Aug 03

Today’s News 3rd August 2021

  • Germany Sends Warship To Contested South China Sea For First Time In 2 Decades
    Germany Sends Warship To Contested South China Sea For First Time In 2 Decades

    In an almost unprecedented move, Germany has joined the US and UK in bolstering its military presence in the South China Sea, on Monday sending a warship to contested waters to counter China’s expanding territorial ambitions for the first time in two decades.

    Reuters cited defense officials in Berlin who said “the German navy will stick to common trade routes,” who further described that “The frigate is not expected to sail through the Taiwan Strait either, another regular U.S. activity condemned by Beijing.”

    German Navy’s F 217 FGS Bayern

    “Nevertheless, Berlin has made it clear the mission serves to stress the fact Germany does not accept China’s territorial claims,” the report added.

    German Defense Minister Annegret Kramp-Karrenbauer in a fresh statement stressed that “We want existing law to be respected, sea routes to be freely navigable, open societies to be protected and trade to follow fair rules.” And a statement made last week by Kramp-Karrenbauer explained that “Stronger defense and security cooperation fills the multilateralism that is so important to us with life and strengthens the partnership with friends in Australia, Japan, South Korea and Singapore.”

    The German frigate now en route to the region has been identified as the “Bayern” – which is kicking off a seven month voyage to the Indo-Pacific, including stops in Australia, Japan, South Korea and Vietnam. As the maritime monitoring site Naval News details:

    On the way, exercises are planned with the navies of Australia, Singapore, Japan and the United States of America.

    …The vessel is expected to cross the South China Sea in mid-December, making it the first German warship to pass through the region since 2002.

    Crew members of the Bayern setting off, via DPA

    US pass throughs of the contested Taiwan Strait – again which Germany is not expected to undertake itself – have now been a monthly feature of President Biden’s policy and stance toward China. 

    Berlin has the added pressure, however, of not wanting to introduce new tensions with Beijing given China has lately become Germany’s most important trading partner.

    Tyler Durden
    Tue, 08/03/2021 – 02:45

  • UN Special Rapporteur On Torture Requests Info On German Police Brutalizing Anti-Lockdown Protesters
    UN Special Rapporteur On Torture Requests Info On German Police Brutalizing Anti-Lockdown Protesters

    Authored by Paul Joseph Watson via Summit News,

    The UN’s Special Rapporteur on Torture Nils Melzer has requested more information on an incident in which a female anti-lockdown protester in Berlin was grabbed by the throat and brutally thrown to the ground by riot police.

    As we highlighted earlier, the demonstrations ended up with a whopping 600 people being arrested amidst innumerable brazen examples of police brutality, including against children, that were caught on camera.

    Germans were protesting against plans to ban unvaccinated people from a plethora of different venues, including restaurants, cinemas and stadiums.

    One video clip shows an elderly protester merely attempting to walk past a police officer dressed in riot gear before he grabs her neck with both hands and throws her to the floor.

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    Cops were obviously given orders to enforce a draconian crackdown on the protesters given their behavior throughout the day, which looked like something out of the 1930’s.

    The clip caught the attention of Nils Melzer, a professor of international law, whose official title is United Nations Special Rapporteur on Torture and other Cruel, Inhuman or Degrading Treatment or Punishment.

    “This has just been brought to my attention,” tweeted Melzer.

    “Can anyone provide my office with the specifics / witness statements of this incident and whether an official investigation has been launched?” he asked.

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    It’s highly unlikely that any investigation will take place given that riot police were clearly ordered to conduct themselves with wanton disregard for basic dignity and human rights.

    Another video clip showed a police officer reacting to a young boy’s concern over the treatment of his mother by forcefully pushing him to the floor by his head.

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    Another clip shows two old women also being pushed to the floor by police.

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    Another protester also collapsed and died while being harassed by police to show his ID.

    Anti-lockdown protesters have been vilified and dehumanized by the media and by vaccine cultists who lobby for them to be treated like lepers.

    That’s why such scenes, which would cause outrage if they occurred at a Black Lives Matter or LGBT march, are either totally ignored or callously celebrated.

    *  *  *

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    Tyler Durden
    Tue, 08/03/2021 – 02:00

  • Escobar: The Taliban Go To Tianjin
    Escobar: The Taliban Go To Tianjin

    Authored by Pepe Escobar via The Asia Times,

    China and Russia will be key to solving an ancient geopolitical riddle: how to pacify the ‘graveyard of empires’…

    So this is the way the Forever War in Afghanistan ends – if one could call it an ending. Rather, it’s an American repositioning.

    Regardless, after two decades of death and destruction and untold trillions of dollars, we’re faced not with a bang – and not with a whimper, either – but rather with a pic of the Taliban in Tianjin, a nine-man delegation led by top political commissioner Mullah Abdul Ghani Baradar, solemnly posing side by side with Foreign Minister Wang Yi.

    Lateral echoes of another Forever War – in Iraq – apply. First, there was the bang: the US not as “the new OPEC,” as per how the neo-con mantra had visualized it, but with the Americans not even getting the oil. Then came the whimper: “No more troops” after December 31, 2021 – except for the proverbial “contractor” army.      

    The Chinese received the Taliban on an official visit in order once again to propose a very straightforward quid pro quo: We recognize and support your political role in the process of Afghan reconstruction and in return you cut off any possible links with the East Turkestan Islamic Movement, regarded by the UN as a terrorist organization and responsible for a slew of attacks in Xinjiang.

    Chinese Foreign Minister Wang explicitly said, “The Taliban in Afghanistan is a pivotal military and political force in the country, and will play an important role in the process of peace, reconciliation, and reconstruction there.”

    This follows Wang’s remarks back in June, after a meeting with the foreign ministers of Afghanistan and Pakistan, when he promised not only to “bring the Taliban back into the political mainstream” but also to host a serious intra-Afghan peace negotiation. 

    What’s implied since then is that the excruciatingly slow process in Doha is leading nowhere. Doha is being conducted by the extended troika – US, Russia, China, Pakistan – along with the irreconcilable adversaries, the Kabul government and the Taliban.  

    Mullah Baradar speaks with Chinese Foreign Minister Wang Yi (right foreground) in Tianjin. Photo: Chinese Foreign Ministry

    Taliban spokesman Mohammad Naeem stressed that the Tianjin meeting focused on political, economic and security issues, with the Taliban assuring Beijing that Afghan territory would not be exploited by third parties against the security interests of neighboring nations.

    This means, in practice, no shelter for Uighur, Chechen and Uzbek jihadis and shady outfits of the ISIS-Khorasan variety.   

    Tianjin has been added as a sort of jewel in the crown to the current Taliban diplomatic offensive, which has already touched Tehran and Moscow.

    What this means in practice is that the real power broker of a possible intra-Afghan deal is the Shanghai Cooperation Organization (SCO), led by the Russia-China strategic partnership.

    Russia and China are meticulously monitoring how the Taliban have been capturing several strategic districts in provinces from Badakhshan (Tajik majority) to Kandahar (Pashtun majority). Realpolitik dictates that the Taliban be accepted as serious interlocutors. 

    Pakistan, meanwhile, is working closer and closer within the SCO framework. Prime Minister Imran Khan could not be more adamant when addressing US public opinion: “Washington aimed for a military solution in Afghanistan, when there never was one,” he said.

    “And people like me who kept saying that there’s no military solution, who know the history of Afghanistan, we were called – people like me were called anti-American,” he said. “I was called Taliban Khan.”

    Pakistani Prime Minister Imran Khan (R) meets with Taliban co-founder Mullah Abdul Ghani Baradar (2d from the window on the left side of the picture) and his delegation in Islamabad on December 18, 2020. Photo: AFP / Pakistan Prime Minister Office

    We are all Taliban now

    The fact is that “Taliban Khan,” “Taliban Wang” and “Taliban Lavrov” are all on the same page.

    The SCO is working all-out to present a road map for a Kabul-Taliban political settlement in the next round of negotiations in August. As I have been chronicling it – see, for instance, here and here – it’s all about a comprehensive economic integration package, where the Belt and Road Initiative and its affiliated China-Pakistan Economic Corridor interacts with Russia’s Greater Eurasia Partnership and overall Central Asia-South Asia connectivity.  

    A stable Afghanistan is the missing link in what could be described as the future SCO economic corridor, which will integrate every Eurasian player from BRICS members India and Russia to all Central Asian ‘stans.

    Both President Ashraf Ghani’s government in Kabul and the Taliban are on board. The devil, of course, is in the details of how to manage the internal power play in Afghanistan to make it happen.   

    The Taliban have done their crash course on geopolitics and geoeconomics. In Moscow, in early July, they had a detailed discussion with Kremlin envoy for Afghanistan Zamir Kabulov.

    In parallel, even the former Afghan ambassador to China, Sultan Baheen – no Taliban himself – admitted that for the majority of Afghans, irrespective of ethnic background, Beijing is the preferred interlocutor and mediator in an evolving peace process.    

    So the Taliban seeking high-level discussions with the Russia-China strategic partnership is part of a carefully calculated political strategy. But that brings us to an extremely complex question: To which Taliban are we referring? 

    There’s no such thing as a “unified” Taliban. Most old-school top leaders live in Pakistan’s Balochistan. The new breed is way more volatile – and feels no political constraints. The East Turkestan Islamic Movement, with a little help from Western intel, might easily infiltrate some Taliban factions inside Afghanistan. 

    Very few in the West understand the dramatic psychological consequences for Afghans – whatever their ethnic, social or cultural backgrounds – of living essentially under a state of non-stop war for the past four decades: USSR occupation; intra-mujahideen fighting; Taliban against Northern Alliance; and US/NATO occupation.

    In February 1980 Afghan refugees who have fled the area of Kabul in December 1979, are shown in the Aza Khel refugee camp near Peshawar in Pakistan. Photo: AFP / EPU

    The last “normal” year in Afghan society was way back in 1978.     

    Andrei Kazantsev, a professor at the Higher School of Economics and director of the Center for Central Asia and Afghanistan Studies at the elite MGIMO in Moscow, is uniquely positioned to understand how things work on the ground.

    He notes something I saw for myself numerous times; how wars in Afghanistan are a mix of weaponizing and negotiation:

    There is a little fighting, a little talking, coalitions are formed, then there is fighting again; talking again.

    Some have defected over, betrayed each other, fought for a while, and then returned. It’s a completely different culture of warfare and negotiation.

    The Taliban will simultaneously negotiate with the government and continue their military offensives. These are just different tools of different wings of this movement.

    I’m buying: how much?

    The most important fact is that the Taliban are, de facto, a constellation of warlord militias. What this means is that Mullah Baradar in Tianjin does not speak for the whole movement. He would have to hold a shura with every major warlord and commander to sell them whatever political road map he agrees with Russia and China.

    This is a huge problem as certain powerful Tajik or Uzbek commanders will prefer to align themselves with foreign sources, say Turkey or Iran, instead of whoever will be in power in Kabul.

    The Chinese might find a detour around the problem by literally buying everyone and his neighbor. But that still wouldn’t guarantee stability.

    What Russia-China are investing in with the Taliban is to extract iron-clad guarantees:

    • Don’t allow jihadis to cross Central Asian borders – especially Tajikistan and Kyrgyzstan;

    • Fight ISIS-Khorasan head-on and don’t allow them sanctuary, as the Taliban did with al-Qaeda in the 1990s; and

    • Be done with opium poppy cultivation (you did give it up in the early 2000s) while fighting against drug trafficking.

    An Afghan farmer harvests opium sap from a poppy field in Dara-l-Nur, District of Nangarhar province, in 2020. Photo: AFP / Wali Sabawoon / NurPhoto

    No one really knows whether the Taliban political wing will be able to deliver. Yet Moscow, much more than Beijing, has been very clear: If the Taliban go soft on jihadi movements, they will feel the full wrath of the Collective Security Treaty Organization.

    The SCO, for its part, has kept an Afghan contact group since 2005. Afghanistan is an SCO observer and may be accepted as a full member once there’s a political settlement.

    The key problem inside the SCO will be to harmonize the clashing interests of India and Pakistan inside Afghanistan.

    Once again, that will be up to the “superpowers” – the Russia-China strategic partnership. And once again, that will be at the heart of arguably the top geopolitical riddle of the Raging Twenties : how to finally pacify the “graveyard of empires.”  

    Tyler Durden
    Mon, 08/02/2021 – 23:40

  • Americans Tend To Stick To Their Stance On COVID-19 Vaccines
    Americans Tend To Stick To Their Stance On COVID-19 Vaccines

    As U.S. health officials and the Biden administration desperately try to kickstart the stalling rollout of COVID-19 vaccines in face of the highly contagious Delta variant, President Biden gave a speech on Thursday, where he once again urged Americans to get vaccinated and announced additional steps to encourage vaccination.

    Source: Bloomberg

    Echoing statements from the CDC and his chief medical advisor Dr. Anthony Fauci, Statista’s Felix Richter notes that Biden referred to the current situation of rising infections as a “pandemic of the unvaccinated”, calling the fact that unvaccinated Americans are dying despite the availability of an effective vaccine “an American tragedy”. He went on to emphasize that getting vaccinated is not a political statement, nor is it a proper exercise of personal freedom. “With freedom comes responsibility,” Biden said. “Your decision to be unvaccinated impacts someone else. So, please, exercise responsible judgement. Get vaccinated — for yourself, for the people you love, for your country.”

    Biden then urged employers to offer paid time off for workers to get themselves and family members vaccinated. He also called on local and state governments to offer a $100 cash bonus to those who get fully vaccinated, hoping that a little monetary incentive could at least sway those undecided on whether to get jabbed. Finally, stopping just short of a mask mandate for federal employees, he announced several inconveniences for unvaccinated federal workers, including a mask mandate, strict testing rules and being banned from work-related travel.

    As the following chart, based on findings from KFF’s COVID-19 Vaccine Monitor, suggests, Americans aren’t easily persuaded when it comes to their stance on COVID-19 vaccines.

    Infographic: Americans Tend to Stick to Their Stance on COVID-19 Vaccines | Statista

    You will find more infographics at Statista

    Having circled back to a group of respondents originally surveyed in January, KFF found that two thirds of those who did not want to get a vaccination in January stand firm on their refusal to get jabbed, with another 9 percent wanting to wait and see.

    Meanwhile 24 percent of those against the vaccine in January ended up with at least one dose in June, most of them convinced by family members or their employers. Of those who were keen to get vaccinated in January, 92 percent have received at least one dose by now, while another 3 percent plan to get it asap.

    Tyler Durden
    Mon, 08/02/2021 – 23:20

  • Is This What's Really Behind The War On Home-Ownership?
    Is This What’s Really Behind The War On Home-Ownership?

    Authored by Kit Knightly via Off-Guardian.org,

    Becoming a “Nation of Renters” is clearly a big part of the New Normal…

    The incipient “Great Reset” is a multi-faceted beast. We talk a lot about vaccine passports and lockdowns and the Covid-realated aspects – and we should – but there’s more to it than that.

    Remember, they want you to “own nothing and be happy”. And right at the top of the list of things you definitely shouldn’t own, is your own home.

    The headlines about this have been steady for the last few years, but it has picked up pace in the wake of the “pandemic” (as has so much else). An agenda hidden on back pages, behind by Covid’s meaningless big red numbers, but perhaps no less sinister.

    You can find articles all over the net talking up renting over owning.

    Last month, for example, Bloomberg ran an article headlined:

    America Should Become a Nation of Renters”

    Which praises what they call “the liquefaction of the housing market” and gleefully expounds on the idea that “The very features that made home buying an affordable and stable investment are coming to an end.”

    The Atlantic published “Why Its Better To Rent Than Own” in March.

    Financial pages from Business Insider to Forbes to Yahoo and Bloomberg again are filled with lists titled “9 Ways Renting is Better Than Buying”, or similar.

    Other publications go more personal with it, with anecdotal columns about ignoring financial advice and refusing to buy your home. Vox, never one to sell their agenda with any kind of subtlety, have a piece titled:

    Homeownership can bring out the worst in you

    Which literally argues that buying a house can make you a bad person:

    It’s the biggest thing you might ever buy. And it could be turning you into a bad person.

    So what exactly is the narrative here? What’s the story behind the story?

    The short answer is fairly simple: It’s about greed, and it’s about control.

    It almost always is, in the end.

    The longer answer is rather more complicated. Major investment firms such as Vanguard and Blackrock, along with rental companies such as American Homes 4 Rent, are buying up single-family homes in record numbers – sometimes entire neighbourhoods at a time.

    They pay well over market value, pricing families who want to own those homes out of the market, which forces the housing market up whilst the Lockdown-created recession is lowering wages and creating millions of newly unemployed.

    Of course, this is motivating people to sell the houses they already own.

    People all across America have been saddled with houses worth less than they bought them for since the 2008 economic crash, and are eager to take the cash from private investment firms paying 10-20% over market value. Combine an economic recession with a created housing boom and you have a huge population of motivated sellers.

    Of course, many of these sellers don’t realise, until it’s too late, that even if they attempt to downsize or move to a cheaper area, they may be priced out of the market completely, and forced to rent.

    As such, in the last year, the private investment share of single-family home purchases is estimated to have increased ten-fold, going from 2% in 2018 to over 20% this year.

    As more and more people are forced to rent, of course, rental properties will be in higher and higher demand. This in turn will drive the cost of renting up.

    Market Watch has already reported that, in the last year, rent has increased over 3x faster than the government predicted.

    This problem is likely to get worse in the near future.

    Last night, Congress “accidentally failed” to extend the Covid-related eviction ban.

    Which means, this weekend, while Senators adjourn to the summer homes they probably don’t rent, the ban will officially end and a lot of people are likely to have their houses foreclosed or their landlords kick them out.

    The newly empty buildings will be a feeding frenzy for the massive corporate landlords. Who will descend on the banks like starving hyenas to snap up the foreclosed properties for pennies on the dollar. Just like they did in 2008.

    None of this is any secret, it’s been covered in the mainstream. Tucker Carlson even did a segment on it in early June.

    The Wall Street Journal headlined, back in April, “If You Sell a House These Days, the Buyer Might Be a Pension Fund”, and reported:

    Yield-chasing investors are snapping up single-family homes, competing with ordinary Americans and driving up prices

    However, since then, something has clearly changed. The propaganda machine has kicked into gear to defend Wall Street from any backlash.

    No better example of this shift can be found than The Atlantic, which ran this story in 2019:

    WHEN WALL STREET IS YOUR LANDLORD

    With help from the federal government, institutional investors became major players in the rental market. They promised to return profits to their investors and convenience to their tenants. Investors are happy. Tenants are not.

    …and this story last month:

    BLACKROCK IS NOT RUINING THE US HOUSING MARKET

    The real villain isn’t a faceless Wall Street Goliath; it’s your neighbors and local governments stopping the construction of new units.

    Going back to the Vox well we have:

    Wall Street isn’t to blame for the chaotic housing market

    Which ran just a few days after the Atlantic article, and is practically identical.

    Both these (oddly similar) articles argue that Wall Street and private equity firms can’t be blamed for buying up houses, and that the real problem is the lack of supply to meet demand.

    You see, all the “selfish” people who already own homes (they did say it makes you a bad person) are blocking the construction of new houses, and thus driving up the cost of property through scarcity.

    This has been a logically flawed argument around the housing market for decades.

    That there aren’t enough houses for people to buy is patently absurd when the US census data says that there are over 15 million houses currently standing empty. That’s enough to house all of America’s roughly 500,000 homeless people 30x over.

    There’s plenty of houses, there’s just not enough money to buy them.

    The reason for that is the same reason the California has massive “homeless camps” in its major cities, and that so many people are having to become renters instead of owners: wage stagnation.

    For decades now, wage increases have lagged behind increases in the cost of living. In the 1960s one full-time job could afford a decent standard of living for a family of four or more. These days both parents work, sometimes multiple jobs each.

    It was huge amounts of financial de-regulation which created this situation. So, whether you believe Vox’s BlackRock apologia or not, one way or another Wall Street very definitely is to blame.

    But this isn’t just about money. It never is. Just as the war on cash isn’t just about efficiency, and the environmental push isn’t just about climate change. Ditto veganism. It’s about control. Just like vaccines, lockdowns and masks.

    It always comes down to control.

    It’s an oft-used cliche, but no less true for that, that homeowning “gives people a stake in society”. A family-owned house is a source of security for the future and something to leave your children. It is also sovereignty and privacy. Your own space that no one else can control or take away.

    In short: A homeowner is independent. A renter is not. A renter can be controlled. A homeowner can not.

    It’s the same reasoning behind the way working people were encouraged to take out loans and become debt slaves. If you limit people’s options, if you make them rely on you for a roof over their heads, you have control over them.

    There’s a great article about this situation called “Your New Feudal Overlords”.

    Under Feudalism, land wasn’t owned by the working class, but provided to them by landed barons, hence the term “Land Lord”. If you disrespected your Lord, or broke his rules, or he perceived another peasant/farm animal/crop would be a better use of the land, he could take it back.

    Essentially, the behaviour of serfs was kept in check by their reliance on the nobility for a place to live. That’s very much the dynamic they’re going for here.

    Rental agreements can be full of any terms and conditions the landlord wants, and the more desperate people get the more of their consumer rights they will sign over.

    Maybe you’ll agree to smart meters which monitor your internet or power-usage habits, and then sell the data to behavioural modellers and viral marketers.

    Maybe you’ll have to agree to certain power limitations or water shortages in order to “fight climate change”.

    Maybe it will get worse than that.

    Maybe they’ll go full Black Mirror style corporate dystopia. Maybe, through affiliation programs, the mega-equity firm which owns your rental house has ties to McDonald’s, and as such will require you to not eat at any competing fast-food franchises, or demand you observe at least ninety seconds of Disney advertisements per day.

    Maybe it will be as simple as including vaccine status in the tenancy agreement, making it impossible for the unvaxxed to find a home.

    Maybe they just want to make poor people miserable.

    After all, the super-wealthy have got all the money they could ever need, and all the luxury they could ever use. Their living standards are as high as physically possible. So maybe the only way they can keep “winning”, is to start driving the living standards of us proles down.

    No air travel. No vacations. No going out at all. Live in a tiny house, or a pod. Eat bugs. Get rid of your car. Rent your clothes. Or your furniture. Pay taxes on sugar. And alcohol. And red meat.

    They’ve been very clear about this. They’ve told you about the Great Reset and the Internet of Things. That’s the plan.

    You won’t own a house. And you’ll be happy…or else the mega-corporation you’re forced to rent from will kick you out.

    Tyler Durden
    Mon, 08/02/2021 – 23:00

  • The $1.2 Billion Snub: Scholastic Corp. Boss Cuts Family From Will And Leaves Fortune To Former Lover
    The $1.2 Billion Snub: Scholastic Corp. Boss Cuts Family From Will And Leaves Fortune To Former Lover

    In a move that is likely going to prompt litigation for centuries to come, M. Richard “Dick” Robinson Jr., the late owner of Scholastic Corp., the book company responsible for publishing books like “Harry Potter”, has snubbed his family and left his entire fortune – worth $1.2 billion – to his former lover.

    Robinson died on June 5 while in Martha’s Vineyard and his will directed that his fortune be left to his “longtime romantic partner” Iole Lucchese, according to the NY Post.

    Lucchese is Scholastic’s chief strategy officer. A copy of Robinson’s will was reviewed by the Wall Street Journal, who said it called Lucchese “my partner and closest friend.” 

    Family members told the Journal they’re “unhappy” about the firm being left to Lucchese, who they called an “outsider”. They’re also apparently upset that Lucchese will have control of Robinson’s personal possessions, the report said.

    And so goes the the inevitable plunge into the legal system, as the family is reportedly “reviewing their legal options” and seeking to cut a deal with Lucchese.

    Robinson’s youngest son, who is 25, called the move “unexpected and shocking”. “What I want most is an amicable outcome,” he said. 

    Robinson’s 34 year old son said he had never even met or spoken to Lucchese. The family held a call with her last week. The son “operates a sawmill and workshop that produces lumber, flooring and furniture from trees in Martha’s Vineyard,” the Post reported. 

    Robinson’s younger brother said: “Our family value was we’d rather not have the financial benefit that we might get from a sale if it means the company won’t be in the future what it was. Everybody knows Scholastic and has a good feeling about it and it does good things for teachers. It’s more than just a business for us.”

    One of Robinson’s sisters commented to the Journal: “Our first goal is the continuation of the mission and legacy of Scholastic, the vision and brilliant lifework of both our father and our brother Dick, and we are confident that the new management of the company is fully committed to this goal.”

    Robinson’s will named Lucchese as co-executor of his will, alongside of Scholastic’s general counsel, Andrew Hedden. Lucchese is tasked with distributing Robinson’s personal possessions “with the request, but not the direction” that she hand out items “as she believes to be in accordance with my wishes,” the Post wrote.

    “You might think from the will that he didn’t see his sons. That’s not true. For the last two years I saw him multiple times a week,” Robinson’s youngest son said. 

    Robinson reportedly spoke about how he had to work his way up at the company, which neither of his sons did. Lucchese now owns 53.8% of the company’s Class A shares – about 3 million shares – which hold the majority of the the voting power. 
     

    Tyler Durden
    Mon, 08/02/2021 – 22:40

  • America's Chinese Fentanyl Flood
    America’s Chinese Fentanyl Flood

    Authored by Grant Newsham via The Epoch Times,

    Foreigners have been buying—or at least renting—America’s ruling class since the republic was founded. Almost exactly 225 years ago, in his 1796 Farewell Address, George Washington warned against “the insidious wiles of foreign influence,” adding that “foreign influence is one of the most baneful foes of republican government.”

    In modern times, Saudis, Japanese, South Koreans, and Israelis—to name a few—have all managed to purchase influence. But the usual goal is to gain advantages for their own nations. What we are seeing now is something much more dangerous—using influence to corrode the United States from within.

    One nation is pouring highly addictive and unpredictable illicit drugs into the American bloodstream – killing tens of thousands a year. And the American elites are doing absolutely nothing about it. Now THAT is influence.

    The drug? Fentanyl. The country? Communist China.

    Fentanyl mostly originates in China, often moving via Mexico (and Mexican drug gangs) into the United States. The Chinese are also into the money laundering part of the business—helping drug gangs launder (or recycle) their massive earnings. Talk about a “win-win”—as the Chinese communists like to say.

    Casualties

    The deluge started around 2013 and has picked up steadily since then. The numbers are staggering.

    In 2017, 28,000 Americans died of overdoses involving fentanyl.

    In a 2018 meeting with President Donald Trump, Chinese leader Xi Jinping pledged to restrict all fentanyl-like substances. Trump declared this a “gamechanger.” Not surprisingly, the fentanyl and drugs kept flowing.

    In 2019, over 37,000 Americans died from fentanyl overdoses. That’s nearly five times the number of American troops killed in the wars in Iraq and Afghanistan.

    In 2020, the U.S. government reported 93,000 American residents died from a drug overdose—the vast majority from fentanyl poisoning. The COVID-19 lockdowns have helped bump up the already horrific death totals.

    Yet, even as the death toll mounts, U.S. businesses and financial titans never mention it. The think tanks are mostly silent. Academia? Can’t be bothered. The U.S. media often downplays or ignores the fentanyl bloodbath, and even more so the source, seemingly afraid to mention the C-word, China.

    Packets of fentanyl mostly in powder form and methamphetamine, which U.S. Customs and Border Protection say they seized from a truck crossing into Arizona from Mexico, is on display during a news conference at the Port of Nogales, Ariz., on Jan. 31, 2019. (U.S. Customs and Border Protection/Reuters)

    And on Capitol Hill where there’s bold, blustery, “bi-partisan” talk about taking on the Chinese regime, when it comes to fentanyl and China one hears little.

    Excuses

    Even the Trump administration—the firmest yet in standing up to China—didn’t make so much of the fentanyl issue, though Mr. Trump raised it directly with Xi, and others did try.

    One official suggested calling the “fentanyl scourge” the “Third Opium War.”  The response from inside the Beltway was immediate and visceral: “You can’t say that” (when it comes to China there’s all sort of things “you can’t say”).

    In this case, the response was particularly curious as, in some quarters (including in China), there is a tendency to excuse Chinese non-cooperation as payback for the Opium Wars of the 19th century.

    Payback? The Opium Wars were 180 years ago. By that logic, slave labor in Xinjiang is “payback” for the pre-Civil War plantations. How does creating new despair and death rectify old despair and death?

    American elites also have plenty of other “insider” excuses for why the Chinese regime (or, better said, won’t) stop the illicit drug flow.

    Three of the most common:

    1) The Chinese regime is in a legal bind as fentanyl producers keep jiggering the formula to avoid the “illegal list” and therefore the producers are always one step ahead of a government that can’t revise laws fast enough, try as it might.

    A nice excuse, but in China the law is what Xi and the Chinese Communist Party (CCP) say it is, as even billionaire Jack Ma and any number of other powerful and well-connected Chinese tycoons and officials have discovered the hard way. If Beijing wants to shut down fentanyl producers the law is no obstacle.

    2) Chinese local authorities, supposedly outside of Beijing’s reach, won’t stop fentanyl production since they want tax revenues and employment—and are also thoroughly corrupt.

    True enough. But local officials are also frightened of being caught crossing Beijing—everyone knows what happed to Ma.

    3) Chinese authorities can’t locate the illegal drug producers. China is a big place, you know.

    The CCP is creating a surveillance state that even George Orwell couldn’t have imagined. Draw a mustache on a poster of Xi and see how long it takes to be arrested and imprisoned. Post on social media that Xi resembles Winnie the Pooh and you’ll have Ministry of State Security agents at your front door in minutes.

    The CCP police can do whatever they want. “Disappear” people, arrest starlets, kidnap billionaires and booksellers—take foreigners hostage and lock them up? No problem. The only restraints come from Zhongnanhai—the very top of the CCP.

    The fact the Chinese regime doesn’t ban fentanyl in its entirety—much less go after producers the way it goes after Uighurs, Christians and Falun Gong, or Hong Kongers—suggests the CCP is glad America is awash in fentanyl.

    And when Trump told Xi to knock off the fentanyl flow back in 2018, Xi reportedly replied: “We don’t have a drug problem in China.” That means Xi can control the drugs and he’s channeling the chemical warfare agents—in true “unrestricted warfare fashion”—towards his #1 rival and greatest enemy. Most things involving the CCP just aren’t that hard to figure out.

    The Effects of China’s Chemical Warfare

    The carnage can’t be overstated. Fentanyl is ravaging all parts of American society. And about half of the deaths attributed to fentanyl are young people of military age.

    As one former U.S. government official noted, this is the equivalent of removing five or six divisions of Army or Marines off the rolls every year. And don’t forget the “battlefield casualties” who survive but can no longer function as productive members of society, the burden and expense of caring for them, and the devastated families left broke and broken.

    One hears elites who should know better say the victims are just “druggies” and wouldn’t have joined the military anyway. That’s malicious and wrong. Young people have been misbehaving for centuries, and that includes many who join the U.S. military. But a six-pack or a joint is one thing; a difficult to identify drug that is often mislabeled and unpredictably kills or permanently disables in minute quantities, is quite another.

    From China’s perspective, what’s not to like? You’re weakening your avowed enemy, which you plan to dominate by mid-century. And, even better, the CCP makes a lot of money from the drug trade—and in convertible currency. Buy fentanyl and you pay in dollars.

    Accomplices

    While China is ultimately to blame, it is America’s own ruling class that refuses to do anything about it for fear of “offending” China. Or, more accurately, for fear of not being able to feed their own addiction—to Chinese money. Money that, in some small part, may have come from selling fentanyl to Americans in the first place.

    Maybe overlooking 93,000 dead countrymen and exponentially more left in the wreckage in exchange for Chinese cash is easier when you think it’s just deplorables and Neanderthals in fly-over country who are dying.

    It can’t be helped if these people were too stupid and lazy to “learn to code” or to get a Wharton MBA when their jobs, livelihoods, and communities were shipped overseas from the 1990s onwards—mostly to China—by those same political and business elites.

    Countering ‘the Most Baneful Foes’

    Watching America’s elites do nothing – or worse even calling for unrestricted engagement with the Chinese regime – one concludes that the Chinese have indeed gotten their money’s worth from America’s ruling class.

    Just listen to the head of the U.S.–China Business Council, or the CEO of Boeing, or Nike, or Apple if you don’t believe me.

    ‘Chemical warfare’ as suspected 44 lbs of Fentanyl seized by law enforcement officials in Dayton, Ohio during the week of Oct. 21, 2019. (Montgomery County Ohio Sheriff’s Office)

    Here’s an idea: require prospective graduates from elite MBA and International Relations programs, as well as Congressional staffers—and maybe even members of Congress themselves—to spend a couple of weeks in the so-called “Rust Belt” that’s been hit both by fentanyl and the carnage caused by the pedigreed classes when industries and jobs were shipped off to China.

    Try: Youngstown, Ohio; Uniontown, Pennsylvania; Buffalo, New York; or East Cleveland, if you need some idea. Though the list could be much, much longer. Put them up in a local motel and require them to be outside on the streets from 8 a.m. to 10 p.m. “soaking in the atmosphere.”

    And maybe, for a break, accompany the EMTs out on drug overdose calls. Or stop off at the local high schools and sit in with the guidance counselors—just to get a sense of things and the bright futures too many of these kids face.

    Is this likely? No.

    One gets the impression America’s Best and Brightest just don’t care. They have become willing accomplices to the “baneful foes.”

    This is particularly infuriating because we can fight back. China is not invulnerable. They’ve hit us where it hurts—in our families and communities. We need to hit them where it hurts—in their elites.

    Message to President Joe Biden:

    You have sworn to protect American citizens, not to ensure Wall Street and U.S. industry can take advantage of Xi’s umpteenth promise to “open up.”

    So do one or, ideally more, of the following:

    First, suspend all Chinese financial institutions from the U.S. dollar network. Start with the People’s Bank of China.

    Second, immediately de-list every Chinese company from the New York Stock Exchange and other exchanges. They should not have been listed in the first place.

    Third, revoke the Green Cards and visas—and place liens on the properties and bank accounts—of the top 500 CCP members’ relatives in the United States.

    China can stop pushing drugs into America. It just needs a reason to do so. And we need to give them one. And, at the same time, we need to break our most “insidious” addiction, the one of our elites to Chinese money.

    Tyler Durden
    Mon, 08/02/2021 – 22:20

  • Tesla Megapack Battery Fire In Australia Finally Extinguished After Four Days Of Burning 
    Tesla Megapack Battery Fire In Australia Finally Extinguished After Four Days Of Burning 

    Four days ago, we reported a shipping container-sized Tesla Megapack battery unit at the world’s largest energy storage project, operated by France’s Neoen SA, in Australia’s Victoria, dubbed “Victorian Big Battery,” caught fire during a test-run. 

    Victoria Country Fire Authority (CFA) published a statement Monday that said the 13-ton battery was finally extinguished after four days, according to Bloomberg. 

    “There was one battery pack on fire to start with, but it did spread to a second pack that was very close to it,” Chief CFA Fire Officer Ian Beswicke said in a statement. CFA has yet to determine the origins of what caused the Tesla battery to combust spontaneously. 

    On Friday, when the fire was first reported, CFA officials were so concerned about toxic fumes spewing from the battery unit that they issued air quality warnings for surrounding suburbs and urged people to move indoors. 

    The problem with lithium-ion batteries is that besides emitting toxic fumes during a blaze, the sheer amount of water to extinguish the fire is not ESG-friendly. 

    For a regular Tesla car battery weighing around 1,200 pounds, it takes about 20 tons of water to put out the blaze. Some Tesla vehicle fires have taken upwards of 75 tons of water. 

    Now picture a 13-ton, or approximately 26,000-pound battery catching fire and the amount of water needed to extinguish it. CFA didn’t release the number of tons of water it took to extinguish the blaze, but statements show it took four days to put out flames. 

    As for the considerable amounts of gas and smoke emitted from the lithium-ion battery blaze, there has yet to be any quantifiable data released by CFA detailing the environmental impact. 

    The whole ESG push for “green technology” on the grid sounds wonderful, but if a mishap occurs, firefighters do not have the technology to quickly and efficiently put out a lithium-ion battery blaze. 

    Tyler Durden
    Mon, 08/02/2021 – 22:00

  • Incompetence + Arrogance = Woke
    Incompetence + Arrogance = Woke

    Authored by Victor Davis Hanson via Summit News,

    Politically correct ideology is masking and contributing to the widespread failure of our institutions…

    We know the nature of mass hysterias in history, and how they can overwhelm and paralyze what seem to be stable societies.  

    We know the roots and origins of the cult of wokeness.  

    And we know, too, how such insanity—from the Salem witch trials to Jacobinism to McCarthyism—can spread, despite alienating most of the population, through fear and the threat of personal ruin or worse. These are the dark sides of the tulip, hula-hoop, and pet-rock fads, the mass obsessions so suited to past affluent Western societies.  

    But does wokeism serve another purpose as well? Specifically, does it either hide preexisting incompetence or fuel it?  

    In the last 18 months, we have seen most of our major institutions go woke and spend considerable amounts of time, capital, and labor on what might be called “commissarism.” Yet in their zeal to rectify society in general and sermonize, virtue signal, pontificate, and perform to the public, many institutions are increasingly failing at what they were established to do. 

    Of course, public servants have long suffered the “Bloomberg effect”—focusing on misdemeanors to virtue signal competence as penance for failing to solve the existential crises. If you cannot clear New York City of snow in a timely manner, then lecture the trapped on everything from global warming to the dangers of super-sized soft drinks. Yet wokeism is a bit different since it now pervades our societies as a pandemic of its own.

    Take Delta Airline CEO Ed Bastian. He earns $17 million in annual compensation, and lectures the state of Georgia and the nation at large on our supposedly racist voting laws. The issue at hand is mostly a requirement to show a valid ID to vote—in the manner one must present identification to enter the boarding area of Bastian’s planes. Surely if one should vote without an ID, why not then be allowed to board a Delta flight?

    I also suggest the public try to call Delta’s consumer helplines to fix the airline’s post-quarantine screw-ups with credits, refunds, rebooking, and recalibrating charges. Just try it—but expect several hours of wait time on the phone. We know now Delta is woke, but what we don’t know is whether one’s past purchase of a ticket will ensure a spot on a Delta flight, or whether prior money or mileage credited will ever be returned or applied to future travel.  

    A cynical observer might suggest that if Ed Bastian cannot ensure adequate consumer service, it won’t matter since he weighs in on voting laws. (Or is it worse than that? Because he pontificates on voting laws and other assorted woke issues, he thinks he can simply worry less about his own consumer services?) 

    American Airlines CEO Doug Parker is woke, too. He has denounced a new Texas voting law likewise requiring tougher ID usage—although he later  admitted that he had never read the new statute before virtue signaling its illiberality.  

    I suggest Parker might first ensure that his airline has not become a Third-World carrier before he seeks to enlighten Americans on their supposed backwardness. I just took a flight on one of Parker’s American Airlines flights from central California to Dallas, Texas. But right before boarding the full flight, passengers were apprised that American did not have enough gas in the plane to make it to Dallas—and couldn’t find any in Fresno. So it was “stopping off” on the way in San Francisco to “fill up”—180 miles away and in the exact opposite direction of its eventual destination. I’ve only twice been on a plane without enough fuel to reach its destination and in need of a detour to find gas somewhere— once 15 years ago in Mexico and the other in 1974 in Egypt.  

    We’ve seen an epidemic of well-compensated professional (and Olympic) athletes lecture the country on its various sins of racism, sexism, and the usual affiliated -isms and -ologies. Like the now passé Colin Kaepernick, they devote enormous time to what in normal times would be called extraneous efforts or even distractions from their business at hand. 

    Is there a connection between their wokeness and the general lack of interest in the NBA, Major League Baseball, NFL, and the Tokyo Olympics? Is the public sense not just that they do not wish to be talked down to by such privileged and spoiled 20- and 30-somethings, but also that the level of play of professional and amateur sports seems on the decline as well? Or is it that these woke, young athletes can handle sports or social hectoring, but not both—and it shows in their performances and in the lack of mass appeal?

    Hollywood is the worst offender. Almost daily a mega-star joins the outrage twitter chorus to remind us of her exemplary virtue or his singular outrage over “social injustice.” They belong to this strange collection of celebrity-obsessed multi-millionaires whose homes, lifestyles, modes of transportation, and fashion are Versailles-like—yet whose daily lives never quite match their sanctimonious barking.  

    The real travesty is that Hollywood simply makes poor movies, or rather mostly remakes them ad nauseam, ensuring only that they are “diverse” and proportionally—or now reparationally—representative of “the other.” Two genres tend to dominate the current movies: computer-enhanced comic-book films (sometimes apparently white-washed by progressive executives so as not to offend the racist 1.5 billion-viewer Chinese market), and “the hero versus the Man” movies.  

    The latter usually pits an attractive and courageous young investigator, lawyer, journalist, whistleblower, or public servant against a malicious conspiratorial corporation whose racism, environmental desecration, sexism, and thievery must be exposed in gallant, lone-ranger fashion. Not only are these Maoist scripts boring and repetitive but they sprout from a self-indulgent, hyper-corporate Los Angeles capitalist culture that gave us the Hollywood-beloved, and woke-before-his-time Harvey Weinstein. 

    Universities are the old-new woke bastion. We will probably never know the machinations used by our elite colleges and universities to warp race in favor of some, and against others, among this year’s first incoming class of the post-2020 riot era. 

    Mostly wealthy, white bicoastal administrators and middle managers across all sectors send out communiques, on spec, attesting to their own superior virtue with vocabulary so trite and predictable that a computer programmer could institutionalize and improve on the boilerplate in a few hours. Their bogeyman target is the noxious white male heterosexual—of course, exempting the memo writers themselves, due to their superior morality.  

    The woke have unleashed a veritable jihad to root out and banish those infected with “whiteness” among us. But aside from their main mission of promoting diversity, equity, and inclusion, can we say that woke universities—on the side—are turning out talented and educated graduates who will ensure American prosperity, freedom, preeminence, and the sort of lifestyle the young now assume as their birthright? To ask the question is to know the answer. What else could happen when there are more diversity, equity, and inclusion facilitators on elite campuses than there are history professors? 

    Is the general knowledge of the college student superior to his counterpart of five, 10, or 20 years ago?  Did the great experiment with various “studies” courses (black studies, peace studies, environmental studies, equity studies, Asian studies, La Raza studies, etc.) result in better writers, thinkers, speakers, analysts, mathematicians, and scientists than what was produced by the old Shakespeare English course, or Western Civ highlights from Homer to Locke, or advanced calculus? Is the campus more tolerant than it was in 1980, more open to free speech, more determined to protect the constitutional rights of its students? 

    The military is an especially good example of a major American institution whose woke credentials are now ostentatious, but whose performance in a cost-to-benefit analysis seems increasingly anemic. 

    We know that the chairman of the Joint Chiefs of Staff, General Mark Milley, is popular for the moment with the Left in Congress. As a result, like many of his predecessors, if he wishes, Milley can gravitate to lucrative defense contractor boards upon retirement—without a finger-pointing Senator Elizabeth Warren (D-Mass.) castigating him as a get-rich, revolving-door apparatchik.  

    Milley and others, such as Admiral Michael Gilday, have given spirited, if incoherent, defenses of why they want their enlistees to read Ibram X. Kendi’s texts on “antiracism”—or at least why they want the Washington elite to know they recommend them to their soldiers and sailors. We know that multimillionaire ex-Raytheon board member, consultant, and now defense secretary, General Lloyd Austin is auditing the ranks to weed out suspicious white male insurrectionaries, an investigation that so far seems to lack any actual data to justify said witch hunt. The chain of command, which can enact social change by fiat, is in this case beloved by the Left. And the officer corps has made the necessary adjustments to ensure their own rapid promotions. 

    Thus, there is little protest about the military budget being slashed by the beloved Joe Biden, after it was markedly raised by the hated Donald Trump, who among his many other sins jawboned the NATO allies finally to pony much of their promised military contributions to the alliance. 

    Milley’s earlier apologies for doing a photo-op with President Trump while the rascal supposedly cleared the environs with tear gas were mostly empty virtue signaling, given the inspector general of the Interior Department found no such presidential edict or any use of such an agent.  

    Indeed, a dozen or so of our best and brightest retired four-stars had blasted their former commander-in-chief as fit for removal the “sooner, the better,” a veritable monster who employed Nazi-like tactics, emulated Mussolini, and took his immigration policy in part from Auschwitz.

    But was such energy, rhetorical imagination, and refined conscience evident in our stellar victories in Afghanistan and Iraq? Was the Libyan intervention a model of military planning, on both the strategic and tactical levels? Have our innovative weaponry, training, and displays of strength deterred the Chinese military? Have our latest naval and aviation acquisitions proven to be models of brilliant cost-effective investments? In our woke age, do our soldiers die on the battlefield in proportion to their sex and race, in conformity with the new proportional representation gospel and in all other areas of military endeavors?

    We could ask the same of the FBI and CIA, given the loud, recent wokeist careers of John Brennan, James Clapper, Kevin Clinesmith, James Comey, Andrew McCabe, Lisa Page, and Peter Strzok. From such sanctimony we might assume the FBI had successfully ferreted out and preempted the Boston Marathon bombers, or the San Bernardino terrorists; or that we knew from the CIA the threats posed by the Phoenix-like reappearance of the “J.V.” ISIS killers in Iraq, the Spratly Island aggrandizement by China, the true nature of the Wuhan lab leak, the location of existing stockpiles of weapons of mass destruction in Iraq or Syria, and the current status of the Iranian nuclear program. 

    The point is not to berate our institutions, but to warn them.  Either their abilities to carry out their assigned tasks are becoming diminished by Nineteen Eighty-Four-like wokism, or they are using ideological camouflage simply to mask their unaccountability—and their increasing incompetence.  

    Tyler Durden
    Mon, 08/02/2021 – 21:40

  • Kim Jong Un Makes Public Appearance With Strange "Green Spot" & Bandage On His Head
    Kim Jong Un Makes Public Appearance With Strange “Green Spot” & Bandage On His Head

    South Korean intelligence as well as the media have of late been closely monitoring Kim Jong Un’s changing appearance, especially given his clear rapid weight loss of the past months, setting off higher than usual amounts of speculation over possible ill health. 

    This speculation has been renewed over these past days and has taken a bizarre turn, as commentary on the reclusive dictator’s appearance is now focusing on a strange “dark green spot” on the back of Kim’s head, as NK News has highlighted.

    Image: KCNA, edited by NK News

    Judging by a series of images and footage published in North Korean state media of a military event held during the last week of July, the strange mark seems the result of a prior wound – or possible medical intervention like surgery – given the spot was covered with a bandage at one point.

    NK News’ commentary includes the following description:

    North Korean leader Kim Jong Un appeared with a dark spot on the back of his head during public activities last week — the latest health-related issue Kim has faced in recent years. 

    The cause or nature of the large, dark green spot or bruise on the rear right side of his head, which was covered with a bandage in some footage, is still unknown and is difficult to diagnose using only images. 

    The report notes that at times state media attempted to avoid broadcasting images of the back of his head, while in other settings the discolored mark appears.

    There’s so far been no indication or even acknowledgement out of Pyongyang of what it could be, even after this summer there was an unusual acknowledgement of the weight loss during street interviews with concerned citizens.

    NK News put together the above montage of the latest appearances at a military event.

    https://platform.twitter.com/widgets.js

    The bandage as well as mark had appeared after he reportedly spent two weeks away from public duties:

    Meanwhile, it is likely that Kim was spending time at his Wonsan mansion during his two-week break from public activities in mid-July, just before showing up with the new mark and bandage on his head.

    His recently upgraded “floating amusement park” boat appeared at the DPRK leader’s Wonsan private beach at the start of his break and was placed back in storage on the same day Kim reappeared in Pyongyang, according to Planet Labs satellite imagery.

    At a politburo meeting held on 29 June, Kim’s last big appearance prior to the late July meetings, there appeared to be no mark or injury to the back of his head, or at least nothing visible, suggesting whatever it is developed within the last month.

    Tyler Durden
    Mon, 08/02/2021 – 21:20

  • How To Spot The Start Of The Tapering Cycle
    How To Spot The Start Of The Tapering Cycle

    By Vincent Cignarella, Bloomberg Markets Live commentator

    Job growth at pre-pandemic levels is the key to the start of tapering, according to Fed Chair Powell. The good news for fixed income traders worried about higher rates and bond bulls is we’re not there yet.

    A good gauge for when we do get there, take a look at the spread between the labor participation rate and job openings (JOLTS). It’s nowhere near pre-pandemic levels. Looking back at where labor and job openings were when the Fed announced tapering in December 2013 serves as a decent indication of what this relationship needs to look like before tapering is a more convincing option for the central bank.

    The question Fed Chair Powell is asked time and time again and the one he cannot seem to answer is “what does transitory mean and when will inflation point to the beginning of tapering?” The answer is likely not about inflation at all, but jobs. Remember, inflation is transitory for the Fed, or is it?

    Take a look at another metric of jobs returning to pre-pandemic levels: payroll gains and jobless claims. It seems we’re already there and the Fed is indeed behind the curve. It’s likely to fall even further behind once inflation begins to percolate.

    That means inflation and inflationary expectations are like a spring wound tight. It is only when you reach the tipping point that it unravels. For the Fed, it appears that time is when labor participation increases sufficiently to fill current job openings.

    We may be closer than we think to that moment. School re-openings and the end of extended jobs benefits is right around the corner. That should produce an increase in the labor participation rate and result in fewer job openings. That’s when the first aforementioned metric may come into play.

    For equity investors, it’s not a time to panic. The 2013 taper tantrum didn’t produce an extended selloff but it was a different story for bond traders. As the participation/job opening gap closes, the canary in the coal mine may stop singing. That’ll likely be a sign that tapering is at hand and signal the beginning of a substantial bond correction.

    Tyler Durden
    Mon, 08/02/2021 – 21:00

  • "An Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle
    “An Environmental Disaster”: An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle

    If there’s one thing about the growing demand for EVs that we have tried to point out over the last month, it’s the fact that the rhetoric about the “green” vehicles being perfect for the environment with little consequence isn’t exactly 100% accurate.

    Just over the last two months, we’ve written not only about how much driving needs to be done in EVs to make them better for the environment than internal combustion engine vehicles, but we’ve also noted that EV carbon footprints aren’t necessarily as better than ICE vehicles as many people think.

    Now, more questions are starting to be raised about the potential unintended consequences of the EV revolution. Notably, how can the metals used for EV batteries be recycled and reused as part of a circular economy before a materials crunch – or environmental impact from mining – negates the “green” label affixed to EV vehicles. That’s the question FT delved into this week in a new report. 

    And who better to make it clear that recycling is an issue than former Tesla executive JB Straubel. He started a company called Redwood Materials in 2017 that is focused on trying to break down used batteries and reconstitute them into a fresh supply of metals for new ones.

    Despite EVs bring zero emission while being driven, the “mining, manufacturing and disposal process for batteries could become an environmental disaster for the industry,” FT wrote.

    Straubel said to FT: “It’s not sustainable at all today, nor is there really an imminent plan — any disruption happening — to make it sustainable. That always grated on me a little bit at Tesla and it became more apparent as we ramped everything up.”

    His company takes batteries from old smartphones, power tools and scooters, and turns them back into metals like nickel, cobalt and lithium so they can re-enter the supply chain. His goal is to stop mining from places like the Democratic Republic of Congo, Australia and Chile, and start mining household waste. Straubel says there’s about 1 billion used batteries sitting around in households. 

    Gene Berdichevsky, chief executive of battery materials start-up Sila Nano, noted that there’s a material amount of cobalt in smartphones compared to EV batteries: “So for every 300 smartphones you collect, you have enough cobalt for an EV battery.”

    Cobalt mining is particularly resource intensive. “Cobalt can travel more than 20,000 miles from the mine to the automaker before a buyer places a ‘zero emission’ sticker on the bumper,” FT points out. 

    Straubel says that EV emissions can be halved even further from where they are if batteries and metals can be continually recycled.

    Redwood has raised more than $700 million from investors to hire 500 people and expand its operations. This year it’ll process 20,000 tons of scrap and has already recovered enough material to build 45,000 EV battery packs. 

    Redwood already has partnerships with companies like Panasonic and Amazon. And companies like Apple are getting on board with the circular economy idea, which CEO Tim Cook aspiring to “not to have to remove anything from the earth to make the new iPhones”. 

    A circular economy with EV batteries would give the world a significant push forward to meeting net zero emissions goals. Kunal Sinha, head of copper and electronics recycling at miner Glencore, said: “For the world to hit net zero — by 2050 you can’t do it with just resource efficiency, switching to EVs and clean energy, there’s still a gap. That gap can be closed by driving the circular economy, changing how we consume things, how we reuse things, and how we recycle.”

    As EV adoption grows, demand for nickel, cobalt and lithium will continue to rise. Paul Anderson, a professor at the University of Birmingham, said: “There is going to be a mass scramble for these materials. Everyone is panicking about how to get their technology on to the market and there is not enough thought [given] to recycling.”

    A “crunch” for the materials will likely happen as a result of demand surpassing supply, which will take place in 2 to 3 years, according to Monica Varman, a clean tech investor at G2 Venture Partners. 

    Berdichevsky concluded: “In the future we’ll replace the car, but not the battery; of that I’m very confident. We haven’t even scratched the surface of the battery age, in terms of what we can do with longevity and recycling.”

    Tyler Durden
    Mon, 08/02/2021 – 20:40

  • Beijing Quietly Issued 'Buy Chinese' Procurement Guidelines For Hospitals & State Companies 
    Beijing Quietly Issued ‘Buy Chinese’ Procurement Guidelines For Hospitals & State Companies 

    China may be preparing to unleash its own “buy Chinese” policy in contradiction to prior agreements when it joined the World Trade Organization in 2001. The government is believed to have been signaling the erection of new significant trade barriers with the United States based on ‘unofficial’ procurement guidelines yet to be made public, as Reuters reports Monday:

    China’s government quietly issued new procurement guidelines in May that require up to 100% local content on hundreds of items including X-ray machines and magnetic resonance imaging equipment, erecting fresh barriers for foreign suppliers, three U.S.-based sources told Reuters.

    A respirator at the factory of Shenyang RMS Medical Tech Co., Ltd in Shenyang, via Xinhua

    Though not yet acknowledged publicly by Beijing, the sources say the document issued by the Chinese Ministry of Finance and the Ministry of Industry and Information Technology (MIIT) under the title “Auditing guidelines for government procurement of imported products,” has been circulated to Chinese hospitals and state companies laying out “local content” requirements of 25% to up 100% for over 300 items ranging from testing machinery to radar equipment to geological equipment, according to the report.

    There’s been other signs that the policy is being implemented, raising the stakes further for Presidents Biden and Xi Jinping’s upcoming meeting in October on the sidelines of the G20 in Rome. Reuters continues: 

    Doug Barry, spokesman for the U.S. China Business Council, said his group has heard about the document, but has not seen a copy. The group’s members who operate in China are reporting new problems in competing for and winning bids there, including areas such as testing equipment and transportation, he said.

    And here’s more details from the ‘secretive’ document seen by Reuters’ sources: 

    The new guidelines affect a wide range of goods, including medical devices, which Beijing agreed to buy more of under the terms of the Phase 1 trade deal. For example, magnetic resonance imaging equipment – a key export for U.S. companies in the past – would face a 100% local content requirements under the new guidelines, the former official said.

    U.S. trade experts said China’s local content rules differed from planned increases in U.S. “Buy American” thresholds because they were not publicly released, and affect far greater volumes of medical equipment and other goods since China’s state-owned enterprises include hospitals and other entities.

    This could have devastating impact on US medical device exports from major brands like Johnson & Johnson, GE and Abbott – all who sell billions of dollars in equipment to China. 

    Reuters notes further that “China imported some $124 billion in goods from the United States in 2020, much of which was purchased by vast state-owned and government-associated companies that control the education, health, transportation, agriculture and energy sectors.”

    You will find more infographics at Statista

    And more: “With three-fourths of the deal now complete, China is on pace to buy just over 60% of the goods needed to reach its target, according to Chad Bown, a fellow at the Peterson Institute for International Economics.”

    Tyler Durden
    Mon, 08/02/2021 – 20:20

  • IMF Creates Record $650 Billion Slush Fund For Pandemic Relief
    IMF Creates Record $650 Billion Slush Fund For Pandemic Relief

    The International Monetary Fund (IMF) has approved a record $650 billion in special drawing rights (SDRs) to ‘help nations dealing with mounting debt and the fallout from the Covid-19 pandemic,’ according to Bloomberg, which notes that it’s the largest resource injection in the organization’s history.

    The creation of the reserve assets — known as special drawing rights — is the first since the $250 billion issued just after global financial crisis in 2009, with IMF Managing Director Kristalina Georgieva billing it as “a shot in the arm for the world” that will help boost global economic stability. –Bloomberg

    “The SDR allocation will benefit all members, address the long-term global need for reserves, build confidence, and foster the resilience and stability of the global economy,” said Georgieva, framing it as a “shot in the arm for the world” which will contribute towards global economic stability.

    “It will particularly help our most vulnerable countries struggling to cope with the impact of the covid-19 crisis,” she added.

    According to the report, the plan has been in the works for more than a year – as early progress was beset with delays after the Trump administration (the IMF’s largest shareholder) blocked it early last year after then-Treasury Secretary Steven Mnuchin insisted that the funds wouldn’t actually end up with the nations that need it most.

    This, of course, radically changed under Mnuchin’s successor, Janet Yellen – as the fund revisited options for rich nations to redistribute wealth to ‘vulnerable and low-income countries.’ At present, reserves are allocated to all 190 members of the IMF in proportion to their quota, while around 70% will go to the G20 largest economies. Just 3% will go to low-income nations.

    As Bloomberg explains, that’s about to change.

    Overall, 58% of the new SDRs go to advanced economies, with 42% for emerging and developing economies. So of the $650 billion, about $21 billion go to low-income countries and $212 billion to other emerging market and developing countries, without counting China, according to U.S. Treasury Department calculations.

    The Group of Seven advanced economies in June endorsed a plan to reallocate $100 billion of new SDRs to poorer countries, but the G-20 in July only specified support for a general allocation of $650 billion in SDRs, without detailing how much would re-lent. –Bloomberg

    The reallocation will help impoverished countries in Africa, which will receive roughly $33 billion of the new SDRs – made possible by a commitment from France to reallocate their SDRs. South African President Cyril Ramaphosa has insisted in the past that a full quarter, around $162 billion, should be allocated to African nations – and called on rich countries to donate, not lend, their SDR allotments.

     

     

     

     

    Tyler Durden
    Mon, 08/02/2021 – 20:00

  • Trump Amends Big Tech Lawsuit As 65,000 Americans Submit Censorship Stories
    Trump Amends Big Tech Lawsuit As 65,000 Americans Submit Censorship Stories

    Authored by Tom Ozimek via The Epoch Times,

    Former President Donald Trump’s legal team has amended his class action lawsuit against Big Tech to incorporate additional class representatives and more censorship stories provided by everyday Americans.

    According to the America First Policy Institute (AFPI), Trump’s July 7 lawsuit against Facebook, Twitter, and Google is adding ”additional censorship experiences” from some of the nearly 65,000 people who submitted them to the institute.

    ”Late last night, Amended Complaints were filed in the Big Tech lawsuits against Facebook, Inc., Mark Zuckerberg, Twitter, Inc., Jack Dorsey, Google LLC, and Sundar Pichai,” AFPI said in a July 28 statement.

    “Since the initial filing on July 7, 2021, nearly 65,000 American people have submitted their stories of censorship through America First Policy Institute’s (AFPI) Constitutional Litigation Partnership (CLP) at TakeOnBigTech.com,” AFPI added.

    Trump said at a July 7 press conference outlining his plans for the legal action that he expected thousands of people would join his lawsuit. Several people invited to speak at the press conference shared their experiences of what they said amounted to censorship by social media platforms.

    “Joining us this morning are just a few of the many Americans who have been illegally banned or silenced under the corrupt regime of censorship,” Trump said at the time.

    “These brave patriots are included in the lawsuit and thousands more are joining as we speak. Thousands more. They’re all wanting to join. This will be, I think will go down as the biggest class action ever filed,” Trump predicted.

    AFPI said in its statement that Trump’s amended complaint includes “additional censorship experiences and incorporates additional class representatives, including Dr. Naomi Wolf and Wayne Allyn Root—individuals on opposite ends of the political spectrum who highlight the bipartisan need to protect the thoughts and voices of all Americans, regardless of political affiliation.”

    Wolf, a longtime liberal and former adviser to the political campaigns of both Bill Clinton and Al Gore, told EpochTV’s “American Thought Leaders” in a recent interview that the growing number of people banned from Big Tech platforms is leading to a wave of self-censorship.

    Wolf, who was banned by Twitter in June for allegedly sharing so-called misinformation about COVID-19 vaccines, said the “chilling effect” her ban has had on other journalists is evident because some have reached out to her directly.

    “I’ve gotten so many emails from other reporters saying, ‘I really admire you, I’m so sorry you were de-platformed.’ And when I would say ‘well, can you say that publicly?’ They universally said ‘I would, but I’m really afraid of being de-platformed.’ And I’ve seen the self censorship that has gone on in the wake of some high-profile de-platforming of journalists,” she said.

    Naomi Wolf attends the “Fed Up” premiere at the Museum of Modern Art in New York City on May 6, 2014. (Rommel Demano/Getty Images)

    Trump said at the July 7 press conference that his suit centers on protecting the First Amendment right to free speech.

    “We’re asking the U.S. District Court for the Southern District of Florida to order an immediate halt to social media companies’ illegal, shameful censorship of the American people, and that’s exactly what they are doing,” the former president said.

    “We’re demanding an end to the shadow banning, a stop to the silencing, and a stop to the blacklisting, banishing, and canceling that you know so well. Our case will prove this censorship is unlawful, it’s unconstitutional, and it’s completely un-American,” added Trump who himself was banned from major social media platform following the Jan. 6 Capitol riot.

    Twitter, Facebook, and Google said in January that they banned Trump over his claims that the Nov. 3 election was stolen and alleged that he contributed to the Jan. 6 violence. Twitter executives have said Trump’s ban will be permanent, Facebook imposed a two-year ban on the former president’s account, and Google-owned YouTube has said it would curtail his suspension until it determines that “the risk of violence has decreased.”

    Facebook CEO Mark Zuckerberg, Google CEO Sundar Pichai, and Twitter CEO Jack Dorsey were named in the lawsuits—as well as the companies themselves. Trump said the lawsuits will seek a court award of punitive damages over the suspension.

    Tyler Durden
    Mon, 08/02/2021 – 19:40

  • Corporate Margins Set To Tumble As Companies Freak Out About Surge In "Bad Inflation"
    Corporate Margins Set To Tumble As Companies Freak Out About Surge In “Bad Inflation”

    First the good news: according to Bank of America’s earnings tracker, Q2 earnings season is already one of the strongest in history (as one would expect following trillions in fiscal and monetary stimulus and comping off the catastrophic Q2 of 2020 when covid shut down the economy), and following the busiest earnings week of 2Q, 296 S&P 500 companies (76% of index earnings) have reported. 2Q EPS is now tracking a 13% beat or $51.12, topping BofA’s estimate of $50 or an 11% beat; and far above the historical average since the start of earnings season.

    To avoid the skewed 2020 data and doing a two-year lookback, 2Q is now expected to be +83% YoY or +24% vs. 2Q19, vs. last quarter’s 25% 2-yr growth rate. Financials, Communication Services, and Consumer Discretionary led the EPS beat, while revenues are also coming in red hot and tracking a 3% beat, led by Energy.

    More importantly, the proportion of beats also remained strong: 83%/85%/74% of companies beat on EPS/sales/both, representing the best proportion of beats in history (since 2011).

    Looking at the top line, analysts now expect 2Q sales to rise 21% YoY, vs. 14% YoY last quarter. Energy is expected to lead (+102%), while Financials are forecast to be the biggest drag (-4%). Here, BofA estimates that FX tailwinds thanks to a weaker dollar added about 3% to YoY sales growth (Exhibit 4), representing the biggest benefit since 2011. Excluding FX/oil impacts, constant-currency sales growth for the S&P 500 ex. Fins. & Energy is expected to be +15% YoY (Exhibit 5), accelerating from the 13% growth last quarter.

    What is more surprising is that in a quarter when many predicted margins would be hit by surging input costs, not only was that not the case but companies once again posted skyhigh margins, with 2Q net margins (ex-Financials) jumping to a new high at 13.0%, topping last quarter’s 12.5%. This was consistent with BofA’s Corporate Misery Indicator, which rose to a record high (“least miserable”) in 2Q, indicating it was among the most favorable macro environment for corporate margins in history since 1978!

    How is this possible in a time when numerous commodity prices have hit never before seen levels? Simple: companies have experienced virtually no pushback to rising prices as most Americans can easily absorb the rampant inflation. Indeed, as IHS Markit Chief Economist Chris Williamson commented in today this is “perhaps the strongest sellers’ market that we’ve seen since the survey began in 2007, with suppliers hiking prices for inputs into factories at the steepest rate yet recorded and manufacturers able to raise their selling prices to an unprecedented extent, as both suppliers and producers often encounter little price resistance from customers.” It remains to be seen just how long such a “seller’s market” will be the norm, although we expect it to reverse quite painfully once government handouts end.

    In any case, that was the good news: now the bad and that was summarized best by BofA’s Savita Subramanian who wrote that “we are starting to see the good inflation environment turning into a bad inflation environment with many companies citing accelerating cost inflation, particularly around wages.”

    Indeed, as shown in the chart above, consensus margin expectations for 2H reflect this risk, with margins forecast to moderate to 12.6 % in 3Q and 12.5% in 4Q. But if cost pressure continues to accelerate, we could see more downside risk in 2H margins.

    And nobody captures this risk better than companies themselves: according to word counts of corporate earnings transcripts by BofA’s Predictive Analytics team, mentions of “inflation” on 2Q earnings calls topped 1Q levels and jumped to a record high, based on BofA’s Predictive Analytics team’s analysis. On a YoY basis, inflation mentions rose nearly 1100% YoY, outpacing the 900% increase we saw last quarter.

    Notably, labor-related mentions – i.e., discussion of rising wages – rose the most among inflation categories BofA tracks in 2Q, up 155% YoY. This compares to last quarter when labor-related mentions rose the least (+12% YoY), pointing to soaring wage pressure, and is why BofA remains cautious on labor-intensive Consumer Discretionary and Industrials.

    Meanwhile, supply-chain related mentions also more than doubled YoY (+106% vs. +17% YoY in 1Q). Both supply chain and labor related mentions rose to record highs in BofA data history since 2004.

    And before we dig through the actual earnings transcripts, we leave the most ominous finding for last: using earnings calls transcripts, BofA calculated sentiment for S&P500 companies that have reported this earnings season (it used Loughran McDonald’s financial dictionary to calculate sentiment scores.) Overall, BofA found that corporate sentiment dipped from a record high, indicating peak corporate sentiment amid inflation concerns and rising cases of the Delta variant.

    Similarly, companies mentions of business condition (ratio of mentions of “better” or “stronger” vs. “worse” or “weaker”) indicate weaker business conditions vs. the peak level last quarter. Mentions of optimism also declined from the peak levels in the prior two quarters.

    To summarize: yes, Q2 earnings were a huge beat and margins were a record high… but it’s all downhill from here as the “bad inflation” (to companies, and very good inflation to workers) is about to roll down the income statement, resulting in sharply lower margins and deteriorating earnings. And insiders know this well, which is why corporate sentiment has already rolled over and is down despite a true earnings bonanza, and is also why corporation optimism has moved sharply lower, a move which will accelerate to the downside as soon as margins are hit by surging wages and as soon companies can no longer pass through sharply higher input prices.

    Finally, courtesy of BofA, here is a snapshot of what some of the most notable companies just said about inflation, bad or otherwise:

    AMZN (Discretionary): “The other thing is wage pressure has become evident. We’ve talked about this a bit. The wage increase that we normally would do in October we pulled forward into May. We’re spending a lot of money on signing and incentives. And while we have very good staffing levels, it’s not without cost. It’s a very competitive labor market out there and certainly the biggest contributor to inflationary pressures that we’re seeing in the business.”

    NWL (Discretionary): “We expect Q3 to be the peak quarter for inflation pressure, which will significantly weigh on the company’s margin performance.”

    ITW (Industrials): “We continue to expect price/cost impact to be EPS-neutral or better for the year. […] We continue to experience raw material cost increases, particularly in categories such as steel, resins and chemicals and now project raw material cost inflation at around 7% for the full year which is almost 5 percentage points higher than what we anticipated as the year began. And just for some perspective, this is roughly 2x what we experienced in the 2018 inflation/tariff cycle.”

    CHD (Staples): “We now expect full year gross margin to be down 75 basis points. This represents an incremental impact from our last guidance due to broad-based inflation on raw materials and transportation costs.”

    IP (Materials): “We do expect further input cost inflation in the third quarter with substantial pressure on OCC and transportation costs.”

    HSY (Consumer Discretionary): “In the second half of the year, we expect increased packaging and freight costs to continue. We also expect labor costs to remain elevated as higher levels of marketplace attrition contribute to more overtime and accelerated hiring to keep pace with demand. While we expect more price realization in the second half versus the first half, we also expect less sales volume benefits… And then in addition, I think labor rates in general and labor availability in general are a pressure point beyond just volume. The market for labor is challenging. And so just like everyone, we want to make sure we are staying ahead of the curve on hiring, making sure our value proposition at our plants is attractive. And packaging inflation similar, packaging inflation we touched on a little bit on the last call. It’s still a pressure point. I think we’re still optimistic we’re going to see that moderate as we go forward, but we haven’t seen it yet. And so, it is a combination of those transitory costs on the back of the higher volume and a few things that are a little bit [stickier] here as we look across the balance of the year.”

    TFX (Health Care): “Any inflation that we saw, we saw it begin last year in transportation. So, that was already in our run rate. And we saw some modest inflation in some of our resins, but it was pretty – it’s very manageable, and we’re going to more than offset it with really positive pricing and building momentum in the quarter with that positive pricing.”

    LKQ (Consumer Discretionary): “Across all of our segments, we are experiencing some level of supply chain shortages and disruptions. These disruptions are creating product scarcity and freight delays that are resulting in meaningful availability pressures in certain product lines. The supply chain challenges are also driving product inflation, which in turn, is generating the most robust pricing environment we’ve seen in years. Across all of our segments, we have been very effective in passing along these costs as witnessed by our margin performance. Alongside supply chain inflationary pressures, like many businesses across the globe, we are facing wage inflation and increased competition for labor.”

    MAS (Industrials): “We continue to see escalating inflation across most of our cost basket, including freight, resins, TiO2 and packaging. Inbound freight container costs nearly tripled during the quarter. We now expect our all-in cost inflation to be in the high single-digit range for the full year for both our Plumbing and Decorative segments, with low double-digit inflation in the second half of the year.
    Inflation in coatings will likely be in the mid-teens later in the fourth quarter. To mitigate this inflation, we have secured price increases across both segments and are taking further pricing action across our business to address these continued cost escalations. We are also working with our suppliers, customers and internal teams to implement further productivity measures to help offset these costs. Despite the increased inflation, we still expect to achieve price/cost neutrality by year-end. While cost inflation has clearly been an issue, material availability has also impacted our business.”

    FBHS (Industrials): “While inflation headwinds were anticipated, they continued to strengthen throughout the quarter. As I mentioned earlier, we are taking incremental actions during the second half of the year to offset increased inflation. […]Through this combination of cost and thoughtful pricing actions, we plan to offset all inflationary headwinds this year and expect to deliver 2021 operating margin improvement.”

    AVY (Materials): “Given the increasing inflationary pressures, we are redoubling our efforts on material re-engineering and again raising prices. We are targeting to close the inflation gap relative to mid last year by the fourth quarter.”

    IEX (Industrials): “We anticipated rising inflation as the global economy recovered, but like many, did not imagine the sharp rate of increase. This narrowed our spread between price capture and material costs, although we remain positive overall. Our teams leveraged the systematic investments we made a few years ago in pricing management and aggressively deployed two, sometimes three pricing adjustments with precision. We are on track to expand our price/cost spread to typical levels as we travel to the back half of the year.”

    ODFL (Industrials): “It’s a tighter labor market than certainly we’re used to. Of course, I’ve been here for a long time and I don’t ever remember the growth percentages in the past that we’ve got today. So, it’s definitely a bigger challenge than it’s ever been.”

    MHK (Consumer Discretionary): “We anticipate material and freight challenges will continue to impact our business in the third quarter. To compensate for material inflation, we have increased prices and we expect further increases will be required as our costs continue to rise”

    MDLZ (Staples): “As we said many times, inflation and commodity costs are higher than we originally anticipated at the start of 2021, but we continue to believe that they are manageable. In terms of pricing and inflation, I would say there is going to be more in the second part of the year. To start with, our pipeline of commodities and FX has been advantageous in the first part of the year, and we expect some commodities and FX impact to be relatively higher in the second part. So there will be some more pressure in Q3 specifically, but we will continue to be very disciplined in terms of costs and pricing.”

    SBUX (Consumer Discretionary): “While we’re thrilled with our margin performance in Q3, we expect it to moderate slightly in Q4 primarily due to the growing impact of inflation coupled with incremental investments critical to our continued growth.”
    “So in Q3 we had outstanding performance, but within that we covered headwinds in the Americas business of about 70 basis points. And we expect headwinds related to rising costs and inflationary pressures to continue into Q4 which is reflected in the guidance that we’ve given.”

    SHW (Materials): “Our gross margins were under considerable pressure in the quarter given the sustained higher raw material costs. However, as we have demonstrated in past inflationary cycles, we are fully committed to offsetting these costs, and we announced additional pricing actions in the quarter, which will be realized as the year goes on.”… “We anticipate year-over-year inflation in the third quarter to be higher than it was in the second quarter with only slight improvement in the fourth quarter as demand remains high.”

    WM (Industrials): “It’s no surprise to anyone who follows economic indicators that most businesses are experiencing inflation in their costs throughout 2021 and our business is no exception, particularly with regard to labor. We expect to overcome these pressures by increasing operating efficiencies and executing on our disciplined pricing programs.”

    RSG (Industrials): “we’re seeing very modest inflation in this year’s economics; kind of do an annual increase and we give our people a fair increase every year. We expect that certainly to tick up next year, but to be more than offset by our ability to price through that. And so we think that inflation net-net will be margin expanding for us.”

    LW (Staples): “As a result, we expect input cost inflation, especially for edible oils packaging and transportation to be a significant headwind for fiscal 2022. Our goal is to offset inflation using combination of levers including pricing. To that end, we just began implementing broad-based price increases in our Foodservice and Retail segments, and don’t expect to see the most of their benefit until our fiscal third quarter.”

    IQV (Health Care): “it’s no secret that given the strength of the industry backdrop, there’s obviously strong competition for talent. […] Now does it cause a certain amount of anxiety in the industry? And yes, it’s true. And has it caused some level of wage inflation? Yes, that is true. There is also a little bit of an uptick in attrition levels as a consequence of all of that. All of that is true… But again, we feel confident. We do not anticipate this to cause any significant – there will be some level of headwind to our margins, but we have so many programs and productivity measures and process improvement measures in place that we are confident we will overwhelm.”

    KMB (Staples): “Obviously, given that amount and given our outlook, we are covering a significant portion of that, but we can’t practically cover all of that this year […] And so, what I would say is, part one, our pricing implementation is largely on track and we expect to fully offset inflation over time. Not all this year, but over time.”

    SWK (Industrials): “We continue to see elevated commodity prices and now expect $260 million of commodity inflation in the second half versus our prior assumption of $210 million. In particular, elevated steel pricing is largely driving the $50 million increase. We are now in the full implementation mode and believe we should be in a position to offset approximately 50% of the 2021 headwind, netting material inflation and better price realization is a neutral effect versus the prior guidance. The goal is to have our actions in place during the third quarter, so the 2022 carryover benefits of price and margin actions fully offset the carryover inflation”

    PNR (Industrials): “Regarding the current inflationary environment, we have implemented further price increases and we expect the price cost gap to further narrow in the second half.”… “Consistent with our guidance, the second quarter did not see price fully offset inflation as we saw higher inflation that we have continued to implement price increases to help offset. The second half should see price costs start to even out. But an unprecedented amount of material and wage inflation coupled with robust demand has contributed to price reading out at a slower pace. Our forecast reflects our expectations that material shortages and inflation are not going away nor will they improve materially.”

    FTV (Industrials): “Even though we are seeing a little bit of cost inflation, we’re still going to be net – significantly net in a good shape relative to material cost reductions for the year. So material cost reductions will still be a profit improver for the year, even though we’ve seen a little bit more inflation than typical, we still are in a very good shape relative to price cost, not only because of price, but also because we’ve done a nice job on the cost reduction side as well.”

    CL (Staples): “We expect raw material costs to remain elevated throughout 2021, but we do expect some sequential lessening of inflation as we get into the fourth quarter.”

    JCI (Industrials): “Although lead times and conversion cycles are stretching, we believe conditions will begin to improve over the next couple of quarters. We are successfully leveraging our pricing capabilities to offset inflation, and we still expect to remain price cost positive for the year.”

    UPS (Industrials): “We know what happens in an inflationary environment, don’t we? Somebody pays for it. It’s usually the consumer, which means, right, that price increases get passed along all the way to the end to the consumer until the consumer says, ouch, I’m not going to buy any more. The consumer continues to buy. So there we are in the cycle, and this is a cycle, right. This is a cycle.”

    PKG (Materials): “These items were partially offset by higher operating costs of $0.57, primarily due to inflation-related increases in the areas of labor infringes, repairs, materials and supplies, recycled fiber cost, as well as other indirect and fixed cost areas Inflation associated with most of the operating costs as well as freight and logistics expenses is expected to continue.”

    GLW (Tech): “Now during the quarter, we continue to face supply chain disruptions and inflationary headwinds. Planning and increased output allowed us to reduce costly airfreight, but the sequential improvement was offset by increases in shipping rates and the cost of certain raw materials such as resin, a key component in our Optical and Life Sciences businesses. […] So right now, we’re clearly facing a lot of supply chain disruptions and inflationary pressure. And what we saw in the first quarter was, of course, a lot of that relative to freight and logistics. We had plans to mitigate that. We actually did those mitigations. But then there were other things that occurred, particularly around increased resin cost. So as we think about the guide, in particular the guide for the third quarter, we thought it was prudent to assume that, that 150 basis points drag that’s coming from those inflationary and supply chain logistics costs would continue.”

    IR (Industrials): “Since the end of Q1 of 2021 of this year, we have seen inflation and we call inflation here direct material and logistics, continue to increase, which is the reason why we acted on additional pricing actions. I’ll say those pricing actions are offsetting the incremental inflation that we’re expecting to see in the second half.”

    HIG (Financials): “As we listen to inflationary expectations, we expect some of those trends will be with us into the third quarter, fourth quarter. But I think that given our trends, our expectations to the year haven’t changed materially and we’re on top of our selections and I think we’re in good shape as we move into Q3.”

    PHM (Consumer Discretionary): “As reflected in the increases in our sales prices and gross margin, we’ve been able to pass on the meaningful cost inflation we have incurred over the course of the year. At this point, we now expect house costs to be up between 9% and 11% for the full year with the peak of certain costs, driven by lumber flowing through in the third and fourth quarters. Even with the ongoing rise in build costs, we still see opportunity for gross margins to move higher over the remaining two quarters of the year.”

    BSX (Health Care): “[We] expect slight improvements in second half gross margin compared to the first half, though still not at full year 2019 levels, as other headwinds remain, in particular, the lingering cost of running plants with COVID-specific measures, as well as some impact from inflation.”

    HAS (Consumer Discretionary): “We talked earlier about ocean freight in some of our prepared remarks and we’re seeing those costs are over four times higher than what we had been experiencing earlier or last year even. So, we expect a lot of those costs to continue. But between cost of sales and that, we do expect our gross margin to be slightly down from a year ago, but we do expect the price increases that we’ve taken to offset our increased costs”

    GE (Industrials): “Looking forward to the second half of 2021 and into 2022, although inflation pressure is likely to increase particularly in Aviation and Renewables, we expect the net inflation impact to be limited.”

    OTIS (Industrials): “This high inflationary environment that we’re seeing should help us on Service pricing because most of our contracts in Europe and Americas have price escalators kind of built-in that are largely tied to labor inflation. And, historically, we’ve always had that lever but given low inflationary environment in the macro market, the prices don’t always stick. And now, with this inflationary environment, we should have a greater ability to stick those prices, so that should help next year.”

    HON (Industrials): “so everywhere in our books of business that we can, we continue to pass through the inflation that’s being seen in the materials and also in the labor because in the projects businesses, labor is also important as well.”

    SLB (Energy): “But I believe that the tool box we have and the professional and very experienced organization we have in our planning and supply chain and manufacturing organization that are used to manage some inflationary pressure has allowed us to mitigate and edged this inflationary pressure and contain cost inflation […] under our roofs.”

    CE (Materials): “But we did raise price more than we saw our materials increasing. And I think that’s a question of mix. I mean what – we are in a very tight supply constrained situation. So we have been prioritizing our higher margin products and our higher market –higher margin region to really maximize the return that we get for the molecules thatwe have available to sell to the market.”

    ADM (Materials): “In our scenario, margins normalize, we have inflation and then we are able to offset a lot of that through growth and through productivity.”

    INTC (Tech): “Since April, we have seen supply chain inflation happening faster than we are electing to pass through to our customers, further impacting our second half gross margin outlook.”

    LUV (Industrials): “We are mindful of the tight job market, as well as general inflationary pressures. We expect to have wage rate inflation beyond our normal annual wage rate increases, as we want to be competitive to retain and attract talent, including the decision to increase the minimum hourly wage to $15 per hour across all workgroups, we now estimate, $5 million to $10 million of additional salary, wages, and benefits cost pressure in third quarter and approximately $15 million in fourth quarter.”

    GPC (Consumer Discretionary): “In the second quarter, there was significant pricing activity with our suppliers resulting in product cost inflation. We were positioned to pass these increases on to our customers and the impact of price inflation was neutral to gross margin. We estimate a 1.5% impact of inflation in automotive sales for the quarter and a 1% impact in industrial. Based on the current environment, we expect this to increase further through the second half of the year.”

    NUE (Materials): “So we’ll see some price inflation that will cause working capital to go up further, but probably not at the same pace as we experienced in Q2.”

    POOL (Consumer Discretionary): “Inflation, as we have previously mentioned, has been above average this year and is trending to 5% to 6% for the year in total. This has had no meaningful impact on demand and has passed through the channel as is typically the case.”

    NEM (Materials): “The impacts of the pandemic are also driving cost inflation around the globe. We are now expecting cost escalation of around 3% to 5% for materials, energy and labor. And we expect these pressures to continue through until at least the end of next year.

    FCX (Materials): “Everyone is focused on inflation around the world and the impact on mining companies. And as Kathleen said, we’ve had higher energy costs, higher grinding material cost, but Josh Olmsted and our Americas team has just done a great job in helping offset that.”

    UNP (Industrials): “And as we experience a strong demand environment, our pricing actions continue to yield dollars in excess of inflation.”
    DGX (Health Care): “So there’s nothing extraordinary in the back half of the year in terms of labor inflation.”

    MMC (Financials): “The pace of price increases continued to moderate, but still remains high, reflecting elevated loss activity and concerns about inflation and low interest rates.”

    ALLE (Industrials): “Allegion is not immune to inflation and the supply chain constraints impacting industrial markets. Allegion navigated well during Q2, but these industry-wide constraints will persist for the remainder of the year and put pressure on margins for the short-term.”
    “We’ve seen an acceleration of inflation, predominantly in commodity costs, material components, freight, packaging, et cetera. It’s continued to be a headwind. As you know, we’re pretty aggressive moving on price and we’re taking similar actions in the back half of this year. We’ve went ahead and announced a price increase that will take effect at the beginning of Q4. So, there’s going to be some margin pressure, I would say, given the acceleration in inflation particularly in Q3.”

    WHR (Consumer Discretionary): “Structural cost takeout actions, higher volumes and ongoing cost productivity initiatives delivered 550 basis points of net cost margin improvement. These margin benefits were partially offset by raw material inflation, particularly steel and resins, which resulted in an unfavorable impact of 400 basis points.”

    CSX (Industrials): “The good news is we have secured adequate inventory and supply commitments for critical materials, and we’ve worked to lock in the vast majority of unit costs for 2021. Excluding locomotive fuel, expense inflation this quarter was just above 3% and we don’t expect that to move much going into the second half.”

    NTRS (Financials): “Inflation is showing up in different areas. I mean every firm is dealing with talent issues and the pressure is there. We certainly see that and experience it and talking at management levels about how to address it. And the inflation we see across the business and different areas as well. And some of it is unit costs but some of it is just the increased cost of doing business. And we talked about the significant increase in technology oriented expenses that we’re having. In some ways that’s an inflation cost on the business. It’s not just a unit price inflation but it’s inflation in the overall cost of doing business. So, it’s showing up in different ways across the organization.”

    BKR (Energy): “Although we have moved quickly to pass inflation on to our customers, there is a timing lag relative to the increase in costs.”

    JNJ (Health Care): “We continue to expect in the back half of the year pressure in parts of our portfolio in terms of commodity inflation and distribution cost. We are prepared to absorb those.”

    CMG (Consumer Discretionary): “We anticipate these commodity headwinds will negatively impact the quarter by an additional 60 basis points to 80 basis points, essentially offsetting the benefit of menu price increases. This will result in food costs for Q3 being at or slightly above the percentage we saw in Q2. Over the next few quarters, we’ll have greater visibility on how much of this inflation is permanent versus transitory, and we can take the appropriate actions as needed to help offset any lasting impacts.”

    DOV (Industrials): “What we underestimated was the total cost impacts of a strained logistics system and tight labor market that shows no signs of abating. This has had two knock-on effects on our results. First, the absolute cost of inbound and outbound freight were materially higher; and second and more important, the costs associated with production line stoppages due to lack of labor and components caused by transit time uncertainty and overall supply chain tightness.”… “I think that there is an interesting argument, and I would agree with it that to the extent that labor inflation is durable and that supply chains, the issues that we’re having in supply chains will improve, but not dramatically. There’s an argument to be made that the returns on automation are going to be better than they’ve been over the last five to six years. And I would agree with that.”

    KSU (Industrials): “Core pricing and contract renewals were essentially in line with the first quarter, but we are clearly seeing inflationary pressures that will need to be addressed going forward. As we look into the back half of 2021, we would expect the auto chip shortage to continue to negatively impact our growth, with a strong bounce-back late in the year and into 2022 as auto demand continues to be extremely high and dealer inventories at all-time lows.”… “We’ve now got to step up in inflation. So, we need to kind of deal with that going forward because our long-term strategy has always been to price above the cost of inflation. But an interesting dynamic and even the fed looking at their long-term projections around inflation would suggest inflation is going to come back down in 2022. So, there are interesting discussions with customers to have and we’re going to do our best to continue to make sure we cover cost increases in our business there.”

    PPG (Materials): “Due to supply disruptions, we experienced unprecedented levels of raw material and transportation costs that continually elevated as the quarter progressed. This drove raw material inflation to be up a mid to high-teen percentage on a year-over-year basis versus our original estimate of a high single-digit percentage increase.”… “Clearly this inflation cycle is much higher than anyone anticipated, and we’re continuing on a business-by-business basis, working to secure further selling price increases. This includes executing additional pricing actions during the third quarter.”…“We now fully expect to offset raw material cost inflation in the fourth quarter on 2021 on a run rate basis.”…“But if we could get the overall base supply/demand (back in) balance, if you will, in our supply chain, I think prices would start to normalize somewhat. We don’t see that happening in 2021. So right now, we’re still anticipating significant inflation, when we said it’s 20% in Q3 and we’ll have a significant inflation in Q4. So for as far as we can currently look out, we’re still looking at a pretty inflationary cycle.”

    FAST (Industrials): “Price actions to-date have largely matched cost increases. There’s a ton of inflation going on. There’s inflation because of disruption and shipping,”… “The marketplace is still receptive to price actions and the tools and processes we have developed have been effective. Even so, given the rate of inflation, maintaining price cost parity will be a bigger challenge in the third quarter.”

    CAG (Staples): “We expect the negative impact of the cost inflation to hit our financials before the beneficial impact of our responsive actions, including our pricing. This timing mismatch is expected to be particularly impactful in (fiscal) H1 and, more specifically, in (fiscal) Q1. The resulting pressure on our first half margins impact our full year profit […] Although the substantial increase in inflation over the last few months has negatively impacted our profit guidance for the (fiscal) year, we remain confident in the underlying strength of the business. […] Importantly, we expect that the impact of our aggressive mitigating actions will cause second half adjusted EPS to rebound, to be in line with what was assumed for (fiscal) H2 within our prior guidance.”… “When we initially gave our fiscal 2022 targets at our Investor Day in April of 2019, our models assumed an annual inflation rate of around 3%. At the time of our third quarter call, in April of 2021, we expected fiscal 2022 inflation to come in at twice that level around 6% […] We now currently expect fiscal 2022 inflation to come in around 9%. The difference between the 6% we expected a few months ago and the 9% we expect today equates to approximately $255 million in additional costs during fiscal 2022.”

    JPM (Financials): “In terms of inflation, I would say that we’re not seeing inflation in our actuals. But obviously, your guess is as good as mine in terms of the future. But it would be reasonable to assume that that’s going to be a little bit of a challenge… it won’t make any difference as long as you have that strong growth in consumer there. Jobs are plentiful; wages are going up. These are all good things. And so, obviously, inflation could be worse than people think. I think it’ll be a little bit worse than what the Fed thinks. I don’t think it’s all going to be temporary. But that doesn’t matter if we have very strong growth.”

    MKC (Staples): “We’re seeing broad-based inflation across our various commodities, packaging materials and transportation costs. To offset rising costs, we are raising prices where appropriate, but usually there is a lag time associated with pricing, particularly with how quickly costs are escalating. And therefore, most of our actions won’t go into effect until late 2021.”

    PEP (Staples): “We’re seeing inflation in our business across many of our raw ingredients and some of our inputs in labor and freight and everything else. So, we operate in the same context. We feel quite comfortable or confident that through a combination of net revenue management initiatives and increased productivity, we can navigate this.”

    CTAS (Industrials): “While some inflationary pressures increased certain costs, these were more than offset by increased revenue from businesses reopening or increasing capacity as COVID-19 case counts fell and restrictions on businesses were reduced.”

    ZION (Financials): “This outlook does not reflect a significant change in inflation from what we’ve observed over the past several years which we believe is an emerging and increasingly important risk to our outlook.”… “But there is no softening in the concerns about supply chain or concerns about inflation. Those concerns are real. They’re certainly remaining steady, if not building, in terms of the minds of business owners.”

    SIVB (Financials): “If we do see inflation, I actually think it’s going to be modest, I don’t think it’s going to be something that would be a fundamental change that would cause the market to get overly spooked. But again, something to pay attention to, and that’s just my own opinion.”

    WRB (Financials): “We continue to be very focused on inflation. From our perspective, inflation is very much here. There’re some people that talked about it being this transient that may be true. I’m not quite sure when people talk about transient, well, how long is transient, regardless the costs of things are up today. But even if you saw inflation return to a 2.5% or 3% level, we continue to believe that the 10-year at 130% or less doesn’t make a whole lot of sense for a long run.”

    RHI (Industrials): “We’re passing through the wage inflation that we’re having and we’ve actually expanded our margin.”

    Tyler Durden
    Mon, 08/02/2021 – 19:20

  • Evictions Start With Nancy Pelosi & The House On A 7-Week Break
    Evictions Start With Nancy Pelosi & The House On A 7-Week Break

    Authored by Mike Shedlock via MishTalk.com,

    The pain starts in the South. Laws and procedures to evict tenants in some Southern states are among the most landlord-friendly in U.S…

    Nationally, about 16% of adult renters live in households that are behind on rent payments.

    Checking in With Nancy Pelosi

    https://platform.twitter.com/widgets.js

    CDC Powerless

    https://platform.twitter.com/widgets.js

    Time Ran Out on Renters

    “In my view, clear and specific congressional authorization (via new legislation) would be necessary for the CDC to extend the moratorium past July 31,” Kavanaugh wrote.

    The WSJ reports Renters in South Appearing Most Vulnerable.

    A senior White House official said last week that an administrative—rather than legislative—extension of the moratorium would quickly be struck down by the Supreme Court. [Mish Comment: How can Pelosi not know this?”]

    Renters in Southern states are among the most vulnerable to the ban’s expiration, U.S. Census survey data indicate. Mississippi, South Carolina and Georgia tenants are more likely to carry rent debt than the U.S. average, surveys show. Nationally, about 16% of adult renters live in households that are behind on rent payments.

    In Mississippi, tenants can lose their eviction case in court and be removed from their home on the same day. In Arkansas, landlords can pursue criminal charges for tenants who don’t pay rent. And in western Tennessee, where a federal judge ruled that the CDC ban was unconstitutional, tenants are already getting evicted for nonpayment.

    Rent increases in cities like Charlotte, N.C., Jacksonville, Fla., and Memphis, Tenn., have outpaced the rest of the country. In Atlanta, rents rose 12.7% during the past year, according to listings website Apartment List, exceeding the national average of 10.3%. Rents in some Atlanta suburbs have risen more than 20% during that period.

    On CNN, Rep. Alexandria Ocasio-Cortez (D., N.Y.) said on Sunday that the House should reconvene to extend the moratorium and she also cast blame on the White House for not requesting Congress act earlier. The White House didn’t immediately respond to a request for comment.

    Federal Program

    The Federal program only pays 60% of lost rent to landlords. Admittedly, that’s much better than nothing, but it’s also an illegal action by the government to impose such losses. 

    Although the money does not go to renters, they still have to apply, but didn’t. That’s why almost all of the $46.6 billion in federal rental assistance sits undistributed. The Mississippi distribution rate is a mere 6% of allotment. 

    The Biden administration did little or nothing to promote this assistance. 

    A judge in DeKalb county Georgia (Atlanta) extended the eviction ban (illegally in my opinion), but at least the official wants to pay landlords 100% of back rent. 

    But who is it that’s really paying? If the Federal program only pays 60% then De Kalb taxpayers will foot the rest. 

    Warning Shot Ignored

    Congress and the Biden administration had a clear warning shot from Justice Kavanaugh and did nothing, not even promote the program that was in place. 

    How Many are Impacted?

    I discussed that question ahead of the pack last week in At Least 12 Million Face Eviction as Moratorium Ends. 

    The wording in the Census discussion I downloaded was a bit confusing. I originally reported “households” but the numbers appear to be total number of people.

    Census Department Data

    Here is the Census Department Data Feed. I pulled data from the Housing Tables, specifically 1A, 1B, 2A, and 2B. 

    Household Calculation

    I believe we can derive households. 

    Let’s start with 1B: “Household currently caught up on rent payments” specifically the column that says “No” to caught up on rent.

    That total is 7,433,895 individuals, not households.

    We can derive households by dividing those not current by household size. 

    Households Not Current in Rent

    Note: Size of household at 7 is actually 7 or more. Thus, households not current in line 7 is slightly high as I divided by 7.

    Unfortunately, the table is a huge understatement of the problem. 

    The Census Department reported 50,922,215 people living in rental units with 7,433,895 behind in rent (I total 1 more). Importantly, the bureau also reported 72,166,927 did not report to tenure. 

    More people did not accurately respond to the survey than those who did. 

    How many of those who are not current is a mystery. 

    Those unwilling to admit they are behind is another issue.

    There is also an issue of expiring Federal unemployment benefits such that even if people are current, they fear they will not be. And finally, rents are rising fast.

    Let’s now look at “confidence”, table 2B. 

    Households Not Confident in Ability to Pay Rent

    There are 4,562,469 households that fear ability to make rent payments. 

    If we total no confidence and slight confidence individuals we get 4,859,440 + 7,853,495 = 12,712,935 people fearing eviction.

    Once again however, that number is hugely understated because there were 72,166,927 did not report to tenure and only 50,922,215 who did.

    Here are my rental charts again, with numbers reflecting individuals, not households.

    Rent Payment Status

    Confidence in Ability to Pay Rent

    Recap

    12,712,935 people in 4,859,440 households fear eviction. Those numbers are hugely understated. The Census total shown in the chart above is off my total of their numbers by 1. 

    The House is now in recess with warning shots by the Supreme Court ignored. 

    Place the Blame 

    There is a huge amount of blame to spread around but please note that even the Democrat-governed states failed to promote the Federal rent assistance programs. 

    Through June, only $3 billion of an allocated $47 billion was spent.

    Neither the Administration nor the House nor state governors – anywhere – promoted the existing Federal rent assistance programs.

    By the way, rental assistance is a budget item. Democrats could easily have passed a better program through reconciliation even without support of Republicans.

    There are only 2 people to blame for that failure: Biden and Pelosi.

    Start at the Beginning

    We need go back and start at the beginning. 

    Eviction moratoriums are just plain wrong without compensation to the owners. 

    How would you like it if you rented out a 2-flat and the government came along and told your tenants they did not have to pay rent? 

    Then you seek to evict but Biden extends the eviction moratorium followed by the CDC three more times. Total it up and you have not been paid rent for 15 months but your bills are due.

    This is flat out unconstitutional confiscation of property.

    Trump was wrong to declare an unpaid moratorium, Biden was wrong to extend it, the CDC was wrong to extend it three times, and Pelosi remains clueless about what the Supreme Court ruled. 

    Addendum

    I just got a call from the Census Department. The woman I talked to confirmed that my approach to determining the number of households is reasonable. 

    She agreed that because 72,166,927 individuals did not report to tenure and only 50,922,215 did report that the numbers of individuals and households in trouble is low. 

    There is no way to further quantify “how low” because the people who don’t respond and those who do are very different sets so one should not extrapolate the numbers. 

    All we know is approximately 12.7 million people in approximately 4.9 million households fear eviction and those numbers are definitely low.

    *  *  *

    Like these reports? I hope so, and if you do, please Subscribe to MishTalk Email Alerts.

    Tyler Durden
    Mon, 08/02/2021 – 19:00

  • Biden Admin Is Booting 24 More Russian Diplomats By September 
    Biden Admin Is Booting 24 More Russian Diplomats By September 

    Russia has announced Monday that two dozen of its diplomats in the United States will essentially be booted from the country after their visas expire during the first week of September.

    “Russia’s ambassador to the United States said Washington had asked 24 Russian diplomats to leave the country by Sept. 3 after their visas expired,” Reuters writes. “Anatoly Antonov did not say whether the US request was prompted by any particular dispute, and there was no immediate comment from Washington.”

    Moscow has cited stringent visa procedures which will likely bar the diplomats from being able to renew them. “Almost all of them will leave without replacements because Washington has abruptly tightened visa issuing procedures,” Ambassador Antonov said on Sunday.

    Russian embassy in Washington, via AP

    “We hope that common sense will prevail and we will be able to normalize the life of Russian and American diplomats in the United States and Russia on the principle of reciprocity,” the top Russian diplomat in the US added.

    Despite the momentary ‘bright spot’ for potential US-Russia rapprochement seen on June 16 during Biden and Putin’s Geneva summit where the two vowed to re-open talks on arms control and cybersecurity threats, and also crucially decided to restore each’s ambassadors to their posts, this latest development appears to be likely retaliation for this:

    The United States said Friday it has laid off nearly 200 local staffers working for its diplomatic missions in Russia ahead of an August 1 deadline set by the Kremlin for their dismissal. The move is the latest in a series of measures taken by both sides that have strained U.S.-Russia relations. 

    Secretary of State Antony Blinken said the layoffs are regrettable and something the U.S. had hoped to avert, despite a sharp deterioration in ties between Moscow and Washington, which show few signs of improvement.  

    All of this was based on prior tit-for-tat escalating moves, given earlier in the year Russia announced a new ban on its citizens working at the US embassy in Moscow and consulates in Yekaterinburg and Vladivosto. The US had earlier expelled Russian diplomats from US soil.

    Blinken had said further of last Friday’s local staffer layoff in Russia :”These unfortunate measures will severely impact the US mission to Russia’s operations, potentially including the safety of our personnel as well as our ability to engage in diplomacy with the Russian government.”

    Meanwhile, Russian ambassador Antonov urged that instead of more ‘counter moves’ in the diplomatic arena which will only further hurt and strain communications, “As an option, we can debate on cyber threats to arms control systems, etc,” he offered. Last week the US and Russia did began nuclear arms control talks based on a prior Biden-Putin agreement made in Geneva.

    Russian Deputy Foreign Minister Sergei Ryabkov had told the WSJ: “We are just at the very beginning of what I hope would be a sustainable process,” but he added the caveat: “At this point in time we in Moscow don’t have any sense if we would be able to succeed.”

    Tyler Durden
    Mon, 08/02/2021 – 18:40

  • Chicago Officials Trying To Block $1 Million Tax Refund On Trump Building
    Chicago Officials Trying To Block $1 Million Tax Refund On Trump Building

    Authored by Isabel van Brugen via The Epoch Times,

    Chicago officials are trying to block former President Donald Trump from receiving a $1 million tax refund that the Illinois Property Tax Appeal Board ruled is owed on his Chicago skyscraper’s 2011 tax bill.

    The office of Cook County State’s Attorney Kimberly Foxx filed a lawsuit with the Illinois Appellate Court on July 9 disputing the refund, noting that the money would come out of the property taxes due to the city of Chicago, the Chicago Public Schools and several other government agencies.

    The lawsuit comes after the board ruled in a 5-0 vote in June that the former president is owed a total tax refund of $1.03 million as the value of the Trump International Hotel & Tower had been overassessed.

    The tax agency ruled that the “Cook County Board of Review overestimated the value of the building’s hotel rooms and retail space,” the Chicago Sun-Times reported.

    The Epoch Times has reached out to the Trump Organization for comment.

    The dispute over the tax bills on the high-rise building is the latest chapter in a long-running legal battle over Trump’s tax bills that started more than 12 years ago and has led to more than $14 million in tax breaks for the former president.

    Originally, the state agency rejected Trump’s argument that the vacant stores had no value because he could not find any tenants to lease them. A hearing officer for the state agency rejected Trump’s argument that the vacant stores at the building had no value because he couldn’t lease them. But a staff member later wrote a report that Trump was entitled to the refund.

    The agency delayed acting on the case until Trump was out of office and in June voted to reduce the assessment on the building’s commercial property.

    This comes as the Department of Justice said that tax officials must hand over Trump’s tax returns to a congressional panel, after a lawyer in the department’s Office of Legal Counsel on July 31 reversed a 2019 decision that said they didn’t have to be given to Rep. Richard Neal (D-Mass.), chairman of the House Ways and Means Committee, because Neal was “disingenuous” about the true purpose of seeking the returns.

    After Trump was elected in 2016, a number of Democrats have attempted to obtain his tax returns. The former president has refused to release them to the public.

    Tyler Durden
    Mon, 08/02/2021 – 18:20

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