Sep 02

Today’s News 2nd September 2020

  • Lancet Study Finds US Has, By Far, The World’s Most Overpriced Medical Care
    Lancet Study Finds US Has, By Far, The World’s Most Overpriced Medical Care

    Tyler Durden

    Wed, 09/02/2020 – 02:20

    Submitted by Eric Zuesse, originally posted at Strategic Culture

    The medical journal, The Lancet, is one of the world’s Big Three scientific journals of medicine; that’s the triumvirate of authorities for physicians worldwide, and the other two are the Journal of the American Medical Association, and the New England Journal of Medicine. On August 27th The Lancet published “Measuring universal health coverage based on an index of effective coverage of health services in 204 countries and territories”. Here is the visual that’s in it, which shows the United States as having, by far, the world’s costliest medical care, at around $9,000 per person per year, and yet as having lower quality of health care than virtually all other industrialized nations do:

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    Here is another such study, showing the same thing, and calculating it more simply:

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    What explains this?

    Quite simply, the United States is the world’s most corrupt nation, and medical care is such an extreme necessity when a citizen needs it, so that they’ll pay whatever the system charges them for it — and investing in healthcare products and services is therefore enormously profitable in the United States. Actually, the only other market-sector that competes with it for providing simultaneously high returns and low risk (the combination that offers the best of both worlds to investors) is consumer staples, such as foods, which likewise are necessities of life. When people are desperate, they’ll pay, whatever the cost, because these are things they don’t just want — they need. Here, from Maksim Papenkov’s award-winning 6 February 2020 paper, “An Empirical Asset Pricing Model Accommodating the Sector-Heterogeneity of Risk”, is his sector-specific calculation of stock-market profitability during 2000-2018, showing that “HC” Health Care, and “CS” Consumer Staples, were the best at combining low risk with high returns, during that 19-year period:

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    (“CD” there is Consumer Discretionary and includes Automobiles and Hotels. It’s the only sector that has higher returns than Health Care, but those returns are twice as risky. The S&P500 have lower returns than Health Care and slightly higher riskiness. At the opposite end, “IT” Information Technology is both the riskiest and the least profitable; and “F” Financials are the second-worst sector for investors. The most-profitable sectors are the necessities, the sectors that take the most from the most-desperate.)

    In May 2017, Axene Health Partners published their actuary, Chris Slaybaugh’s, study, “International Healthcare Systems: The US Versus the World”, which stated:

    The United States is the only industrialized country in the world that does not have Universal Health Coverage for all citizens. … Rather than one system, United States citizens and residents are insured under a variety of sometimes overlapping systems. The United States is also the only developed country where a significant number of citizens are permitted to be uninsured and where a person’s employment can determine whether they have insurance and what insurance they have. … The extent to which medical bills contribute to bankruptcy is hard to tease out from other factors, but even those who are skeptical of the claim that medical costs cause the majority of bankruptcies concede that they are a significant contributor.13

    In the rest of the developed world, by contrast, medical costs are rarely or never cited as a driver behind personal bankruptcy.

    In fact, CNBC headlined on 11 February 2019, “This is the real reason most Americans file for bankruptcy” and reported that,

    Two-thirds of people who file for bankruptcy cite medical issues as a key contributor to their financial downfall.

    While the high cost of health care has historically been a trigger for bankruptcy filings, the research shows that the implementation of the Affordable Care Act [“Obamacare”] has not improved things.

    What most people do not realize, according to one researcher, is that their health insurance may not be enough to protect them.

    While Barack Obama was running for President in 2008, he was promising to provide Americans with a “public option” in order to reduce profits for health insurance companies and thus lower costs, but he dropped that proposal immediately when he won the 2008 election, and he never pushed for it (not even to use as a bargaining chip with the Republicans in shaping his Obamacare). (In fact, Obama chose the conservative head of the Senate Finance Committee, Democratic Senator Max Baucus, to draft his Obamacare, because Baucus was against there being a public option, and because the progressive Democratic Senator Ted Kennedy’s Health, Education & Labor Committee had just drafted an Obamacare with a public option — Obama refused to have Kennedy draft his healthcare legislation. Obama was actually against there being a public option; only his public rhetoric was for it. Joe Biden is apparently now following the same tactic, of lying promises to the public, and true promises to his billionaire backers, to win the White House.) Obama promised the public “universal coverage”, which means 100% of the population covered, like in all other advanced economies, and his Obamacare increased the percentage insured from 84.5% when he came into office in 2009, to 87.7% two years after Obamacare started in 2013 — around 3%, by 2015 (which was after two years). That was still far short of the promised 100%. He was lying through his teeth in order to win election, and the ‘news’-media still hide (instead of expose) the fact that he did, and that he was actually an agent of the billionaires. He’s now the big hero among Democrats, because maybe Trump is even worse. Trump is up-front about his fascism. And Trump’s opponent now is another hypocrite (after Obama), Obama’s V.P., Joe Biden, who was the U.S. Senate’s leading Democratic Party segregationist and won his nomination by claiming to have been instead a civil-rights champion. Everything in U.S. politics is bait-and-switch. That’s the reality in America’s ‘democracy’: a bait-and-switch ‘democracy’, which serves actually only the wealthiest few. The politicians who are elected serve only the wealthy and well-connected.

    America is the most libertarian, or “neo-liberal,” of the advanced industrial nations, and this is why it has the world’s most overpriced medical care. It provides the most liberty for the billionaires.

    One of the few extremely bold Americans who rose high in the U.S. healthcare system and tried to tell the public how intensely corrupt it is, has been Marcia Angell, M.D, who held numerous prestigious posts in the U.S. medical system, and she was for a while the Editor-in-Chief of the New England Journal of Medicine. On 15 January 2009, Dr. Angell headlined “Drug Companies & Doctors: A Story of Corruption”, and wrote:

    Conflicts of interest pervade medicine. … It is simply no longer possible to believe much of the clinical research that is published, or to rely on the judgment of trusted physicians or authoritative medical guidelines. I take no pleasure in this conclusion, which I reached slowly and reluctantly over my two decades as an editor of The New England Journal of Medicine. … So many reforms would be necessary to restore integrity to clinical research and medical practice that they cannot be summarized briefly. Many would involve congressional legislation and changes in the FDA, including its drug approval process. But there is clearly also a need for the medical profession to wean itself from industry money almost entirely. … Breaking the dependence of the medical profession on the pharmaceutical industry will take more than appointing committees and other gestures. It will take a sharp break from an extremely lucrative pattern of behavior. But if the medical profession does not put an end to this corruption voluntarily, it will lose the confidence of the public. …

    She had said, nine years earlier:

    If we had set out to design the worst system that we could imagine, we couldn’t have imagined one as bad as we have. … Our health care system is based on the premise that health care is a commodity like VCRs or computers and that it should be distributed according to the ability to pay. … That market ideology is what has made the health care system so dreadful, so bad at what it does. … That is a fundamental mistake in the way this country, and only this country, looks at health care. … The only way to both reduce cost and increase access and quality is to change the system, to scrap it and start over. … I would pay for health care in a single payer system, and what goes into that pot can vary. In Germany, employers have to contribute to that pot. I don’t think that’s a good idea. I would rather see it come straight out of tax revenues.

    Experts who are that public-spirited and knowledgeable about the system should be appointed by U.S. Presidents to lead the FDA and the Department of Health and Human Services, but the billionaires prevent that (of course).

    On June 27th, NPR headlined “After Pushing Lies, Former Cigna Executive Praises Canada’s Health Care System”, and interviewed a retired PR executive for America’s health insurance companies, who said that maybe the work that he had done smearing Canada’s socialized health insurance — “to spread misinformation about Canada or use cherry-picked data and anecdotes” so as to deceive Americans to accept America’s existing medical system — was partly to blame for America’s having performed significantly worse than Canada had done on the coronavirus crisis. (As of 29 August 2020, Canada had 3,378 cases per million and was the 76th worst out of 215 countries, whereas U.S. had 18,522 cases per million and was the 9th-worst. On deaths, Canada was the 27th-worst at 241, whereas U.S. was the 11th-worst at 564.)

    America’s billionaires derive the vast majority of their net worth from stocks (capital gains and dividends), and from interest that’s paid to them; and, since nothing does this for them better than healthcare investments, the current for-profit system in health care is terrific for them; and these few hundred people, billionaires, extract this wealth from the hundreds of millions of Americans, the general public, and want to continue doing so, and they consequently finance politicians such as Joe Biden and Donald Trump (and their predecessors, such as Bush and Clinton), and they also set up ‘charitable’ foundations, and donate to medical schools, so as to inculcate this libertarian belief, not just into the public, but especially into the students and professors, who receive that trickle-down from them, as employees and future employees. While many in academe are against it, they’re not the ones who get advanced to the prestigious and high-paid positions. “He that pays the piper calls the tune.” It’s top-down (aristocracy), and it only pretends to be bottom-up (democracy). And, so, the corruption continues, and Americans die younger, and poorer, because of this aristocratically controlled system. It’s the American way. It’s the American system. Of corruption. Americans call it “capitalism.”

    Of course, another area in which the U.S. Government is extraordinarily corrupt is its Military-Industrial Complex; and, on August 28th, a former top official of the NSA, Bill Binney, provided, online, an in-depth description of what he personally knows about that. His personal knowledge is enormous concerning within the Government itself, but not outside it — i.e., not regarding the corporations and billionaires who control the economic rewards system that the top public officials, who typically are agents of the “Deep State” (the billionaires), are serving. However, what he says there is informative and highly reliable regarding the way that the Government’s bureaucracy itself functions, and he is extraordinarily honest about the intense corruption within the official Government. He makes clear that the U.S. Constitution is being systematically and routinely violated by top U.S. officials; so, the U.S. Government routinely violates the U.S. Constitution, in this ‘democracy’, where the system functions like clockwork, for the billionaires.

  • Millions Of Americans Had Their Emergency Savings Wiped Out By Downturn
    Millions Of Americans Had Their Emergency Savings Wiped Out By Downturn

    Tyler Durden

    Wed, 09/02/2020 – 01:30

    A new survey via CNBC and Acorns Invest commissioned by SurveyMonkey, found that the virus-induced recession wiped out 14% or about 46 million American’s emergency savings. 

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    About 17% had to tap into emergency savings to cover living expenses, 11% had to borrow money to cover everyday expenses, 6% stopped contributing to 401(k) or other retirement accounts, and 5% asked for rent relief. 

    The survey of more than 5,400 adults in August found that older millennials depleted their emergency savings the most. About 26% of those aged 25 to 34 said their savings had been drained as they struggled to survive the downturn. Only 6% of boomers drained savings; they’ve been through multiple boom/bust cycles and understand the importance of saving for a rainy day. Unlike millennials who have only been through one recession. 

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    The survey’s findings outline a similar message from former Federal Reserve Chair Janet Yellen last week, where she warned in an op-ed, published in The New York Times, that millions of Americans are suffering. She said monetary policy by itself could not save the economy from the downturn, and the solution will require additional rounds of fiscal stimulus to thwart a deepening fiscal cliff. 

    The virus-induced recession has caused unprecedented economic damage, while more than 30 million American’s are collecting unemployment benefits. The labor market recovery has stalled as the Fed’s new policy to raise the inflation target above 2% will result in a higher cost of living for tens of millions broke, jobless Americans. 

    What’s even more stunning is that a quarter of all personal income is derived from the government.

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    This merely underscores the uneven, or K-shaped nature of the the recovery: where the political elites and ultra-wealthy were bailed out by the Fed, while millions of serfs, i.e., low-income folks, have (almost) completely run out of savings, depleted stimulus funds, and some can no longer afford food as the fiscal cliff  hits the 31 day mark on Tuesday.

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    Congress and the Fed better beware: stress low-income households enough, they will eventually assemble and revolt, striking at the one building that has so far avoided the protesters’ focus: the Marriner Eccles building.

  • New York Launches Unsecured Online 'Portal' For Requesting Absentee Ballots
    New York Launches Unsecured Online ‘Portal’ For Requesting Absentee Ballots

    Tyler Durden

    Tue, 09/01/2020 – 23:50

    As New York, which successfully managed to hold most of its primary votes mostly by mail, has opened an online portal allowing residents to request an absentee ballot.

    Gov Andrew Cuomo acted unilaterally to allow any person concerned about COVID-19 risk to request an absentee ballot, even as some southern states rule that COVID-19 fears aren’t a valid reason to vote absentee. ;

    NYers have until Oct. 27 to mail in their ballots.

    The absentee ballot portal went live Tuesday, and Cuomo heralded the launch as a move toward ensuring free and fair elections.

    “As the November election approaches, we know that many voters feel vulnerable in the midst of this pandemic,” he said. “In line with the sweeping reforms we have implemented to make it easier for New Yorkers to exercise their right to vote, today we launch the online portal through which every registered voter concerned about COVID-19 can obtain an absentee ballot.”

    USPS has advised Americans to request ballots no later than 15 days before the Nov. 3 vote.

    To request a ballot, users must enter their birth date, county and ZIP code to confirm that you are already registered to vote. You are then taken to a page where you decide how you want the absentee ballot delivered.

    Interestingly, when we tested the portal, we found that it didn’t include any requests for sensitive private information like an individual’s social security number. An individual could request an absentee ballot simply by entering in another individual’s birthday, address and zip code – all information that’s easily attainable.

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    The screen shots below are from the website for NYC’s board of elections. City-dwellers are directed there to finish the application, but virtually all of the same questions, and the complete lack of security, are the same.

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    We sincerely hope this doesn’t create a massive crush of fraudulent requests, as any motivated individual could use social media to fraudulently apply for absentee ballots, if only to prove a point.

    And NY isn’t alone.

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  • One In Four Workers Say They Are Working Entirely From Home: Gallup
    One In Four Workers Say They Are Working Entirely From Home: Gallup

    Tyler Durden

    Tue, 09/01/2020 – 23:25

    By Jeffrey Jones of Gallup,

    The coronavirus pandemic has led to a surge in remote work. However, that surge is more apparent in the number of remote working days for telecommuters than in the number of workers moving from on-site to at-home work.

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    Since Gallup last asked about remote work in October 2019, there has been a modest uptick in the percentage of U.S. workers who report having ever telecommuted for work, from 42% to 49%. The recent figures demonstrate the growth in remote work over recent decades from 9% in Gallup’s initial measurement in 1995.

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    While the percentage of U.S. workers who have telecommuted has changed modestly, the average number of workdays telecommuters are working from home has more than doubled, from 5.8 days per month last fall to 11.9 days currently. Among all U.S. workers, the average number of telecommuting days has also more than doubled, from 2.4 per month to 5.8.

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    These results are based on Gallup’s annual Work and Education poll, conducted July 30-Aug. 12.

    The poll finds 26% of U.S. workers currently saying they have worked entirely from home in recent weeks, while 51% are working entirely from a location outside their home, with one in five reporting a mix of on-site and remote work.

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    Nearly half of those who have ever telecommuted, 45%, say they have been working entirely from home in recent weeks, with another 14% working mostly from home. This question had not been asked previously, so it is not possible to know how those figures compare with before the pandemic.

    However, 13% of telecommuters and 5% of all workers in 2019 said they worked from home 20 days a month (assuming 20 monthly workdays). Now, the figures are 45% and 22%, respectively.

    College Graduates Much More Likely to Work Remotely

    As might be expected, telecommuting is much more common among Americans with a college degree than those without one. Employed college graduates are more than twice as likely as employees without a college degree to work remotely. This is seen in the percentages reporting that they have ever telecommuted, as well as in the number of days they report working remotely and in their self-reports of whether they are currently working entirely from home.

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    The survey also shows that working women are more likely than working men to be performing their job functions remotely.

    The differences between younger and older workers’ likelihood to work remotely are not statistically meaningful.

    An analysis of prior Gallup data on occupation finds that the vast majority of college graduates work in what can be considered white-collar occupations, and that women are much more likely than men to do so.

    Last year, an average of 63% of college graduates versus 29% of college nongraduates had ever telecommuted, so the growth in telecommuting has come almost entirely among those with higher educational attainment. Also, before this year, men and women were about equally likely to say they had ever telecommuted for work. The emerging gender gap in remote work probably reflects women’s greater presence in white-collar than blue-collar jobs.

    Implications

    The widespread closure of businesses and schools to control the spread of the coronavirus sent unemployment soaring. The jobs situation would have been much worse if not for advances in technology that allow many workers to complete their work remotely. Close to half of U.S. workers have now taken advantage of opportunities to telecommute, and currently about one-quarter are doing so every workday.

    Of course, not every job can be done remotely; therefore, the growth of telecommuting has a ceiling. Half of U.S. workers currently say they do their job entirely at a location outside their home. Given this, and that half of U.S. workers report they have never telecommuted, the growth in the proportion of the workforce that could telecommute may have reached that ceiling during the pandemic. Further growth in remote work may thus come in the amount of time workers spend outside the office or work site, rather than in the number of workers who do so.

    Having an expanded remote workforce alters the dynamics for employers in many ways. Remote work changes the considerations on where employers can find and attract new hires. For example, flexible work arrangements have special appeal to millennials and women. But remote work also can create both challenges and opportunities when it comes to worker engagement, worker productivity and maintaining company culture. The COVID-19 pandemic has accelerated the trend toward remote work and has made companies’ policies toward it even more crucial to their success.

  • New York City's MTA Crisis Could Be "Catastrophic" For Housing Market 
    New York City’s MTA Crisis Could Be “Catastrophic” For Housing Market 

    Tyler Durden

    Tue, 09/01/2020 – 23:00

    Readers may recall New York City’s MTA proposed drastic transit cuts and higher fares after losing an astonishing $200 million per week after a collapse in ridership following the virus pandemic. As a result, the transit authority is preparing for a “doomsday scenario” to include a 40% reduction in service for both commuter trains and busses, a move that would result in longer travel times and make commuting a nightmare. 

    A reduction in NYC’s transit system could be nearing if Washington doesn’t pass another coronavirus relief package. Both Republicans are Democrats have stalled for at least a month in agreeing on the dollar amount of the next round of stimulus, already resulting in a dangerous fiscal cliff that could soon jeopardize the nation’s economic recovery. 

    If transit cuts are seen, the effects could be devastating to the city’s economy, said Bill Rudin, CEO of Rudin Management, and chairman of the Real Estate Board of New York, who spoke with The Real Deal. 

    “The ability to move people effectively, expeditiously, efficiently is critical to our economic engine,” Rudin said.

    The latest mobility trends report via Apple shows people using NYC public transportation on Sept. 1 continues to remain halved of what it was before the virus. 

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    One look at Time Squares on Tuesday afternoon and foot traffic remains dead – the city is still a “ghost town.”

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    Nicole Gelinas, a senior fellow at the Manhattan Institute, focused on transportation and infrastructure policy, said the transport authority “could not persist very long in continuing full service with just a fraction of their fare and toll revenue.” 

    Gelinas said, “I do think they need more money from the federal government and also need to look at rational cost-cutting.”

    Drastic cuts to the city’s transit system could slow the economic recovery in the metro area as the velocity of people moving around, transacting, and or just doing business that uses public transportation be much slower than pre-virus times. Longer travel times would undoubtedly lead to continued ridership losses and more future cuts to service. 

    Scott Rechler, chairman and CEO of RXR Realty, who is also chairman of the Regional Plan Association and a former MTA board member, claims transit cuts “would be catastrophic for the real estate industry,” as well as the city’s overall economy. 

    Already, real estate prices in Manhattan are pressured as folks and businesses are leaving the borough for rural communities amid depressionary unemployment, virus pandemic, social unrest, and surging violent crime. 

    If Congress can’t agree on the next round of stimulus in the near term, NYC’s MTA could undergo transit cuts, resulting in a chain reaction that would cripple the city’s already limping recovery.

  • The Real Reason The Oil Rally Has Fizzled Out
    The Real Reason The Oil Rally Has Fizzled Out

    Tyler Durden

    Tue, 09/01/2020 – 22:35

    Submitted by Simon Watkins, of OilPrice.com

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    One of the themes that is emerging as we review investment candidates is the era of oil growth, which is at least going to take a substantial pause, if it is indeed, not totally in the rear view. Company after company has told us that “maintenance capex” is all they are allocating at current oil prices.  An example of this mindset is Parsley Energy, (NYSE:PE) which reduced its capex budget by 50% year over year. This new era of growth restraint has implications for the world energy market that isn’t reflected in the energy structure at present.

    Drilling and fracking each picked up slightly from the week prior. Hence the question I pose about seeing the bottom in activity. We saw a bump similar to this once before this summer, and then each category fell back into decline for a month or so. I am not betting that we’ll see another boost this week, as the trading range for WTI just isn’t supportive enough for a big activity inflection.

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    Source: Baker Hughes

    I remain committed to my previously established targets for shale exit production ~5 mm BOEPD. The next way point will be the EIA-914 on Monday.

    Why are we where we are?

    That’s a question I’ve been wrestling with regards to the pricing of WTI. Oil has definitely plateaued in recent weeks, after a nice run in the spring and early summer. A brief investigation reveals one likely source of the lack of volatility.

    The answer could be hedging. Using a trading strategy known as a Strangle, funds, and large institutions with exposure to commodities-oil in this case, can limit this with puts and calls. A put gives you the right to sell WTI-for example at a future price, while a call gives you the right to buy at a different price, thus limiting the impact of volatility on your position.

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    Note: The tight range since late April driven by hedging strategies

    Source  Hedging on this scale has a potential to result in a big dislocation in the market. In a recent WSJ article Marwan Younes, chief investment officer of Massar Capital Management commented: ‘’Hedging has the consequence to push prices back within that range. Historically, long periods of calm in financial markets have tended to end with a burst of volatility. It feels like we have two tectonic plates building up energy. The day it gives way will be a fairly eventful day.’’

    This is an interesting idea that is supportive of my general diatribe about oil going higher and breaking out of this range. Particularly as regards Younes final line that I have italicized. We need a catalyst for this to happen, and it’s hard to say just what that will be.

    I don’t trade futures contracts. I just don’t have the attention span or the temperament to stay that focused on the market. I figure the money I am missing out on in a success case, is more than compensated for by sleeping fairly well at night, and consuming less Maalox.

    Under-investment in supply, “Chickens” are coming home to roost

    Paul Sankey is a well-known securities analyst, formerly with a big firm-Mizuho, and now on his own. I’ve followed him for years. Sankey has some interesting ideas that coincide with my own. Chief among them is the idea that the oil market is approaching a precipice of supply short-fall that will simply be breath-taking when its full effects land out.

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    Sankey Research

    Another area of agreement between us is that years of under-investment in replacing barrels from aging Brown-field developments will ultimately constrict supply and drive prices higher.

    Focusing mainly on the decline rate of shale and the lack of new drilling, I’ve made the point repeatedly in OilPrice articles that the shale miracle in the U.S. is over. Here is a link to my most recent writing on this topic. Shale was thought to be impervious to decline by many. Some of us (speaking of myself here) always knew better as we understood the short-decline nature of the rock. Now companies are taking write-offs on shale as they did deepwater assets a few years ago, meaning there are reserves we thought would be available in the years ahead that will now be uneconomic.

    The short-lived era of the U.S as “swing-producer” for oil has ended.

    Why “war-premiums” for oil don’t last

    One thing we should be able to agree on is that the world currently assumes unlimited supplies of crude oil, now the norm thanks to overproduction the last few years, will continue to be the base case going forward.

    Is the world right? Obviously you know I don’t think so, but we are certainly getting mixed signals right now. It is worth noting when a giant hurricane that shuts down 80% of the GoM’s producing and refining capacity doesn’t move the market even a little higher it speaks strongly to the markets confidence about future supply.

    As noted in the EIA graphic below, last week we edged down still further toward the 500 million barrels mark in inventories, and still crickets from the oil market. It should be noted that this represents about a 30 day supply at current consumption rates.

    We think that the +/- 3-mm BOEPD supply/demand gap will accelerate as the year closes, and these inventory draws will continue.

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    EIA-WPSR

    I have previously identified several hot spots that could explode at any time, creating an instant inflection for oil. You know them well. Iran, Venezuela, Iraq, Libya are all experiencing severe economic and social disharmony for various reasons, but no one is shooting at one another taking a war-premium completely out of the price. Should we be so complacent?

    One interesting aspect of a war-premium is that it doesn’t last for long. History tells us the sharp spikes in price due to conflict are short-lived, and oil driven higher by conflict reverts quickly to its previous range. The world continues to spin on its axis, infrastructure that may be damaged or destroyed is quickly rebuilt, and importantly no one goes without. A good example is the recent attack on Saudi oilfields in 2019 by Iran. Oil spiked to $80 from $60 overnight, and quickly fell back to $60, and then to $50, and then to $40. Fear comes out of the market as rapidly as it enters.

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    Macrotrends

    What the chart above tells us is that war premiums soon fade. Take the spike circa 1990 when the U.S. led coalition began the response to Iraq’s invasion of Kuwait. A brief spike to $80 was quickly followed by a rapid collapse to the mid-$30’s and over most the next decade to a low below $20. It then took another 10 years for oil to peak again, this time in the financial collapse of 2008.

    One takeaway from this chart is that wars are over so quickly these days (Afghanistan excepted), that they don’t have much prolonged impact on the perception of supply security.

    Much more important are key producer decisions to restrict production. For example the Arab oil embargo of the early 1970’s led to a 30-year uptrend that was only broken when they opened the taps in 1998. A decision they quickly regretted when the oil price crashed. A “V” shaped rebound led to nearly another 20 years of higher prices, until in 2014, OPEC again opened the taps. This seems to be a mistake they are unable to stop making as they did it again earlier this year.

    In short while a shooting war changes the dynamic briefly, decisions by producers have a much more pronounced effect on oil prices.

    Your takeaway

    Inflation is on the horizon. It’s been ages since we had to worry about generally rising prices. The full effects of the dynamic imposed by the virus, lower employment, business failures, etc. have led governments around the world to print trillions of dollars to provide liquidity. A lesson perhaps learned in 2008 when governments were slow to provide this under-pinning to world markets. The net effect of this is always inflation.

    Last week the Chairman of the Federal Reserve, (Fed) Jerome Powell reinforced their position on employment vs inflation making a change to their historic stance of combating inflation. In this speech Powell let it be known that it will let inflation run…to a degree, in support of putting people back to work. Up to this point the Fed had established an arbitrary 2% limit for inflation before it would move proactively to tighten the money supply to drive it down.

    This is bullish for oil prices and oil equities in general, telling us we are on the right track with our overall thesis of higher oil prices. Interest rates will stay down hurting savers, but commodities and equities will rise. Oil is a commodity.

  • Australia Plunges Into First Recession In 29 Years Following Biggest GDP Drop On Record
    Australia Plunges Into First Recession In 29 Years Following Biggest GDP Drop On Record

    Tyler Durden

    Tue, 09/01/2020 – 22:31

    Nothing good lasts forever, as Australia just discovered when after seemingly defeating the gravity of the business cycle and lasting a record 29 year without an economic contraction, the country tumbled head first into its first recession in almost 30 years, which also happened to be the worst on record as its Q2 GDP plunged -6.3% Y/Y, worse even than the consensus estimate of a -6.0% drop.

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    GDP plunged 7% sequentially from the first three months of the year – hammered by the renewed Covid outbreak and lockdown in Victoria state – the first back-to-back quarterly declines since 1991. The sequential drop also was larger than economist forecasts of a 6% drop.

    As Bloomberg notes, “Australia’s record run of avoiding two consecutive quarters of negative GDP, which included avoiding recessions during the 1997 Asian Financial Crisis, the Dot Com Bubble and the 2008 global financial crisis, has come to an end with the largest contraction on record according to ABS data dating back to 1959. It now joins much of the world in succumbing to a pandemic-induced downturn.”

    The report also showed:

    • Household spending plunged 12.1%, subtracting 6.7 percentage points from GDP; government spending rose 2.9%, adding 0.6 percentage point
    • Investment in new and used dwellings fell 7.3% in the quarter
    • Net exports contributed 1 percentage point to GDP
    • Just like in the US, the savings rate soared, hitting 19.8%, the highest rate since 1974

    Australia’s desire to declare an early victory against covid which was accompanied by an early lifting of restrictions and reopening of its economy, proved catastrophic and has been offset by an almost two-month lockdown in Melbourne, the nation’s second-largest city with about 5 million people, crushing any hopes of a recovery.

    In March, Australia’s Reserve Bank cut its cash rate to a record-low 0.25% and set the same target for the three-year bond yield as it aims to lower borrowing costs across the economy. As Bloomberg notes, the RBA predicts the renewed lockdown will lift unemployment to about 10% later this year.

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    A ‘closing down’ sign fills the window of a homewares store in Melbourne, Australia; Photo: Bloomberg

    The government, meantime, has followed the rest of the world in flooding the country with fiscal stimulus, injecting tens of billions of dollars into the economy including its signature JobKeeper wage subsidy program designed to keep workers attached to firms as it tries to maintain employment connections until activity can resume.

    The silver lining is that the stimulus unleashed in China – Australia’s top trading partner (which is in jeoaprdy due to an escalating diplomatic feud) – to revive its economy is also fueling demand for Australian commodities and lifting prices, keeping the terms of trade elevated in the second quarter. In Q2, Australia saw a record current-account surplus of A$17.7 billion ($13.1 billion) aided by the weaker dollar and the country nation’s closed international borders which is keeping people from traveling abroad.

    Meanwhile, on Tuesday the central bank boosted a line of cheap funding to banks to A$200 billion. In addition to supporting the economy, that should also help ease some of the upward pressure on the currency by confirming the RBA’s commitment to keeping conditions accommodative until activity recovers.

    While the recession was widely expected, the aussie dollar slumped against the dollar, sliding from 0.7375 before the news to 0.7337 before paring some of the losses. The Australian dollar has benefited from Australia’s trade position, soaring almost 30% from a nadir in March.

  • Bipartisan Bill Seeks To Curb US Reliance On China For Rare Earths
    Bipartisan Bill Seeks To Curb US Reliance On China For Rare Earths

    Tyler Durden

    Tue, 09/01/2020 – 22:10

    Ever since the first shots were fired in the US-China trade/tech/cold war in 2016, Beijing has frequently threatened to use its strategic position as the world’s pre-eminent supplier of rare earth metals – a group of 17 elements used in everything from sophisticated weapons to cell phones to wind turbines to electric cars – as potential leverage which it could wield in response to any perceived foreign (read US) aggression, even if it has so far refused to use this particular trump card. And with Sino-US relations deteriorating by the day, pushing China ever closer to the day it may in fact ban rare earth exports to the US, US House lawmakers are now taking advance measures for when that day finally comes, and have introduced a bipartisan bill aimed at seeking to curb US dependence on China for rare earths.

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    Rare earth elements are described as the ‘vitamins of chemistry’ — producing powerful effects in small doses

    The legislation was co-authored by Republican Lance Gooden and Democrat Vicente Gonzalez, both of Texas, and is similar to that introduced in May by Senator Ted Cruz. Republicans Will Hurd, Roger Williams, Pete Olson and Randy Weber, as well as Democrat Henry Cuellar, are co-sponsors of the bill. All are Texas representatives. The measure would give tax incentives for companies involved in the mining, reclaiming and recycling of critical minerals and metals from deposits in the US, Bloomberg reported.

    The bill is also part of a recent push in Congress to shift supply chains, especially in sectors viewed as critical for national defense, away from China and back toward the US; predictably, the effort has drawn broad support from domestic rare-earth companies which anticipate a major financial windfall should the bill pass.

    “The tax incentive seeks to level the playing field with regard to the subsidies China provides from mine to magnet,” Pini Althaus, chief executive officer of USA Rare Earth, which is developing the Round Top Mountain deposit in Texas, said in a phone interview. “It would significantly improve the bottom line of any domestic rare earth project.”

    Althaus also said the House measure which China would surely claim is a subsidy prohibited by the WTO, reduces the potential for China to dissuade investment in U.S.-based rare earth projects and supply chains, because those businesses will be better able to compete.

    Last year, amid mounting concerns China would limit shipments of rare earths as the trade war escalated, Trump ordered the Defense Department to spur production of rare-earth magnets.

    The legislation “lowers the cost of capital, which is the goal because China has lowered the cost of capital for their sector, and our sector needs to be able to compete,” Jim Litinsky, the incoming CEO of MP Materials, currently the sole U.S. miner of the minerals, said in a phone interview. “It’s probably the one thing I’ve seen everyone get behind.”

  • Joe Kennedy III Becomes First 'Kennedy' To Lose A Race In Massachusetts As Ed Markey Triumphs In Close-Fought Dem Primary
    Joe Kennedy III Becomes First ‘Kennedy’ To Lose A Race In Massachusetts As Ed Markey Triumphs In Close-Fought Dem Primary

    Tyler Durden

    Tue, 09/01/2020 – 21:45

    As expected, the candidate with the best memes has carried the day.

    Sen. Ed Markey, best known outside Massachusetts as Alexandria Ocasio-Cortez’s partner in the Senate – the pair co-sponsored the Green New Deal, which Biden has embraced  – has triumphed over Joe Kennedy III in a hotly contested Democratic primary. The race was remarkable for several reasons: Markey, the incumbent, and a longtime Congressman, became the ‘outsider’ candidate, while his challenger, the 39-year-old scion of the legendary Kennedy political family, was painted as the incumbent.

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    When Kennedy first announced his candidacy last September, it provoked speculation that Markey might decide to retire rather than risk what many felt would be an inevitable victory in favor of Kennedy III.

    Apparently, these pundits had never seen that clip of Kennedy drooling all over himself while delivering the rebuttal to President Trump’s 2018 state of the union.

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    This, along with conservative positions like his skepticism of legalized marijuana – now an institution in Massachusetts – helped Markey capture the sympathies of the liberals and the energetic young grassroots, thanks in large part to the help of AOC.

    Turns out, Markey was the first Senator to invite her to the Senate dining room after her primary victory over Joe Crowley. That meeting led to what has been a successful political partnership.

    In a piece published Tuesday, the Washington Post said: “there are Markey clubs at every major college, Markey memes splattered across social media and phone banks around the country organized by the Sunrise Movement, the youth climate-change activists who coined the Green New Deal shortly before Markey endorsed it.”

    A few minutes ago, Cook Political Report editor Dave Wasserman officially called the race for Markey, who entered the day with a slight edge in the polls.

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    Markey has apparently carried nearly all the early reporting towns, along with sweeping East Boston, where Kennedy launched his primary campaign.

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    Jokes flooded twitter…

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    As one veteran reporter pointed out, Markey’s victory is historic because it marks the first time a Kennedy has ever lost a race in their home state of Massachusetts. Family Matriarch Ethel Kennedy – Joe’s grandmother – even hit the campaign trail as a surrogate for her grandson.

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    In case you needed another reminder: American political dynasties have become intolerable to vast swaths of the electorate.

    To be sure, Tuesday’s Democratic primaries in the Bay State weren’t a sweep for the AOC-aligned progressive left. House Ways and Means Commission Chairman Richard Neal, the House’s top tax writer,defeated Holyoke Mayor Alex Morse, his progressive, AOC-backed challenger.

  • California DA Asks Police To Consider Whether Looters 'Needed' What They Stole Before Filing Charges
    California DA Asks Police To Consider Whether Looters ‘Needed’ What They Stole Before Filing Charges

    Tyler Durden

    Tue, 09/01/2020 – 21:20

    Authored by Collin Jones via The Post Millennial (emphasis ours)

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    A district attorney in California reportedly told members of law enforcement that they should consider the needs of looters before deciding to charge them with looting.

    Costa County District Attorney Diana Becton expressed her view that officers should consider whether “the target business” was “open or closed” at the time the looting took place, and “what was the manner and means” by which the looters had managed to get inside the business, the Daily Wire reported.

    The charging guidelines were laid out by Jennifer Van Laar of RedState, which are as follows:

    1.) Was this theft offense substantially motivated by the state of emergency, or simply a theft offense which occurred contemporaneous to the declared state of emergency?

    2.) Was the target business open or closed to the public during the state of emergency? ii. What was the manner and means by which the suspect gained entry to the business? iii. What was the nature/quantity/value of the goods targeted? iv. Was the theft committed for financial gain or personal need? v. Is there an articulable reason why another statute wouldn’t adequately address the particular incident?

    Van Laar goes on to quote Shouse California Law Group: “Under Penal Code 463 PC, California law defines ‘looting’ as taking advantage of a state of emergency to commit burglary, grand theft or petty theft. Looting charges can be filed as a misdemeanor or a felony and is punishable by up to 3 years in jail.

    Becton’s ideas run counter to those in charge of Sacramento County, where Sheriff Scott Jones reportedly requested on Friday that the federal government send in the National Guard after “roughly 200 protesters broke windows at the downtown offices of the sheriff, district attorney and other government agencies the night before.”

    Jones was flanked by “blown-up photographs” depicting protesters dressed in body armor during a protest that took place Thursday, and he referred to the demonstrations as an “attempted insurrection.” Sacramento County District Attorney Anne Marie Schubert suggested that the actions of the demonstrators was planned.

    “It’s been one day and I’m already done with this,” Jones said during a Friday news conference.

    The Daily Wire reported that Becton is the same district attorney who charged a couple with a “hate crime” for painting over a Black Lives Matter mural in front of the Wakefield Taylor Courthouse.

    Becton has also garnered a name for herself in co-authoring an opinion piece for Politico alongside district attorneys Kim Foxx of Chicago, St. Louis’ Kim Gardener and two two others, writing: “Our criminal legal system was constructed to control Black people and people of color. Its injustices are not new but are deeply rooted in our country’s shameful history of slavery and legacy of racial violence. The system is acting exactly as it was intended to, and that is the problem. We should know: We’re Black, we’re female, and we’re prosecutors. We work as the gatekeepers in this flawed system. And we have some ideas for how to fix it.”

    Becton is not the only one supporting the idea of looting. Vicky Osterweil penned a book entitled “In Defense of Looting,” where she argued that “looting is a powerful tool to bring about real, lasting change in society.” Osterweil even denigrated small businesses, in writing: “When it comes to small business, family owned business or locally owned business, they are no more likely to provide worker protections. They are no more likely to have to provide good stuff for the community than big businesses.”

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  • Ilhan Omar Demands Apology From MSNBC's Joy Reid Over "Islamophobic Comments"
    Ilhan Omar Demands Apology From MSNBC’s Joy Reid Over “Islamophobic Comments”

    Tyler Durden

    Tue, 09/01/2020 – 20:55

    MSNBC personality Joy Reid is under fire once again after making an allegedly “Islamaphobic” comment”. But this time, her accuser is none other than controversial Democratic Congresswoman Ilhan Omar, who herself has refused to apologize for comments that were heralded as anti-semitic, while once blithely – and publicly – dismissing 9/11 as “a thing that happened”.

    Omar and a anti-defamation league-type group called Muslim Advocates complained that Reid made callously Islamophobic remarks on air during a broadcast the other night.

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    Reid’s crime? She compared the way President Trump acts to the way “Muslims” act. She intended to compare Trump’s behavior to that of somebody like Turkish leader Recep Tayyip Erdogan, which is hilarious because in reality, there is no real grounds for comparison. Even their rhetorical styles differ markedly, though both have shown a penchant for “interfering” with the central bank.

    But that’s not how it came out.

    During her show, Reid said, “the leaders, let’s say in the Muslim world, talk a lot of violent talk and encourage their supporters to be willing to commit violence, including on their own bodies, in order to win against whoever they decide is the enemy. We in the U.S. media describe that as they are radicalizing those people—particularly they are radicalizing young people. That’s how we talk about the way Muslims act. When you see what Donald Trump is doing, is that any different from what we describe as radicalizing people?””

    In a statement, Muslim Advocates demanded that Reid “apologize on air tonight.”

    “Joy Reid must apologize on air tonight for spreading the false, dangerous myth that Muslims are inherently radical and violent. MSNBC also needs to take action to ensure anti-Muslim bigotry has no place on its network. Muslims have been gunned down in their homes and houses of worship by people who believe in the very same hateful, false smears that Reid shared on her program. This is deadly serious and it’s part of a dangerous, longstanding pattern. 

    Omar made a similar request.

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    This isn’t the first time Reid has been in the cross-hairs of Islamic rights groups. Back in 2018, a furor was unleashed when several old blog posts bearing homophobic and Islamophobic messages were unearthed.

    Here’s an excerpt from one particularly “problematic” post:

    “My feeling is that the only reason that a world war between civilizations has not already broken out is that the vast majority of Muslims living in the world today are so desperately poor that they have the time, energy and resources for only the occasional burst of AK-47 fire into the air from the garbage and sewage laden streets outside of their mud huts. Give them resources and I fear that they will come after us everywhere that they can find us, which is to say everywhere.”

    Her use of the phrase “mud huts” is particularly appalling.

    Yet, Reid survived past scandals and managed to hang on to her job at MSNBC. It’s almost like the news organization can’t fire her.

    Last time around, Reid laughably made things worse by claiming that “hackers” published the offending blog posts under her name.

    Will Reid make history as one of the first people to mendaciously cry “deep fake?”

  • In Unprecedented Move, CDC Halts Most Rental Evictions Until End Of 2020
    In Unprecedented Move, CDC Halts Most Rental Evictions Until End Of 2020

    Tyler Durden

    Tue, 09/01/2020 – 20:30

    In an unprecedented move on Tuesday, with Congress unable to reach a common ground on virtually any stimulus extension, the Centers for Disease Control and Prevention unveiled today it would temporarily – at least through the end of 2020 – suspend most rental evictions for Americans struggling to pay rent due to the pandemic, in a step which CNN dubbed was “broader than eviction protections already in place.” The move comes as negotiations on further coronavirus aid have been stalled as Republicans and Democrats refuse to budge on topline numbers for what a new relief package would cost.

    In a phone call with reporters, officials said the order will apply to Americans who qualified for direct payments under the CARES Act.

    To be sure there are some hurdles: renters will have to prove that they’ve taken “best efforts possible to seek government assistance to make their rental payments,” and will have to “declare that they are unable to pay rent due to Covid financial hardship,” and must show they “will likely become homeless or move into congregate housing settings if they are evicted”, but that should not be a problem for anyone willing to live rent free indefinitely.

    Renters will also have to fill out several forms, found on the CDC’s website, and give them directly to their landlords to qualify for the program.

    “This will be a declaration presented to the landlord, if that landlord approaches a tenant with an intent to evict,” an official said. Because the move is federally mandated, it “would become a criminal offence” if the landlord chose to ignore the declaration. But it could still end up in courts, possibly leading to legal actions that could show up on background checks or credit reports.

    And while landlords are being effectively stripped of most if not all of their rights with this extraordinary intervention, they will still be able to remove tenants for “committing criminal acts, threatening the health and safety of other residents, damaging property or other health and safety considerations,” an official added although good luck getting through to the local police station and reporting a crime in a country where defunding the local law enforcement is seen as the pinnacle of progressive thought.

    “To the extent that there is a dispute between the landlord and the renter about whether or not an eviction protection is in place here, it can be filed, and that would be for the local courts, which are not federal to adjudicate,” an official said, without clarifying how long before defunding the local courts becomes the next progressive ideal. On the other hand, in places like Portland they won’t even have to do that: after all, everyone arrested for rioting is released the next day with the blessing of the judicial branch so they can resume rioting post haste.

    Under the CARES Act, only renters in federally-backed rental units were protected from eviction. “This covers any rental unit in United States, so long as the renter meets those requirements, where they’ve demonstrated that they are at risk of becoming evicted,” an official said. There’s also currently a moratorium on evictions for federally-backed, single family home mortgages.

    Realizing that this was nothing short of an invitation to stop paying rent, a CDC official said pointblankthis “is not an invitation to stop paying rent.” It was unclear how many in the audience laughed. “The order makes clear that a renter who cannot pay his or her full rent should pay an amount that is not unduly burdensome, and as close to payment as possible.”

    The landlords are surely holding their breath (their best and only recourse… although if they hold it long enough they will surely get a Fed bailout too).

    As for those asking just why on earth a decision to halt evictions is being made by the CDC and not say… Congress, an official said “the CDC director has authority to take measures that he’s reasonably necessary to mitigate the spread of communicable disease.”

    “Congress has delegated broad authority to HHS, the Surgeon General and CDC, to take reasonable efforts to combat the spread of communicable diseases, and frankly I think it makes sense for those authorities abroad because we don’t know for any given situation or scenario what steps will be needed to stop the spread,” an administration official said. “I think, in this particular order, the CDC has made a very compelling case that it is quite problematic at this particular time. It’s focused on this particular pandemic, which is obviously the uniquely powerful grasp in the nation’s entire history in terms of the effect it’s had that for a bunch of reasons in particular, that the home has been sort of the focal point of people social distancing and building, sort of a safe space themselves over the past few months, and also the fact that if people get kicked out, they may end up in overcrowded congregated living facilities or homeless shelters, and that is a potential recipe for a big spread of COVID-19.”

    Asked why that authority wasn’t being used to enact a federal mask mandate, officials refused to answer because the question didn’t “have to do with the call at hand.”

    Finally, confirming the political nature of the decision, deputy press secretary Brian Morgenstern said the action “means that people struggling to pay rent due to the coronavirus will not have to worry about being evicted and risk further spreading of or exposure to the disease due to economic hardship,” and attacked Democrats on the hill.

    Officials did not answer questions about how that legal action could impact credit or future housing options.

    And with that, we now wait for the CDC to start sending unemployment benefits and buying Apple bonds.

  • Systemic Chaos
    Systemic Chaos

    Tyler Durden

    Tue, 09/01/2020 – 20:05

    Submitted by Jeff Thomas of International Man

    In the short time since the killing of George Floyd, demonstrations have taken place in all fifty US states. Riots have occurred in forty of them. In each of the incidents, many protesters held up signs saying, “Defund the Police.”

    Of course, no one wants to become a riot victim, but in those cities and states that are Democrat-run, there’s a bit of a hitch: Politicians must be seen to sympathize with protesters, or they will not appear to be sufficiently outraged by “systemic racism.”

    They must therefore choose between the safety of their constituents and appeasing protesters. This is not an enviable position to be in; yet, since most all politicians regard re-election as overshadowing all other concerns, they can be predicted to follow the irrational wishes of the protesters.

    Minneapolis, where the protests began, has a population of some 425,000 residents. Only a small fraction of them actually joined the protest, and in fact, even the Democratic governor of Minnesota has stated that 80% of the protestors were from out of town.

    There are conflicting theories as to whether these 80% were actual sympathisers or were hired by heavily funded organisations that hope to create a dysfunctional situation in Minneapolis and other cities in the US.

    Not surprisingly, Minneapolis is now the first city whose city council has voted to defund the police.

    In place of the police will be a department of community safety that will be staffed with people who have no police training whatever. There will, however, be people with expertise in mental health, social services and counselling.

    The reader could be forgiven if he is inclined to shake his head and say, “But the removal of the police entirely won’t decrease crime, it will invite more crime. Don’t those on the city council understand that?”

    Well, apparently, yes, they do. In fact, since they themselves will no longer have the protection of the police, they’ve arranged for the city to hire security guards to protect them. Over the past three weeks alone, it has cost the taxpayers of Minneapolis over $60,000 to protect council members.

    So how can it be that police are not needed by the general public to protect them from rioters and other criminals, whilst the city council members do? Well, one member has explained that need, stating that she has no fear from rioters, but that white nationalists have made her fear for her life.

    Without seeking to be judgmental, I think it’s safe to say that Minneapolis is in for a crime wave beyond anything it has ever experienced. Inner cities have a penchant for being breeding grounds for chronic street crime. And criminals in inner cities have a long-held record for creating as much crime as they can get away with. The only limitation on the crime level is whatever degree of arrests can be made.

    And it may be safe to say that social service counsellors will not be making many arrests.

    Those of us who are not American and don’t live in the US tend to be stupefied by such developments taking place, as the US had, for so long, been regarded by the rest of the world as a paragon of freedom and common sense.

    In recent years, however, that perception has been tossed in the dustbin.

    We tend to be stunned that such absurdly self-destructive decisions such as the recent one in Minneapolis could take place, and just as stunned that the majority of Americans, who surely have more sense, would not raise an immediate furor.

    But this view leaves out an important factor in US political culture.

    Beginning in the 1960s, American youth began to take their country in a new direction. In countless campus demonstrations, they championed causes such as peace and race relations. This was the baby-boomer generation, and whilst these university students may have been somewhat spoiled and self-focused, they were more numerous than the previous generation and had a huge impact on American society.

    Also, truth be told, the concepts of peace, racial equality and gender equality unquestionably were laudable and well worth protesting for.

    Indeed, it might be said that it would be perennially desirable for younger people to question the previous generation, and to offer possible alternatives. Not all would be workable, but it’s healthy for the grand social experiment to be questioned periodically.

    But, unfortunately, this is not what we’re seeing in today’s America.

    What we’re seeing is the maturation of political correctness – a movement that at first appeared to be relatively benign. However, from the very first, it contained a telltale dark aspect. Anyone who disagreed with a tenet of politically correct thinking was shamed and sometimes ostracized.

    Of course, our old friend George Orwell warned us of this approach. He understood that once it took hold – once it had firmly rooted itself in the culture – it would be almost impossible to stop.

    “War is peace. Freedom is slavery. Ignorance is strength.”

    This motto was created by Orwell’s “Ministry of Truth,” which dictated whatever the State decided was true at any given time.

    Today’s Ministry of Truth actually has several outlets – primarily the twenty-four hour news programmes that repeat the same interpretations of events, ad nauseum.

    And it does seem that the result has been that a percentage of Americans have come to accept the often-ludicrous concepts that are put forward by the Ministry.

    This is how it’s possible for the politically correct but largely non-factual claim of systemic racism to soon be replaced by the very real systemic chaos.

    And worse, just as our friend Mister Orwell predicted, the great majority – who thoroughly understand that many politically correct concepts are nonsense – are so fearful of being singled out as not accepting such dogma that they simply remain quiet and allow their once-great country to be converted into a collectivist oligarchy.

    Of course, that term may startle some as possibly being an overstatement, but once those who value freedom and common sense have effectively been silenced, it’s safe to say that it’s game over.

    From that point forward, the political class may pass whatever legislation it wishes, with impunity, no matter how illogical or harmful.

    As Ayn Rand observed,

    We are fast approaching the stage of the ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission; which is the stage of the darkest periods of human history, the stage of rule by brute force.

    Editor’s Note: Disturbing economic, political, and social trends are already in motion and now accelerating at breathtaking speed. Most troubling of all, they cannot be stopped.

    That’s exactly why bestselling author Doug Casey and his team just released a free report with all the details on how to survive the crisis ahead.

    It will help you understand what is unfolding right before our eyes and what you should do so you don’t get caught in the crosshairs.

  • "Blowouts For Me, Not For Thee!": Pelosi Sneaks Visit To Closed San Francisco Hair Salon
    “Blowouts For Me, Not For Thee!”: Pelosi Sneaks Visit To Closed San Francisco Hair Salon

    Tyler Durden

    Tue, 09/01/2020 – 19:40

    House Speaker Nancy Pelosi (D-CA) – who invited people to tour Chinatown in late February to prove that coronavirus was ‘no big deal’ – has just been caught ignoring a San Francisco city ordinance ordering hair salons to remain closed during the pandemic.

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    According to security footage obtained by Fox News, the 80-year-old lawmaker was seen at San Francisco hair salon “eSalon” Monday afternoon for a wash and blow-out at 3:08 p.m. according to a timestamp on the footage, which shows her walking through the salon without a mask over her mouth or nose.

    Her stylist, however, can be seen walking behind her with a black face mask.

    Salons in San Francisco had been closed since March and were only notified they could reopen on Sept. 1 for outdoor hairstyling services only.

    Salon owner Erica Kious, in a phone interview with Fox News on Tuesday, shared details of Pelosi’s visit. Kious explained she has independent stylists working for her who rent chairs in her salon.

    “One of the stylists who rents a chair from me contacted me Sunday night,” Kious said.

    A screengrab of the text message she received from one of her stylists, and obtained by Fox News, said: “I’ll be there at 2:45 tomorrow. Pelosi assistant just messaged me to do her hair.”

    Kious replied: “Pelosi?” –Fox News

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    “I was like, are you kidding me right now? Do I let this happen? What do I do?” Salon owner Kious told Fox News, adding that she “can’t control” what her stylists do if they rent chairs from her – as “they’re not paying” at this time.

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    According to Kious, Pelosi’s visit was like a “slap in the face.”

    “It was a slap in the face that she went in, you know, that she feels that she can just go and get her stuff done while no one else can go in, and I can’t work,” Kious told Fox News, adding that she “can’t believe” the speaker didn’t have a mask on. (From the footage, it appears Pelosi had some kind of covering around her neck.)

    We’re supposed to look up to this woman, right? It is just disturbing.

    …

    The fact that they did this, and she came in, it’s like a slap in the face.“

    Pelosi spokesman Drew Hammill told Fox that the speaker was simply following the rules.

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    “The Speaker always wears a mask and complies with local COVID requirements. This business offered for the Speaker to come in on Monday and told her they were allowed by the city to have one customer at a time in the business. The Speaker complied with the rules as presented to her by this establishment.”

    Not so fast, says Kious, who said Pelosi received a wash and blow-dry, but added that “you’re not supposed to blow dry hair” according to COVID-19 safety precautions for hair salons.

    “We have been shut down for so long, not just me, but most of the small businesses and I just can’t – it’s a feeling – a feeling of being deflated, helpless and honestly beaten down,” Kious added. “I have been fighting for six months for a business that took me 12 years to build to reopen.”

    “I am a single mom, I have two small children, and I have no income.”

    Clearly Pelosi is taking this thing seriously…

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    Read the rest of the report here.

  • Where Will The World’s Next Giant Gold Discovery Be Made?
    Where Will The World’s Next Giant Gold Discovery Be Made?

    Tyler Durden

    Tue, 09/01/2020 – 19:15

    Submitted by Rick Sonenshein of OilPrice.com

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    With gold trading at an all-time high, and legendary investor Warren Buffet backing the precious metal for the first time, it’s time to consider where the next big gold discovery will emerge. And chances are it will be the same country that Buffett just bet on: Canada.

    Buffett wasn’t betting on discovery though, instead, he was betting on dividends. But dividends are for small, steady returns over a long period of time.

    But for investors looking for big returns, small-cap miners are where the risk-reward potential gets interesting. Especially when it’s a small-cap miner like Starr Peak Exploration  that was prescient enough to place itself right next to a huge gold discovery – before it happened.

    And now the company is doubling down with major new acquisitions in the heart of one of the friendliest mining regions in the world. The smart money is already circling the stock, with Starr Peak’s shares on a tear, gaining over 900% in 12 months.

    Even Buffett Believes The Time Is Right For Canadian Gold

    Buffett broke with his long-held negative stance on gold on August 17th when his Berkshire Hathaway disclosed a massive stake in Canadian Barrick Gold (NYSE:GOLD) at a time when gold is soaring.

    Berkshire Hathaway bought more than $560 million in Barrick Gold shares.

    Buffett has always called gold useless for the most part. 

    But with COVID-19 ravaging the economy, even if the dollar makes a few temporary comebacks, gold is on track for a 90% increase in a very short time frame. That makes gold one of the biggest opportunities in the past few months.

    Still, holding gold-mining stocks isn’t the same as holding physical gold, which is largely just a safe haven hedge against inflation – and nothing more. Buffett didn’t buy gold. He bought GOLD.

    Gold-mining stocks come with much bigger potential rewards, but the biggest risks and rewards of all are the small-cap stocks that are sitting on new potential resources that nobody knows about.

    That’s where small-cap Starr Peak Exploration Ltd. (TSX:STE.V; OTC:STRPF) shines in that sweet spot right between a major discovery and low exposure.

    The company is now trying to replicate a huge discovery made by its neighbor – Amex Exploration, whose own shares surged over 2,000% in the last year on new gold discoveries, and over 1000% in the last 12 months alone.  

    And it’s right in the heart of what is arguably the best gold venue in the world …

    Canadian Gold and the Quebec Heartland

    The future is bright for gold miners in Quebec, with a rich precious metals history and still a ton of unexplored and underexplored territory.

    And it’s got geology that makes the mining industry reel with anticipation. More than 90% of the province’s substratum consists of Precambrian rock, which is famous for rich deposits of gold – as well as iron, copper, and nickel.  

    That’s why the province has at least 30 major mines and some 160 exploration projects. And that is with only around 40% of the province’s mineral potential even known.

    The biggest prize is the Abitibi Greenstone Belt, home to some of the world’s largest gold and base metal deposits. These are “world-class” deposits – a dozen of them, including the recent giant discovery by Amex. And Starr Peak is working to repeat Amex’s success.

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    When gold soars, the first – and biggest – beneficiaries are those stocks on Canada’s main index, the Toronto Stock Exchange (TSX). And it’s been a phenomenal 2020 for these stocks. And the best way to look for the surges is what’s coming out of Quebec.

    Right now, we’re looking at the best conditions ever for new high-value gold discoveries. The soaring optimism has market values climbing uproariously since March for an entire lineup of Canadian miners, including Osisko Mining (TSX:OSK), IAMGOLD Corporate (NYSE:IAG), McEwen Mining Inc. (NYSE:MUX), and many others.

    After years of cost-cutting, gold miners are now ready to spend, spend, spend on exploration – globally.

    But what’s happened is this: Mining majors have largely given up exploration, standing by to let the junior miners do all the heavy lifting and then scooping them up on a major discovery, or once a discovery has been proved up. That makes some junior mining stocks worth far more than their market caps. And it makes millionaires out of some of their investors.

    And Quebec is one of the friendliest, most lucrative gold-mining venues in the world. This isn’t African gold, with the uncertainty of corruption and the lack of infrastructure. This is a superior mining country with massive infrastructure already in place.

    Welcome to the Discovery Zone: Past, Present & Future

    Starr Peak acquired its first property directly adjacent and joining Amex’s property back in June 2019. 

    That was prescient because it was done before Amex made its first big discovery, and even before it started drilling aggressively. 

    Anytime later and that would have been prime real estate with a prime price. Which is what it is, precisely, now. 

    Figure 1: Geological Map of the NewMetal property with the new acquired claims blocs with respect to Amex Exploration’s Perron Project.

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    Figure 1: Geological Map of the NewMetal property with the new acquired claims blocs with respect to Amex Exploration’s Perron Project

    Starr Peak’s NewMétal Property is immediately east of AMEX’s Perron Property, and also hosts the past-producing Normétal Mine, which Starr Peak just acquired on August 10th 2020. 

    The acquisition hunger here has been incredibly aggressive. Even though Starr Peak and its early staged investors were already confident that the company was sitting on an Amex-style re-run, they still moved fast to keep expanding their position. 

    It’s been a series of acquisitions over the past 12 months, including a huge package that looks like a pincer movement around Quebec’s  best-positioned gold play.  

    In June 2020, it expanded the first property by strategically acquiring a property that almost doubled its existing land position next to the world class deposit discovered by Amex.

    There were dozens of companies trying to get their hands on the property, but Starr Peak already had a leg up in the area.

    Then, in August, Starr Peak acquired a 100%-interest in three major gold properties, orchestrating what can only be described as a mining coup for a small-cap company like this:  

    • The Normetal/Normetmar gold, copper, zinc and silver property
    • The Rousseau gold property
    • The Turgeon Lake gold property

    Starr Peak now has 74 mineral claims on some 2,280 hectares in one of the world’s most exciting gold plays.

    As we speak, Amex is drilling closer and closer to Starr Peak’s property line–and the closer it gets, the higher the grades of gold and the shallower the depth.

    Right now, it’s only about 1.2 kilometers away from Starr Peak. 

    And Starr Peak is fully funded and ready to start drilling its own property, with the same top geological consulting firm in Quebec, Laurentia Exploration–the same one behind the Amex discovery–to ramp it up. 

    These are exciting times in the Canadian gold patch, and nowhere is more exciting than the untapped precious metals potential of the world’s favorite gold province–Quebec. This is where giant discoveries have a past, a present, and an even bigger future. If Normetal was a major player, and Amex a story of wild returns for investors, Starr Peak may be next in line.

    Other companies set to benefit from record-high gold prices:

    Freeport-McMoRan

    While Freeport-McMoRan is primarily known for its significant copper mining operations, the resource giant also has a fair influx of gold as well. In fact, its Grasberg mine in Indonesia holds of the world’s largest deposits of copper and gold. But that’s just scratching the surface of the miner’s global assets. Freeport-McMoRan also has extensive operations across the Americas, including mines in Arizona, Mexico and Peru.

    Though its business struggled as global demand for copper took a hit, panic-buying from China has lifted prices higher in recent months – and that’s good news for Freeport-McMoRan. In addition to climbing copper prices, gold prices hit record levels, which will add even more to the mining giant’s bottom line.

    Freeport-McMoRan has had a solid year, with the price of its stock bouncing off a low of $5.31 back in March to a high of $15.70 today, representing a strong 195% gain for shareholders.

    Gold Fields

    Gold Fields has catapulted itself into the global mining elite in recent years thanks to its forward-looking vision and exceptional management. Based out of Johannesburg, South Africa, Gold Fields is one of the de facto leaders in the region. With operations in South Africa, Ghana, Australia and Peru, Gold Fields is well-diversified.

    In 2019, Gold Fields produced over 68 tons of the precious metal, up nearly 8% from the year before. And thanks to this year’s rally in gold prices, it’s on track to produce even more by the end of 2020.

    Last September, Gold Fields was trading at only $5.12 per share, but thanks to its increased production, and the dramatic rise in gold prices, it’s now trading at $13.15, which means investors who held on have brought home over 150% returns – with many analysts suggesting the stock could go even higher.

    Compania de Minas Buenaventura

    It’s rare to see miners from outside of North America on the New York Stock Exchange, but Peruvian Compania de Minas Buenaventura is an exception. Listing on the NYSE in 1996, Minas Buenaventura has clawed its way up the ranks of the global mining elite. Currently valued at $3.51 billion, the mining giant is far from its all-time highs. But it’s not down for the count just yet.

    Minas Buenaventure is exposed to six different mining properties around the globe which bring in an estimated 945,000 ounces of gold every year. But that’s not all its got going for it. It is also has exposure to a number of silver mines which produce as much as 26.5 million ounces per year, and tens of thousands of metric tons of industrial metals such as zinc, lead and copper from its domestic mines.

    Harmony Gold

    Harmony Gold is another South African miner which has exploded onto the radars of investors this year. Though it’s only the third-largest miner in the country, it has made some stellar moves in the marketplace. Domestically, it has nine underground mines in the resource-rich Witwatersrand Basin and one open-pit mine in the Kraaipan Greenstone Belt. It also has a major joint-venture with Newcrest Mining in Papua New Guinea.

    Earlier this year, Harmony raised a whopping $200 million to partially fund a key acquisition of AngloGold’s assets in its home country. The deal is expected to more-than-triple its gold production to as much as 1.8 million ounces per year.

    This time last year, Harmony was trading at just $3.22, dropping to a low of $1.93 in March as a result of the wider market downturn, but it has since soared by 260% in a matter of months, now trading at $6.95 per share.

    AngloGold Ashanti

    AngloGold is the third-largest gold mining company by production volume. And though it has had some problems over the past decade, specifically in the early 2010s when the gold market took a major hit forcing many miners, including AngloGold to shutter operations, the mining giant has persevered.

    AngloGold is one of the more diverse miners on the planet, shielding itself from country-specific regulatory troubles or civil strife. It has operations on four continents including Africa, Australia, South America and North America.

    Though AngloGold hasn’t performed quite as well as some of its peers over the past year, it has shown that it still has the potential for long-term growth. Back in 2015, the company’s share price dropped to just $5.97, but since then, investors who have been able to hold onto the stock have seen a 401% return over a five-year period.  

    Canadian miners are in the race, as well:

    Yamana Gold

     Yamana, has recently completed its Cerro Moro project in Argentina, giving its investors something major to look out for. The company ramped up its gold production by 20% through 2019 and its silver production by a whopping 200%. Investors can expect a serious increase in free cash flow if precious metal prices remain stable.

    Recently, Yamana signed an agreement with Glencore and Goldcorp to develop and operate another Argentinian project, the Agua Rica.  Initial analysis suggests the potential for a mine life in excess of 25 years at average annual production of approximately 236,000 tonnes (520 million pounds) of copper-equivalent metal, including the contributions of gold, molybdenum, and silver, for the first 10 years of operation.

    The agreement is a major step forward for the Agua Rica region, and all of the miners working on it.

    Eldorado Gold Corp. is a mid-cap miner with assets in Europe and Brazil. It has managed to cut cost per ounce significantly in recent years. Though its share price isn’t as high as it once was, Eldorado is well positioned to make significant advancements in the near-term.

    In 2018, Eldorado produced over 349,000 ounces of gold, well above its previous expectations, and boosted its production even further in 2019.

    Eldorado’s President and CEO, George Burns, stated: “As a result of the team’s hard work in 2018, we are well positioned to grow annual gold production to over 500,000 ounces in 2020.  We expect this will allow us to generate significant free cash flow and provide us with the opportunity to consider debt retirement later this year. “

    First Majestic Silver

    Though First Majestic recently took a significant blow, as a strong dollar weighed on precious metals resulting in a poor quarterly earnings report, there’s still a lot of bullishness surrounding the stock. Adding to the negative numbers, however, was a string of highly valuable acquisitions which are likely to turn around for the metals giant in the mid-to-long-term.

    While it’s primary focus remains on silver mining, it does hold a number of gold assets, as well. Additionally, silver tends to follow gold’s lead when wider markets begin to look shaky. And with analysts sounding the alarms of a global economic slowdown, both metals are likely to regain popularity among investors.

    Wheaton Precious Metals Corp.

    Wheaton is a company with its hands in operations all around the world. As one of the largest ‘streaming’ companies on the planet, Wheaton has agreements with 19 operating mines and 9 projects still in development. Its unique business model allows it to leverage price increases in the precious metals sector, as well as provide a quality dividend yield for its investors.

    Recently, Wheaton sealed a deal with Hudbay Minerals Inc. relating to its Rosemont project. For an initial payment of $230 million, Wheaton is entitled to 100 percent of payable gold and silver at a price of $450 per ounce and $3.90 per ounce respectively.

    Randy Smallwood, Wheaton’s President and Chief Executive Officer explained, “With their most recent successful construction of the Constancia mine in Peru, the Hudbay team has proven themselves to be strong and responsible mine developers, and we are excited about the same team moving this project into production. Rosemont is an ideal fit for Wheaton’s portfolio of high-quality assets, and when it is in production, should add well over fifty thousand gold equivalent ounces to our already growing production profile.”

    Pan American Silver

    Pan American is a world-class mining operation with active projects in Mexico, Peru, Canada, Bolivia and Argentina. Though silver has seen better days, it is still a favorite among investors stocking up on safe haven assets.

    Recently, Pan American made a major acquisition of Tahoe Resources, absorbing the company’s issued and outstanding shares.

    Michael Steinmann, President and Chief Executive Officer of Pan American Silver, said: “The completion of the Arrangement establishes the world’s premier silver mining company with an industry-leading portfolio of assets, a robust growth profile and attractive operating margins. We are also now the largest publicly traded silver mining company by free float, offering silver mining investors enhanced scale and liquidity.”

  • A Deal To Sell TikTok Probably Isn't Happening Tuesday – Or Any Time Soon
    A Deal To Sell TikTok Probably Isn’t Happening Tuesday – Or Any Time Soon

    Tyler Durden

    Tue, 09/01/2020 – 18:50

    CNBC assured us yesterday that despite Beijing’s latest attempt to stall any sale of TikTok, that Chinese conglomerate ByteDance could announce a deal with a chosen US partner by the end of Tuesday.

    Well, here we are: The business day has ended in North America, and Asia is just waking up on Wednesday morning, and while reporters have doubled down on their assurances that a deal just might be in the offing, this latest report from the Wall Street Journal highlighting new obstacles to a TikTok sale is a pretty obvious sign that we’re not going to get a deal tonight.

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    But then again, we suspected as much earlier, when President Trump insisted that Sept. 15 would, in fact, be a hard deadline for TikTok to be sold (even though his last EO technically extended that deadline). Whatever the ‘deadline’ may be, Beijing has already clearly signaled that it won’t allow a “smash & grab” deal. For whatever reason, the CCP is pumping the breaks. The other day, we surmised that President Xi might be savoring the chance to stick it to Trump by embarrassing him politically. But in truth, this is probably an ancillary benefit.

    According to WSJ, which cited an anonymous source close to Beijing’s thinking, the goal of China’s latest attempt to obstruct the deal is simply to delay a deal, not to scuttle it completely.

    A delay, this source reasons, would create an opportunity for the Chinese government to have a say as well as to subject it to a level of Chinese government scrutiny similar to that imposed by CFIUS, as Beijing works to bolster the narrative that the US’s claims about national security threats stemming from China are brazen hypocrisies, and that Washington is the real threat to Beijing’s security.

    That Beijing is committing to this approach makes sense, considering what Peter Navarro said after warning his interviewer during an appearance on Fox Business that the US would soon expand its list of Chinese companies to target. After that, Navarro hinted that TikTok had stolen some of the AI technology it used to build its precious ‘core algorithm’ from Alphabet and Microsoft.

    CFIUS has killed several deals involving Chinese companies, including the sale of Grindr, the queer-focused hookup app, to a Chinese company, for fear that it could make members of the US military vulnerable to blackmail.

    Chinese Foreign Ministry spokesman Zhao Lijian responded to a question about a TikTok sale by accusing the US of “economic-bullying and political-manipulation tactics against non-U.S. companies.”

    WSJ’s report noted that Beijing’s decision to force regulatory approval of any sale of TikTok by ByteDance would complicate the talks because the only option ByteDance would have to get around these restrictions would be to sell TikTok to Microsoft-Wal-Mart (or whoever) while retaining the algorithm – something that analysts say would pretty much invalidate the entire point of the deal, since the algorithm is so critical to TikTok’s success.

    Others argued that ByteDance could circumvent Beijing’s restrictions by just selling the shell of the business, allowing the buyer to simply build their own algorithm, like Facebook did when it launched Instagram Reels.

  • Flamethrower-Packing Antifa 'Entered Fetal Position And Began Crying' After Unsuccessful Escape From Cops
    Flamethrower-Packing Antifa ‘Entered Fetal Position And Began Crying’ After Unsuccessful Escape From Cops

    Tyler Durden

    Tue, 09/01/2020 – 18:44

    A 23-year-old Wisconsin man carrying a flamethrower, smoke grenades and fireworks during a Saturday night demonstration in Green Bay ‘dropped into the fetal position and began crying‘ after he was chased down by police.

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    Matthew Banta of Neenah, WI – who is “known to be a violent Antifa member who incites violence in otherwise relatively peaceful protests,” was one of four individuals walking towards a protest with baseball bats, according to ABC2.

    Green Bay police say they were called for “a whole bunch of white people with sticks, baseball bats and helmets headed… towards the police” on Walnut St. near Webster Ave.

    A responding officer says he saw four individuals walking towards a protest with baseball bats. One man was wearing a metal helmet with goggles and military-style gear with multiple pouches, and was carrying an Antifa flag. When the officer pulled his squad car in front of the group, they ran away. The officer caught Banta, who was carrying the flag, and says Banta “dropped into the fetal position and began crying.” He accused the officer of lying on him; the officer replied nobody was on him. –ABC2

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    Banta claims he wasn’t planning to incite a riot (with his flamethrower, smoke grenade and fireworks).

    The three other individuals Banta was with were caught trying to break into a house. When officers apprehended them, they dropped what they were carrying, with one of them telling the police that they were simply bringing items for self-defense.

    Last month, Banta was charged in Waupaca County with second-degree recklessly endangering safety and four other charges for pointing a loaded gun at a police officer, and biting and kicking another.

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  • Trump Lashes Out At Drudge Over "Fake News Report On Mini-Strokes"; Suggests Selfish, Ulterior Motives
    Trump Lashes Out At Drudge Over “Fake News Report On Mini-Strokes”; Suggests Selfish, Ulterior Motives

    Tyler Durden

    Tue, 09/01/2020 – 18:27

    Update (2030ET): In a late Monday statement, Vice President Mike Pence said there was “nothing out of the ordinary” about Trump’s visit to Walter Reed hospital last year, and that he doesn’t recall being told to be on standby.

    “There was nothing out of the ordinary about that moment or that day,” Pence told Fox News,” adding that President Trump is in “excellent health.”

    *  *  *

    President Trump lashed out at the Drudge Report on Tuesday, after the formerly right-leaning news aggregator headlined a rumor from New York Times reporter Michael Schmidt, who claimed that Trump had suffered a series of small strokes last year, requiring Vice President Mike Pence to be on ‘standby’ in case Trump was incapacitated.

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    “Drudge didn’t support me in 2016, and I hear he doesn’t support me now. Maybe that’s why he is doing poorly,” Trump claimed in a Tuesday tweet, adding “His Fake News report on Mini-Strokes is incorrect. Possibly thinking about himself, or the other party’s “candidate”.

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    Earlier in the day, Trump tweeted “Now they are trying to say that your favorite President, me, went to Walter Reed Medical Center, having suffered a series of mini-strokes,” adding “Never happened to THIS candidate – FAKE NEWS. Perhaps they are referring to another candidate from another Party!”

    Of course, it’s perhaps a bit of a stretch for Trump to suggest that Drudge wasn’t pulling for him in 2016. Could this be ‘4D chess’ to force a discussion on Drudge’s clear ideological shift over the past year?

    In April, President Trump retweeted conservative journalist Paul Sperry, who called a Drudge Report headline about coronavirus peaking “disingenuous,” to which Trump said “I gave up on Drudge (a really nice guy) long ago, as have many others. People are dropping off like flies!” His comment was a reference to conservative figures growing less popular, and Drudge losing web traffic, after breaking with Trump, and not the rising death toll in the U.S. from coronavirus.”

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    Drudge responded, telling CNN “The past 30 days has been the most eyeballs in Drudge Report’s 26 year-history,” adding “Heartbreaking that it has been under such tragic circumstances.”

    Former Drudge employee Joseph Curl suggested that Matt Drudge simply wants ‘more turmoil’ and ‘doesn’t give a shit about America.’

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  • Daily Briefing – September 1, 2020
    Daily Briefing – September 1, 2020


    Tyler Durden

    Tue, 09/01/2020 – 18:10

    Senior editor, Ash Bennington, hosts Tony Greer, editor of The Morning Navigator, to discuss how the Fed’s “inflation running hot” memo has been translated by the markets. With a weakening dollar, rally in TIPS, and a steeper yield curve, Tony argues that the asset price inflation happening is the way the Fed had intended it to be and that understanding how the Fed fits into the equation will shape the investor’s understanding of the sustainability of this rally. He and Ash examine the price action and continuous rotation across different sectors as well as how commodities continuing to rip is an expression of an ever-weakening dollar. Tony then provides his forward guidance for the remainder of the week. In the intro, Nick Correa goes over the newest U.S. manufacturing numbers as well as what’s happening with copper and other industrial metals.

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