stories, effectively criminalising independent journalism. And all this has been achieved by sleight of hand.
In Assange’s case, Judge Vanessa Baraitser largely assented to US claims that what the Wikileaks founder had done was espionage rather than journalism. The Obama administration had held off prosecuting Assange because it could not find a distinction in law between his legal right to publish evidence of US war crimes and the New York Times and the Guardian’s right to publish the same evidence, provided to them by Wikileaks. If the US administration prosecuted Assange, it would also need to prosecute the editors of those papers.
Donald Trump’s officials bypassed that problem by creating a distinction between “proper” journalists, employed by corporate outlets that oversee and control what is published, and “bogus” journalists, those independents not subject to such oversight and pressures.
Trump’s officials denied Assange the status of journalist and publisher and instead treated him as a spy who colluded with and assisted whistleblowers. That supposedly voided the free speech protections he constitutionally enjoyed. But, of course, the US case against Assange was patent nonsense. It is central to the work of investigative journalists to “collude” with and assist whistleblowers. And spies squirrel away the information provided to them by such whistleblowers, they do not publicise it to the world, as Assange did.
Notice the parallels with Murray’s case.
Judge Baraitser’s approach to Assange echoed the US one: that only approved, credentialed journalists enjoy the protection of the law from prosecution; only approved, credentialed journalists have the right to free speech (should they choose to exercise it in newsrooms beholden to state or corporate interests). Free speech and the protection of the law, Baraitser implied, no longer chiefly relate to the legality of what is said, but to the legal status of who says it.
A similar methodology has been adopted by Lady Dorrian in Murray’s case. She has denied him the status of a journalist, and instead classified him as some kind of “improper” journalist, or blogger. As with Assange, there is an implication that “improper” or “bogus” journalists are such an exceptional threat to society that they must be stripped of the normal legal protections of free speech.
“Jigsaw identification” – especially when allied to sexual assault allegations, involving women’s rights and playing into the wider, current obsession with identity politics – is the perfect vehicle for winning widespread consent for the criminalisation of the free speech of critical journalists.
Corporate media shackles
There is an even bigger picture that should be hard to miss for any honest journalist, corporate or otherwise. What Lady Dorrian and Judge Baraitser – and the establishment behind them – are trying to do is put the genie back in the bottle. They are trying to reverse a trend that over more than a decade has seen a small but growing number of journalists use new technology and social media to liberate themselves from the shackles of the corporate media and tell truths audiences were never supposed to hear.
Don’t believe me? Consider the case of Guardian and Observer journalist Ed Vulliamy. In his book Flat Earth News, Vulliamy’s colleague at the Guardian Nick Davies tells the story of how Roger Alton, editor of the Observer at the time of the Iraq war, and a credentialed, licensed journalist if ever there was one, sat on one of the biggest stories in the paper’s history for months on end.
In late 2002, Vulliamy, a veteran and much trusted reporter, persuaded Mel Goodman, a former senior CIA official who still had security clearance at the agency, to go on record that the CIA knew there were no WMD in Iraq – the pretext for an imminent and illegal invasion of that country. As many suspected, the US and British governments had been telling lies to justify a coming war of aggression against Iraq, and Vulliamy had a key source to prove it.
But Alton spiked this earth-shattering story and then refused to publish another six versions written by an increasingly exasperated Vulliamy over the next few months, as war loomed. Alton was determined to keep the story out of the news. Back in 2002 it only took a handful of editors – all of whom had risen through the ranks for their discretion, nuance and careful “judgment” – to make sure some kinds of news never reached their readers.
Social media has changed such calculations. Vulliamy’s story could not be quashed so easily today. It would leak out, precisely through a high-profile independent journalist like Assange or Murray. Which is why such figures are so critically important to a healthy and informed society – and why they, and a few others like them, are gradually being disappeared. The cost of allowing independent journalists to operate freely, the establishment has understood, is far too high.
First, all independent, unlicensed journalism was lumped in as “fake news”. With that as the background, social media corporations were able to collude with so-called legacy media corporations to algorithm independent journalists into oblivion. And now independent journalists are being educated about what fate is likely to befall them should they try to emulate Assange or Murray.
Asleep at the wheel
In fact, while corporate journalists have been asleep at the wheel, the British establishment has been preparing to widen the net to criminalise all journalism that seeks to seriously hold power to account. A recent government consultation document calling for a more draconian crackdown on what is being deceptively termed “onward disclosure” – code for journalism – has won the backing of Home Secretary Priti Patel. The document implicitly categorises journalism as little different from espionage and whistleblowing.
In the wake of the consultation paper, the Home Office has called on parliament to consider “increased maximum sentences” for offenders – that is, journalists – and ending the distinction “between espionage and the most serious unauthorised disclosures”. The government’s argument is that “onward disclosures” can create “far more serious damage” than espionage and so should be treated similarly. If accepted, any public interest defence – the traditional safeguard for journalists – will be muted.
Anyone who followed the Assange hearings last summer – which excludes most journalists in the corporate media – will notice strong echoes of the arguments made by the US for extraditing Assange, arguments conflating journalism with espionage that were largely accepted by Judge Baraitser.
None of this has come out of the blue. As the online technology publication The Register noted back in 2017, the Law Commission was at the time considering “proposals in the UK for a swingeing new Espionage Act that could jail journalists as spies”. It said such an act was being “developed in haste by legal advisers”.
It is quite extraordinary that two investigative journalists – one a long-term, former member of staff at the Guardian – managed to write an entire article in that paper this month on the government consultation paper and not mention Assange once. The warning signs have been there for the best part of a decade but corporate journalists have refused to notice them. Similarly, it is no coincidence that Murray’s plight has also not registered on the corporate media’s radar.
Assange and Murray are the canaries in the coal mine for the growing crackdown on investigative journalism and on efforts to hold executive power to account. There is, of course, ever less of that being done by the corporate media, which may explain why corporate outlets appear not only relaxed about the mounting political and legal climate against free speech and transparency but have been all but cheering it on.
In the Assange and Murray cases, the British state is carving out for itself a space to define what counts as legitimate, authorised journalism – and journalists are colluding in this dangerous development, if only through their silence. That collusion tells us a great deal about the mutual interests of the corporate political and legal establishments, on the one hand, and the corporate media establishment on the other.
Assange and Murray are not only telling us troubling truths we are not supposed to hear. The fact that they are being denied solidarity by those who are their colleagues, those who may be next in the firing line, tells us everything we need to know about the so-called mainstream media: that the role of corporate journalists is to serve establishment interests, not challenge them.
Tyler Durden
Mon, 08/02/2021 – 02:00 - The Road To Totalitarianism
The Road To Totalitarianism
Authored by CJ Hopkins via The Consent Factory,
People can tell themselves that they didn’t see where things have been heading for the last 17 months, but they did.
They saw all the signs along the way. The signs were all written in big, bold letters, some of them in scary-looking Germanic script. They read …
“THIS IS THE ROAD TO TOTALITARIANISM.”
I’m not going to show you all those signs out again. People like me have been pointing them out, and reading them out loud, for 17 months now. Anyone who knows anything about the history of totalitarianism, how it incrementally transforms society into a monstrous mirror image of itself, has known since the beginning what the “New Normal” is, and we have been shouting from the rooftops about it.
We have watched as the New Normal transformed our societies into paranoid, pathologized, authoritarian dystopias where people now have to show their “papers” to see a movie or get a cup of coffee and publicly display their ideological conformity to enter a supermarket and buy their groceries.
We have watched as the New Normal transformed the majority of the masses into hate-drunk, hysterical mobs that are openly persecuting “the Unvaccinated,” the official “Untermenschen” of the New Normal ideology.
We have watched as the New Normal has done precisely what every totalitarian movement in history has done before it, right by the numbers. We pointed all this out, each step of the way. I’m not going to reiterate all that again.
I am, however, going to document where we are at the moment, and how we got here … for the record, so that the people who will tell you later that they “had no clue where the trains were going” will understand why we no longer trust them, and why we regard them as cowards and collaborators, or worse.
Yes, that’s harsh, but this is not a game. It isn’t a difference of opinion. The global-capitalist ruling establishment is implementing a new, more openly totalitarian structure of society and method of rule. They are revoking our constitutional and human rights, transferring power out of sovereign governments and democratic institutions into unaccountable global entities that have no allegiance to any nation or its people.
That is what is happening … right now. It isn’t a TV show. It’s actually happening.
The time for people to “wake up” is over. At this point, you either join the fight to preserve what is left of those rights, and that sovereignty, or you surrender to the “New Normal,” to global-capitalist totalitarianism. I couldn’t care less what you believe about the virus, or its mutant variants, or the experimental “vaccines.” This isn’t an abstract argument over “the science.” It is a fight … a political, ideological fight. On one side is democracy, on the other is totalitarianism. Pick a fucking side, and live with it.
Anyway, here’s where we are at the moment, and how we got here, just the broad strokes.
It’s August 2021, and Germany has officially banned demonstrations against the “New Normal” official ideology. Other public assemblies, like the Christopher Street Day demo (pictured below), one week ago, are still allowed. The outlawing of political opposition is a classic hallmark of totalitarian systems. It’s also a classic move by the German authorities, which will give them the pretext they need to unleash the New Normal goon squads on the demonstrators tomorrow.
In Australia, the military has been deployed to enforce total compliance with government decrees … lockdowns, mandatory public obedience rituals, etc. In other words, it is de facto martial law. This is another classic hallmark of totalitarian systems.
In France, restaurant and other business owners who serve “the Unvaccinated” will now be imprisoned, as will, of course, “the Unvaccinated.” The scapegoating, demonizing, and segregating of “the Unvaccinated” is happening in countries all over the world. France is just an extreme example. The scapegoating, dehumanizing, and segregating of minorities — particularly the regime’s political opponents — is another classic hallmark of totalitarian systems.
In the UK, Italy, Greece, and numerous other countries throughout the world, this pseudo-medical social-segregation system is also being introduced, in order to divide societies into “good people” (i.e., compliant) and “bad” (i.e., non-compliant).
The “good people” are being given license and encouraged by the authorities and the corporate media to unleash their rage on the “the Unvaccinated,” to demand our segregation in internment camps, to openly threaten to viciously murder us.
This is also a hallmark of totalitarian systems.
And that, my friends, is where we are.
We didn’t get here overnight. Here are just a few of the unmistakable signs along the road to totalitarianism that I have pointed out over the last 17 months.
June 2020 … The New (Pathologized) Totalitarianism.
August 2020 … The Invasion of the New Normals.
October 2020 … The Covidian Cult.
November 2020 … The Germans Are Back!
March 2021 … The New Normal (Phase 2).
March 2021 … The “Unvaccinated” Question.
May 2021 … The Criminalization of Dissent.
June 2021 … Manufacturing New Normal “Reality“.
And now, here we are, where we have been heading all along, clearly, unmistakably heading … directly into The Approaching Storm, or possibly global civil war. This isn’t the end of the road to totalitarianism, but I’m pretty sure we are in the home stretch. It feels like things are about to get ugly. Very ugly. Extremely ugly. Those of us who are fighting to preserve our rights, and some basic semblance of democracy, are outnumbered, but we haven’t had our final say yet … and there are millions of us, and we are wide awake.
So pick a side, if you haven’t already. But, before you do, maybe look back at the history of totalitarian systems, which, for some reason, never seem to work out for the totalitarians, at least not in the long run. I’m not a professional philosopher or anything, but I suspect that might have something to do with some people’s inextinguishable desire for freedom, and our willingness to fight for it, sometimes to the death.
This kind of feels like one of those times.
Sorry for going all “Braveheart” on you, but I’m psyching myself up to go get the snot beat out of me by the New Normal goon squads tomorrow, so I’m a little … you know, overly emotional.
Seriously, though, pick a side … now … or a side will be picked for you.
Tyler Durden
Mon, 08/02/2021 – 00:00 - Can Masturbation Boost Your Immune System to Fight COVID?
Can Masturbation Boost Your Immune System to Fight COVID?
With COVID-19 and the Delta variant spreading worldwide, people have been exploring ways to boost their immune systems. Immunity-boosting supplements, exercising, eating healthy, reducing stress, and quitting smoking are some common strategies to boost the immune system, but now masturbating could be added to the list, according to The Sun.
Jennifer Landa, M.D., a specialist in hormone therapy, has said masturbating might strengthen the body’s natural defense forces.
“Masturbation can produce the right environment for a strengthened immune system,” Landa told Men’s Health.
Men’s Health also cited a 2004 study that showed men had more white blood cells 45 minutes after they had a solo orgasm. For those who don’t know, white blood cells are part of the body’s immune system that help fight infection and other diseases.
According to the study by the Department of Medical Psychology, University Clinic of Essen, Germany, “these findings demonstrate that components of the innate immune system are activated by sexual arousal and orgasm.”
Touching oneself might not prevent infection, but orgasms generally help people relax and elevate mood that is key to a healthy immune system.
Dr. Felice Gersh, a gynecologist and obstetrician who specializes in women’s health, said chronic masturbation might not prevent COVID, but “it’s not going to create harm.”
“I think the takeaway message is that there are no negatives from it,” Gersh said.
Further research needs to be done to see if masturbation can supercharger the immune system and provide an extra layer of defenses against viruses.
Tyler Durden
Sun, 08/01/2021 – 23:30 - Taibbi: Can History Itself Violate 'Community Standards?'
Taibbi: Can History Itself Violate ‘Community Standards?’
Authored by Matt Taibbi via TK News substack,
Meet the Censored: Hitler
Can history itself violate community standards?
100 years ago last week – on July 29, 1921 – Adolph Hitler was elected leader of the Nationalist Socialist German Workers’ Party, later known as the Nazi Party. The combustible Army corporal succeeded the party’s original leader, Anton Drexler, whom Hitler originally been sent to spy on, but whose ideas he came to admire (he may even have shaved his mustache to emulate his predecessor). The 533-1 delegate vote set in motion a series of events that would dominate the next two and a half decades of world history.
Hitler, pre-mustache change.
A young Jewish Internet commentator named Manny Marotta wanted to call attention to the date, for educational purposes. Marotta has been maintaining popular accounts on both Twitter and Instagram called 100 Years Ago Live. His simple, clever, and enlightening mission is to describe history as an actual contemporary might have, in the language of modern social media tools. It’s popular, earning 26,000 followers on Twitter.
Marotta’s accounts remind us that the past was once news, that stories we now remember as ossified, fixed narratives captured in black and white were once fresh, suspenseful events, that filled contemporaries with excitement, and uncertainty.
Whether it’s a snapshot of a socialist congress in Lille, France that at the time might have seemed the beginning of a global Western revolution, or a cartoon showing both sides of the prohibition debate that showed how extremes of opinion dominated discourse even back then, Marotta has a nice touch for putting readers in the mood of the era, while keeping our thoughts in the present. He is very much the opposite of a Nazi or a fascist, and posts about history in the hope that people will learn from it. “I have a step-grandmother who’s a Holocaust survivor,” he says. “That’s part of the reason I started the account.”
His Instagram post on Hitler’s ascension to the status of leader of the Nazi Party looked like this:
A tweet marking the same event appeared as follows:
After the war, disillusioned and bankrupt, the odd little Corporal worked as an intelligence agent for the government. While gathering information on the new German Workers’ Party, he grew fond of it and joined it. Today, he’s become its leader. pic.twitter.com/1NDSMdCV3U
— 1921 Live (@100YearsAgoLive) July 29, 2021
https://platform.twitter.com/widgets.js
There is no politicking or advocacy observable here, not as standalone posts and still less in the context of hundreds of other entries about other scenes as disparate as Thomas Edison taking a nap under a tree, a woman on Tremont Street in Boston turning heads by wearing pants, or a Soviet ship shelled in the Russian Civil War.
Nonetheless, Instagram pulled Marotta’s post on Hitler’s election, saying it violated “community guidelines.” When he appealed the decision, the rejected him again, saying his content went against their guidelines on “violence or dangerous organizations”:
Since the beginning of the “content moderation” movement, a major problem has become apparent. Human beings simply create too much content on Twitter, Facebook, YouTube, and Instagram for other human beings to review. Machines have proven able to identify clearly inappropriate content like child pornography (though even there the algorithms occasionally stumbled, as in the case of Facebook’s removal of the famous “Running Girl” photo).
But asking computer programs to sort out the subtleties of different types of speech — differences between commentary and advocacy, criticism and incitement, reporting and participation — has proven a disaster. A theme running through nearly all of the “Meet the Censored” articles is this problem of algorithmic censorship systematically throwing out babies with bathwater.
Whether it’s YouTube cracking down on videographer Ford Fischer for covering events involving Holocaust deniers or white supremacists, the same platform zapping footage of the January 6th riots shot by Jon Farina of Status Coup, or Matt Orfalea being punished for violating a “criminal organizations policy” for a spoof coffee commercial involving a mass-murderer, Internet carriers have consistently shown they cannot or will not distinguish between, say, being a Nazi and criticizing one, joking about one, even warning about one.
The frightening thing about the 100YearsAgoLive incident is that it’s not hard to see this becoming a trend, where history itself is deemed to violate common decency. The whole idea of historical education is to prevent future horrors via graphic warnings from the past. Survivors of the Holocaust have always been adamant that we must “Never Forget,” that places such as Auschwitz must never be buried or hidden away but instead displayed prominently, made into lasting cultural artifacts whose purpose is to be so conspicuous as to prevent the natural human impulse to whitewash our sadly expansive history of evil.
In the name of combating hate speech, violence, conspiracy theory, etc., Internet platforms are removing not just advocacy, but knowledge, in a wide-ranging effort that may help the companies create a more frictionless, commercially successful product, but will impede the past from chastening the present. If the aim is preventing the spread of hateful ideas, nothing could be more counter-productive that cleaning away the record of their real-world impact.
This 100YearsAgoLive episode seems like a silly glitch at first, a parody of Internet censorship, but it’s no joke — if we’re going to put machines in charge of cleaning our mental universes, the past is going to be one of the first casualties.
I reached out to Marotta:
TK: Can you tell us a little about the idea behind “100 Years Ago Live”?
Marotta: I graduated from the University of Pittsburgh two years ago. While there, in January 2018, I became interested in WWI history and decided to create a Twitter account that would “live-tweet” the events of the final year of WWI, as if I was a reporter on the ground. While there are certainly Twitter accounts that deal with historical subjects, none put themselves in the first-person, and act as if they are experiencing history, and so I decided to do that.
The account caught on and many people enjoyed the format. Its mission is to provide historical education in a fun and engaging way. I have had to report on some sensitive subjects. Most notably, this past May/June, there occurred the anniversary of the Tulsa Race Massacre. I took care to do thorough research on the subject and report on it in real-time with the utmost objectivity and respect for the victims. There was no censorship of this reporting.
Yesterday’s tweet/Instagram post was the first time in which the social media platform removed the post, accusing it of promoting hate. Hitler’s rise to power is, of course, one of the hallmark historical events of the 1920s and 1930s, and I intend to cover it often. This will be difficult if I cannot post the man’s name and image in any place.
TK: What happened yesterday?
Marotta: The purpose of this account is to provide historical education by reporting events from 100 years ago in real time. With that said, we espouse no extremist nor hateful views, even if they were expressed 100 years ago. 100 years ago yesterday, Adolf Hitler was made Führer of the Nazi Party. We reported on this story with the same caption for both Twitter and Instagram, explaining that Hitler had become Fuhrer and a little background information. There was no hateful imagery or view espoused in reporting on this objective fact. Within 20 minutes, Instagram took down the photo of Hitler, with the note that the post promoted hate speech and extremism. Given that it was literally a photograph of Hitler with the caption that he was made Führer, I appealed the decision. They struck it down once again.
TK: Do you think this was a human being making a decision, or a machine?
Marotta: This appears to be a result of an algorithm failing to distinguish between images used in an educational context, and images used in a hateful context. I believe that no human reviewed my case, and that the algorithm blindly struck it down because of the word “Hitler” and a depiction of the man.
TK: What do you think the rationale behind this kind of moderation is? If you have any idea, what’s your opinion on this brand of speech regulation?
Marotta: I believe that Instagram does this to protect their advertising viability, and because they cannot moderate each and every case, an automatic algorithm is applied. However, this serves as a detriment to historical education. I am Jewish, and Holocaust education is vital to my beliefs system. If I cannot provide context on Hitler’s rise to power, then Holocaust education becomes difficult.
TK: Can history violate “community guidelines”?
Marotta: There are certain situations in which I could understand a decision like that. If you had a violent or gratuitous image from the past, I could perhaps understand… But there is no situation in which you can justify suppressing just the image of a human being who happened to be an evil dictator. That is censorship of education itself.
Tyler Durden
Sun, 08/01/2021 – 23:00 - Apple Bans "Tinder For Anti-Vaxxers" On App Store
Apple Bans “Tinder For Anti-Vaxxers” On App Store
Apple on Saturday removed a dating app for unvaccinated people. Allegedly, the app violated Apple’s policies for COVID content.
Considered the “Tinder for anti-vaxxers,” Unjected is a dating-and-community app for unvaccinated people. In May, the app was launched after top dating websites, such as Bumble and Tinder, partnered with the White House and encouraged users to get vaccinated.
Apple removed the dating app from its App Store after being contacted by Bloomberg. In an email to Unjected, Apple said the app “inappropriately refers to the Covid-19 pandemic in its concept or theme.”
Apple requires all apps related to Covid-19 provide credible health and safety information and only come from recognized entities including government organizations, health-focused non-profits and medical or educational institutions.
Apple had originally denied Unjected during the initial review process and approved the app after it made changes to comply with Covid-19 policies, an Apple spokesperson said. Since then, “the developer has made statements externally to its users as well as updates to the app that once again bring it out of compliance,” Apple said, adding that Unjected encouraged users to avoid using certain words to avoid detection. “This is a violation of our guidelines, which make it clear: ‘If you attempt to cheat the system…your apps will be removed from the store.'”
Unjected’s views on vaccines have also resonated on Instagram where its account has almost 25,000 followers. The growing member base defies efforts by public health officials to boost vaccination rates as the highly contagious Covid-19 delta variant spreads across the U.S. -Bloomberg
In response to the de-platforming, one of the Unjected co-founders posted a video on Instagram saying, “apparently, we’re considered ‘too much’ for sharing our medical autonomy and freedom of choice… So, of course, Apple removed us.”
Making matters worse, Unjected is under review at the Google Play store for posts that claim vaccines are “experimental mRNA gene modifiers,” “bioweapons” and “nano-technology microchips.” As of 1323 ET Sunday, the app is still available on Play.
“We are looking into ways to get off of Apple and Google,” she said. “But the easiest transition for us might be to make the website as great as possible since they can’t shut that down like the app.”
Apple and Google are making it clear that anti-vax content will not be displayed on their platforms. This sort of dystopic censorship would make George Orwell turn over in his grave.
Remember what Silicon Valley did to conservative social media platform “Parler”?
Tyler Durden
Sun, 08/01/2021 – 22:30 - Sky News Australia Suspended By YouTube
Sky News Australia Suspended By YouTube
Authored by Melanie Sun via The Epoch Times,
YouTube has temporarily suspended Sky News Australia from posting on its video platform, issuing a first strike to the popular conservative news channel over “COVID-19 misinformation,” according to a statement.
The tech giant said its decision to issue a strike was based on local and global health authority guidance, which Sky News Australia challenged are constantly “subject to change” alongside updates to guidance from the various authorities.
Sky News Australia added that the suspension was over “old videos” posted on its channel.
The strike means that Sky News Australia is suspended for a week from uploading content to its 1.85 million subscribers on its YouTube account.
“Specifically, we don’t allow content that denies the existence of COVID-19 or that encourages people to use hydroxychloroquine or ivermectin to treat or prevent the virus,” YouTube said in an early version of its statement that was sent to local media.
“We do allow for videos that have sufficient countervailing context, which the violative videos did not provide.”
Sky News Australia said it “expressly rejects that any host has ever denied the existence of COVID-19 as was implied, and no such videos were ever published or removed.”
It added that the network acknowledges YouTube’s right to enforce its own policies and “looks forward to continuing to publish its popular news and analysis content back to its audience.”
“We support broad discussion and debate on a wide range of topics and perspectives which is vital to any democracy,” a spokesperson for the network added.
“We take our commitment to meeting editorial and community expectations seriously.”
Local media reported the strike came into effect on July 29.
According to YouTube’s policies, three strikes within a 90 days period will see a channel banned permanently from the platform.
One of Sky News’ news reporters has consistently been the first to cover controversial updates on global efforts to track down the origins of COVID-19, some of which were initially dismissed as “conspiracy theories” by other outlets but have since gained wider recognition as possible explanations.
Sky News Australia investigative reporter Sharri Markson was among the first to report on existing footage of bat research from inside the Wuhan Institute of Virology, dating back to May 2017, while members of the World Health Organizations investigative team continued to deny that live bats had ever been housed at the facility.
Tyler Durden
Sun, 08/01/2021 – 22:00 - Earnings Have To Grow At 3.8% In Perpetuity For Stock Prices To Make Sense
Earnings Have To Grow At 3.8% In Perpetuity For Stock Prices To Make Sense
In a world where an entire generation of traders is convinced that market moves are detached from fundamentals, cash flows and actual news and only the Fed’s balance sheet matters (and they are not wrong; the Fed has indeed broken the “market” irreparably and nothing but the Fed’s QE matters) SocGen’s head of global asset allocation Alain Bokobza has taken a walk down financial memory lane to remind his readers that in the long run it’s all about earnings, and long after the Fed has destroyed the monetary system with its murderous market manipulation, it will still be about earnings. But what will be the new S&P baseline?
That’s the $640 trillion question, because one day traders will have to reasses the upside for stocks without the Fed, and therein lies the rub because as Bokobza has calculated, for the S&P to trade at the current level of ~4,400, corporate profits will have to rise at 3.8%… in perpetuity.
As the SocGen strategist begins his masterclass in valuation (the way stuff like this was done before the Fed took over the entire market), equity valuation is driven by earnings growth expectations and – as such – we normally derive the fair value of equity by calculating the present value of all future dividends (we use the dividend discount model for equity valuation). The future dividends are based on assumptions as to the earnings trajectory and dividend payout ratio.
Now normally, in SocGen’s 4-stage dividend discount model, the bank uses a combination of consensus earnings estimates, historical earnings growth and long-term nominal GDP growth rate to forecast earnings. It then uses the 10y moving average of the dividend payout ratio to forecast the dividend stream.
But to perform his latest analysis, Bokobza had inverted the process and instead of using assumptions about earnings growth, he calculates the earnings growth needed for a given level of total return from equity. Specifically, he uses consensus earnings for the next year and assumes that earnings grow at a constant rate thereafter.
Which brings us to the key question: what returns to expect from equities?
While SocGen would have ideally wanted to use past returns as the first factor on which to anchor return expectations, it quickly encountered a problem: past returns were delivered during a very different context in terms of bond yield and growth, destroying any hope for uniformity. For example, US equity delivered a 10.7% annualized total return between January 1990 and July 2021 and the average annualized 10y rolling return is 10.9% over the period. However, the potential long-term return based on SocGen’s cost of equity approach is 5.7%. One can also use the average equity risk premium and our expectation of the 10y government bond yield to frame our expected return from equities. As per the risk premium model, the average equity risk premium for the US equity market is 4%. And since SocGen’s forecast for the 10y UST yield for 4Q21 is 2%, based on the average equity risk premium and its near-term forecast of the 10y government bond yield, investors could demand a total return of 6% from US equity. However, as SocGen’s economics team notes, the neutral rate for 10y USTs is 3.5%. This would suggest a 7.5% annualized return from the US equity over the long term.
The next question is what growth is implied in current level of the US equity market.
Here Bokobza calculates the rate of earnings growth for a given level of return from the US equity market. In the left-hand chart below, he plots the required earnings growth for different levels of return. So, if US equity market were to deliver an annualized return of 8% over the long term, the earnings CAGR required would be ~6%. In the right-hand chart below, he calculates the required earnings growth such that the long-term annualized return from equity is equal to the latest cost of equity (5.7%). In the early 1990s, US equity needed to grow earnings at around 1.5% every year to deliver a return of 5.7%. Compared to that, the earnings growth now required for a 5.7% return is 3.8%. The higher the earnings required to deliver the same level of return, the more expensive the market.
Bottom line: when seeking to answer what growth is in the price in the US, the answer is that while the US equity market has historically delivered high returns, the current cost of equity (expected return) at 5.7% is near its lows. Clearly, the expected return is much lower than the realized return. However, to deliver this level of expected return, the US equity market needs to grow earnings at 3.8% perpetually.
Tyler Durden
Sun, 08/01/2021 – 21:30 - When Will The COVID Revolt Come?
When Will The COVID Revolt Come?
Authored by Roger Kimball via AmGreatness.com,
At some point, there will be a revolt. The longer the arbitrary insanity persists, the more violent the reaction will be…
The most cheerful headline I have seen in weeks was on Glenn Reynolds’ New York Post column: “No, Karen, we’re not masking again.” I hope he is right. I do wonder, though. I have no doubt that the second part of his headline—“A winning GOP message for 2022 [and] beyond”—is correct. At least it’s correct if it is expressed as a conditional: It would be a winning strategy were it adopted. As Reynolds notes, “There is a great deal of pent-up frustration and resentment over the inconvenience, the loss of freedom and the general climate of hectoring that the government’s pandemic response has created.” Indeed. And he’s right, too, that
It’s irritating to be lectured by officials who claim to be smarter than you. It’s infuriating to be lectured by government officials who claim to be smarter than you—but clearly aren’t.
The on-again/off-again claims on masks and vaccination are just part of it. Tired of masks? Get vaccinated, they told us. Now they’re saying wear a mask, even if you’ve been vaccinated and even if you’re associating with others who’ve been vaccinated.
And there’s talk of more lockdowns, which a growing body of scientific evidence suggests were perfectly useless and downright harmful.
As Molly Bloom exclaimed in a different context, Yes, Yes, Yes!
But to return to the question of hope, I am reminded that hope was said by some cynics to have been the last evil in Pandora’s pithos. It seems like only yesterday—in fact, it was just this past May—that both the president and the vice-president of the United States insisted that (as Joe himself put it) “Folks, if you’re fully vaccinated—you no longer need to wear a mask.”
Of course, that was more than a year after “15 days to slow the spread,” Anthony Fauci’s steady stream of contradictory, though authoritatively delivered, advice, not to mention the recent advent of (cue the scary music) The Delta Variant.
It was the New York Post, again, that cut to the chase on the latest (unless we’re on to the epsilon variant already) with its cover of July 30. “Insanity!” read its oversized headline and below was a large grid with a tiny bit of the upper right square marked. Of the 161 million people who have been vaccinated, only 5,601 have been hospitalized with the new version of the virus. Of those, only 1,141 have died. That’s .0007 percent. (And how old, one wonders, were those who succumbed and from what comorbidities did they suffer?)
Now it turns out that the latest CDC advice was based largely on an outbreak at Provincetown after the informal party time of “Bear Week” in early July. Andrew Sullivan treated the news with some portion of the skepticism it deserves. In fact, as another commentator pointed out, what the Provincetown outbreak really shows is that “even under perfect conditions for a superspreader event, the vaccine works spectacularly well.”
But even to talk about studies and statistics and “expert” advice is to assume that we are talking primarily about an issue of public health. We aren’t. Consider this list from Jim Treacher:
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Absolutely do not wear a mask
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You must, must, must wear a mask or you’re killing Grandma
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Don’t leave the house or you’re killing Grandma
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If you can’t avoid leaving the house, stay at least six feet away from any other human being you see or you’re killing Grandma
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Wash your hands 20 times a day
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Do not touch your face or anything else, ever
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Get vaccinated so you don’t have to wear a mask
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You have to wear a mask even if you’re vaccinated
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When the above rules change, and then change back, and then change back again, shut up about it or you’re a stupid MAGA-head
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Don’t forget to vote Democrat!
Of course, the last item is more often left unspoken than it is overtly expressed, but it is a sentiment, an assumption, that infuses the whole shifting kaleidoscope of contradictory advice. Treacher is right. “This isn’t about science. It’s about control. You will do as you’re told, peasants, and your moral, ethical and intellectual betters will continue to do whatever they please.”
I think Glenn Reynolds is correct that opposing the tyrannous spirit that stands behind the lockdowns, the mask mandates, and the smug, hectoring, politically correct demands for proof of vaccination would be a winning strategy for GOP politicians. Will they adopt it? Most will do so timorously, if at all. That’s my prediction.
Last year at Encounter Books, we published an admonitory book by Joel Kotkin called The Coming of Neo-Feudalism: A Warning To The Global Middle Class. Some people thought Kotkin was overstating things with his talk of an increasingly stratified society in which a tiny elite lorded it over an increasingly pauperized and disenfranchised mass. It turns out, though, that if anything Kotkin understated the trends. The weaponization of public health diktats, their enforcement by a vast and increasingly overbearing cadre of nanny-state bureaucrats, is simply the latest manifestation of the profoundly anti-democratic spirit that has taken hold in Western societies.
It’s all about social control, as Jim Treacher says. At some point, there will be a revolt. The longer the arbitrary insanity persists, the more violent the reaction will be. The question is whether we are at or are approaching the point of crisis. Will the voters stand for another lockdown as we approach the 2022 election? Lockdowns markedly increased the opportunities for voter fraud; 2020 showed that. That is precisely why the swamp is prepping us for another go. Let’s see if we stand by grumbling impotently or if, finally, we actually do something. I am not holding my breath.
Tyler Durden
Sun, 08/01/2021 – 21:00 -
- 'Purge-Like Siren' Blares Near US Census Building, Keeps Residents Up At Night
‘Purge-Like Siren’ Blares Near US Census Building, Keeps Residents Up At Night
“It sounds kind of like a combination of a tornado siren and a spaceship taking off, like the siren from the ‘Purge’ movies,” Suitland, Maryland, resident Scott Bovarnick told NBC4 Washington.
An unidentified siren keeps Suitland residents up “all night – every night” and makes it extremely difficult to sleep. They want the noise to stop, but no one can tell them the origin of the siren.
“We have a lot of young families in the neighborhood, a lot of children, and I know it’s probably keeping them up,” Bovarnick said. “A lot of my neighbors are having trouble sleeping, and it’s disturbing.”
Residents speculate the siren could be coming from the gated Suitland Federal Center, home to the U.S. Census Bureau.
“I just want to know what it is, and can they turn it off because people are trying to sleep,” resident Marcus Brent said.
NBC4 reached out to the Census Bureau and the other federal agencies, including the National Oceanic and Atmospheric Administration, about the mysterious siren. None of the agencies have yet to respond to the local news station.
Tyler Durden
Sun, 08/01/2021 – 20:30 - 10 Republicans Back Bill Calling For Audit Of The CDC
10 Republicans Back Bill Calling For Audit Of The CDC
Authored by Ivan Pentchoukov via The Epoch Times,
A group of 10 Republican senators is backing a bill that would require an audit of the decision-making and public health messaging by the Centers for Disease Control and Prevention (CDC).
The Senate bill (pdf), titled ‘Restore Public Health Institution Trust Act of 2021, would require the Government Accountability Office (GAO) to assess the CDC’s public health messaging and decision making and prepare a report on the matter.
The bill requires the report to include a review of the data the CDC used to make its recommendations and whether the agency’s “inconsistent messaging” had an impact on the public’s trust and willingness to take the COVID-10 vaccine.
“These guidelines, like most of the Biden Administration’s actions these days, make little sense and seem without scientific direction,” Sen. Marco Rubio (R-Fla.) said in a statement, referring to the CDC recent reversal of masking guidance for fully vaccinated people.
“Americans have spent the last year and a half making tremendous sacrifices to halt the virus’s spread, but they are confused and have lost trust in our institutions. The mixed messaging could also degrade trust in the efficacy of vaccines.”
The bill would also require the GAO to determine whether outside entities, including teachers’ unions, were in a position to impact the CDC’s guidance.
The CDC revised its mask guidance last week, telling fully vaccinated people to don masks in crowded indoor settings. The agency based the decision on a study of an outbreak in Massachusetts which found that 74 percent of the people infected had been fully vaccinated. The study also suggested that fully vaccinated people who become infected with the CCP (Chinese Communist Party) virus, could spread the virus the same way unvaccinated people do.
The CCP virus, commonly known as the novel coronavirus, is the pathogen that causes COVID-19.
“The CDC’s flip flop on mask guidance sends a confusing message to Montanans and the American people, and has not been clearly justified with data,” Sen. Steve Daines (R-Mont.) said in a statement.
“The CDC needs to improve its communications with the public and stop undermining vaccine confidence.”
“Over the past year and a half, the Centers for Disease Control and Prevention issued conflicting health guidance, at times only weeks apart, and at times without supporting clinical data,” Sen. Cythia Lummis (r-Wyo.) said in a statement.
“Their actions have unnecessarily divided our country, and fueled partisan conflict. The job of the CDC is to help control and prevent disease, not play politics. It’s time for oversight and reform.”
Tyler Durden
Sun, 08/01/2021 – 20:00 - One Bank Asks How Much Lower Stocks Would Be Without Covid
One Bank Asks How Much Lower Stocks Would Be Without Covid
With another round of economic lockdowns and restrictions on the immediate horizon as Joe Biden unexpectedly admitted on Friday, one bank has dared to ask where we would be without the pandemic, and correctly extrapolates that the worse it gets for the general population the better it is for markets… just in case anyone is wondering who the Biden administration is really working for.
That said bank is Goldman Sachs is surprising: the vampire squid is not known for calling a spade a spade, especially when telling the truth could get the bank deplatformed, or worse, kicked out of the woke corporations club. Despite these risks, Goldman’s head of HF equity derivatives sales, Tony Pasquariello, focuses precisely on this “no covid” counterfactual in his latest markets and macro note, pointing out that “as a client once put it, financial markets have no moral conscience. as we sit here today, one can argue the paradox of recent COVID variants is they’ve become a net positive for certain risk assets – on the thesis that local setbacks have kept the activity meter from going into the red, allowing for a back-footed Fed and a slower but, certainly far from slow — pace of US and global growth.”
Pasquariello then says that his sales & trading colleague Mark Wilson summarized it best, as follows: “the irony of this most recent bout of virus concern is that it actually likely exacerbates (not undermines) the durability of the medium-term growth outlook: inflation concerns have been pushed further out, central banks temptation to reduce support has been quashed, financial conditions have eased to new lows, and determination to follow through on widely heralded investment plans will have only increased.”
To take that logic a step further, Pasquariello shares a thought provoking two-liner that he saw on Twitter…
“imagine the counterfactual of the pandemic never happening; would the S&P 500 be 30% above its peak in February 2020 without it?”
… and notes that despite his normally bullish instinct, readers should put him in the “no” camp:
while the global economy had plenty of cyclical momentum coming out of 2019, in the absence of the utterly enormous policy response that COVID set off, it’s a little hard for me to think S&P would be printing 4400. here’s another approach: all else equal, without COVID, would US 10yr real yields be negative 1.17% … and, without that rate underpinning, would US equity markets be trading on multiples never sustained outside of the 1990s tech bubble?
And just in case it’s unclear, he simplifies the quite provocative point he is trying to make:
despite all of the deep awfulness of the pandemic, it touched off a series of events and reactions that are still playing out — and, largely to the benefit of the risk complex, with no better example than the NDX 100.
Almost as if the covid pandemic is precisely what bull markets ordered (and according to a growing number of people that’s precisely what happened, but that’s a topic for another day)
Taken together, the balance between a strong runway for growth (increasingly more first derivative than second) and remarkably easy financial conditions (the same statement applies here) is still healthy for risk assets over the near-term. So, if the biggest dynamics remain in favor of the bulls, the Goldman trader argues that “the main thing” is to keep your eye on the ball amidst the inevitable noise and volatility; That means: (1) be long, on a responsible and flexible risk setting, given how far we’ve come; (2) maintain a split between secular growers and cyclical plays, with a shade towards the former; (3) yes, favor the US over all other markets.
Recapping his market sentiment, Pasquariello shares the following sentiment (first brought up by his Goldman colleague Dominic Wilson): “the environment is still one where you want to be buying dips and reducing on good news. there’s probably too much negativity around the growth outlook, and thus cyclicals. the overall balance of underlying growth and real yields is very healthy. so, stick with the game plan.”
To dig a step deeper into the biggest question of the day, if the UK analog for how a highly vaccinated country handles the Delta variant is the best available stress test, there should be a reasonable limit to concerns even as US case growth accelerates (and, objectively, may not peak for another month).
This means that we have a reference point that looks reassuring on the biggest risks as we are within 1-2 weeks of the Delta wave peaking around the globe. Pasquariello also notes that it is interesting that the bank’s pandemic basket (GSXUPAND) and back-to-office basket (GSFINOFC) outperformed the S&P this week – those are the high quality gauges to measure investor anxiety as we get into and move through August…
We concludes with some parting observations from Pasquariello: “if you take a big step back, the underlying strength of asset markets is stunning. This, of course, includes risk assets — particularly equities and credit markets. It also extends to luxury goods, be it boats or watches or art or fine wines. It also includes the interest rate market, where persistently lower nominal yields in the face of many countervailing factors calls to mind the “conundrum” word choice of prior years. If there’s one pattern of fact that helps to rationalize all of this, it’s the simple point that there’s a ton of cash still looking for a home — again, recall our work on $5tr of excess savings globally or the rise of family offices and their considerable war chests.”
So going back to the original question – how much has covid boosted stock returns – The Goldman traders says that while he doesn’t know how this story ends, “but apropos of nothing, if you told me in March of 2020 that I’d be typing this, there’s no way I’d believe it.”
Tyler Durden
Sun, 08/01/2021 – 19:30 - Higher Gas Prices Mean Higher Taxes: Illinoisans Now Pay The Nation's 2nd-Highest Gas Taxes
Higher Gas Prices Mean Higher Taxes: Illinoisans Now Pay The Nation’s 2nd-Highest Gas Taxes
By Ted Dabrowski of Wirepoints
As gas prices jump in Illinois, so do the gas taxes Illinoisans must pay. Illinois is one of just four states to impose a general state sales tax on gasoline, and that’s helped push Illinois’ gas taxes to the 2nd-highest in the nation, according to the American Petroleum Institute.
Illinoisans pay an additional 6.25% for every gallon of gas, on top of the standard excise taxes that were doubled in 2019. Hawaii, Indiana and Michigan are the only other states that apply their general sales taxes to gasoline.
Just over a month ago, Wirepoints reported that Illinois gas taxes were still the nation’s 3rd-highest, a position the state has held since lawmakers hiked the excise tax in 2019. But this summer’s higher gas prices have pushed Illinois to second place as of July 1st, surpassing Pennsylvania’s own sky-high taxes by about a cent.
Now Illinois is only behind California, whose residents pay both the highest gas prices and gas taxes in the nation. Illinoisans, meanwhile, paid the 11th-most for a gallon of gas as of July 30th, according to AAA.
For comparison, Wisconsin and Iowa’s gas prices are about 40 cents lower than Illinois’, while Kentucky and Missouri’s prices are about 50 cents cheaper. Indiana’s prices are 30 cents lower.
Chalk this up as another failed policy in Illinois that causes Illinoisans to cross the border to spend their money in neighboring states.
Tyler Durden
Sun, 08/01/2021 – 19:00 - Key Cryptocurrency Developments And Updates From JPMorgan
Key Cryptocurrency Developments And Updates From JPMorgan
All those who have followed the writings of JPMorgan’s Nick Panagirtzoglou and Josh Younger, for whom no bitcoin bashing opportunity was too small or too insigificant (we too are patiently waiting for Panagirtzoglou to observe which way bitcoin’s momentum has been moving in recent weeks following the cryptocurrency’s longest winning streak since 2015, a fact he has oddly failed to discuss), may be surprised to learn recently the bank quietly launched a report for its clients looking at all the top crypto developments.
So for those tired of listening to JPM’s conflicted musing as it tries to create a lower entry point for its prop traders, here is nothing but facts from the Crypto Weekly report at the world’s largest bank:
- Bitcoin, Ether, Dogecoin, and other major cryptocurrencies rose sharply during the week after the market took cues from a recent job posting by Amazon seeking to hire a “Digital Currency and Blockchain Product Lead.” It sparked questions among the market participants if the move could lead to Amazon accepting cryptocurrencies as a method of payment soon. Further, the upward movement of the market was fueled by short covering as more than $950mm of crypto shorts were liquidated on Monday, the most since May 2019, as per data from bybt.com. Post the market’s sharp rally, Amazon clarified that the speculation around its specific plans for cryptocurrencies was not true and it remains focused on exploring this space. Despite Amazon’s clarification, the market remained buoyed as Bitcoin ended the week at $39.7K, up 23.2% from the prior week. Meanwhile, Ether rose 14.7% w/w to $2,314 and Dogecoin rose 7.1% in the week.
- Coin Spotlight: Theta serves as the native token for the blockchain-driven video sharing platform of the same name. By enabling faster and cheaper transmission of high-definition streaming, the Theta network shows promise of becoming a central part of the entertainment ecosystem. Tesla revealed that it’s holding Bitcoin worth $1.31B. Moreover, it booked $23mm of impairments related to its Bitcoin holding in 2Q21 and did not buy or sell Bitcoins during the quarter.
- Goldman Sachs filed an application to offer an ETF focused on securities of cryptocurrency-related companies with the US Securities and Exchange Commission. The proposed ETF would track the Solactive Decentralized Finance and Blockchain Index.
- Twitter’s CEO announced that Bitcoin will be a “big part” of the company’s future. He also remarked that the company would continue to look at the space and invest aggressively in it.
Key Developments in the Week
Key Regulatory Updates on Crypto
Crypto Adoption by Non-Financial Services Companies
VC Corner: Key Blockchain/Crypto VC Investments
- Fireblocks (7/27): The blockchain infrastructure firm Fireblocks recently raised $310mm in a Series D round that valued the company at $2B. Fireblocks’ technology can implement direct custody without having to rely on third parties. Its platform has been used by over 500 institutions with more than $1T in digital assets. Its list of clients include Revolut, BlockFi, Celsius, Crypto.com, and eToro. The latest funding round was led by Sequoia Capital, Stripes, Spark Capital, Coatue, DRW Venture Capital, and SCB 10X, the venture arm of Thailand’s Siam Commercial Bank. (link)
- Figure (7/28): Figure, a blockchain-based solution provider to the financial services industry, closed $200mm Series D round backed by Apollo Global Management, Inc., Blockchain.com, Rockaway Blockchain, HOF Capital, Endeavour Capital, National Bank Holdings, Goldentree Asset Management, and L1 Digital. This round valued the firm at $3.2B. Figure provides blockchainbased solutions for loan origination, equity management, private fund services, and payments. (link)
- Eco (7/27): Eco, a cryoto wallet company, raised $60mm financing in a latest round led by Activant Capital, L Catterton, a16z Crypto, Lightspeed Venture Partners, LionTree Partners, and Valor Equity Partners. Eco offers an all-in-one digital wallet with rewards and no fees and has average deposits of around $6,000. Eco’s top priorities are accelerating product roadmap and scaling user base. It is looking to significantly grow its team, build up marketing, and pursue regulatory approvals while expanding its services. (link)
- Dibbs (7/27): Fractional sports card marketplace Dibbs announced $13mm Series A funding from Foundry Group, Tusk Venture Partners, Courtside Ventures, and Founder Collective. Dibbs provides a platform for fans to trade fractions of sports cards, in real time. It assigns NFTs to physical assets that are then fractionalized on blockchains. The ownership of these cards is defined using smart contracts. Dibbs will use the incoming funds to increase its team size, add new range of products, and expand globally. (link)
Global Crypto Market Size and Landscape
The size of the global market increased in the past week, with the global crypto sector’s market cap rising 18.2% w/w from $1.31 trillion to $1.55 trillion as of 7/29.
Currently, the top five cryptocurrencies by market cap are (1) Bitcoin, (2) Ether, (3) Tether, (4) Binance Coin, and (5) Cardano. Below we give brief explanations of each of these major cryptocurrencies
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Tyler Durden
Sun, 08/01/2021 – 18:30 - San Fran DA Chesa Boudin Stands Up For Shoplifters And Drug Dealers
San Fran DA Chesa Boudin Stands Up For Shoplifters And Drug Dealers
Authored by Momica Showalter via AmericanThinker.com,
San Francisco’s broad-daylight retail heists have shocked the nation in their brazenness. They’ve triggered the closings of stores, such as Walgreens, and the shortening of hours from retail giants such as Target. Forty-four percent of city is planning to move out, with 80% citing out-of-control crime.
But the shoplifters have got a defender, too — in San Francisco District Attorney Chesa Boudin. So do the drug dealers. The only problems that Chesa sees are the victims.
Which tells us a lot about the state of moral bankruptcy of the wokester movement, and what the New Yorker dismisses as the “backlash.”
According to the Daily Mail, citing an interview in the New Yorker, after a viral video surfaced in June of a thief stuffing oodles of goods from a Walgreens into a trash bag and then riding his bike through the store unencumbered on the way out:
‘When I watch that video, I think about five questions that people are not asking that I think they should,’ Boudin told The New Yorker.
‘Is he drug addicted, mentally ill, desperate? Is he part of a major retail fencing operation?
‘What’s driving this behavior and is it in any way representative, because it was presented as something symptomatic?’
The question that doesn’t occur to him is whether the thefts are illegal. Or whether continuous unpunished crime is seriously disruptive to any society of lawful order.
In fact, according to the New Yorker, Boudin embraces the logic of looters from Black Lives Matter from over the summer:
Boudin said, “If Walgreens has insurance for certain goods or they expect a certain amount of loss, if they would rather not risk lawsuits or escalation to violence—then maybe that’s something we should know about.”
Well, gee, if they had insurance, then of course it’s all right, right, Ches? That was what the Black Lives Matter looters were saying as they hauled out the Nike tennis shoes and large-screen TVs.
He sounds like a sleazy defense attorney, crafting a case for a scummy defendant with nothing else for his defense than to blame the victim.
Worse still, he does the same thing for hardened drug dealers in the country illegally:
Greenberg showed me a video of Boudin at a town hall at which residents had asked what could be done about some drug dealers. Boudin noted, in his reply, that many of the drug dealers had been brought to the United States by human traffickers—that they were, in a sense, victims themselves. “He’s excusing the Honduran drug dealers,” Greenberg said. “Not holding them accountable greenlights.”
You see, they had a bad childhood, so dealing drugs is therefore all right.
The New Yorker piece is a total puff piece, giving Chesa’s point of view on several things with nothing to counter it. It describes the huge broad-daylight retail heist at Neiman-Marcus as ‘zany’ and actually kind of cute. Get a load of this:
Earlier this month, a bystander captured the final stages of a ten-person larceny of designer handbags from Neiman Marcus. One by one, they spill out the front door, each clutching oversized bags to the chest; the final thief races out carrying half a dozen handbags, still attached to a multipronged security chain. Their movements are encumbered, zany, almost Chaplin-esque; when they exit, some look uncertain about which way to run. This is disorder without menace, but not without effect.
Well isn’t that charming.
As for the Walgreens video of the shoplifter riding out:
The video crystallizes the subversive, Banksy-ish quality of the San Francisco theft wave.
It’s all so artsy, who couldn’t be cool with it?
Three big points from Chesa in the interview, however, do stick out:
One is that Chesa keeps claiming that crime in San Francisco is down, citing city statistics:
The way the video had been presented suggested that shoplifting had become a raging problem in San Francisco, but, he pointed out, the official data showed that over-all theft was down from the previous year.
Two is that he fails to cite the reason, even though the evidence is right in front of his eyes:
Boudin turned to the matter of the security guard: Why, Boudin asked, had he reacted so passively?
…here, too:
He mentioned a fact he often cites when confronted about property crime—that the police make arrests in just two-and-a-half per cent of reported thefts. “Maybe that’s a good thing—maybe that means they’re prioritizing murders,” Boudin said.
Might it occur to this Machiavel that these crimes are not being reported given his refusal to prosecute? If every theft is considered by the D.A. a junk case not worth prosecuting, then maybe people don’t bother reporting crimes anymore. Boudin announced early on that he would refuse to prosecute “quality of life” crimes, such as noisy hookers in the upstairs apartment and drunks peeing in doorways, a detail the New Yorker left out, along with young Chesa’s early associations with Venezuelan Marxist dictator, Hugo Chavez, a man who turned Venezuela into the mother of all crime-pit hellholes. It did, however, cite this:
His office eliminated cash bail and announced that it would no longer use gang affiliation to seek longer sentences or bring cases in which police pulled over a car as pretext for a drug search. When the pandemic shut down San Francisco, and infections began to rise in prisons around the country, Boudin saw an opportunity for decarceration; by May, 2020, he had cut the city’s jail population from a daily average of about twelve hundred people to about seven hundred.
Let them out, refuse to prosecute, and somehow, crime is down?
When crime is never prosecuted, and reporting is simply futile, people don’t report crimes. Why bother? Nobody’s going to do jack.
Third, he can’t stop blaming the victim. Get a load of his inability to use the word ‘rob’:
Boudin said, “If your car gets broken into, you’re outraged or angry or inconvenienced or incurred an expense. If your home gets broken into, it feels much scarier.”
Getting your car stolen with payments still due on it, and being forced to pay $600 for a police tow you didn’t ask for once the car is recovered (this happened to me in the ’90s), is merely an “inconvenience,” you see, an expense incurred, something you can put on your expense sheet or tax loss returns the way rich people do, same as Walgreens can claim insurance. You shouldn’t be upset about it. Nowhere does Boudin ever use the term ‘robbed’ or issue recognition that most people don’t have expense sheets or tax qualifications, and can only eat the loss.
As for public sentiment turning against the current crime wave, Chesa explains that it’s all in their heads:
He said, “From a public political standpoint, what matters more is the ups and downs and if people feel less safe. It doesn’t matter that crime is down. People feel less safe. They want to feel safe.”
Maybe they don’t feel safe because they aren’t safe. Maybe they’ve been robbed one time too many.
The recall petition seems to suggest just this kind of trouble, but Boudin compares it to Trumpism, “Trump’s big lie,” as he stated at a July 9 Mission District community meeting. It’s not about crime, you see, it’s about closet-Trump people somehow living in a place like San Francisco, with anyone who doesn’t like his act rightfully name-called a Republican. In Chesa’s passive-aggressive, Ayers-like mind, that’s something that ought to guilt-trip the locals, though it may in the end annoy them.
The New Yorker, still having Chesa’s back, calls it “backlash,” Chesa being innocent and all, with none of the public discontent having anything to do with his actions you see. Just “backlash.”
It’s unknown whether two recall petitions against him are gathering all the required signatures. The New Yorker writer dismisses both as unlikely to succeed, but the signature-gatherers say they are making progress ahead of the August and October deadlines.
According to the California Globe:
“Both Newsom and Boudin had their first recall petitions filed one year after they took office, the minimum to do so in California,” said former lobbyist Harry Schultz, who has monitored and advised on recall campaigns in California since the late 90’s, in a Globe interview on Thursday. “As you mentioned, both saw support increase following huge nationwide stories that painted them negatively and decisions that proved to be very controversial. And both recall movements have been doing quite well despite being in largely Democratically held areas, Newsom having California and Boudin being in the more liberal San Francisco County.”
“For them to face a recall in California it’s incredible, but it goes to show just how upset they’ve made people. When voters say we want someone not as extreme as you, or in Newsom’s case, a Republican, in a state where Democrats outnumber Republicans four to one no less, well, they did something wrong.”
“And now Boudin is starting to go through what Newsom did recall-wise this year. These huge spurts of funding against him are a big indicator there. I wish we had signature data, but once we have that, or at least see what the group with the August-expiring petition wound up with, we can see where we are big-picture wise when it comes to a possible Boudin recall either this year or next.”
One can only hope that with revolting leftist who blames victims, defends shoplifters, stands up for drug dealers, abetted by a press that calls crime ‘zany,’ that San Franciscans will finally come to their senses.
Tyler Durden
Sun, 08/01/2021 – 18:00 - FDA May Grant Full Approval For Pfizer Jab As Early As September
FDA May Grant Full Approval For Pfizer Jab As Early As September
The Food and Drug Administration (FDA) may grant full approval for Pfizer’s Covid-19 vaccination as early as September or October, according to the Wall Street Journal, citing FDA advisers and former officials familiar with the process.
The rush for full approval – as opposed to the current emergency use authorization – comes as many schools, hospitals and employers have used full approval as a benchmark for moving forward with mandatory vaccinations.
“We’d like to see it approved as fast as humanly possible, so we can really go back to just the more normal experience,” said Jim Malatras, chancellor of the State University of New York system, who currently cannot impose a vaccine mandate for some 400,000 students served under the system. At present, the school requires either vaccines or weekly testing.
Three vaccines—from Pfizer Inc. and partner BioNTech SE, Moderna Inc., and Johnson & Johnson —are authorized for emergency use in the U.S. Pfizer and Moderna have filed initial paperwork for full approval. However, only Pfizer has submitted all the necessary information to the FDA, according to the companies, and analysts expect it will be the first to get the green light. Moderna says it is still completing rolling data submissions, and Johnson & Johnson says it plans to file for full approval later this year. –Wall Street Journal
The FDA is taking an “all-hands-on-deck” approach to review Pfizer’s applicaiton for full approval “as rapidly as possible in keeping with the high-quality complete assessment that the public expects from the FDA.”
As the Journal notes, full approval will ease restrictions on distribution and advertising, and will allow more states, schools and employers to force people to take the jab, according to attorneys and current/former FDA officials. Once full approval is granted, the vaccine would be eligible for prescriptions as booster doses by physicians.
According to a June Kaiser Family Foundation survey, over 30% of unvaccinated Americans would be more likely to get it if the FDA grants full approval.
“The vast difference in vaccination rates across the country tell a story about what the perceptions are about risk across the country,” said Harvard University associate professor Joseph Allen, head of the university’s Healthy Buildings program. “If you’re a company operating in all 50 states and even internationally, it’s hard for them to move on the vaccine mandate and having a full FDA approval and authorization would make that easier.”
Pfizer says it initiated a rolling submission process in May, while Moderna did the same in June – allowing them to submit finished sections of their applications without having to wait for full completion.
“It’s like if you said not all the Christmas presents are under the tree, but you can start unwrapping them,” said former FDA chief scientist, Dr. Jesse Goodman.
Once a company completes its submission, the FDA has 60 days to decide whether to grant a priority review. Then, under the 1992 Prescription Drug User Fee Act, the FDA must take action on an application within six months of its submission, compared with 10 months under standard review.
The agency earlier this month granted Pfizer priority review, and Moderna has said it would request one. AstraZeneca PLC said it would apply for full approval of its vaccine, which isn’t yet authorized for emergency use in the U.S., by the end of 2021. The U.S. has an oversupply of other vaccines, but the company says its vaccine can still play a role.
That said, some public health experts suggest that full approval might not do much to boost vaccination numbers due to the appearance of a rushed and politicized process.
“This sounds like an easy fix, but I think we need to understand it isn’t,” said University of Michigan epidemiology professor, Arnold Monto. “If they moved more rapidly in a complicated situation, I am afraid some people would say, ‘Why did they do it so fast? Did they really scrutinize all of the data they were supposed to?’”
Tyler Durden
Sun, 08/01/2021 – 17:35 - Did China Kill SoftBank's Golden Goose
Did China Kill SoftBank’s Golden Goose
By Pitchbook.com,
The Chinese tech crackdown has kicked into high gear, prompting investors to dump shares of the companies that have found themselves in Beijing’s crosshairs. The nation’s tutoring sector, which until recently had been the envy of the edtech world, is now nonprofit by government decree. That could be just the beginning. Investors are bracing for similar action against other sectors.
* * *
In another country, the obliteration of a promising young industry might be unprecedented. Not so in China, where a similar drama unfolded in the peer-to-peer lending market in recent years. Some of those companies also flew too close to the regulatory sun, and then fell to Earth.
Investing in Chinese startups isn’t for the faint of heart. Few know this better than SoftBank. Its principal fortune was made on Alibaba, and it has repeatedly backed the country’s tech darlings. Two online tutoring specialists caught up in the recent crackdown, Zuoyebang and Zhangmen, were also backed by the Japanese investor.
SoftBank CEO Masayoshi Son compares his business model to the goose that laid the golden egg. In recent earnings presentations, Son has pitched the firm as a golden egg factory, positioned to take a steady stream of companies public.
That vision has played out in China until recently, with Beike and Full Truck Alliance delivering massive IPOs in the past year.
But in Aesop’s telling, the goose with the golden egg is a parable that warns against greed. A farmer gets rich after his goose begins to lay golden eggs. He wants to get rich faster, so he cuts open the goose to get all the eggs. The goose dies. Goodbye, golden eggs.
Beijing believes that some corners of the tech world got greedy, and it’s wringing the neck of the proverbial goose.
SoftBank-backed Didi Global pulled off an IPO reportedly in defiance of the government’s wishes. Now Didi is considering a return to private ownership, The Wall Street Journal reported, as it faces regulatory probes and a ban on its apps.
ByteDance, which is said to have heeded Beijing authorities when it paused its IPO plans, is another of SoftBank’s golden eggs.
But SoftBank is just one of a cohort of investors that have braved China’s regulatory hurdles to fund billion-dollar startups—a gambit that has paid off in many cases. Since 2018, China has given rise to 136 new unicorns, making it the second-most prolific producer of billion-dollar companies after the US, according to PitchBook data.
Hillhouse Capital and IDG Capital are also part of a club that has long ruled the region’s tech scene. Ditto Sequoia China, which reportedly launched its first fund in 2005 and has backed tech leaders including Kuaishou, JD.com and Pinduoduo.
As China’s stock rout shows, the immediate impact of the tech clampdown is a shift in the risk premium that investors charge to certain companies.
Sectors that have pushed up the cost of living for Chinese consumers, such as real estate and healthcare, are seen as especially risky. This has contributed to selling pressure on newly public companies like JD Health, a unit of JD.com, and home-sale platform Beike. Businesses that align with national priorities are comparatively safe. Stocks of electric carmakers like Nio and Xpeng, for example, have risen in recent days despite the broad selloff.
On Friday, the Securities and Exchange Commission called for new disclosures from Chinese companies looking to go public in the US. Chinese companies frequently list in the US through contracts with shell companies, meaning investors don’t directly hold equity in the operating business. SEC Chairman Gary Gensler said he wants companies to clearly spell out these structures as well as other risks posed by the Chinese government.
With headwinds like these, venture capitalists will likely find fundraising harder in China. That said, firms that can demonstrate that they have a close pulse on the government’s priorities will have an easier time convincing LPs that the benefits still outweigh the risks.
International VCs may also be tempted to look to other countries, which are increasingly producing startups of sufficient enough size to be worthy of their time. Europe’s unicorn herd is reproducing rapidly. India and Latin America have also come of age, leading investors like Sequoia, Tiger Global and SoftBank to target the regions.
But China’s ruling party can’t simply put the genie back in the bottle, and it continues to express a desire to attract foreign capital. Startups will pivot and change business models, and the ever-growing buying power of the Chinese consumer isn’t going anywhere. Entrepreneurs will find a way to work with the government’s new rules.
Tyler Durden
Sun, 08/01/2021 – 17:10 - Goldman's Top 10 Takeaways From July
Goldman’s Top 10 Takeaways From July
Despite Friday’s modest pullback in the market, stocks managed to close higher for a sixth consecutive month, the longest such stretch since 2018, as investors digested another slew of earnings (despite near record beat, the adverse price reaction for most companies showed that stocks had been priced to perfection, if not beyond), a continued rise in virus cases in the US, a benign Fed, and a growth outlook that has now clearly created in the post-pandemic era, and will soon require another major fiscal stimulus (and/or lockdowns) as US consumer have now burned through most of their post-covid savings.
The month of July has been an active one as corporate earnings have taken a backseat to another surge in COVID cases, a policy shift from China, and a quick fade of inflation fears.
Here, courtesy of Goldman’s Chris Hussey, are the top 10 takeaways from July:
1. The vaccine didn’t kill the virus but it has kept people out of hospitals. The vaccine didn’t kill the virus but it has kept people out of hospitals (so far).
The undercurrent of rising COVID cases and its implication for mobility, the services sector recovery, and global growth sustainability was prevalent throughout the month of July — although it did little to suppress the appetite for risk assets. As shown above, new case growth has already peaked in the UK and Spain (where the delta variant emerged in the spring) and Goldman analysis confirms that vaccinations have been a key factor that has kept hospitalizations low.
2. Peak growth may still be ahead of us (or already occurred). As the service sector is slowed by rising cases of the virus, the remainder of the global economic recovery will be more gradual writes Daan Struyven in “Global Reopening: Slower, but Not Slow.” Notably, since the emergence of the Delta strain in early April, the gap between our 2021 global growth forecast and the median consensus forecast has narrowed from 1pp to 0.3pp, reflecting consensus upgrades and GS downgrades. And our economists lowered our US 2H21 consumption growth forecast as it is becoming apparent that the service sector recovery in the US is unlikely to be as robust as we had expected in “After Peak Growth: A Slightly Slower Service Sector Recovery.” We also see this sluggishness continuing into 2022 to a trend-like 1.5-2% by 2H22, a sharper deceleration than consensus expects. The drivers: fewer people returning to work in the office and rising concerns around the Delta variant. Finally, we saw evidence of this slower growth trajectory Thursday when 2Q GDP growth came in well below expectations.
3. China has other priorities. This month also saw China ramp up its regulatory oversight of businesses. Recent regulations have signaled that the Chineseauthorities are prioritizing social fairness and stability over the capital markets inareas that are deemed public goods or important to strategic policy goals writes Kinger Lau in “Investing under a new regulation regime” (see also Goldman Downgrades China Stocks After Clients Ask If They Are Even “Uninvestable” Any More)
4. Corporate profitability remains robust. 2Q earnings season has been largely positive so far. The big banks posted unsurprisingly strong results. And this week, the market’s premier mega-cap Tech stocks all reported with most posting solid results although the market reaction was not particularly positive (4 of the 6 FAAMG+T stocks are down on the week).
5. Inflation may indeed be temporary and not 1970’s style. On the back of the 2Q21 GDP report, Goldman economists actually lowered our sequential inflation forecast for the first time in a long time as they are “seeing signs of fading inflation pressures already as the recovery ‘matures’ (see And Now The Hangover: Goldman Sees Sharp Deceleration In US Economic Growth In 2022). And indeed, core PCE inflation reported Friday came in at+0.45% for June, down from +0.54% in May. For many investors, inflation pressures likely pose a greater headwind to risk assets than rising cases of the virus, making Friday’s report a bit of a “welcome relief” according to Goldman.
6. There’s no place like stocks. And against this mix of catalysts, the S&P 500 returned ~2.5% for the month and ~17.5% ytd (before dividends). Goldman’s David Kostin wrote in last week’s “US Weekly Kickstart” that the combination of vaccinations, equity demand from households and corporations, and attractive relative valuations will support equity inflows and prices. Goldman recommends tactical positions in virus-exposed cyclicals alongside longer-term investments in high-quality secular growth stocks.
7. There’s no place like Treasuries. Yields on 10-year US Treasuries have settled into a new lower range around 1.25%, driven there following the Fed’s June meeting and rising market sentiment, perhaps, that the Fed will successfully suppress any long-term inflation impulses in the economy before they get out of hand.
8. There’s no place like Commodities. July started off with an OPEC+ meeting that didn’t end but eventually the world’s biggest producers reached an agreement. And then the market sold off sharply as concerns around rising virus cases dominated sentiment. Goldman’s commodities team sees oil reaching $80/bbl in 4Q. Meanwhile, copper is up over 5% for July but and Goldman sees even more upside as China production restrictions should curtail supply without an offsetting adverse impact on demand from the virus.
9. Credit is a bit more complicated. The current combination of tight spreads, low yields and the low level of implied volatility warrants a dose of hedges in credit portfolios writes Goldman credit strategist Lotfi Karoui in “Where We Stand in the Credit Cycle.” Corporate fundamentals are unusually strong at this point in the cycle but valuations are also far more stretched.
10. Back to work meets back to the kitchen table. Allison Nathan highlights how a hybrid model of some days in the office and some days working from home is likelyto emerge across most office-based sectors in Friday’s Top of Mind, “The Post-Pandemic Future of Work.” Surveys currently indicate that employers are on pace to allow employees to work from home 20% of the time from now on. And interestingly, a recent survey revealed that the two biggest categories of people are those that want to come back to the office every day (30%) and those that rarely or never want to return to the office (35%).
A realization that the work-adjacent economy is likely to recover at a slower pace than we originally anticipated is behind Goldman’s lower US GDP growth forecasts as well (see above).
Tyler Durden
Sun, 08/01/2021 – 16:45 - Illinois Unconcerned As Communication And 'Science' Behind COVID Policy Slip Toward Chaos
Illinois Unconcerned As Communication And ‘Science’ Behind COVID Policy Slip Toward Chaos
By Mark Glennon of Wirepoints
The Illinois Department of Public health took no time at all deciding last week to say it “fully aligns” with new masking guidelines issued by the Centers for Disease Control, including universal masking in schools, regardless of vaccination status. IDHP’s announcement came only hours after the CDC announcement on Tuesday.
If you think that means the “science” behind the changes must be settled or clear, you haven’t been paying attention. Contradictions, confusion and unanswered questions from national health experts and media followed the CDC announcement, none of which is apparently of concern to IDPH.
This time, the criticism outside of Illinois isn’t coming just from the right. Sources ordinarily friendly to the Biden Administration and national public health officials had already started to call them out on dishonesty. Left-leaning Slate earlier in the week detailed four instances of what it thought at best have been white lies coming out of the federal government. Bret Stephens of the New York Times had done much of the same earlier in the week in a column headlined, “COVID information comes from the top, too.”
But things really heated up after the new CDC guidelines were announced and objections mounted over the failure of the CDC to explain the science behind them. The Washington Post published a leaked internal CDC document that apparently informed the CDC’s guidelines but raised extensive doubt and confusion on a number of issues.
Liberal Axios summarized things this way on Saturday.
The Biden administration’s handling of the Delta surge has left Americans confused and frustrated, fueling media overreaction and political manipulation. The past year and a half have left Americans cynical about the government’s COVID response, and — in many cases — misinformed or uninformed. We’re getting fog and reversals when steady, clear-eyed, factual information is needed more than ever.
What caused all the dispute and confusion over the past week?
Most of the reported problem has focused on what to make of a cluster of 882 COVID cases in Provincetown, Massachusetts in which 74% of the infected people were fully vaccinated. That chapter is described in the leaked CDC document as well as a report the CDC later published.
Three-fourths of the victims were fully vaccinated? That triggered concerns about vaccine efficacy. To what extent it should have, however, is questionable.
Look at that published report with any empirical skepticism, and you will scratch your head. It’s anecdotal, and certainly not consistent with broader data. There was huge selection bias in the cases studied and it’s unclear how many other infections occurred in the area and whether they were vaccinated.
Second, the report contains data on particularly high viral loads in the infected, vaccinated group, indicating that the vaccinated may be far more likely to be contagious than previously thought.
Alarming headlines then appeared in much of the media, including the New York Times and Washington Post.
What followed is something you certainly don’t see every day. The White House communications guy on COVID matters openly criticized both of those papers, which are ordinarily White House BFFs, for going too far. Here are his Tweets to them:
Apparently, the White House wanted to scare people enough to get vaccinated, but not so much as to cause them to question the vaccine. It didn’t work.
It sure would have been fun to see the discussions among the censors in social media over how to deal with those accusations against the NYT and Washington Post — sources the censors routinely favor. Just this past week Twitter suspended a science writer merely for posting the results of a Pfizer clinical test. Acute cognitive dissonance surely has overtaken the censors.
The most fundamental problem, however, arose from silence – silence from both the CDC and Biden Administration on the increasingly frequent requests for them to produce the science behind masks. Many health and communication experts are frustrated.
“The mistake is releasing the guidance without explanation,” said Vish Viswanath, a professor of health communication at the Harvard T.H. Chan School of Public Health,“ quoted in the Wall Street Journal. “One of the most important principles in communicating risk in such situations is complete transparency.” Similar criticisms are collected here.
What is the science about masks that the CDC is relying on? We indeed don’t know. Studies conflict, and I’m not about to try to sort out that conflict. The point, instead, is that the CDC and the White House should. They should be presenting a full analysis of how they interpret the conflicting studies. They haven’t done so, leaving harsher critics like Dr. Marc Siegel to say on Fox that there “is no science” behind mask mandates. In Illinois, the matter likewise goes unanswered.
Two further, important matters haven’t gotten much media attention.
First, many recent headlines, like this on CNN, say the CDC concluded that the new, prevalent Delta variant of the virus causes “more severe” infections than the original virus. That’s a big claim because the widespread reporting earlier had only said that Delta is more contagious, which it clearly is, but not more severe, which is presumably why deaths have not spiked up along with infections.
What’s the evidence that Delta is “more severe”? The headlines are based only on vague information in the leaked CDC document to that effect.
Interestingly, an initial sub-headline in a New York Times column made the claim, too, but they changed the sub-headline and still haven’t noted the change. That’s bad journalism. The initial sub-headline on the article said, “Infections in vaccinated Americans also may be as transmissible as those in unvaccinated people, the document said, and lead more often to severe illness.”
But the body of the article claimed nothing to that effect. Whether there’s any basis for the other widespread headlines claiming “more severe” infections obviously needs discussion, which is absent so far.
Second, there’s a real doozy in that leaked CDC document that nobody else has noticed as far as I can see.
Their model is based on the assumption, it says, that 50% of all cases are reported. In other words, two actual cases occur for every reported case.
What? The CDC’s own website currently says that there are 4.2 actual cases for every reported case.
This is hugely important because it tells us how many Americans were already infected and therefore have natural immunity, which studies now consistently say is at least as robust as being vaccinated. If natural immunity is high, then we might be heading for a quick drop-off in cases just as has happened recently in the United Kingdom.
It’s a topic that the establishment has been suppressing consistently, as we have written about often. We’ve been criticizing IDHP and the Pritzker administration on that since April 2020. It’s one of the topics that Slate says Anthony Fauci has been fibbing about.
We’ve followed this matter closely and nobody has ever suggested that the ratio of actual to confirmed cases is as low as 2:1, as the CDC document assumes. Last November, the CDC said the ratio was 11:1, which it backed off of with no good explanation. We know that many politicians and much of the media ignore the topic of natural immunity, but is the CDC blind to it as well?
None of these questions appears to be of importance in Illinois, so the IDHP sheepishly followed right along with the CDC’s new guidelines. New mask guidelines, that largely function as mandates, are now in place, and tougher restrictions apparently may be coming.
Science, right?
Tyler Durden
Sun, 08/01/2021 – 16:20
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