Mar 02

Today’s News 2nd March 2020

  • Does The Coronavirus Make The Case For World Government?
    Does The Coronavirus Make The Case For World Government?

    Authored by Jeff Deist via The Mises Institute,

    Sometimes terrible things happen without any human malfeasance, and the novel Wuhan coronavirus may in fact be one of those things. It is entirely plausible the virus emerged from “wet markets” in the Hubei Province of China rather than as a fumbled (or worse, intentionally released) bioweapon cooked up by the Xi Jinping government. 

    We may never know, of course. But easy or readily apparent answers to the question of how this could have been avoided should be viewed with the skepticism appropriate to any state propaganda. Crises of all kinds, whether economic, political, military, or health, send ideologues scrambling to explain how such events fit neatly into their worldview. In fact, political partisans often attempt to paint any crisis as having occurred in the first place precisely because their policies and preferences have not been adopted. 

    The Wuhan coronavirus seems tailor-made for this. Alarmists who argue for (i) much more robust and comprehensive “public health” measures by national governments and (ii) greater supranational coordination inevitably point to infectious diseases as justification for increased state power over personal medical decisions. Scary and fast-spreading viruses are perfect fodder for their busybody argument that people cannot simply be left to their own devices.

    Cross-border outbreaks of illnesses are particularly well suited to the preexisting bureaucratic desire for power over populations: they make the public much more willing to accept forced quarantines and arrests for noncompliance; forced immunizations; involuntary commitments to state facilities; curfews; restrictions on business operations and travel; and import controls. They also allow public health officials to commandeer and manage efforts to find “the cure,” who then take credit when the virus eventually relents. 

    These are the sorts of things that authoritarian politicians want all the time. Crises simply provide an opportunity to ratchet up their power and also to accustom the public to being ordered around and taking cues from centralized government sources.

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    Antistate libertarians are not immune to this phenomenon of attempting to place square events into round holes. We tend to explain crises as the result of state (or central bank) interference, either created or made worse by the lack of market discipline, incentives, and property rights lacking due to state action or state regulation. Libertarians think the Food and Drug Administration, for example, kills more people than it saves by approving bad drugs and delaying regulatory approvals for promising treatments. 

    Moreover, an individualist libertarian perspective on bodily sovereignty poses an obvious challenge to public health. No individual should be forced to accept quarantine or immunization against his will, and in fact no individual should be forced to consider herd immunity or other collectivist notions when making medical decisions. Just as most libertarians don’t think Doritos and Mountain Dew should be banned because their consumption imposes “public” healthcare costs in a statist/fascist system of mandatory insurance and tax-funded Medicaid, most don’t think that individual health decisions should be overridden by politicians—even in an “emergency” outbreak situation. 

    So how do we reconcile public health with individual rights? Should the latter be sacrificed to protect the former?

    Three observations present themselves.

    First, even the highly authoritarian Chinese national state has been unable to contain the virus, though it can cordon off whole cities by dictatorial fiat and impose wholesale house arrest over cities in a manner unthinkable in Western countries. Chinese state police literally drag people suspected of carrying the virus out of their cars, forcibly put them handcuffed in hazmat vehicles, and haul them off to what amount to prison hospitals. Chinese citizens who speak out publicly against the Xi government’s handling of the crisis are arrested. So, if the Chinese government can’t contain it, even with martial law and control over media, how in the world do Western countries expect to do so? Imagine trying to quarantine, say, Dallas and Fort Worth!

    Second, poor countries (and China is quite poor per capita compared to the West, ranking around sixty-fifth internationally) almost invariably suffer from worse public health conditions. Sanitation, nutrition, and access to drugs, facilities, and competent doctors matter a great deal when it comes to incubating infectious diseases. Richer countries are healthier countries, and the West benefits when conditions improve and modernize in the Third World.

    Third, we already have de facto supranational bodies such as World Health Organization tasked with preventing and lessening the spread of diseases like the coronavirus. The WHO has been around since 1948 and hasn’t prevented a host of modern epidemics like SARS and Zika; excatly what new international agency or organization will do better?

    If anything, pandemics call for decentralization of treatment. After all, the best approach is to isolate infected people rather than bringing them into large hospital populations in crowded city centers. What doctor or nurse wants to work in a hospital full of coronavirus cases?

    We might wish for a utopian libertarian answer to public health crises like the coronovirus, along the lines of a Rothbardian externality argument for airborne pollution. But sometimes bad things simply happen. The best hope is market incentives, the rapid application of individual human ingenuity and self-interest to the situation. Liberty is better, not perfect. And governments, including the Chinese government, are clueless as always.


    Tyler Durden

    Sun, 03/01/2020 – 23:55

  • Gabbard Urges Trump: Don't Drag Us Into War At Bidding Of Islamist Dictator Of Turkey
    Gabbard Urges Trump: Don’t Drag Us Into War At Bidding Of Islamist Dictator Of Turkey

    Tulsi Gabbard has once again gone on the offensive, skewering Washington mainstream foreign policy and the Trump administration’s refusal to stand up to “dictator” Recep Tayyip Erdogan.

    Trump reportedly told Erdogan in a phone call last week as the Idlib crisis escalates, now in an open state of war between the Turkish and Syrian armies, and with Russia supporting the latter, that the US “reaffirmed” its support for Turkey in Idlib. Ankara is now demanding greater support from NATO as well, after Russian jets were widely believed behind last Thursday’s massive air strike which killed 33 Turkish soldiers.

    Congresswoman and Democratic presidential hopeful Gabbard attacked this stance in a weekend video statement, urging Trump instead to make clear that “the United States will not be dragged into a war with Russia by the aggressive Islamist expansionist dictator of Turkey via NATO.”

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    She also slammed the mainstream media’s efforts to renew holding up al-Qaeda terrorists on the ground in Idlib as mere “rebels” and “freedom fighters” — saying it’s a disgrace to men and women in uniform who signed up to fight terrorists in the wake of 9/11.

    “Turkey’s been supporting ISIS and al-Qaeda terrorists from behind the scenes for years,” she pointed out.

    “Turkey’s Erdogan wants to create an Islamist caliphate in Syria, reestablish the Islamist Ottoman Empire, and is working with al-Qaeda and other terrorists to achieve his goal.”

    “He wants to be the caliph,” she added, explaining further he’s not a “friend” of America, but remains one of the most dangerous dictators in the world.

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    She ended by urging the American people to get behind passage of her Stop Arming Terrorists Act, which seeks to remove all support to terrorist factions in Syria as well as aid to those state actors like Turkey which back them.

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    Notably, she also called out President Trump for contradicting past accurate statements which highlighted the terrorist links of Syria’s so-called “moderate rebels”. 

    And in what could be a first, Syrian state media has reportedly translated Gabbard’s speech and broadcast it all over Syria.

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    Tyler Durden

    Sun, 03/01/2020 – 23:30

  • Were Coronavirus Samples Destroyed By China To Coverup The Outbreak?
    Were Coronavirus Samples Destroyed By China To Coverup The Outbreak?

    Via GreatGameIndia.com,

    Since the outbreak of Coronavirus in Wuhan, the Chinese Communist Party has concealed the epidemic from the local government to the central government and shirked from its responsibility. Recently, Caixin, a Beijing-based media group published a shocking report that the Hubei Provincial Health and Medical Commission ordered the destruction of Coronavirus samples. Soon after the story was gagged with the article subsequently taken down.

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    Were Coronavirus Samples Destroyed By Chinese Health Commission?

    Gene sequence detected and reported at the end of December

    On February 26, Caixin published a shocking article titled “Tracking the Source of New Coronavirus Gene Sequencing“. Caixin sources told GreatGameIndia on condition of anonymity that the article was taken down due to mounting pressure from the Chinese authorities. The article was archived on the web but even the archived version redirects to an error page. So, we decided to publish the Caixin report in full translated into English from Chinese (found at the above link).

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    Archived version of the deleted Caixin report “Tracking the Source of Novel Coronavirus Gene Sequencing” also redirects to an error page

    The Caixin report said:

    As of February 24, more than 2660 people have died and more than 77,000 people have been diagnosed with the novel coronavirus, a novel coronavirus similar to SARS. When was it found? Caixin reporters conducted interviews from various sources and sorted out relevant papers and database materials. By piecing together all sorts of information, the full picture is gradually emerging.

    The Caixin article stated that there were no less than 9 unknown pneumonias before the end of December last year. Samples of the cases were collected from various hospitals in Wuhan. Gene sequencing showed that the pathogen was a SARS-like Coronavirus (similarity is about 80% and infectious). These test results were returned to the hospital and reported to the Health and Medical Commission and the Center for Disease Control.

    A private enterprise in Huangpu district of Guangzhou, analysed the gene sequence of the virus on December 26. The results of the study found that it was most similar to the bat SARS Coronavirus, with an overall similarity of about 87% and a similarity with SARS of about 81%.

    The company officials communicated with the hospital and CDC by telephone on December 27 and 28, and even went to Wuhan to report all the results of the analysis in person to the hospital management and CDC on December 29 and 30.

    Zhang Jixian, director of the Department of Respiratory and Critical Care Medicine, Xinhua Hospital of Hubei Province, received four consecutive unexplained pneumonia cases on December 26. On December 27, Zhang Jixian reported the discovery of four “unknown viral pneumonias” to the hospital, which was inturn reported by the hospital to Jiang Han District Center for Disease Control.

    From December 28th to 29th, Xinhua Hospital treated 3 patients from the South China Seafood Market. They had similar symptoms of viral pneumonia. At 1 pm on December 29th, Xia Wenguang, deputy director of Xinhua Hospital, convened ten experts to discuss the seven cases. The experts agreed that the situation was unusual. Xia Wenguang reported directly to the disease control department of the provincial and municipal health committees.

    On December 29, the industry leader Huada Gene (Shenzhen, China) completed a case of gene sequencing, and the results showed that the virus and SARS gene sequence similarity was as high as 80%. On January 1, the company’s three sample test reports were reported to the Wuhan Municipal Health Commission.

    On December 30, Beijing Boao Medical Laboratory reported the patient report to the doctor, and the test result was – “SARS Coronavirus”.

    Health and Medical Commission of Hubei Province ordered destruction of Coronavirus case samples

    The Caixin report said that it was not until January 9th that the Chinese Communist Party officially declared the pathogen a “new Coronavirus.”

    The report also quoted a person from a gene sequencing company who disclosed that on January 1, 2020, he “received a phone call from an official of the Health and Medical Commission of Hubei Province, informing him that samples of cases of new Coronavirus in Wuhan could not be re-examined. Existing case samples must be destroyed and sample information cannot be disclosed. Relevant papers and related data cannot be released to the public. If you detect it in the future, you must report to us.”

    This article from Caixin has now been deleted, but has been circulated widely overseas and in Chinese social media attracting a strong response from the administration.

    Beijing authorities concealed the epidemic

    In fact, not only the authorities in Wuhan and Hubei provinces and related medical units were involved in the Coronavirus coverup, but also the National Health and Medical Committee of the Communist Party of China and the Chinese authorities concealed the epidemic.

    On January 5th, the Shanghai Public Health Clinical Center detected a new SARS-like Coronavirus and sequenced it to obtain the entire genome sequence of the virus. On the same day, the center immediately reported to the National Health Commission of the Communist Party of China and “suggested to take corresponding prevention and control measures in public places.”

    The report states that the virus shares 89.11% homology with SARS Coronavirus and is named Wuhan-Hu-1 Coronavirus.

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    On January 5, the Shanghai Public Health Clinical Center reported to the National Health Commission of the Communist Party of China, asking for the prevention of Coronavirus

    Numerous such internal circulars, notifications and reports of studies warning the Chinese administrations were sent out in the weeks leading to the outbreak which were not only ignored but actively suppressed from reaching to people. We have cataloged these findings in our scientific investigation on the origin of Coronavirus – the COVID19 Files – from five major areas, including epidemiological investigation, virus gene comparison, cross-species infection research, key “intermediate hosts” and the findings on the Wuhan P4 lab.

    However, the Wuhan Centers for Disease Control and Prevention and the National Health Commission of the Communist Party of China declared that the epidemic was “preventable and controllable” until January 19, and “the possibility of limited transmission from person to person was not ruled out”.

    On February 3rd, Chinese Ministry of Foreign Affairs spokesperson Hua Chunying said that since January 3rd, the Chinese Communist Party has notified the United States of a total of 30 outbreak information and control measures. Immediately after the remarks were published, it was strongly condemned.

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    When Chinese Ministry of Foreign Affairs spokesperson Hua Chunying’s remarks appeared in the press, it immediately aroused the anger of the Chinese people

    However, it was not until January 20th that Xi Jinping and Li Keqiang made public statements on the prevention and control of the epidemic for the first time. Zhong Nanshan, a CCP expert, acknowledged for the first time that the new Coronavirus was “person-to-person.”

    On January 26, the Communist Party of China set up a task force for epidemic prevention and control with Li Keqiang as the leader. It was after more than two months since the outbreak.

    Wuhan pneumonia cases were discovered by the Communist Party of China CDC, Wuhan Centers for Disease Control and Prevention, the CPC Health and Medical Committee, and the Hubei Health and Medical Committee by December 1st, and the relevant results were published in international journals.

    However, the Chinese Communist Party has been concealing the epidemic, suppressing doctors and people who spread the truth of the epidemic, and spreading a false narrative that the epidemic is “preventable and controllable” and is not “person-to-person”.

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    The claims of the Caixin report that gene sequencing studies carried out by the Chinese administration found that COVID-19 Coronavirus is almost 80% similar to SARS gives further credence to GreatGameIndia‘s report on how Chinese Biowarfare agents smuggled SARS Coronaviruses from Canada and weaponized it – Coronavirus Bioweapon. Further, the Canadian Scientist Frank Plummer who received these SARS Coronavirus samples of the first patient from Saudi Arabia was found dead in mysterious conditions in Nairobi, Kenya within 11 days of the publication of our report.

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    We need your support to carry on our independent and investigative research based journalism on the external and internal threats facing India. Your contribution however small helps us keep afloat. Kindly consider donating to GreatGameIndia.


    Tyler Durden

    Sun, 03/01/2020 – 23:05

  • Anti-Greta Knocks 'Climate Alarmists' During CPAC Speech
    Anti-Greta Knocks ‘Climate Alarmists’ During CPAC Speech

    A 19-year-old European activist dubbed the ‘anti-Greta’ slammed “climate alarmists” on Friday at the Conservative Political Action Conference (CPAC) in Maryland, according to Bloomberg. 

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    Self-proclaimed “climate realist” Naomi Seibt, who has roughly 60,000 followers on YouTube, told a panel sponsored by the Illinois-based Heartland Institute think tank: “The climate has always been changing, and so it’s ridiculous to say we deny climate change.”

    “Man vastly overestimates his power if he thinks he can, with CO2 emissions, destroy the climate.”

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    Seibt dismissed allegations she is being used by climate skeptics to woo young people and counter Thunberg, the Swedish activist who has won international acclaim for arguing the world needs to rapidly throttle the greenhouse gas emissions fueling a warming world. “I am not the puppet of the right wing or the climate deniers or the Heartland Institute either,” Seibt said. –Bloomberg

    Seibt has come under fire after a video began circulating on Friday of her saying “The normal German consumer is at the bottom, so to speak. Then the Muslims come somewhere in between. And the Jew is at the top. That is the suppression characteristic,” remarks she said were taken out of context, and that she was expressing her view that it is “wrong to comment on different races differently and view them differently.”

     


    Tyler Durden

    Sun, 03/01/2020 – 22:40

  • Equity & Oil Futures Soar After BoJ Promises To "Ensure Market Stability"
    Equity & Oil Futures Soar After BoJ Promises To “Ensure Market Stability”

    Update (2225ET): Well who could have seen that coming? Following The BoJ’s promise to do ‘whatever it takes’ to stabilize the markets (though nothing about the economy of course), the reaction was delayed until someone got the tap on the shoulder to buy with both hands and feet…

    NKY Futs are up 900 points from the opening lows…

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    Dow futures are now up 850 points from the opening lows…

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    WTI is soaring…

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    And Treasury yields have reversed dramatically higher…

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    Did Stevey make the call?

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    Or is The National Team on the case?

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    Update (2000ET): Following, now confirmed, rumors of The BoJ “striving to provide market stability via open market operations and asset purchases”, US Treasury yields are collapsing…

    2Y Yields are down a stunning 15bps and 30Y down 11bps to 1.58%…

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    10Y is getting very close to 1.00%!

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    And bonds are signaling a lot more pain for stocks…

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    …as stocks refuse to bounce…

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    And eurodollars’ open signaling 38bps of rate-cuts in March and 50ps by April…

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    As the yield curve is getting dramatically more inverted (3m10y – 8bps)…

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    Safe-haven flows are flooding back into gold, pushing Futures back above $1600…

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    After Friday afternoon’s combination of Jay Powell’s statement and a major rebalancing flow sent stocks soaring into the close, a lack of the much-demanded ‘coordinated global easing’ this weekend has spoiled the party and futures are opening down hard.

    Friday’s almost 1000 point surge in less than an hour – on absolutely nothing but hope that somebody will do something –

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    Oil is also collapsing with WTI at a $43 handle…

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    And gold is bid…

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    And bond prices have hit a new high, erasing the late-Friday spike in yields…

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    Additionally, we detailed earlier, the following chart from Deutsche Bank shows, overall liquidity for S&P500 futures has fallen to all time lows even though the S&P was trading near all time highs as recently as a week ago. As such, the recent melt up levitation was nothing more than a mirage, propelled mostly by stock buybacks among the Top 5 tech stocks and fickle retail investors, and once these were removed, the market entered the proverbial “trapdoor opening” formation.

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    The problem is that virtually no liquidity, extreme moves to the downside are now very likely which in turn creates a reflexive relationship with risk sentiment, as the lower the liquidity and greater the selloff, the higher volatility surges leading to even lower liquidity, even more selling and so on.

    In short: absent central bank intervention, it will be virtually impossible for any major player to arrest the market’s collapse.

    Of course, that is a big ask the market is already pricing in almost 4 rate-cuts in 2020…

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    And almost completely priced-in 2 rate-cuts in March…

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    That’s a lot to expect from a Fed that doesn’t want to signal panic and burn through its ammunition so fast without evidence of economic disruption.


    Tyler Durden

    Sun, 03/01/2020 – 22:29

  • Humanity Is Making A Very Important Decision When It Comes To Assange
    Humanity Is Making A Very Important Decision When It Comes To Assange

    Authored by Caitlin Johnstone via CaitlinJohnstone.com,

    The propagandists have all gone dead silent on the WikiLeaks founder they previously were smearing with relentless viciousness, because they no longer have an argument. The facts are all in, and yes, it turns out the US government is certainly and undeniably working to exploit legal loopholes to imprison a journalist for exposing its war crimes. That is happening, and there is no justifying it.

    So the narrative managers, by and large, have gone silent.

    Which is good. Because it gives us an opening to seize control of the narrative.

    It’s time to go on the offensive with this. Assange supporters have gotten so used to playing defense that it hasn’t fully occurred to us to go on a full-blown charge. I’ve been guilty of this as well; I’ll be letting myself get bogged down in some old, obsolete debate with someone about some obscure aspect of the Swedish case or something, not realizing that none of that matters anymore. All the narrative manipulations that were used to get Assange to this point are impotent, irrelevant expenditures of energy compared to the fact that we now have undeniable evidence that the US government is working to set a precedent which will allow it to jail any journalist who exposes its misdeeds, and we can now force Assange’s smearers to confront this reality.

    “Should journalists be jailed for exposing US war crimes? Yes or no?”

    That’s the debate now. Not Russia. Not Sweden. Not whether he followed proper bail protocol or washed his dishes at the embassy. That’s old stuff. That’s obsolete. That’s playing defense.

    Now we play offense: “Should journalists be jailed for exposing US war crimes? Yes or no?”

    Demand an answer. Call attention to them and demand that they answer. Dig them out of their hidey holes and make them answer this. Drag them out into the light and make them answer this question in front of everyone. Because that is all this is about now.

    Don’t get sidetracked. Don’t get tricked into debating defensively. Force the issue: the US government is trying to establish and normalize the practice of extraditing and imprisoning journalists for exposing its misdeeds. That is the issue to focus on.

    You will find that anyone who dares to stick their head above the parapet and smear Assange now gets very, very squirmy if you pin them down and force them to address this issue. Because they cannot answer without admitting that they are wrong. And that they’ve been wrong this entire time. It’s a completely unassailable argument.

    We now have two and a half months to prepare for the second half of Julian Assange’s extradition hearing: all of March, all of April, and half of May. We’re going to need all that time to seize control of the narrative and make it very, very clear to the world that a very important decision is about to be made by the powerful on our behalf, if we don’t make that decision for them.

    This really is do or die time, humans. If we allow them to extradite and imprison Julian Assange for practicing journalism, that’s it. It’s over. We might as well all stop caring what happens to the world and sit on our hands while the oligarchs drive us to ecological disaster, nuclear annihilation or authoritarian dystopia. It’s impossible to hold power accountable if you’re not even allowed to see what it’s doing.

    If we, the many, don’t have the spine to stand up against the few and say “No, we get to find out facts about you bastards and use it to inform our worldview, you don’t get to criminalize that,” then we certainly won’t have the spine it will take to wrest control of this world away from the hands of sociopathic plutocrats and take our fate into our own hands. 

    We are deciding, right now, what we are made of. And what we want to become.

    This is it. This is the part of the movie where we collectively choose the red pill or the blue pill. 

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    We are collectively being asked a question here, and our answer to that question will determine the entire course we will take as a species.

    So what’s it going to be, humanity?

    Truth, or lies?

    Light, or darkness?

    A world where we can hold power to account with the light of truth, or a world where power decides what’s true for us?

    A world with free speech and a free press, or a world where journalists are imprisoned whenever they expose the evils of the most powerful institutions on this planet?

    A world where we all actively fight to free Assange and get the job done, or a giant, irreversible leap toward the end of humanity as we know it?

    Do we free Assange?

    Or do we sit complacent with our Netflix and our KFC and trust the authority figures to do what’s best?

    Do we take the red pill?

    Or do we take the blue one?

    Choose your path, humans.

    Choose wisely.

    *  *  *

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    Tyler Durden

    Sun, 03/01/2020 – 22:15

  • 'Losing A Billion Dollars A Month' – No Rebound In Sight Amid Global Shipping Slump 
    ‘Losing A Billion Dollars A Month’ – No Rebound In Sight Amid Global Shipping Slump 

    America’s seaports are now starting to feel the chilling effects of supply chain disruptions from China, warned Noel Hacegaba, the Deputy Executive Director of Administration and Operations for the Port of Long Beach, California. 

    Hacegaba said the Port of Long Beach, the second-largest containerized port in the US – is experiencing weakness in volume, down 6% YoY in January, and down another 6% YoY in February. For the quarter, he said the port could see a decline of 12% YoY.

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    He warned that economic paralysis in China has led to blank sails of containerships across shipping lanes between China and the US. 

    World Maritime News adds more color onto blank sailings and economic loss that is shocking the global shipping industry right down to the haul. 

    So far, 105 blank sailings between Asia to North America and Europe have been recorded from January 20 to February 10. The shuttering of dozens of manufacturing hubs in China for virus containment purposes has left the country’s factory output well below full capacity in February, and likely depressed into March.   

    Data from the UK-based maritime research consultancy, Drewry, said, “the cancellation of 105 sailings per month represents a shortfall in revenue of roughly USD 1 billion (105 x 10,000 TEU x USD 1,000), of which a portion will be made up later via full ships and extra loaders, but the short term damage to carrier profits is large.” 

    Drewry said port operations in China remained down 20 to 40% during the period. It said ports in the US are only now starting to feel the shock, which is what Hacegaba described last week was beginning at West Coast ports. 

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    Drewry warned that the plunge in container volume in China would severely weigh on global port volumes for the quarter: 

    “Cargo owners and shipping lines are desperate for a swift resolution that will see Chinese factories resume production and start churning out the goods and parts that grease the global supply chain. It is inevitable that world port throughput will suffer a large contraction in 1Q20, but the question is now whether we can expect a v-shaped recovery later this year or something else entirely?” 

    For some color on why container volumes in China and likely the rest of the world will collapse this quarter, we specifically outlined in semi-official data from China that business conditions are printing at depression levels (as a reminder, China has been responsible for 60% of the world’s credit creation in the last decade – if China’s catches the flu – so does everyone): 

    And for confirmation of China’s economic paralysis, China’s National Statistics Bureau reported Friday night the latest, February PMIs and they were absolutely catastrophic:

    • Manufacturing PMI crashed to 35.7 in Feb, far below the 45.0 consensus estimate, and sharply down from 50.0 in January. A record low.
    • Non-Manufacturing PMI plummets to 28.9, also far below the 50.5 consensus, estimate, and down nearly 50% from the 54.1 in Jan. This too was a record low.

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    Putting these numbers in context, the collapse in China’s economy will continue to weigh on global supply chains that are entirely dependent on the Asian country as a manufacturing source. 

    “Whatever the outcome, COVID-19 has exposed the fragility of global supply chains that are overly dependent on a single manufacturing source. We suspect that shippers will look to broaden their sourcing options as a form of insurance,” Drewry said.

    The nightmare scenario is that the virus outbreak shocks the world into recession as containerized volumes collapse along with trade growth would be devastating for the shipping industry: 

    “Under this scenario, we anticipate a prolonged downturn for freight rates and an elevated risk of a carrier bankruptcy. To avoid such a prospect, carriers would be forced to revisit the playbook from the financial crash of a decade before and undertake large scale capacity withdrawal in the form of mass idling and demolitions,” Drewry concludes.

    And for all those expecting that Beijing will unleash another massive stimulus to kick-start the economy at any cost, it seems that the likelihood of another round of massive stimulus appears low, which means markets are underestimating the scale of the growth slump. 

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    The outbreak in South Korea and Japan may be the next big concern for American ports, as creaking global supply chains has underlined the fragility of the global economy. 


    Tyler Durden

    Sun, 03/01/2020 – 21:50

  • "This Crisis Will Spill Over Into Disaster" – Dr.Doom Sees 40% Collapse In "Delusional" Stock Market
    “This Crisis Will Spill Over Into Disaster” – Dr.Doom Sees 40% Collapse In “Delusional” Stock Market

    “The Democratic field is poor, but Trump is dead. Quote me on that!”

    That’s Nouriel Roubini’s take on how the escalating global health crisis will morph into a financial crisis (it’s starting) and a political crisis…

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    In an interview with Germany’s Der Speigel, Dr.Doom – who correctly predicted the bursting of the U.S. housing bubble in addition to the 2008 financial crisis along with the ramifications of austerity measures for debt-laden Greece – believes that coronavirus will lead to a global economic disaster and that U.S. President Donald Trump will not be re-elected as a result.

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    DER SPIEGEL: How severe is the coronavirus outbreak for China and for the global economy?

    Roubini: This crisis is much more severe for China and the rest of the world than investors have expected for four reasons: First, it is not an epidemic limited to China, but a global pandemic. Second, it is far from being over. This has massive consequences, but politicians don’t realize it.

    DER SPIEGEL: What do you mean?

    Roubini: Just look at your continent. Europe is afraid of closing its borders, which is a huge mistake. In 2016, in response to the refugee crisis, Schengen was effectively suspended, but this is even worse. The Italian borders should be closed as soon as possible. The situation is much worse than 1 million refugees coming to Europe.

    DER SPIEGEL: What are your other two reasons?

    Roubini: Everyone believes it’s going to be a V-shaped recession, but people don’t know what they are talking about. They prefer to believe in miracles. It’s simple math: If the Chinese economy were to shrink by 2 percent in the first quarter, it would require growth of 8 percent in the final three quarters to reach the 6 percent annual growth rate that everyone had expected before the virus broke out. If growth is only 6 percent from the second quarter onwards, which is a more realistic scenario, we would see the Chinese economy only growing by 2.5 to 4 percent for the entire year. This rate would essentially mean a recession for China and a shock to the world.

    DER SPIEGEL: And your last point?

    Roubini: Everyone thinks that policymakers will react swiftly but that’s also wrong. The markets are completely delusional. Look at fiscal policy: You can do fiscal stuff only in some countries like Germany, because others like Italy don’t have any leeway. But even if you do something, the political process requires a great deal of talking and negotiating. It takes six to nine months, which is way too long. The truth is: Europe would have needed fiscal stimulus even without the corona crisis. Italy was already on the verge of a recession, as was Germany. But German politicians aren’t even thinking about stimulus, despite the country being so exposed to China. The political response is a joke – politicians are often behind the curve. This crisis will spill over and result in a disaster. 

    DER SPIEGEL: What role do the central banks have to play?

    Roubini: The European Central Bank and the Bank of Japan are already in negative territory. Of course, they could lower rates on deposits even further to stimulate borrowing but that wouldn’t help the markets for more than a week. This crisis is a supply shock that you can’t fight with monetary or fiscal policy.

    DER SPIEGEL: What will help?

    Roubini: The solution needs to be a medical one. Monetary and fiscal measures do not help when you have no food and water safety. If the shock leads to a global recession, then you have a financial crisis, because debt levels have gone up and the U.S. housing market is experiencing a bubble just like in 2007. It hasn’t been a time bomb so far because we have been experiencing growth. That is over now.

    DER SPIEGEL: Will this crisis change the way the Chinese people think of their government?

    Roubini: Businesspeople tell me that things in China are much worse than the government is officially reporting. A friend of mine in Shanghai has been locked in his home for weeks now. I don’t expect a revolution, but the government will need a scapegoat.

    DER SPIEGEL: Such as?

    Roubini: Already, there were conspiracy theories going around about foreign interference when it comes to swine flu, bird flu and the Hong Kong uprising. I assume that China will start trouble in Taiwan, Hong Kong or even Vietnam. They’ll crack down on protesters in Hong Kong or send fighters over Taiwanese air space to provoke the U.S. military. It would only take one accident in the Strait of Formosa and you would see military action. Not a hot war between China and the U.S., but some form of action. This is what people in the U.S. government like Secretary of State Mike Pompeo or Vice President Mike Pence want. It’s the mentality of many people in D.C.

    DER SPIEGEL: This crisis is obviously a setback for globalization. Do you think politicians like Trump, who want their companies to abandon production abroad, will benefit?

    Roubini: He will try to reap benefits from this crisis, that’s for sure. But everything will change when coronavirus reaches the U.S. You can’t build a wall in the sky. Look, I live in New York City and people there are hardly going to restaurants, cinemas or theaters, even though nobody there has been infected by the virus thus far. If it comes, we are totally fucked.

    DER SPIEGEL: A perfect scare-scenario for Trump?

    Roubini: Not at all. He will lose the election, that’s for sure.

    DER SPIEGEL: A bold prediction. What makes you so sure?

    Roubini: Because there is a significant risk of a war between the U.S. and Iran. The U.S. government wants regime change, and they will bomb the hell out of the Iranians. But Iranians are used to suffering, believe me, I am an Iranian Jew, and I know them! And the Iranians also want regime change in the U.S. The tensions will drive up oil prices and lead inevitably to Trumps defeat in the elections.

    DER SPIEGEL: What makes you so sure?

    Roubini: This has always the case in history. Ford lost to Carter after the 1973 oil shock, Carter lost to Reagan due to the second oil crisis in 1979, and Bush lost to Clinton after the Kuwait invasion. The Democratic field is poor, but Trump is dead. Quote me on that!

    DER SPIEGEL: A war against Iran is needed to beat Trump?

    Roubini: Absolutely, and it’s worth it. Four more years of Trump means economic war!

    DER SPIEGEL: What should investors do to brace for the impact?

    Roubini: I expect global equities to tank by 30 to 40 percent this year. My advice is: Put your money into cash and safe government bonds, like German bunds. They have negative rates, but so what? That just means that prices will rise and rise – you can make a lot of money that way. And if I am wrong and equities go up by 10 percent instead, that’s also OK. You have to hedge your money against a crash, that is more important. That’s my motto: “Better safe than sorry!”


    Tyler Durden

    Sun, 03/01/2020 – 21:25

  • WHO Encourages Adoption Of "Alternative Greetings" Like The "Elbow Tap" And "Foot Shake" To Fight Coronavirus
    WHO Encourages Adoption Of “Alternative Greetings” Like The “Elbow Tap” And “Foot Shake” To Fight Coronavirus

    As humanity struggles to “adapt” to the coronavirus outbreak, which has suddenly introduced a patina of sinister risk to mundane activities like greeting a friend or visiting the supermarket, the Yon Loo Lin School of Medicine has published a ‘new greetings’ guide to help people in virus-stricken communities learn new greetings like the “elbow tap”, “foot shake” and, of course, the “wave.”

    Dr. Sylvie Briand, the WHO’s director of epidemic and pandemic, tweeted a screenshot of what appears to be a new WHO guide to these ‘alternatives’ to the cheek-kiss and the handshake, popular greetings throughout the world.

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    We’ve mentioned this issue a few times in recent days. Videos shared on Twitter suggest that the ‘foot shake’ is gaining popularity in Iran.

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    Walter Cotte, the regional director of the international federation of the Red Cross and Red Crescent for America and the Caribbean, shared the guide on twitter.

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    The final pane on the comic-format graphic encourages readers to develop their own greetings.

    Funny, we thought of one:


    Tyler Durden

    Sun, 03/01/2020 – 21:00

  • Lies, Damned Lies, & Presidential Debates: The Rhetoric And Reality Of Gun Control
    Lies, Damned Lies, & Presidential Debates: The Rhetoric And Reality Of Gun Control

    Authored by Jonathan Turley,

    There is a yawning chasm between the reality and rhetoric of gun control in light of promises in the Democratic primary. The fact is that many of the ideas raised by the candidates have merit but they are likely to be marginal in their impact on real gun-related fatalities.

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    The Democratic presidential debate down in South Carolina this week has proven once again the famous line that there are “lies, damned lies, and statistics.” The line is the perfect warning to the unwary about politicians citing statistics. The quote itself is widely misrepresented as the work of Mark Twain or British Prime Minister Benjamin Disraeli, so it seems nothing can be trusted when it comes to statistics, not even quotes on statistics.

    Some false statistics, however, are so facially absurd that they are indeed harmless except to the most gullible. That was the case when former Vice President Joe Biden attacked Senator Bernie Sanders over a vote that had favored the gun industry. Biden declared that, since the vote, 150 million Americans have been killed by guns. He also said the vote happened in 2007, when it was actually in 2005. Many people immediately scratched their heads, thinking they may have missed a holocaust that had claimed roughly half the population. Later, the Biden campaign insisted it was just another one of his gaffes and the real number is 150,000 Americans.

    However, even that figure is wrong, but a Democratic primary is no place for the factually preoccupied. Trillions have been pledged for reparations, free college tuition, free medical care and free child care, all to be funded using math that would embarrass Bernie Madoff. First, on the threshold statistical controversy, the Centers for Disease Control and Prevention claims that all gun deaths since 2007 total about 450,000. Thus, Biden went from overstating it by more than 300 times to understating it by three times. It is possible to get this figure down to around 180,000 by excluding the 60 percent of gun deaths that occur due to suicide.

    The much greater danger, however, is not the statistical but the legal misrepresentations on gun control, and those are not confined just to Biden. After all, cracking down on guns is one of the defining issues for former New York City Mayor Michael Bloomberg, who has pledged to “stop this nationwide madness.”

    In the debate, Biden dramatically glared into the camera to speak directly to the National Rifle Association: the NRA:

    “I want to tell you, if I’m elected NRA, I’m coming for you, and, gun manufacturers, I’m going to take you on and I’m going to beat you.”

    The other Democratic candidates have made similar claims that they will reduce gun violence significantly with executive orders and laws.

    Such statements are far more dishonest than the statistical flight of fancy promoted by Biden. Gun ownership is an individual constitutional right under the Second Amendment. A constitutional right cannot be reduced or changed by either executive order or legislation. You can only work on the margins of such exercises of constitutional rights, which belies the promise by Bloomberg that these measures would make an “enormous difference.”

    Elizabeth Warren declared that “we need a president willing to take executive action” to end gun violence without any explanation what she can do to limit an individual right, let alone do it unilaterally.

    It is true that, in the 2007 case of District of Columbia versus Dick Anthony Heller, the Supreme Court held that “like most rights, the right secured by the Second Amendment is not unlimited.” But like other constitutional rights such as the freedom of speech, legally imposed limits cannot deny the right itself but only place reasonable limits on its use. Thus, it may be possible to limit the size of ammunition magazines or such devices as bump stocks. Certainly, background checks would be allowed.

    Red flag laws allowing interventions are also likely to pass muster. But those limits are unlikely to “enormously” reduce gun violence. The vast majority of gun possessors, and many of those involved in massacres, would pass background checks. Indeed, there remains a serious question of whether states could outlaw weapons like AR-15s. Even if the Supreme Court upheld such a ban, there are over eight million AR-15s in private hands, and a wide variety of guns with equal or higher firepower.

    Then there is the problem that most gun deaths involve a single round fired by someone into themselves rather than into others. In 2017, six out of 10 gun deaths were suicides. Less than 40 percent were intentional murders, and the remaining gun deaths in the country were accidental or law enforcement shootings. While gun suicides reached their highest recorded level in 2017, nonsuicide deaths that involve guns have been declining and stand significantly lower from its high point in 1993.

    While the other candidates on the debate stage forced Sanders into a rare flip on his vote to protect gun manufacturers from lawsuits, it was another example of a misleading promise. I actually opposed the 2005 bill that protected gun manufacturers and sellers from lawsuits because it was unnecessary and because I generally oppose legislation that limits tort liability. The Protection of Lawful Commerce in Arms Act, however, was not the sweeping immunity claimed by Biden and other candidates.

    It barred liability for injuries due to the fact that firearms were later used by criminals. The bill saved the industry some litigation costs, but the industry would have prevailed in such actions anyway if they were tried. Product liability and tort actions against manufacturers have uniformly and correctly been rejected by the courts. Guns are lawful products, and holding companies liable for later misuse of such products is absurd. You might as well sue an axe manufacturer for the Lizzy Borden murders.

    Thus, even if you remove immunity protections, ban certain magazines or devices, require background checks, or even ban a couple weapon types, the reduction in gun deaths would not likely fall significantly. Individuals still would have a constitutional right to possess guns. Moreover, the vast majority of guns would remain unaffected. That does not mean we should not try to reduce those fatalities or pass these measures. Any saved life is worth the effort. But candidates are misleading voters in suggesting that, if elected, they can dramatically impact the numbers of these cases.

    Of course, none of that would make for a memorable debate moment for any of the candidates. Biden would be less than riveting if he glared into the camera and poked a figurative National Rifle Association in the chest while saying he would take them on and “marginally reduce the minority of deaths associated with nonsuicidal gun incidents.”

    That is the reason why there are lies, damned lies, statistics, and presidential debates.

    *  *  *

    Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University. You can follow him on Twitter @JonathanTurley.


    Tyler Durden

    Sun, 03/01/2020 – 20:35

  • Lisa Page Simmers After CPAC 'Lovebirds' Skit Mocks Infidelity, Bias
    Lisa Page Simmers After CPAC ‘Lovebirds’ Skit Mocks Infidelity, Bias

    Former FBI attorney Lisa Page is spitting mad after a dramatized reading of text messages between her and former FBI agent Peter Strzok was performed at the Conservative Political Action Conference (CPAC) near Washington.

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    Page and Strzok famously sent anti-Trump, pro-Clinton text messages to each other while they were spearheading separate investigations into each 2016 presidential candidate. The two were also having an affair at the time – which has resulted in President Trump frequently mocking their tryst at rallies with full-on theatrics.

    Here are highlights of stars Dean Cain and Kristy Swanson performing it in September (longer version here).

    And after a Washington Post Op-Ed revealed that President Trump met with the cast and crew of “FBI Lovebirds: Undercover” the day before CPAC, Page raged on Twitter – quoting the Post: “More than three years later, long after his election victory, Donald Trump is still obsessed with two officials who did their jobs while personally not liking him. They are still the stars of Trump rallies, where the president performs their exchanges, grotesquely.”

    Efforts to mock the pair arguably reached a new level at CPAC. The skit where the texts were dramatized was performed by actors Dean Cain, who once portrayed Superman on television, and Kristy Swanson, star of the 1992 film, “Buffy the Vampire Slayer.” The effort was written and produced by Phelim McAleer and Ann McElhinney.

    “We met the president of the United States today in the Oval Office for 40 minutes,” McElhinney told the conference during a Q&A session after a performance. “He loves the play.”

    “He said he wants to play a part,” added Swanson. –Bloomberg

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    Page raged on MSNBC last December, saying that Trump had performed a “vile, sort of simulated sex act” about her and Strzok.


    Tyler Durden

    Sun, 03/01/2020 – 20:10

  • Coronavirus Panic Is Causing A Worst-Case Scenario For Oil
    Coronavirus Panic Is Causing A Worst-Case Scenario For Oil

    Authored by Julianne Geiger via OilPrice.com,

    As the World Health Organization on Friday upgraded its global risk assessment for the coronavirus to “very high”, anxious oil markets are wondering when might be a good time to panic about the oil demand and its effect on inventories, investment dollars, and ultimately, oil prices.

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    Now could be as good of a time as any.

    Where We Stand

    So far, the coronavirus has infected more than 80,000 people worldwide, claiming nearly 3,000 lives. It has spread to 49 different countries in just a few short weeks, and continues to disrupt airline travel on a massive scale. In California, one possible case of community transmission reared its head—bringing awareness of what the virus can do to a whole new level.

    And make no mistake, there is more pain coming.  

    Already, COVID-19 is disrupting manufacturing and industrial output, specifically in China, and the FDA said this week that the world is experiencing its first drug shortage from these coronavirus-induced manufacturing disruptions.

    China’s massive oil refiners have felt the pain too, scaling back their petroleum products output, resulting in a big gaping hole in the demand side of the now precarious supply and demand equation for crude oil. Some suggest that China’s fuel demand now has a 4-million-barrel-per-day hole, and China’s imports of crude oil is expected to have dropped by 160,000 bpd in February. March may be worse, if Saudi’s oil exports to China next month are any indication.

    This decreased fuel demand has caused at least one trading arm of independent Chinese refiner Tianhong Chemical Co to go into receivership this week after feeling the coronavirus pinch. While this is just a single instance of an oil trader going under due unfavorable market conditions courtesy of COVID-19, the development is cause for alarm. Is this just the first of many in China’s independent oil arena to go under?

    This would spell disaster for China, and be painful for any of China’s many crude oil suppliers. After all, it is these independent refiners—the teapots—that have driven most of China’s oil import growth in recent years. Crude suppliers that would feel the pain of China’s refining industry meltdown would naturally be Russia, Saudi Arabia, Angola, and Iraq—who together represented 55% of all China’s crude oil imports as of 2018.

    Saudi Arabia, for example, typically ships between 1.8 million bpd and 2 million bpd, but already for March the Kingdom is cutting its oil exports to China by 500,000 bpd as refineries are throttling output. 

    But smaller suppliers, too, would be hit, particularly countries that ship most of their oil to China—countries like Iran, for example, which ships 50-70% of its oil to China.

    Where We’re Headed

    So things are bad, but surely the virus has run its course? 

    Nothing could be further from the truth. US health officials warned Americans this week to roll up their sleeves, pull up their bootstraps and settle in, because the coronavirus is on its way.

    “It’s not so much a question of if this will happen anymore but rather more of a question of exactly when this will happen,” Nancy Messonnier, director of the National center for Immunization and Respiratory Diseases said in a press briefing this week.

    And if you want a preview of what’s to come, you only need to look at how major institutions such as the federal reserve are behaving.  

    The Federal Reserve and other central banks are expected to act soon—as early as this weekend—to staunch the market bleeding in the financial markets. The Fed’s have suggested that they will indeed cut rates “if” a global pandemic were to develop.

    About that “if” scenario, Moody’s Analytics yesterday suggested that the risk of the current coronavirus outbreak turning into a pandemic has actually doubled from 20% to 40%, calling their previous assumptions that COVID-19 would be contained to China as “optimistic”.

    This pandemic, Moody’s said, would result in a global recession during H1 2020.

    ““The economy was already fragile before the outbreak and vulnerable to anything that did not stick to script. COVID-19 is way off script,” Moody’s said.

    And Moody’s isn’t the only one who is rethinking their former optimism about the deadly virus.

    The IMF is likely to downgrade its global growth projections due to the virus, according to an IMF spokesperson on Thursday. And no doubt, because lethal viruses tend to scare people away from mingling among the potentially sick at places such as malls and other public areas—a situation that naturally lends itself to serious stifling of economic activity. And all that economic stifling will have a profound effect on industry, and industry in turn will have an effect on oil demand. 

    The IMF is now warning that there is the potential for greater economic fallout, and it is cutting its forecast for 2020 global growth by 0.1%.

    Rystad, too, stepped into the doom-spreader game on Friday, warning that the virus outbreak could cut oil and gas industry investments by $30 billion and could delay oil platform deliveries slated for Asia by three to six months. Those hit hardest would likely be shale operators in the US, and offshore E&P companies, according to Rystad. 

    Rystad doesn’t see the situation on the road to improvement. In fact, it sees the situation worsening in March, and affecting the entire global service industry.

    Overall, travel restrictions, reduced industrial throughput, people staying home because they’re scared—these factors have not peaked, and when they do, they will dent oil demand even further. Already WTI has sunk below $45, with Brent below $50. And OPEC may lack the fortitude to cut enough production to offset the major demand losses.

    It’s not out of the realm of possibility to suggest that more pain is on its way to the oil industry in the months that follow. The only question is, how painful will it be.


    Tyler Durden

    Sun, 03/01/2020 – 19:45

  • NY State Admits First Confirmed Covid-19 Case As Global Deaths Pass 3,000: Live Updates
    NY State Admits First Confirmed Covid-19 Case As Global Deaths Pass 3,000: Live Updates

    Summary:

    • Global virus deaths hit 3,000 as China reports another 42

    • NY State confirms 1st case of Covid-19

    • Rhode island announces “presumptive” case; patient recently visited Italy

    • Washington State confirms 2 more cases

    • 2 new cases confirmed in California

    • Israel case total hits 10 day before vote

    • South Korea death toll hits 22

    • Germany case total doubles in 24 hours to 129

    • Mexico case total climbs to 5

    • White House to hold meeting tomorrow with 8 pharma CEOs

    • Italy reports 42% jump in cases overnight to nearly 1,700

    • France reports 30 new cases, bringing total to 130

    • Czech Republic, Dominican Republic report first cases

    • Chinese health officials report first ‘double lung’ transplant connected to virus case

    • Iraq, Bahrain confirm 6 new cases; Lebanon confirms 3

    • 6 being tested in NYC for coronavirus

    • South Korea confirms 18th death, officials seek murder charges for founder of church at epicenter of outbreak

    • American Physical Society cancels major scientific conference

    • Juventus quarantines U23 squad

    • Iran death toll hits 54 as Trump offers aid

    • Thailand, Australia report first deaths

    • Spain case count hits 73; France hits 100

    • Independent scientist says it could have been spreading in WA for six weeks, with hundreds infected

    • Italian cases number more than 1,100; South Korea reports more than 3,700

    • Italian death toll hits 29

    • Luxembourg reports first cases, says it’s linked to Italy

    • UK cases rise to 35 as 12 new cases confirmed; 2 cases infected inside UK

    • UK health secretary says China-style lockdowns “an option”

    *  *  *

    Update (2025ET): A woman who recently traveled to Iran is New York’s first confirmed case of the novel coronavirus, New York Gov. Andrew Cuomo said on Sunday night.

    “There is no cause for surprise – this was expected,” the governor said in a statement.

    “I said from the beginning it was a matter of when, not if, there would be a positive case of novel coronavirus in New York.”

    The Wall Street Journal reports that the woman, who wasn’t named, is in her late 30s and contracted the virus while traveling abroad in Iran.

    *  *  *

    Update (1920ET): Global coronavirus deaths have surpassed 3,000 as China reports 42 new deaths on Sunday.

    • GLOBAL CORONAVIRUS DEATHS SURPASS 3,000 AS INFECTIONS SPREAD
    • CHINA REPORTS 202 ADDITIONAL CORONAVIRUS CASES MARCH 1
    • CHINA REPORTS 42 NEW CORONAVIRUS DEATHS MARCH 1

    3,000 – that’s roughly equivalent to the number of Americans who die every 2-3 weeks from drug overdoses.

    How much longer until we see 6,000?

    * * *

    Update (1915ET): The White House will host a meeting with 8 drug company CEOs to discuss “progress” on finding a coronavirus vaccine to stop COVID-19. The meeting will take place Monday afternoon.

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    We suspect we’ll see a leak in the NYT, WaPo or CNN by 4:30.

    * * *

    Update (1900ET): South Korea’s Arirang News reports another death in South Korea, raising the death toll in the country to 22.

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    Meanwhile, over in Japan, PM Shinzo Abe said it’s imperative that Japan avert an outbreak in the country’s schools. This comes after Abe asked all schools across the country to close until further notice. Abe also said he’s looking into passing a law to enable a declaration of emergency, presumably to give his administration more leeway to act unilaterally.

    We’re glad that, after his administration’s previous mistakes with the handling of the ‘Diamond Princess’, they now recognize this is a priority.

    * * *

    Update (1800ET): Public health officials in Seattle and Washington State’s King County announced on Sunday that two more confirmed cases of the coronavirus had been confirmed, according to a local TV station.

    Additionally, ABC 7 reports that 2 Bay Area healthcare workers have received a “presumptive positive” from state labs.

    Alameda County Public Health Department and Solano Public Health are reporting that two health care workers are presumptive positive for the Coronavirus Disease 2019 (COVID-19); these cases are pending confirmatory testing from the CDC.

    Both cases are NorthBay VacaValley Hospital health care workers and are currently in home-isolation. One is a Solano County resident and the other is an Alameda County resident.

    They were both infected by the “unknown origin” case announced on Friday. They were discovered early, as part of investigators’ efforts to trace the individual’s contacts. Already, about 124 health care workers, including at least 36 nurses, are self-quarantining as we speak.

    The two patients both had exposure to the community-acquired case currently hospitalized at UC Davis Medical Center in Sacramento. The initial case is slowly recovering and the individual’s family members have negative test results so far and remain in quarantine, officials say.

    Alameda County has declared a state of emergency over the outbreak, joining San Francisco, which declared an emergency early last week. Washington Gov. Jay Inslee also declared a state of emergency on Saturday.

    “We understand that the evolving news about COVID-19 is concerning, and we are taking the situation very seriously,” said Dr. Erica Pan, Health Officer, Alameda County Public Health Department. “This news is not unexpected in the Bay Area, and we are ready for cases here. This is not the time to panic; now is the time for all of us to work together.” Dr. Pan said.

    In Washington, both new cases – a 70-year-old resident and 40-year-old employee – were from a Kirkland, WA. nursing home called Life Care Center of Kirkland (we suspect they’ll be seeing some negative Yelp! reviews in the  near future). Johns Hopkins put the US case total at 76 Sunday night, but it’s unclear how many of the cases reported this weekend have been officially ‘confirmed’ and added to their total. Across the world, more than 80,000 have been infected.

    According to state public-health officials, additional 27 residents of the nursing home and 25 staff members are reporting symptoms of the virus, which can be similar to that of the common flu.

    These two new cases bring the total number of confirmed cases in the county to six. Since the outbreak began, 8 cases have been confirmed in the state.

    Fox confirmed that the two new cases are:

    • A man in his 60s, hospitalized at Valley Medical Center in Renton. The man has underlying health conditions, and is in critical but stable condition.
    • A man in 60s, hospitalized at Virginia Mason Medical Center in Seattle. The man has underlying health conditions, and his status is critical.

    And the four prior cases (including one who passed away) that we already reported include:

    • A woman in her 50s, who had traveled to South Korea, recovering at home
    • A woman in her 70s, who was a resident of LifeCare in Kirkland, hospitalized at EvergreenHealth
    • A woman in her 40s, employed by LifeCare, who is hospitalized at Overlake Medical Center
    • A man in his 50s, who was hospitalized and died at EvergreenHealth

    One of these women is an employee of the US Postal Service, the Washington Examiner reports. Though her position didn’t directly require her to handle mail, she had contact with others who did handle mail.

    Scientists can’t say anything for certain about the virus and its ability to live on surfaces, but given its relation to other coronaviruses like SARS and MERS, it’s possible that the virus could survive on surfaces for up to 9 days.

    The LifeCare nursing home facility has been closed until further notice. Several nursing students from the Lake Washington Institute of Technology who reportedly visited the LifeCare nursing facility last wee are also being ‘closely monitored’, along with all 110 residents and 180 LifeCare employees.

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    Despite all the nearby infections – and a rash of cancellations affecting states and countries with no confirmed cases – the Emerald City ComicCon, which is two weeks away, will proceed as scheduled, according to organizers.

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    Members of the Washington State press corps have been sharing an estimate from another viral disease expert named Mike Baker, who said there could be as many as 1,500 people infected in Washington State since mid-January.

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    In other news, ahead of Monday’s big vote, Israel has confirmed three more cases of coronavirus, bringing its total number to 10. Two of the new cases had recently returned from a trip to Italy, and the third is thought to have been infected within Israel. Mexico have confirmed a fifth case of the virus – an 18-year-old woman who had been studying in Milan and had recently returned to Chiapas state. The number of cases in Germany has doubled in one day on Sunday, from 66 to 129.

    * * *

    Update (1530ET): President Trump hasn’t tweeted much so far today, but minutes he go, he broke his silence to highlight a New York Post poll showing a majority of Americans “have confidence in their government’s ability to contain the coronavirus.”

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    * * *

    Update (1500ET): Chinese health officials reported that a patient in serious condition has undergone a “double-lung transplant” in the city of Wuxi. Even after testing negative for the virus, the 59-year-old patient’s lungs failed to recover, so doctors decided to go ahead with the transplant.

    * * *

    Update (1330ET): French health officials have confirmed another 30 cases on Sunday, bringing France’s total to 130.

    Meanwhile, the list of countries confirming their first cases of the virus on Sunday continues to grow: The Czech Republic and Dominican Republic each have confirmed their first cases, joining Australia and Luxembourg.

    The Czech Republic has actually confirmed three cases on Sunday, according to Health Minister Adam Vojtech.

    Qatar has reported 2 new cases, bringing its total to 3, while Iraq just reported six new cases.

    Iraq reported six new coronavirus cases, bringing the total number to 19. Two of the newly confirmed cases were in Baghdad, the other four were in Sulaimaniya.  All cases in the country are travelers who just returned from Iran.

    Bahrain also confirmed six new cases: five Bahraini citizens, and a Saudi national who traveled on an “indirect” flight routed to Iran.

    Earlier, Lebanon confirmed 3 new cases, bringing its total to 10.

    Though it hasn’t confirmed any cases yet, Morocco is set to postpone sports and cultural events over coronavirus fears, the government health committee has announced.

    Meanwhile, Global Times editor Hu Xijin tweeted that Europe and the US will eventually have to accept the coronavirus, arguing that “if the epidemic emerges repeatedly, it would have a “profound impact.”

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    What about China?

    * * *

    Update (1230ET): Italian health authorities have reported more than 500 new coronavirus cases, bringing Italy’s total to 1,694, a 42% surge overnight, and raising the death toll to 34, the second-highest outside mainland China (after Iran).

    Despite reporting less than half of the number of cases confirmed in South Korea, Italy has recorded significantly more deaths, suggesting that the virus is much more widespread than officials realize.

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    Meanwhile, NBC News reports that 2 more people in New York City are being tested for the coronavirus, according to the Department of Health. Since yesterday, another suspected cases was deemed negative, bringing the total of negative cases in NYC to nine so far.

    * * *

    If there’s one thing we’ve learned since the coronavirus outbreak went global in January, it’s that a lot can change in 24 hours. Seemingly overnight, the viral hysteria has apparently arrived in the US, alongside the news of the first virus-related death in Washington State.

    Hoarding has already begun. President Trump has issued “do not travel” warnings affecting ‘hot zones’ in Italy and South Korea. In Italy, the Level 4 State Department advisory affects the hardest-hit provinces of Lombardy and Veneto, where ‘community transmission’ has already been confirmed.

    In South Korea, it affects the city of Daegu. In Europe, France and Switzerland have banned large gatherings over 5,000, and cancelled all sporting events. Games, events and conferences across the world have been cancelled as airlines continue to cut back on routes, with the focus turning to Italy and South Korea.

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    Adding to the growing list of cancellations, the American Physical Society has cancelled one of the world’s major international scientific conferences just a day before it was supposed to begin.

    In South Korea, Samsung announced that a worker at its smartphone plant in Gumi had contracted the virus. The pace of newly confirmed cases is growing so rapid, it’s becoming difficult to keep up: The number of confirmed cases worldwide has reached nearly 87,000, with more than 7,000 cases outside mainland China. The virus has now been detected in at least 60 countries and/or territories. South Korea remains home to the biggest outbreak outside of China with more than half of all cases outside the mainland. As of Sunday afternoon in Rome, Italian health authorities had reported 1,128 cases, while the death toll climbed to 29, according to Al Jazeera.

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    As frustration against a strange cult-like church at the center of the country’s outbreak intensifies, officials are pushing for the leaders of a church at the center of the country’s outbreak be investigated on murder charges as the country’s death toll hit 18.

    With 71 cases confirmed in the US (73 if you count the “presumptive” case announced by Illinois public health officials late last night and a new case in Rhode Island), the outbreak has spread much more quickly than most Americans had realized, though we should also point out that the bulk of these cases were already quarantined when they were confirmed, since they were evacuees from either the ‘Diamond Princess’, or ‘Wuhan’.

    Perhaps the most shocking news out of Italy on Sunday was that Juventus, the Serie A soccer club based in the northern city of Turin, has quarantined its entire under-23 squad after 3 players on an opposing team and their coach tested positive for the virus. The team has also cancelled training and suspended matches, including amatch against Inter Milan, a team that recently played a match before an empty stadium has been postponed.

    According to the Daily Mail, the Serie A outfit announced the decision after their youth team played Serie C Pianese, a team that has seen three players and a manager test positive for the virus, causing an uproar in European soccer.

    Following President Trump’s Saturday press conference, where he and Vice President Mike Pence acknowledged the virus coronavirus-related death outside Seattle in Washington State (note: the deceased was identified as a male, following earlier inaccurate reports claiming the victim was female), the president attended CPAC’s annual conference, where he claimed during his keynote address that the US would be willing to help the Iranians contain their brutal outbreak, the NYT reports. Officials in Washington State fear the virus may have been circulating in the state for weeks.

    “If we can help the Iranians, we have the greatest health care professionals in the world,” he said, adding that “we would love to be able to help them.”

    “All they have to do is ask,” he said.

    Trevor Bedford, a cancer researcher, claimed that the virus may have been spreading in Washington for as long as six weeks, and said that hundreds of people may already be infected.

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    Over in Iran, officials said the total number of confirmed cases had climbed to 978, with 54 confirmed deaths, just days after government officials denied reports that 50 had died in the city of Qom. Recently, the BBC reported that the true death toll has already surpassed 200.

    Hoping to quell the growing sense of panic following a brutal week for US stocks, Trump appealed to the press and politicians in Washington to “not do anything to incite a panic” during his press conference, where he also said he was ‘considering’ closing the southern border, a remark that elicited a frustrated response from the Mexican foreign ministry.

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    Courtesy of NYT

    During separate Sunday appearances on Fox News, HHS Secretary Alex Azar said 75,000 test kits are now available to detected cases of the virus, while VP Pence said a vaccine won’t be available this season (some experts are saying it won’t be ready for next season, either). More cases are expected, Azar said, adding that “we don’t know where this will go,” as public health officials in Washington, California, Oregon, Illinois and Rhode Island scramble to trace the contacts and movements of the newest cases.

    About 90 minutes ago, public health officials in Rhode Island announced the state’s first “presumptive” case of the virus, reporting that the individual is in their 40s and recently returned from a trip to Italy in mid-February, before the outbreak in that country had accelerated, Boston 25 News reports. That’s a relief: The clear path of origin means that the latest American patient isn’t another case of “unknown origin”. Health officials are still assuming the worst: That the lack of a clear source of transmission for at least 4 American patients indicates that potentially dozens of others might also be infected, even if they aren’t yet exhibiting symptoms.

    After emerging as a model of outbreak suppression, Thailand reported its first virus-linked death on Sunday.

    Elsewhere, Australia, a country with only 25 confirmed cases (several from the ‘Diamond Princes’), has reported its first COVID-19-linked death: An elderly man from the remote city of Perth who had traveled aboard the Diamond Princess became the first Australian to die from the virus. The 78-year-old man and his 79-year-old wife were among the 164 Australians who traveled aboard the ‘Diamond Princess’. According to the Australian Broadcasting Corporation, the elderly couple were initially flown to Howard Springs in the Northern Territory where Australia’s Diamond Princess evacuees were sent.

    Speaking of the Diamond Princess, Japan’s Health and Labor Minister Katsunobu Kato said Sunday that the last passengers and crew, including the captain, had disembarked on Sunday.

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    While Italy remains the uncontested epicenter of the outbreak in Europe, twelve more people have tested positive for the virus in the UK, including a second case of an individual believed to have caught the virus inside the country, bringing the total to 35. Health officials are trying to trace a 35-year-old man from Shenzhen who had reportedly been working in Bristol, the Guardian reports.

     

    During an appearance on the Andrew Marr, the UK’s premier political talk show, on Sunday, UK Health Secretary Matt Hancock confirmed that the NHS is bringing doctors out of retirement to fight a potential outbreak, before adding that the UK is leaving the option of China-style, city-wide lockdowns on the table, saying the government needs to consider all available tools:

    Marr asked Hancock: “China, of course, isolated entire cities. Is it conceivable under any circumstance, you try and cut off the city in this country?”

    Hancock replied: “There’s clearly a huge economic and social downside to that. But we don’t take anything off the table at this stage, because you’ve got to make sure that you have all the tools available, if that is what’s necessary. But I want to minimise the social and economic disruption.”

    As of Sunday, Spain has confirmed 73 cases, according to Fernando Simón, the head of the country’s Center for the Coordination of Health Emergencies and Alerts. He added that 90% of the cases were imported or related to imported cases of the virus.

    In France, which has reported 100 cases, the Louvre Museum closed on Sunday, and said it would remain shut as workers objected to the risk of catching the virus while working among the millions of visitors who pass through the museum, the AP reports.

    Around 300 Louvre staff met Sunday morning and voted “almost unanimously” not to open, according to Christian Galani of the CGT labor union, who spoke with AFP.

    Luxembourg has reported its first case, a traveler who recently returned from Italy. Health Minister Paulette Lenert told reporters the patient is a man in his 40s, per Al Jazeera.

    As Brazil confirms a second case, international health authorities pointed out that the fact Africa has only reported 3 cases so far, one in Egypt, one in Algeria and one in Nigeria, is something of a miracle, even as the Nigerians have identified 100 people who may have come into contact with the sick individual, as France 24 reports.

    Finally, we’d like to leave readers with a glimpse of levity before we go: We’d like to draw readers’ attention to the front page of the Saturday Star, a Canadian daily. 

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    You know it’s bad when the Canadian newspaper editors start whipping out the Wayne Gretzky comparisons.


    Tyler Durden

    Sun, 03/01/2020 – 19:26

  • Goldman Now Sees 2 Rate Cuts In Next 2 Weeks, Expects "Coordinated" Central Bank Easing
    Goldman Now Sees 2 Rate Cuts In Next 2 Weeks, Expects “Coordinated” Central Bank Easing

    It was just Friday that Goldman finally gave up on its bizarrely optimistic global outlook that it had adopted in late 2019, and instead of seeing no rate cuts – or hikes – in 2020, the bank’s chief economist Jan Hatzius capitulated, and said that the Fed will likely cut at least three times in the first half to offset the global economic slowdown due to the coronavirus, late on Sunday, just 48 hours after its first rate forecast revision, Goldman has officially thrown in the towel on even a trace of optimism for the foreseeable future, and now expects not only the Fed to cut 4 times by the end of Q2, but also cautions of a a high risk that the easing it expects over the next several weeks could occur “in coordinated fashion, perhaps as early as the coming week“, which of course is disappointing for all those who were hoping the Fed would step in as soon as Sunday afternoon/evening.

    In justifying the implosion of its outlook, Haztius writes that “on Friday morning, we downgraded our baseline view of global GDP growth in 2020 from just over 3% to around 2% on the back of developments related to the coronavirus, with weakness concentrated in the first half of the year. We also changed our Fed call to project 75bp of rate cuts by June, starting with a 25bp cut on March 18.“

    This was on Friday morning. Since then, so over the weekend, it appears that newsflow has taken a decided turn for the worse, and as Goldman adds, “the news on the outlook has remained negative, with significant further increases in infections outside of China and an exceptionally weak China PMI release. Moreover, the statement by Fed Chair Powell on Friday afternoon that the Federal Reserve is “closely monitoring” developments and “will use [its] tools and act as needed to support the economy” strongly hints at a rate cut at or even before the March 17-18 FOMC meeting.”

    Based on these developments, Goldman is making further adjustment to its Fed call and now projects a 50bp rate cut by March 18 followed by another 50bp of easing in Q2, for a total of 100bp in the first half. Which means that the US Fed Funds rate will be just above zero as the US enters the second half, and has a high chance of tipping negative around the time of the election. Hatzius explains:

    The clear signal in Chair Powell’s statement has led the bond market to price in more than 25bp of easing, and the FOMC will not want the cut to come as a disappointment in the present situation.

    But wait, there’s more: Goldman is now also forecasting rate cuts by most other G10 (and some EM) central banks, including a cumulative 100bp of cuts in Canada, 50bp in the UK, Australia, New Zealand, Norway, India and South Korea, and 10bp in the Euro area and Switzerland. The chart below shows Goldman’s new central bank forecasts along with market pricing as of Friday’s close.

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    So does 4 rate cuts seem excessive? Not at all, and in fact Goldman even says that relative to some of its new policy rate forecasts, “the risk is on the downside, at least in terms of timing.”

    Specifically, we see a high risk that the easing we expect over the next several weeks occurs in coordinated fashion, perhaps as early as the coming week. Chair Powell’s statement on Friday suggests to us that global central bankers are intensely focused on the downside risks from the virus. We suspect that they view the impact of a coordinated move on confidence as greater than the sum of the impacts of each individual move. If a coordinated move does occur, we think some central banks for which we are projecting a first 25bp cut in our new baseline forecast may well join the Fed in cutting by 50bp. This might apply to New Zealand and—if the move occurs very soon—Australia. While it is a close call, our baseline is that the UK and Canada will both cut the policy rate by 50bp at their next meetings, even if a coordinated move does not occur very soon.

    Finally to all those who point out the obvious, namely that monetary policy is ill-suited to address the impact of
    the virus on the economy, and that it is really public health policy (and fiscal policy more broadly) that needs to act, Goldman agrees “but thinks that central bankers will still want to do their part” to support what Goldman erroneous calls the economy, when it clearly means the market, especially since there is not a trace yet of the US economy being impacted by the coronavirus, and last time we checked, the Fed is not a pre-cog cutting rates in advance of data developments. And while that obvious, what the Fed does do, is cut when stocks tumble, as they have now, and with the world habituated to a central bank bailout any time there is even a modest, 10% correction, this will be the first time we have a global coordinated central bank action in response to… the flu.

     


    Tyler Durden

    Sun, 03/01/2020 – 19:20

  • Coronavirus: A Great Opportunity For Dems To Attack Trump?
    Coronavirus: A Great Opportunity For Dems To Attack Trump?

    Authored by Lorraine Silvetz via LibertyNation.com,

    As Coronavirus continues to make its way around the world, sickening and killing thousands, the U.S. government’s response to the crisis has become riddled with dissension between President Trump and the Democrats.

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    Trump requested $2.5 billion in funding from Congress to deal with the outbreak. Senate Minority Leader Chuck Schumer (D-NY), however, said that amount was too little as he put down the administration’s preparedness for a disease federal officials say could cause “severe” disruption to everyday life in the U.S.

    “With no plan to deal with the potential public and global health crisis related to the novel coronavirus, the Trump administration made an emergency supplemental appropriations request on Monday,” Schumer said in a statement on Feb. 26.

    “It was too little and too late — only $1.25 billion in new funding. For context, Congress appropriated more than $6B for the Pandemic Flu in 2006 and more than $7B for H1N1 flu in 2009.”

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    Donald Trump and Mike Pence

    House Speaker Nancy Pelosi (D-CA) also insulted the president’s funding request, calling it “completely inadequate” and criticized the president for previously cutting funding to public health programs. She called the response “anemic.”

    After Trump tapped Vice President Mike Pence to lead the Coronavirus response in the U.S.,  Democrats, including Rep. Alexandria Ocasio-Cortez (D-NY), attacked Pence for his handling of HIV while still the governor of Indiana. True to form, in the words of Obama’s former Chief of Staff, Rahm Emmanuel, Democrats “never let a good crisis go to waste.”

    “As governor, Pence’s science denial contributed to one of the worst HIV outbreaks in Indiana’s history,” AOC tweeted.

    “He is not a medical doctor. He is not a health expert. He is not qualified nor positioned in any way to protect our public health.”

    Speaker Nancy Pelosi on Thursday said she spoke with Pence and voiced her concerns regarding Trump’s choosing him to spearhead the Coronavirus initiative. “We have always had a very candid relationship and, I expressed to him a concern that I had of his being in this position,” she said at her weekly press conference on Capitol Hill.

    At Trump’s announcement of his position on Wednesday, Pence said his time serving as governor provided valuable training for this.

     “I know full well the importance of presidential leadership, the importance of administration leadership, and the vital role of partnerships of state and local governments, and health authorities in responding to potential threats and dangerous infectious diseases,” the vice president said.

    Pence announced the appointment of Debbie Birx, a medical doctor and HIV and global health expert, as the “White House Coronavirus Response Coordinator.” She had previously been appointed by President Obama to the position of U.S. Global AIDS coordinator and confirmed by the Senate.

    Presidential candidates didn’t hesitate to jump on the Coronavirus bandwagon declaring how they would respond to the outbreak.

    “Like so much else, the Trump administration’s bungled response to the coronavirus outbreak is a mess,” Sen. Elizabeth Warren (D-MA) tweeted. 

    “As president, I will lead a competent administration prepared to combat outbreaks—because our public health, economy, and national security depend on it.”

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    Mike Bloomberg

    Former New York City Mayor Mike Bloomberg also joined the clamor of Trump insults regarding his approach to the coronavirus.

    “I led NYC through its recovery after 9/11 and the financial crisis,” the billionaire tweeted Wednesday.

    “We faced health epidemics and weather emergencies. The key to leading in a crisis like the coronavirus is sharing the facts, demonstrating control and trusting the experts. Unfortunately, not Trump’s strong suit.”

    Trump said that Democrats and the media are playing up the Coronavirus threat for political gain, as he sought to ease fears about the virus this week both in his Wednesday press conference and in public appearances during his trip to India and on Twitter.

    And it turns out the majority of Americans have faith in Trump to handle it…

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    It is clear that the jury’s still out regarding how malignant Coronavirus will be both in the U.S. and around the world. Some experts estimate the mortality rate is 20 times higher than that of the seasonal flu. And while the seasonal flu kills roughly 35,000 Americans a year, if the coronavirus infects half the U.S. population, the 2% mortality rate still means 3.3 million American lives lost. Is Trump being misled by some of his advisors as to the magnitude of the coronavirus threat?


    Tyler Durden

    Sun, 03/01/2020 – 18:55

  • Watch: SpaceX's "Starship" Explodes On Launch Pad During Routine Pressurization Test
    Watch: SpaceX’s “Starship” Explodes On Launch Pad During Routine Pressurization Test

    When the world first caught a glance of SpaceX’s “Starship” super rocket, many joked about it looking like an abandoned grain silo wrapped in tin foil. 

    OK, we admit. That was mostly us joking that it looked like an abandoned grain silo wrapped in tin foil. But look at it…

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    Now it turns out that had it actually been an abandoned grain silo, it may have performed better during SpaceX’s pressure test of the “vehicle” that was held right before the weekend. 

    Instead, the product of Elon Musk innovation wound up blowing up on the launch pad at the company’s South Texas facility, after being tested for pressure with inert liquid nitrogen. The photographs from the morning after show the extent of the damage on the rocket, which we’re certain will not be reused. 

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    Initial reports claim that the tank may have suffered a structural failure during pressurization and information about injuries and the extent of the damage was not readily available from SpaceX. The protoype ship was designed only for an “initial round of tests”, according to Yahoo News, who said that future prototypes would be used for more ambitious tests.

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    But judging by the streaming video of this test, SpaceX has a long way to go. Next Spaceflight’s Michael Baylor  said on Twitter:

    “Test, fail, fix, test, fail, fix is SpaceX’s game. They will learn from it and get it right.”

    Streaming video caught the Starship N1 tank popping and imploding as the ship flew into the air, before crashing back down to Earth. 

    Social media skeptics of Elon Musk couldn’t help but say “I told you so”. We wonder if Tesla skeptics will have a similar day at some point soon.

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    Tyler Durden

    Sun, 03/01/2020 – 18:30

  • Trump Warns "Dems Taking Bernie Out Of Play" After Buttigieg Quits Democratic Presidential Race
    Trump Warns “Dems Taking Bernie Out Of Play” After Buttigieg Quits Democratic Presidential Race

    Update (1845ET): It didn’t take long for President Trump to chime on Mayor Pete’s exit, warning that “This is the REAL beginning of the Dems taking Bernie out of play”…

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    One day after billionaire Tom Steyer dropped out of the presidential race after spending hundreds of millions on a very expensive ego trip, mayor Pete is also officially out after his dismal performance in South Carolina.

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    For a brief few moments after his narrow victory in the Iowa caucus, things looked good for the first openly gay major presidential candidate, but since then things have slumped and following a crushing loss in the South Carolina primary where his poor performance with black Democrats signaled an inability to build a broad coalition of voters, he has reportedly decided to pull the plug.

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    Buttigieg is on his way to South Bend where he will reportedly make the announcement later tonight (likely on his way to CNN, following Yang to become a ‘talking head’ commentator on the debacle ahead).

    Buttigieg’s exit comes a day after billionaire Tom Steyer ended his campaign after paying the price for focussing far too much of his campaign on climate change, instead of addressing issues people care about.

    Mayor Pete had collapsed in the odds already but not as fats as Mike Bloomberg has since the first debate (and the second debate did nothing for him).

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    Biden’s rebound is of note, but Bernie remains the bookies’ favorite, but the real question is will Mike Bloomberg quit too after a surprisingly strong performance by Biden amid accusations mini Mike will steal from Biden’s centrist base if he does not quit before Super Tuesday.

    What is perhaps just as worrying is the fact that with Buttigieg out, Hillary is now #4 in the odds…

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    As NYTimes notes, in the last presidential debate, on Tuesday in South Carolina, Mr. Buttigieg forcefully warned that nominating Senator Bernie Sanders of Vermont, the front-runner, would lead to crushing defeat in the fall, not just “four more years of Donald Trump,’’ but the loss of the Democratic House majority secured by moderate candidates who won in suburban swing districts in 2018.

    It would appear that thesis is about to be tested… but of course, after Tuesday everything will change.


    Tyler Durden

    Sun, 03/01/2020 – 18:16

  • Coronageddon: Can A "Minsky Moment" Be Avoided?
    Coronageddon: Can A “Minsky Moment” Be Avoided?

    Authored by Mike Whitney via The Unz Review,

    There’s a chance that the coronavirus will be contained in the United States and that fewer people will be infected than in China or Iran. But there’s also a possibility that the highly-contagious virus will spread and that there will be sporadic outbreaks across the country.

    If this latter scenario takes place, then the ructions in the stock market will intensify making it impossible to form a bottom or spark a relief rally.

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    If stocks can’t find a bottom, then pressure will build on the weak players, who purchased securities with borrowed cash, to sell their good assets along with the bad in order to repay their debts. These massive selloffs can quickly turn into firesales where it’s nearly impossible to find a buyer regardless of price. This is what the financial media calls “panic selling”, a vicious, self-reinforcing downward spiral in which stock prices collapse in a frantic, disorderly selloff. The phenomenon has also been described by Pimco’s Paul McCulley as a “Minsky Moment”. Here’s a definition from Investopedia:

    “Minsky Moment crises generally occur because investors, engaging in excessively aggressive speculation, take on additional credit risk during prosperous times, or bull markets. The longer a bull market lasts, the more investors borrow to try and capitalize on market moves. Minsky Moment defines the tipping point when speculative activity reaches an extreme that is unsustainable, leading to rapid price deflation and unpreventable market collapse. What follows, as hypothesized by Hyman Minsky, is a prolonged period of instability.” (Investopedia)

    So, how close are we to a Minsky Moment?

    In the last week alone, US stocks have shed $3.6 trillion in market value while benchmark 10-year Treasury yields have dropped to all-time lows and the ominously-named “fear gauge” or VIX (Volatility Index) has spiked to levels not seen in more than two years. The losses have been savage and severe, but the credit markets have held up fairly well so far. Next week could be a different matter altogether though, after all, there’s only so much fat on the bone. Another week like last week, would lead to widening credit spreads, major dislocations in the corporate bond market and, very likely, a few sizable defaults. Over-extended corporations that have borrowed over a trillion dollars from Mom and Pop investors to buy back their own shares, would certainly face a day of reckoning as their cash flow vanishes overnight and their prospects for rolling over their prodigious pile of debt drops to zero. This is typically how credit cycles end, in a fetid cloud of blood and smoke.

    Despite persistent warnings from the IMF and other establishment institutions, Central Banks have done nothing to curtail the 11-year orgy of debt-fueled spending or the rampant reckless speculation that has sent stock prices through the roof even while workers wages have remained flat and standards of living have continued to slip. For more than a decade the Fed has kept interest rates locked on their emergency setting while pumping trillions in liquidity into the financial system at the first sign of trouble. So now stocks are the biggest bubble in history and the Fed finds itself without the tools it needs to counter the effects of the coronavirus. This has all the makings of a major catastrophe.

    So how does this end?

    Well, next week the Fed will announce that it is slashing rates by 50 basis points and that it’s coordinating its action with its fellow central banks, the BoE, the BoJ, and the ECB. The Fed might also announce an additional liquidity program aimed at banks and financial institutions that suddenly find they themselves unable to borrow at the Fed’s discount rate. The announcement could ignite a relief rally, but the surge is not likely to last long since it will not have any material effect on either the virus or the disruptions to supply-lines. The Fed’s easy money will not create the Chinese-made components that laptop manufacturers need to sell their products. They won’t put skittish workers back in the factories or passengers back on airplanes or consumers back in the retail stores. The Fed’s low rates are designed to stimulate demand, but they do nothing to mitigate a “supply shock”. Regrettably, the problem is on the supply side not the demand side.

    For a better understanding of how the coronavirus is roiling markets, I’ve transcribed a short interview with market analyst Mohamed El-Erian who explains recent developments and provides a window into the future. El-Erian sees the current drama unfolding in four phases.

    Mohamed El-Erian — “Phase one, is the economic and corporate shock. Global growth slows, companies generate less earnings, their costs go up, and their supply chains get disrupted.” (This is already happening.)

    “Phase two is financial disruptions. Now we will see pockets of illiquidity, pockets of distress selling, market dislocations, and a complete closure of markets for any kind of funding other than bank funding. These two phases feed onto each other.” (This is also happening now.)

    “Phase three, the formation of a bottom which happens in finance first, then in the economy. But for that to happen, it’s not about central banks like a financial sudden stop. It’s about addressing the underlying issue, which is the virus.” (No bottom in sight.)

    “Phase four, when we have to look at the longer-term (scare? inaudible) Central banks realize whatever they do, will be shown to be ineffective and the faith that investors have always had that central banks can bolster valuations, is going out the window…..The Fed will cut rates because markets will begin to dysfunction, but (rate cuts) will not deliver a better economic outcome.”

    “The problem is…you need the fundamentals to stop deteriorating in order to form a bottom. But the “technicals” can not stabilize long enough to form a bottom in the face of the continuously negative news. …What we need is hope, realistic hope that we have a way to solve this issue, and a vaccine is the best way to do that but that’s not coming anytime soon.” (No vaccine, no remedy.)

    Bloomberg –“Is this selloff still orderly?”

    “It was until yesterday (Friday afternoon) but now we’re starting to see the things you typically see when too many people are trying to reposition themselves and their isn’t enough risk-taking capacity in the middle. So we are seeing massive price gaps, very little liquidity in certain sectors of the corporate bond markets and emerging markets, and finally people are realizing what you and I have talked about for a long time. They took on too much liquidity risk.” (Watch the whole interview on: “Mohamed El-Erian Breaks Down Coronavirus Impact Into Four Stages”, Bloomberg News)

    This interview will help readers understand how hard it’s going to be to calm the markets and stop the downward slide. There are four points that need to be emphasized:

    1– In order to turn markets around, a bottom must be formed. Unfortunately, forming a bottom is impossible when stocks are whipsawed every few hours by more bleak information. In short, the news cycle is driving stocks lower.

    2– On Friday signs of distress began to appear as a result of the the 5-day Wall Street bloodbath. (“Financial disruptions, pockets of illiquidity, pockets of distress selling, market dislocations, and a complete closure of markets for any kind of funding other than bank funding.) These are the red flags signalling a Minsky Moment is approaching, that is, when speculative activity reaches a tipping point leading to “rapid price deflation and unpreventable market collapse”..followed by “a prolonged period of instability.” In short, a stock market crash.

    3– “Markets will begin to dysfunction, but (rate cuts) will not deliver a better economic outcome.”
    In other words, Wall Street is demanding lower rates, but lower rates won’t help, in fact, they will further undermine the Fed’s credibility.

    4– Finally , what’s needed to stop the selloff is a vaccine. Regrettably, there probably won’t be a vaccine for another 12 to 18 months. By that time, Wall Street could be a pile of smoldering rubble.


    Tyler Durden

    Sun, 03/01/2020 – 18:05

  • "It's A Betrayal" – ICE Runs Millions Of Facial-Recognition Searches On Maryland Drivers
    “It’s A Betrayal” – ICE Runs Millions Of Facial-Recognition Searches On Maryland Drivers

    The real-world use of facial-recognition technology in the justice system is fraught with problems, according to a new report from The Baltimore Sun. 

    New evidence suggests the US Immigration and Customs Enforcement (ICE) has accessed the Maryland state database of licensed drivers numerous times in the last several years, using facial-recognition software to scan millions of licenses without state or court approval.

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    The move by ICE has alarmed immigration activists in the state, alleging that the agency has used the database to scan for undocumented immigrants that have received a special driver’s license in the last seven years.

    ICE can take a photograph of an unknown person and run it through the database, in search of a match. 

    “It’s a betrayal of immigrants’ trust for the [state] to turn around and let ICE run warrantless searches on their faces,” said Harrison Rudolph, a senior associate at Georgetown University Law School’s Center on Privacy and Technology. It’s a bait-and-switch. … ICE is using biometric information in the shadows, without government notice or public approval, to hunt down the most vulnerable people.”

    A new bill backed by state Democrats would force ICE agents to obtain a warrant before running images through the motor vehicle records and driver’s license database. The bill would also allow the state to track federal queries into the system. 

    ICE has used the database to scan for undocumented immigrants, mainly in the Baltimore–Washington metropolitan area. 

    “We have seen certain cases where they didn’t have any sort of criminal record but were targeted,” said Lydia Walther-Rodriguez, operations head of Baltimore CASA. 

    Rodriguez said ICE has used the database to search for immigrants “for years now.” 

    The Washington Post said ICE has also deployed the software in other state databases, such as ones in Utah, Vermont, and Washington. 

    “They have a wide-open door to be able to search through anything in this database,” said Maryland Sen. Clarence K. Lam (D-Howard), who has openly told state officials that there needs to be more oversight on ICE’s use of the database. “They’ve not been forthcoming in their willingness to [stop it] or coming up with solutions.”

    Rudolph said ICE searches affect everyone, not just immigrants, due in part because of the facial-recognition software can produce errors and misidentify people, leading agents to pursue the wrong person. 

    “If you’re a US citizen and thinking ICE facial-recognition searches don’t affect you, you’re wrong,” he added. “With face recognition, the question is not whether you are an immigrant, but whether an error-prone technology thinks you look like an immigrant.”

    Facial-recognition software deployed by ICE to track immigrants is something that tyrannies like China are using to control their population. 

    Law enforcement agencies across the country have also embraced facial recognition and AI surveillance. 

    Last month, the Chicago Police Department was caught using a controversial facial recognition tool that scans social media platforms to pinpoint the identity of unknown suspects. 

    There are additional downside risks of AI surveillance and data harvesting; that is, a hacker can steal the treasure trove of data. This is what happened with a Manhattan-based facial recognition company that uses AI to collect data from unsuspecting social media users reported this week that their entire client list was stolen.

    Although AI promises to make ICE and other law enforcement agencies more effective in crimefighting, the troubling trend is that the US could be sleepwalking into a technological tyranny, just like China.


    Tyler Durden

    Sun, 03/01/2020 – 17:45

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