- Home Invasions: All The Ways The Government Can Lay Siege To Your Property
Home Invasions: All The Ways The Government Can Lay Siege To Your Property
Authored by John W. Whitehead & Nisha Whitehead via The Rutherford In
– Supreme Court Justice Ruth Bader Ginsburg, the lone dissenter in Kentucky v. King
Americans are not safe in their homes.
Not anymore, at least.
This present menace comes from the government and its army of bureaucratized, corporatized, militarized mercenaries who are waging war on the last stronghold left to us as a free people: the sanctity of our homes.
The weapons of this particular war on our personal security and our freedoms include an abundance of laws that criminalize almost everything we do, a government that views our private property as its own, militarized police who have been brainwashed into believing that they operate above the law, courts that insulate police from charges of wrongdoing, legislatures that legitimize the government’s usurpations of our rights, and a populace that is so ignorant of their rights and distracted by partisan politics as to be utterly incapable of standing up to the government’s overreaches, incursions and power grabs.
This is how far the mighty have fallen.
Government agents—with or without a warrant, with or without probable cause that criminal activity is afoot, and with or without the consent of the homeowner—are now justified in mounting home invasions in order to pursue traffic violators, seize lawfully-owned weapons, carry out knock-and-talk “chats” with homeowners in the dead of night, “prevent” individuals from harming themselves, provide emergency aid, intervene in the face of imminent danger, serve as community caretakers, chase down individuals suspected of committing misdemeanor crimes, and anything else they can get away with.
This doesn’t even begin to touch on the many ways the government and its corporate partners-in-crime may be using surveillance technology—with or without the blessing of the courts—to invade one’s home: with wiretaps, thermal imaging, surveillance cameras, and other monitoring devices.
However, while the courts and legislatures have yet to fully address the implications of such virtual intrusions on our Fourth Amendment, there is no mistaking the physical intrusions by police into the privacy of one’s home: the toehold entry, the battering ram, the SWAT raid, the knock-and-talk conversation, etc.
Whether such intrusions, warranted or otherwise, are unconstitutional continues to be litigated, legislated and debated.
The spirit of the Constitution, drafted by men who chafed against the heavy-handed tyranny of an imperial ruler, would suggest that one’s home is a fortress, safe from almost every kind of intrusion. Unfortunately, a collective assault by the government’s cabal of legislators, litigators, judges and militarized police has all but succeeded in reducing that fortress—and the Fourth Amendment alongside it—to a crumbling pile of rubble.
Two cases before the U.S. Supreme Court this term, Caniglia v. Strom and Lange v. California, are particularly noteworthy.
In Caniglia v. Strom, police want to be able to carry out warrantless home invasions in order to seize lawfully-owned guns under the pretext of their so-called “community caretaking” duties. Under the “community caretaking” exception to the Fourth Amendment, police can conduct warrantless searches of vehicles relating to accident investigations and provide aid to “citizens who are ill or in distress.”
At a time when red flag gun laws are gaining traction as a legislative means by which to allow police to remove guns from people suspected of being threats, it wouldn’t take much to expand the Fourth Amendment’s “community caretaking” exception to allow police to enter a home without a warrant and seize lawfully-possessed firearms based on concerns that the guns might pose a danger.
What we do not need is yet another pretext by which government officials can violate the Fourth Amendment at will under the pretext of public health and safety.
In Lange v. California, police want to be able to enter homes without warrants as long as they can claim to be in pursuit of someone they suspect may have committed a crime. Yet as Justice Neil Gorsuch points out, in an age in which everything has been criminalized, that leaves the door wide open for police to enter one’s home in pursuit of any and all misdemeanor crimes.
At issue in Lange is whether police can justify entering homes without a warrant under the “hot pursuit” exception to the Fourth Amendment.
The case arose after a California cop followed a driver, Arthur Lange, who was honking his horn while listening to music. The officer followed Lange, supposedly to cite him for violating a local noise ordinance, but didn’t actually activate the police cruiser’s emergency lights until Lange had already arrived home and entered his garage. Sticking his foot under the garage door just as it was about to close, the cop confronted Lange, smelled alcohol on his breath, ordered him to take a sobriety test, and then charged him with a DUI and a noise infraction.
Lange is just chock full of troubling indicators of a greater tyranny at work.
Overcriminalization: That you can now get pulled over and cited for honking your horn while driving and listening to music illustrates just how uptight and over-regulated life in the American police state has become.
Make-work policing: At a time when crime remains at an all-time low, it’s telling that a police officer has nothing better to do than follow a driver seemingly guilty of nothing more than enjoying loud music.
Warrantless entry: That foot in the door is a tactic that, while technically illegal, is used frequently by police attempting to finagle their way into a home and sidestep the Fourth Amendment’s warrant requirement.
The definition of reasonable: Although the Fourth Amendment prohibits warrantless and unreasonable searches and seizures of “persons, houses, papers, and effects,” where we run into real trouble is when the government starts dancing around what constitutes a “reasonable” search. Of course, that all depends on who gets to decide what is reasonable. There’s even a balancing test that weighs the intrusion on a person’s right to privacy against the government’s interests, which include public safety.
Too often, the scales weigh in the government’s favor.
End runs around the law: The courts, seemingly more concerned with marching in lockstep with the police state than upholding the rights of the people, have provided police with a long list of exceptions that have gutted the Fourth Amendment’s once-robust privacy protections.
Exceptions to the Fourth Amendment’s warrant requirement allow the police to carry out warrantless searches: if someone agrees to the search; in order to ferret out weapons or evidence during the course of an arrest; if police think someone is acting suspiciously and may be armed; during a brief investigatory stop; if a cop sees something connected to a crime in plain view; if police are in hot pursuit of a suspect who flees into a building; if they believe a vehicle has contraband; in an emergency where there may not be time to procure a warrant; and at national borders and in airports.
In other words, almost anything goes when it comes to all the ways in which the government can now invade your home and lay siege to your property.
Thus we tumble down that slippery slope which might have started out with a genuine concern for public safety and the well-being of the citizenry only to end up as a self-serving expansion of the government’s powers that makes a mockery of the Fourth Amendment while utterly disregarding the rights of “we the people.”
Frankly, it’s a wonder we have any property interests, let alone property rights, left to protect.
Think about it.
That house you live in, the car you drive, the small (or not so small) acreage of land that has been passed down through your family or that you scrimped and saved to acquire, whatever money you manage to keep in your bank account after the government and its cronies have taken their first and second and third cut…none of it is safe from the government’s greedy grasp.
At no point do you ever have any real ownership in anything other than the clothes on your back.
Everything else can be seized by the government under one pretext or another (civil asset forfeiture, unpaid taxes, eminent domain, public interest, etc.).
The American Dream has been reduced to a lease arrangement in which we are granted the privilege of endlessly paying out the nose for assets that are only ours so long as it suits the government’s purposes.
And when it doesn’t suit the government’s purposes? Watch out.
This is not a government that respects the rights of its citizenry or the law. Rather, this is a government that sells its citizens to the highest bidder and speaks to them in a language of force.
Under such a fascist regime, the Fifth Amendment to the U.S. Constitution, which declares that no person shall “be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation,” has become yet another broken shield, incapable of rendering any protection against corporate greed while allowing the government to justify all manner of “takings” in the name of the public good.
What we are grappling with is a government that has forfeited its purpose for existing.
Philosophers dating back to John Locke have long asserted that the true purpose of government is to protect our rights, not just our collective rights as a people, but our individual rights, specifically our rights to life, liberty and property. As James Madison concluded in the Federalist Papers, “Government is instituted no less for the protection of the property than of the persons of individuals.”
What we have been saddled with is a government that has not only lost sight of its primary reason for being—to protect the people’s rights—but has also re-written the script and cast itself as an imperial overlord with all of the neo-feudal authority such a position entails.
Let me put it another way.
If the government can tell you what you can and cannot do within the privacy of your home, whether it relates to what you eat, what you smoke or whom you love, you no longer have any rights whatsoever within your home.
If government officials can fine and arrest you for growing vegetables in your front yard, gathering with friends to worship in your living room, installing solar panels on your roof, and raising chickens in your backyard, you’re no longer the owner of your property.
If school officials can punish your children for what they do or say while at home or in your care, your children are not your own—they are the property of the state.
If government agents can invade your home, break down your doors, kill your dog, damage your furnishings and terrorize your family, your property is no longer private and secure—it belongs to the government.
If police can forcefully draw your blood, strip search you, probe you intimately, or force you to submit to vaccinations or lose your so-called “privileges” to move about and interact freely with your fellow citizens, your body is no longer your own—it is the government’s to do with as it deems best.
Likewise, if the government can lockdown whole communities and by extension the nation, quarantine whole segments of the population, outlaw religious gatherings and assemblies of more than a few people, shut down entire industries and manipulate the economy, muzzle dissidents, and “stop and seize any plane, train or automobile to stymie the spread of contagious disease,” then you no longer have a property interest as master of your own life, either.
This is what a world without the Fourth Amendment looks like, where the lines between private and public property have been so blurred that private property is reduced to little more than something the government can use to control, manipulate and harass you to suit its own purposes, and you the homeowner and citizen have been reduced to little more than a tenant or serf in bondage to an inflexible landlord.
If we continue down this road, the analogy shifts from property owners to prisoners in a government-run prison with local and federal police acting as prison guards. In such an environment, you have no rights.
So what can we do, short of scrapping this whole experiment in self-government and starting over?
At a minimum, we need to rebuild the foundations of our freedoms.
What this will mean is adopting an apolitical, nonpartisan, zero tolerance attitude towards the government when it oversteps its bounds and infringes on our rights.
We need courts that prioritize the rights of the citizenry over the government’s insatiable hunger for power at all costs.
We need people in the government—representatives, bureaucrats, etc.—who honor the public service oath to uphold and defend the Constitution.
Most of all, we need to reclaim control over our runaway government and restore our freedoms.
After all, we are the government. As I make clear in my book Battlefield America: The War on the American People, “we the people” are supposed to be the ones calling the shots. As John Jay, the first Chief Justice of the United States, rightly observed: “No power on earth has a right to take our property from us without our consent.”
Tyler Durden
Thu, 03/04/2021 – 00:00 - "Two Sessions" 2021: 5 Things You Need To Know About China's Biggest Political Gathering
“Two Sessions” 2021: 5 Things You Need To Know About China’s Biggest Political Gathering
Authored by Melissa Zhu via The South China Morning Post,
More than 5,000 members of China’s political elite are expected to converge on Beijing in early March for the biggest event on the political calendar.
Known as the “two sessions”, or lianghui, the annual gatherings of the Chinese People’s Political Consultative Conference (CPPCC) and the National People’s Congress (NPC) are a window on the central government’s priorities and plans for the coming year.
This year’s two sessions commence on March 4, and will wrap up on March 11.
The 2021 gatherings of the top advisory and legislative bodies are particularly important because they will mark the start of the next five-year plan and fall in the Communist Party’s centenary year.
Here’s what you need to know:
1. The two meetings are separate affairs
While the CPPCC and NPC meetings take place almost simultaneously and at the same place, they are separate events.
The CPPCC has about 2,200 members from political parties, social groups, professions, various sectors and other organisations.
Its session will get under way on March 4 and members will discuss issues ranging from economics and religion to sport, health and foreign affairs. Various committees will then put together proposals for the government to consider. However, they do not have the power to enact these proposals into law.
This is where the NPC, the country’s top legislature, comes in. Its 3,000 deputies from provinces, autonomous regions and municipalities gather for a full session once a year to vote on and pass important pieces of legislation. This year, they will begin their meetings on March 5.
The NPC is often described as a rubber stamp, serving to officially approve decisions made by other state bodies. The deputies are chosen based on their professional credentials and while some may not have any political affiliations, most are from the ruling Communist Party.
The deputies are selected by legislatures at the provincial, autonomous region and municipal levels and include people from Hong Kong and Macau.
The NPC has never vetoed a party-endorsed plan or work report, although the vote is not always unanimous. The number of opposing votes, however small, is often seen as a sign of the level of disagreement with a government leader or agency.
SCMP Explains: The ‘two sessions’ – China’s most important political meetings of the year
2. Strict Covid-19 control measures will remain in place
Last year, at the height of China’s fight against the coronavirus pandemic, Beijing postponed the two sessions from March to May and imposed strict disease controls on those attending.Beijing has since declared victory over the pandemic, but the country still faces sporadic outbreaks. In January, a cluster of infections about 300km (186 miles) from Beijing resulted in lockdowns in Hebei capital Shijiazhuang and neighbouring Xingtai.Many of the precautions introduced for last year’s two sessions will remain in force for this year’s gathering: only journalists based in Beijing will be allowed to register for the events, most of which will take place online.
The meetings this year will be limited to a week, rather than the usual two weeks or so.
Foreign diplomats who want to attend will also have to take a Covid-19 test and spend a night in quarantine beforehand.
Delegates wearing face masks attend the opening of the third plenary session of the 13th National Committee of the Chinese People’s Political Consultative Conference (CPPCC) in Beijing, China, on 21 May 2020. Photo: EPA-EFE
3. Tech, economic growth and climate change are top of the agenda
One of the NPC’s tasks this year will be to pass the final version of China’s 14th five-year plan, which gives the leadership a chance to outline longer-term priorities that could define President Xi Jinping’s legacy and the party’s future.Notably, the latest five-year plan will be the first to dedicate a specific chapter to technology, framing self-sufficiency in technology as a major pillar of China’s economic development and marking a shift in priorities towards industrial and national security as well as reduced tech imports.Technology is one of the most contentious areas in Beijing’s relationship with Washington and a field that China sees as critical to its drive for modernisation and self-reliance over the next decade and a half.The outlines of the five-year plan published in November indicate that China intends to boost domestic consumer demand and encourage self-reliance in the hi-tech sector, as part of its so-called dual circulation strategy.
Xi signalled this shift towards the domestic sector late last year, telling a party meeting that the country had managed to “turn danger into safety” in response to multiple external risks by focusing on its own businesses.
SCMP Explains: China’s five-year plans that map out the government priorities for development
NPC deputies are expected to cut both the budget deficit and the issuance of local special purpose bonds used to fund infrastructure spending, while increasing the budget for livelihood-related projects, according to analysts.Observers will also be watching for signs of how the country intends to achieve net zero carbon dioxide emissions within the next four decades.
4. It’s a big year for China and the Communist Party
This year’s political set piece will take on extra political weight for the president as the Communist Party gears up to celebrate its centenary in July.
Xi has signalled his confidence that the party and country are on the right track by telling senior officials in January that “time and momentum are on our side”.
However, he warned that the country faced “unprecedented challenges and opportunities”, telling the Politburo they must “create favourable social conditions” for the anniversary.
Coverage of the two sessions is therefore likely to be especially sensitive: Public Security Minister Zhao Kezhi told police chiefs to regard any challenges to the authorities – including online – as “battlefields” on which they must be ready to fight ahead of the July celebrations.Aside from the 14th five-year plan, Beijing’s leadership will also unveil its longer-term “ 2035 vision” at the two sessions this year. This will be a blueprint for the next 15 years, harking back to the start of the era of reform and opening up under Deng Xiaoping four decades ago.
5. International relations will be at play
China is looking to reset relations with the United States after four years of rapid deterioration under former US president Donald Trump.
But Joe Biden has made it clear that he expects “extreme competition” between the two countries, and his team is expected to continue a hard approach to China, albeit in greater consultation with US allies.
Chinese President Xi Jinping, right, shakes hands with then-US Vice-President Joe Biden as they pose for photos at the Great Hall of the People in Beijing in 2013. Photo: AP
Early signals from the Biden administration also reflect a focus on human rights in the relationship with China, so the presence at the two sessions of senior officials sanctioned for their actions in Xinjiang and Hong Kong may be a reminder of some of Beijing’s domestic policies that have caused growing international alarm.
Accusations that China mishandled the start of the pandemic – combined with issues such as Taiwan, the South China Sea and the prolonged border stand-off with India – have further damaged its image on the world stage.
China is likely to be particularly careful about its political messaging as any further international backlash could threaten its economic plans.
Tyler Durden
Wed, 03/03/2021 – 23:40 - Historic Repo Market Insanity: 10Y Treasury Trades At -4% In Repo Ahead Of Monster Short Squeeze
Historic Repo Market Insanity: 10Y Treasury Trades At -4% In Repo Ahead Of Monster Short Squeeze
Something crazy happened in the repo market today: according to Curvature repo guru Scott Skyrm, the 10Y traded as low as -4.00% in repo, a record low level and an unprecedented dislocation for the world’s most liquid security, one with potentially tremendous consequences for what Jerome Powell may say tomorrow. Incidentally, Skyrm was far more dramatic about this historic move:
It’s all over for the 10 Year Note! Clearly a significant amount of shorts rolled forward and now short-demand has overwhelmed the available supply. The issue traded as low as -4.00% today and already traded at -3.05% for tomorrow. Both of those rates are lower than Fail Charge, which is the equivalent of -3.00%.
What is remarkable is that the 10Y was barely “special” last Thursday when yields exploded higher amid the liquidation panic.
Actually scratch that: last week there were barely any shorts in the 10Y – that’s why the massive stop loss liquidation after last Thursday’s 7Y auction was just longs puking. It was only after that the flood of shorts arrived and hammered the 10Y to “fails” levels in repo.
What does that mean in English?
As we have discussed in the past, TSYs trade special, or anywhere between 0% and -3% in repo (and while they may trade at, they never drop below the fails charge), whenever there is a massive pile up of shorts. Think of it as a borrow on a stock at some insane percentage: 100%, 1000%, etc. It’s similar in rates, only such mechanics take places in the repo market and a rate of -3% is usually considered the equivalent of extremely hard to borrow. Even so, never before have we encountered a 10Y trading so special it was below the fails charge.
Why would anyone buy below the Fail Charge? As Skyrm explains, in the Treasury market, if you fail to deliver to a counterparty, there’s a fail charge equal to 300 basis points below the lower bound of the fed funds target range. The equivalent of a -3.00% Repo rate. There are a variety of reasons why a Repo desk will cover a short below the Fail Charge rate – which include: keeping clients happy, avoiding internal meetings/explanations, and internal rules that require shorts to be covered. None of this explains why the repo rate would drop to the mathematically improbable -4%, except to suggest that something is starting to crack in the repo market itself.
Skyrm concludes by saying what what we noted above, namely that “what’s important is that trading below the Fail Charge implies a real deep short-base.”
So what does this mean in the bit scheme of things? Recall what we showed yesterday using the latest data from Goldman – there is zero, nada, zilch liquidity in Treasurys. Indeed the last time the top-of-book depth was this low was during the peak of the Covid crisis last March.
At the same time, the latest repo data merely confirms that all the price action is entirely on the short side and explains much of today’s action. In fact, never before has there been such a massive pile up of shorts in the 10Y.
This is important because it means that the imbalance in the bond market is no longer just a fundamental bet by traders expecting inflation: there is also something profoundly wrong with the actual market structure itself so much so that if left unchecked it could lead to catastrophic consequences for the world’s (once upon a time) most liquidity market.
Meanwhile, none other than the Fed vice chair Lael Brainard, who was until very recently expected to become the next Treasury secretary and is widely considered to be Powell’s replacement as Fed Chair, said on Tuesday that the Fed is now “paying attention”:
I am paying close attention to market developments — some of those moves last week and the speed of those moves caught my eye. I would be concerned if I saw disorderly conditions or persistent tightening in financial conditions that could slow progress toward our goal.
Maybe on Tuesday the Fed did not see “disorderly conditions” but in light of the historic move in repo on Wednesday, the Fed no longer has the luxury of waiting.
What this also means is that tomorrow, when Powell speaks at the Wall Street Journal virtual event which begins at noon, the Fed Chair will likely strongly hint that the Fed will either extend the SLR exemption by another 3-6 months (we explained the critical significance of the SLR term extension earlier in “Why The SLR Is All That Matters For Markets Right Now“), or that the IOER or RRP rates will be hiked to unclog the sudden build up of collateral and push it back in the market. Perhaps the Fed will go so far as suggesting a new Operation Twist will be activated in the coming months (ahead of the Fed’s taper announcement). Incidentally, our base case is that Powell will make it clear the current SLR term, will be extended as the Fed will want to hold on to YCC until just before it announces tapering in H2.
Whatever Powell does, he will have to do something to unfreeze not just the bond but now also the repo market, as the alternative is a market this is now literally broken, something former NY Fed repo guru Zoltan Pozsar predicted last week (see “Here We Go Again: Zoltan Warns Repo Market On Verge Of Major Shock As Key Funding Rate Turns Negative“).
And speaking of Pozsar, this is what he said in his latest Global Money Dispatch note which we touched on earlier:
For every macro narrative that explains why U.S. treasury yields are rising, there is also a plumbing narrative that can explain things with equal persuasion.
So yes, Powell and the Fed could ignore the rise in yields as long as the turmoil did not spread to the repo market – such a move could be explained by the reflationary macro narrative – but now that the 10Y is trading below the fails charge in repo the repo market is officially cracking and as Sept 2019 taught us, there is nothing that the Fed is more worried about than the sanctity of the repo market.
Finally, what happens if we are right and Powell does assure the market that SLR will be extended? Well, since all of the pent up uncertainty about whether or not bank balance sheets will be usable after March 31 will disappear, what will happen is a monster short squeeze as all those shorts that pushed the 10Y to -4% in repo panic and scramble to cover, sparking a massive surge higher in prices (and plunge in yields), and since there will be immediate follow through to stocks where concerns about rising yields just sent risk assets plunging, we expect a monster move higher in stocks tomorrow.
In fact, judging by the freefall in futures, we wouldn’t be surprise if the Fed announces that the SLR exemption will be granted at the usual pre-market time of 830am.
In any case, stay tuned because there will be fireworks – most likely to the upside – but if for some reason Powell refuses to unclog the repo market, there will be blood.
Tyler Durden
Wed, 03/03/2021 – 23:12 - Army Begins New Infantry Squad Vehicle Test At Arizona's Yuma Proving Ground
Army Begins New Infantry Squad Vehicle Test At Arizona’s Yuma Proving Ground
The US Army is racing to modernize its forces. A new Infantry Squad Vehicle (ISV) recently showed up to Yuma Proving Ground for harsh testing in southwestern Arizona, according to Yuma Sun.
Isaac Rodriguez, team leader for the proving ground’s combat automotive division, said testing for the new ISV began in early February and will end in April.
GM Defense LLC is the new vehicle’s manufacturer, which is based on a 2020 Chevrolet Colorado ZR2 midsize truck. Most of the parts for the combat vehicle are commercially available.
The light and agile all-terrain troop carrier can haul up to nine troops with gear. It’s light enough to be sling loaded under a UH-60 Black Hawk helicopter and fit inside a CH-47 Chinook helicopter.
GM’s ISV will undergo 5,000 miles of desert terrain testing at the proving ground, “we will also be doing some slope mobility and cooling system tests,” Rodriguez said.
GM Defense is expected to produce 649 ISVs near term and produce up to 2,065 vehicles by 2024.
The 1st Infantry Brigade Combat Team of the 82nd Airborne Division at Fort Bragg, North Carolina, is expected to receive 59 ISVs later this year.
Besides new light vehicles that appear similar to the Hummer but with a modern flair – the service has been working diligently to field robotic tanks.
Tyler Durden
Wed, 03/03/2021 – 23:00 - $350 Billion Covid "Bailout" To States, Cities, And Counties: Here Are Biggest Winners And Losers
$350 Billion Covid “Bailout” To States, Cities, And Counties: Here Are Biggest Winners And Losers
Authored by Adam Andrzejewski, originally published in Forbes
This week, the U.S. House passed, along party lines, the $1.9 trillion American Rescue Plan Act of 2021. A vote in the U.S. Senate is expected soon. Buried within the 591-page bill is a $350 billion bailout for 50 states, tribal governments, U.S. territories, and more than 30,000 cities and counties.
Our auditors at OpenTheBooks.com finally located the $350 billion allocation, line-by-line, in a supplemental database hidden on the back end of the House Oversight Committee’s website.
We mapped the data to each of the 50 states. Click here to see how much taxpayer money Congress earmarked your hometown to receive from the COVID “relief” bill.
Congress tried to hide these line-by-line appropriations, but thanks to technology and the internet, you can search it for yourself.
Here’s a summary of our oversight findings — our top-down state analysis uses figures found in the Congressional Research Service (CRS) report issued 3/3/2021.
States
Speaker Nancy Pelosi’s House Democrats changed the allocation formula from being based on population to the unemployment rate. This change caused 23 states to gain $31.9 billion and 27 states to lose that funding. The four biggest winners were Democratic strongholds: California—which reaped an extra $6.7 billion; New York—which added another $6 billion; Illinois — increased by $2.1 billion; and New Jersey — a $2 billion increase.
Overall, California – Pelosi’s home state – was allocated the most money ($42.3 billion), followed by Texas ($27.3 billion), New York ($23.5 billion), and tribal governments ($20 billion). They’re followed by states like Florida ($17.3 billion), Illinois ($13.5 billion), Pennsylvania ($13.5 billion), Ohio ($11 billion), Michigan ($10.1 billion), and New Jersey ($10 billion).
The biggest losers were Florida (-$2.3 billion), Vermont (-$2.1); and Wyoming (-$2 billion). The funding change rewarded Gov. Andrew Cuomo (D) in New York ($23.5 billion) over Gov. Ron DeSantis (R) in Florida ($17.3 billion), even though Florida has a larger population and a lower COVID-19 death rate.
Since the Senate is split evenly between the two parties, Democrats can’t afford any defections if the bill is to pass.
Will the two new Democratic senators, Jon Ossoff and Raphael Warnock, from Georgia still vote for this bill even though it shifts $1.5 billion of their Georgia tax dollars to California and New York? What about Sen. Joe Machin (D-WV), whose state is losing $991 million due to the allocation change?
Furthermore, we found that Puerto Rico received more funding at $4 billion than 22 states. Including an extra “plus up” from the previous CARES Act Covid aid bill, the District of Columbia received more funding at $2.3 billion than 13 states.
Cites and Localities – $65 billion
The largest cities received huge allocations of aid. For example, New York City received $4.3 billion, which is more money than 25 state governments. Chicago, with their bonds at junk status, was allocated $1.98 billion, an amount more than 12 state governments.
Democrats apparently don’t believe anyone will object to giving big bailouts to prosperous towns. Beverly Hills, CA, will receive $6.3 million while the Hamptons, NY, will get $8.6 million. They’re followed by Key West, FL ($10.1 million); Greenwich, CT ($21 million); Oyster Bay, NY ($32.7 million); and Cambridge, MA ($65 million).
In fact, the 50 richest places (Bloomberg) would receive $100 million in COVID-19 bailout funds. For example, Atherton, CA, the wealthiest city in America with an average household income of $525,000, received $1.3 million from the legislation.
Hillsborough, CA, reaps $2.1 million from the bill even though it boasts a median home price of $5.8 million. Scarsdale, NY—the richest place on the East Coast—would get $2 million in “relief.”
Democrats earmarked $2 million for the richest town in Texas, Highland Park. The median home price is $1.5 million and notable residents include the owner of the Dallas Cowboys, Jerry Jones, and the Bush family.
California’s sunny playgrounds get big bailouts including Manhattan Beach ($6.6 million); Newport Beach ($9 million); Palm Springs ($11 million); Palo Alto ($12 million); Brentwood ($12.1 million); Napa ($15 million); San Jose ($22 million); Santa Barbara ($22 million); Santa Monica ($29 million); Huntington Beach ($31 million); and even Berkeley ($68 million).
Other high-end vacation destinations like Palm Beach, FL ($3.7 million); Nantucket, MA ($1.1 million) and Martha’s Vineyard at Edgartown, MA ($428,000) received funding from the bill.
Search your hometown on our interactive map at OpenTheBooks.com.
Counties & U.S. Territories – $65 billion
Congress earmarked $1 billion for the top ten richest counties across the U.S. Four of the top six are located in Virginia and Maryland, inside the Washington, D.C. beltway. They include Loudon County, VA ($80.2 million); Howard County, MD ($63.2 million); Arlington County, VA ($45 million); and Fairfax County, VA ($4.5 million). With a median income of $136,000, Loudoun County has the highest income of any U.S. county with more than 65,000 residents.
The wealthy county of Santa Clara, CA, is set to receive a whopping $385 million from the legislation. Located in the heart of Silicon Valley, the county has the highest median income of any county in California. The county seat is the city of San Jose, where the average home price tops $1 million.
Here are the top five counties receiving the most money in COVID “relief”: Los Angeles County, CA ($2 billion); Cook County, IL ($1 billion); Harris County, TX ($914.1 million); Maricopa County, AZ ($870 million); and San Diego County, CA ($647.5 million).
During the past three years, Republicans and Democrats have helped drain the U.S. Treasury from the left and the right. Our national debt increased from $10 trillion (2008) to $19.6 trillion (2016) to $23.6 trillion (2020) and stands at $28 trillion today.
Continuing non-targeted coronavirus responses and bloated legislation will drive the national debt much higher.
Tyler Durden
Wed, 03/03/2021 – 22:22 - JP Morgan Is Trying To Offload "Big Blocks" Of Corporate Manhattan Real Estate
JP Morgan Is Trying To Offload “Big Blocks” Of Corporate Manhattan Real Estate
The continued exodus out of New York carries on...
And it isn’t just corporations packing up their entire operations and moving to tax havens like Florida, as we have noted for the last year, it’s also firms cutting back on the amount of corporate real estate they use in the city. JP Morgan is the latest example, with the company reported looking to sell large blocks of its office space in Manhattan, according to Bloomberg.
The banking giant is reportedly looking to sublet about 700,000 square feet at 4 New York Plaza in the financial district, the report says. They’re also looking to sublet more than 100,000 square feet at 5 Manhattan West in the Hudson Yards area.
A spokesman for the bank said: “It is too early to comment on specifics as we continue to learn and adapt to this current situation and how it impacts our commercial real estate needs. We are committed to New York and are planning for the next 50 years with our new headquarters here.”
Tyler Durden
Wed, 03/03/2021 – 22:20 - 13 Killed In California Crash Allegedly Entered US Illegally Via Border Fence Hole: Officials
13 Killed In California Crash Allegedly Entered US Illegally Via Border Fence Hole: Officials
Authored by Jack Phillips via The Epoch Times,
U.S. Customs and Border Protection officials said they believe the victims killed in the collision in Southern California just miles from the U.S.-Mexico border were illegal immigrants who were smuggled through a dilapidated border fence near Calexico.
A Ford Expedition carrying more than two-dozen people collided with a semi-truck in Imperial County, California, on Tuesday, leaving at least 13 dead and more injured, local officials said.
Border Patrol agents and the U.S. Immigration and Customs Enforcement (ICE) opened an investigation to see whether the car was carrying smuggled migrants.
“We pray for the accident victims and their families during this difficult time,” said El Centro Sector Chief Patrol Agent Gregory Bovino in a news conference on Wednesday. Agents, he said, believe the deceased individuals were part of a larger group of about 44 migrants who were smuggled through a hole in the fence near Calexico, a California city that lies along the border and is next to the Mexican city of Mexicali.
Bovino added that an “initial investigation into the origins of the vehicles indicate a potential nexus to the aforementioned breach in the border wall,” while adding that “human smugglers have proven time and again they have little regard for human life.”
“Those who may be contemplating crossing the border illegally should pause to think of the dangers that all too often end in tragedy; tragedies our Border Patrol Agents and first responders are unfortunately very familiar with,” he said in the news conference.
Law enforcement officers work at the scene of a deadly crash in Holtville, Calif., on March 2, 2021. (Gregory Bull/AP Photo)
The deadly collision occurred on Highway 115 at Norrish Road in Holtville, located some 115 miles east of San Diego. It’s not immediately clear what caused the crash.
And Guatemalan officials on Wednesday said they received information that one Guatemalan national died and another person from the Central American country was injured, Reuters reported. Ten Mexican nationals also died in the incident, Mexican authorities said, according to the news agency.
The revelation that the Expedition was carrying smuggled illegal immigrants is sure to trigger criticism against the White House from Republicans and some Democrats who represent districts near the border over its immigration policy. Starting on Jan. 20, President Joe Biden has signed a number of immigration-related orders, which Republicans have said have triggered a crisis along the Southern Border.
Biden, in remarks to reporters on Tuesday, downplayed concerns of there being a crisis at the border. “No, we’ll be able to handle it,” he said, while confirming that he received a briefing about the border situation Tuesday.
Department of Homeland Security Secretary Alejandro Mayorkas, meanwhile, alleged the previous administration bears some responsibility for the crisis.
“Let me explain to you why [fixing the broken immigration system] is hard and why it is going to take time,” he said during a news conference on Monday.
“I think it is important to understand what we have inherited because it defines the situation as it currently stands. Entire systems are not rebuilt in a day or in a few weeks.”
But Rep. Henry Cuellar (D-Texas), whose district lies along the border, warned that the situation needs to be taken seriously by the White House—namely due to the COVID-19 pandemic.
“It is not a crisis yet, but it will become a crisis,” Cuellar warned in a Fox News interview.
“The numbers have been increasing, and as your report just said a few minutes ago, the numbers are just increasing every day. The number of unaccompanied kids, the number of families who are coming in are just increasing every day.”
Tyler Durden
Wed, 03/03/2021 – 22:20 - The Quality Of Life In The United States Is Going Down The Toilet
The Quality Of Life In The United States Is Going Down The Toilet
Authored by Michael Snyder via TheMostImportantNews.com,
Is the quality of life in America getting better, or is it getting worse? Americans certainly have a lot more “money” than they did when I was a kid, but that doesn’t mean much because the U.S. dollar has only a fraction of the value that it did back then. And without a doubt our electronic devices have become much more advanced, but that doesn’t mean that we are happier. In fact, everywhere I look people seem to be deeply unhappy. It is rare to see someone actually smiling in public, but of course there is a good reason for that. If you smile too much, someone might accuse you of being creepy. As Americans, we are being trained to not express emotions and to keep to ourselves. Being friendly is considered to be “suspicious”, if you tell a joke there is a very good chance that you will deeply offend someone, and if you express strong opinions you might just get “canceled”.
Even though we are far more “wealthy” than they were, I imagine that our culture is not too different from what East Germans experienced before the Berlin Wall came down.
There is so much hate and division in our society, and everyone seems ready to rat out those around them at the drop of a hat. So most people are careful to keep to themselves, but at the same time most people are desperately lonely.
These days, most Americans walk around like a bunch of zombies. In fact, as a result of mental health problems and stress, a majority of Americans are exhibiting at least one of the symptoms of post-concussion syndrome…
A survey of more than 31,000 people shows that insufficient sleep, mental health problems, and stress were the causes of a whole host of symptoms doctors are used to seeing in head injury patients. Symptoms of what doctors call post-concussion syndrome (PCS) range from persistent headaches, dizziness and anxiety, to insomnia and loss of concentration and memory.
While 27 percent of people report having several of these symptoms, between one-half and three-quarters say they experience at least one. The most common symptoms are fatigue, low energy and drowsiness. Yet despite their findings, researchers believe the number in the general population could be much higher.
Of course one of the primary reasons why so many people are acting like zombies is because we have been drugged out of our minds. Americans take more legal drugs than anyone ever has in the entire history of the world, and each year the pharmaceutical companies come up with even more drugs for us to try.
In particular, because we are so deeply unhappy Americans take boatloads of anti-depressants. More than 50 million Americans are on anti-depressants right now, and it gets worse with each passing year.
But even though we are taking so many “happy pills”, Americans continue to kill themselves at a staggering pace, and this is particularly true for our young people.
In North Carolina, one school superintendent recently shared the fact that “the suicide rate among teens is higher than the COVID rate of death in their county”…
The debate to reopen schools for in-person learning has highlighted an alarming idea – that students are not just falling behind academically, but at a heightened risk of death by suicide.
“One of our local superintendents recently shared with me that the suicide rate among teens is higher than the COVID rate of death in their county,” Sen. Deanna Ballard, a Republican from the 45th district, recently told CBS 17, though she declined to name the superintendent or county. Ballard did not respond to NC Health News’ requests for comment.
Isn’t that insane?
You can’t just blame the pandemic for the rise in suicide either. In fact, the national suicide rate for teens was skyrocketing before the pandemic ever began…
The national rate of suicide in young people increased 57 percent between 2007 and 2018, according to the CDC.
“Even before the pandemic, we’ve been seeing an increase in youth suicides,” said Virginia Hamlet Rodillas, hotline manager for National Alliance on Mental Illness NC, which operates a statewide helpline.
If our society is so wonderful, then why are so many kids killing themselves?
The truth is that our society has become so sick and so twisted that life seems completely empty to so many of these youths. Life is such a wonderful gift, and every day should be enjoyed to the fullest, but our society has become so evil that many teens are killing themselves rather than live in it one more day.
I once wrote an entire book about why people can have hope in these deeply troubled times, and I really wish that I could get it into the hands of everyone in America.
There is hope even for those that are facing the darkest circumstances, but most people don’t realize that because our society certainly doesn’t offer any.
Overall life expectancy has been dropping in the U.S. as well. In fact, during the first half of 2020 life expectancy in the United States declined by a full year…
It’s already known that 2020 was the deadliest year in US history, with deaths topping 3MM for the first time. But the latest batch of morbid data is in, and they suggest things are about to get worse on average as life expectancy in the US dropped a full year during the first half of the year.
Life expectancy is a statistical measure of the average time a baby born today is expected to live. From January through June of last year, that was 77.8 years for the entire U.S. population, down from 78.8 years in 2019. It’s the lowest level since 2006, the report said.
Our healthcare system has become a complete and utter nightmare, and it is not going to get any better any time soon.
Speaking of nightmares, our system of public education has become a sick joke. Just look at what has been going on in Baltimore…
A shocking discovery out of a Baltimore City high school, where Project Baltimore has found hundreds of students are failing. It’s a school where a student who passed three classes in four years, ranks near the top half of his class with a 0.13 grade point average.
Tiffany France thought her son would receive his diploma this coming June. But after four years of high school, France just learned, her 17-year-old must start over. He’s been moved back to ninth grade.
Millions upon millions of young people graduate from high school each year, but many of them can barely read, write or speak in public.
I could go on and on. Just about every system that you could possibly name is in the process of failing, and that is probably why our satisfaction with the way our country is functioning is at the lowest level ever measured. The following comes from Gallup…
Americans’ satisfaction with seven broad aspects of the way the country functions is collectively at its lowest in two decades of Gallup measurement. This includes satisfaction with the overall quality of life in the U.S., assessments of government, corporate and religious influence, and perceptions of the economic and moral climates.
The average percentage satisfied with these seven dimensions has plunged to 39% at the start of 2021. That compares with 53% a year ago, the highest average in more than a decade amid strong economic confidence and before the coronavirus pandemic took hold in the U.S.
So once again I wish to pose a question to you.
Is the quality of life in America getting better, or is it getting worse?
The answer is quite obvious, and the rest of the world is laughing at us as our once great nation steadily deteriorates.
* * *
Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***
Tyler Durden
Wed, 03/03/2021 – 22:00 - Miami Beach Preps For Spring Break COVID Crackdown
Miami Beach Preps For Spring Break COVID Crackdown
In yet another great example of government efficiency, Miami Beach is prepping for a Spring Break Covid crackdown. Don’t check your calendar. Yes, it’s 2021.
It’s ironic, since last year – you know, before we even had vaccines and understood fully just how deadly (or not deadly) Covid was – Miami Beach was the go-to place to skirt restrictions and party as though nothing was going on. But now this year – as we are literally weeks away from herd immunity in the country – Miami is prepping to lay down the law.
The only thing that’ll keep Miami open, to some degree, is a statewide executive order that makes it impossible to shut down bars and clubs. Instead, they will run at no less than 50% capacity, according to the Wall Street Journal.
But Miami Beach is going to be taking a “zero tolerance” policy for the restrictions it does put in place. Miami Beach Mayor Dan Gelber (who is, of course, a Democrat), said earlier this week: “We could potentially see a truly outsized spring break at a time when the last thing we want are major gatherings.”
This policy means more police officers and code-compliance staffers enforcing bans on alcohol and boom boxes on the beach, and a midnight curfew. In addition, “music at venues can’t exceed ambient noise levels”. Because, you know, that’ll stop the virus.
And so, as people do, citizens of Miami are adapting and moving many of the parties to boats and yachts. The city said it’ll be “clamping down on those that lack proper licenses or violate noise restrictions” on the water.
City manager and resident downer, Raul Aguila, commented:
“If you are coming here with an anything-goes party attitude, change your flight reservation now and go to Vegas.”
We’re sure those trying to make a living off of hospitality and leisure in the city appreciate his suggestions.
Regardless, it doesn’t look like the city has been intimidated too much. Events planned in the city for spring break include a mansion party called “Miami Gone Wild 2,” another party called “Bikini Palooza” and, of course, a “Booze Cruise”.
Hotel occupancy in Miami is expected to be at 70% in March, which will be up from 43% at the same time last year and 88% in 2019.
One traveler in Miami, 23 year old Quinaysa Shirikico, told the Journal: “We just needed a vacation away from the city. We needed some heat in our lives.”
Promoter Ernesto White has said that demand is strong for events. He is working on several private pool parties and boat and jet-ski parties. “My phone has not stopped ringing. South Beach is going to be jam-packed crazy,” he said.
Tyler Durden
Wed, 03/03/2021 – 21:40 - Japan's Well-Fed Zombie Corporations
Japan’s Well-Fed Zombie Corporations
Authored by Gunther Schnabl and Taiki Murai via The Mises Institute,
The corona crisis has intensified the discussion about the zombification of the economy; enterprises have become more dependent on government bailouts, loans, subsidies, short-time working benefits, and loans from central banks. Governments around the world claim the measures to be only temporary. Yet Japan’s experience suggests that the reliance of enterprises on public support can continue in one form or another.
Japan’s enterprises have long relied on the state and more so during the corona crisis, a path that the US and Europe seem to be following.
There is no formal definition of zombie enterprises. Investopedia defines an enterprise as zombie if it earns just enough to keep operating and to service its interest but is unable to pay off the interest or to invest. An Organisation for Economic Co-operation and Development (OECD) study views a zombie as a firm that cannot cover its interest payments with profits for several years (Adalet McGowan et al. 2017). Caballero, Hoshi, and Kashyab (2008) pay attention to the role of banks, which extend financing to otherwise insolvent borrowers at the expense of profitable firms. Such a lenient practice of extending loans to distressed borrowers is also referred to as forbearance lending (Sekine et al. 2003).
Seen through the lens of Adalet McGowan et al. (2017), the number of zombie firms decreases if central banks gradually lower interest rates. Yet, the number of zombie firms is supposed to increase when central banks ease financing conditions such that enterprises with weak profitability are kept alive. If the loose monetary policy is perpetuated, the efforts of enterprises to increase efficiency and innovate diminish (Leibenstein 1966). Enterprises are “evergreen” (Peek and Rosengreen 2005), while aggregate productivity gains and real growth decline. The high stock of (potentially) nonperforming loans lies with zombie banks, which survive because the government provides explicit or—through persistently loose monetary policy—implicit guarantees (Schnabl 2015).
Zombification in Japan begins with the bursting of the Japanese bubble in December 1989. In the second half of the 1980s, the Bank of Japan (BOJ) had fueled a stock and real estate bubble through sharp interest rate cuts. When the bubble burst, bad loans piled up on banks’ balance sheets. The Bank of Japan cut interest rates toward zero in an attempt to insulate the economy from the ravages of bad loans. This plan had seemed to work, with outflows of Japanese cheap money toward Southeast Asia; yet the plan failed with the 1997/98 Asian financial crisis, which triggered the Japanese financial crisis in 1998. The stock of (potentially) bad loans further grew.
Japan: Equity-to-Asset Ratio by Enterprise Size
Source: Ministry of Finance, Japan. The equity-to-asset ratio is defined as the equity divided by the total assets.
The increasing leniency came from politicians. Members of the legislature from all regions of the country feared the anger of their voters in the event of bankruptcies. Because the persistently loose monetary policy kept reducing the banks’ net interest revenues, the distressed banks were destabilized further (Schnabl 2020). The Japanese banks hesitated to sufficiently price default risks and to close weak companies’ credit lines, because the risk of additional nonperforming loans seemed too high.
The lenient bank lending policies were supported by the government, which softened corporate lending requirements through numerous pieces of legislation. Many small and medium-sized enterprises received public loan guarantees in the course of the 1998 and 2008 crises. The Small and Medium-Sized Enterprises Financing Facilitation Law in 2009, for example, gave banks the incentive to grant very generous credit facilities and extensions to small and medium-sized enterprises. Enterprises just had to submit a business plan that promised an improvement in their situations. Many loans that were actually nonperforming were reclassified as healthy loans. In 2012, further measures, such as deferrals, ensured that the credit burden of small and medium-sized enterprises at risk of default was kept bearable.
The upshot is that the brakes were put on restructuring enterprises. Economic growth was paralyzed, business expectations remained negative, and domestic sales stagnated. However, corporate profits tended to remain stable, because the Bank of Japan decreased the interest expenses of enterprises and the never-ending crisis led to restrained wage demands. The average wage increase of large enterprises through the so-called Shuntô wage negotiations remained stuck at nearly 2 percent after 1998, in contrast to 9 percent on average from 1956 to 1997. The real wage level has been decreasing since 1998 (Latsos 2019).
Despite stable corporate profits, however, Japanese companies did not invest. Sitting idle on the liquidity, they repaid loans and expanded equity (see chart). The corporate sector changed from a net borrower to a net saver. Small and medium-sized enterprises are holding their retained earnings mainly in the form of bank deposits. Large enterprises invest in the international expansion of their business activities, in particular in the form of mergers and acquisitions (M&A) as well as the establishment of foreign branches. The equity-to-asset ratio of Japanese enterprises increased, because corporate profits failed to recirculate into the Japanese real economy.
The ever-increasing equity ratios of Japanese companies can thus be seen as the outcome of subsidization by the government, by the Bank of Japan, by commercial banks, and by households (employees). Many companies are in economic distress due to the never-ending stagnation but survive thanks to comprehensive aid. The corporate sector as a whole is zombified, despite a high equity ratio, because it does not invest in market adjustments and relies on government aid and restrained wage demands by workers. As the falling wage levels since 1998 depress consumption demand, it would be irrational to invest in larger capacity. The survival of enterprises increasingly depends not on their efficiency, but on the low interest rate environment created by the Bank of Japan: enterprises need to generate just enough profits for survival and for a gradual reduction of liabilities, which turns into a gradual increase of the equity ratio—a corollary of zombification.
It is thus the Bank of Japan that can pave the way out of the zombie economy. If the Bank of Japan slowly raised the key interest rate, the government would reconsider costly lenient legislation and enterprises without a business model would have to exit the market. To remain in the market, they would have to invest in efficiency gains and innovation. The exceptionally high equity ratios would decline. The resulting productivity gains would allow for wage increases, which would strengthen consumer demand and growth. Investment would become worthwhile again, and the living dead would be reanimated. The once proud Japanese economy could rise like a phoenix from the ashes.
Tyler Durden
Wed, 03/03/2021 – 21:20 - "Herd Immunity By August," Russian Deputy PM Golikova Predicts
“Herd Immunity By August,” Russian Deputy PM Golikova Predicts
After months of a ‘dark COVID’ winter in Russia, a top official projects herd immunity could be achieved by the end of summer.
Deputy Prime Minister Tatyana Golikova told TASS News Tuesday that government numbers forecast 60% herd immunity by August. She said achieving such a level would be a prerequisite for “fully lifting restrictions.”
Golikova said to reach such a level would depend on the rate of vaccinations:
“If vaccination remains at the same pace as now, if the number of vaccination points is the same as now, then we, as a country, will achieve herd immunity by August 2021. This date could change and could be advanced and, most likely, it will be so. It depends solely on the vaccination pace,” she said.
She noted daily reported COVID-19 cases have significantly decreased from nearly 30,000 per day in late 2020 to around 10,000 in March.
“The numbers of new cases of coronavirus infection are still quite serious, although reassuringly decreasing,” she said. “You will remember that we decided to ease measures last May, when we were at just around this point in terms of the number of new cases.”
Golikova said the situation is improving as vaccine rollouts are helping. Also, colder weather accelerates the spread of the virus, but with much of winter have already peaking and spring ahead – the decline in cases could continue.
“The situation is better now, but the virus is still not going anywhere. You need to take care of yourself and your loved ones,” she said.
Chief epidemiologist Nikolay Briko recently revealed that four million Russians had been vaccinated with either Sputnik V and EpiVacCorona. There are plans to increase the vaccination rate in the coming months.
Projections for herd immunity this year are also being made public in the US. Johns Hopkins surgeon Dr. Marty Makary, who penned an op-ed in the WSJ weeks ago, said the US could experience herd immunity by April.
Nothing is scarier for the politicians, unelected leaders, or non-governmental organizations to return to ‘normal’. And by ‘normal’, we mean a return to an environment outside of the authoritarian control of career politicians and bureaucrats who have got a taste of what it’s like to be ‘king’ by imposing strict measures on society.
Will the US and Russia achieve herd immunity this year? Will other countries follow? Or will variants of the virus and fearmongering by corporate media lead to lockdown extensions?
Tyler Durden
Wed, 03/03/2021 – 21:00 - California High School Athletes Sue Governor Over Indoor Sports Restrictions
California High School Athletes Sue Governor Over Indoor Sports Restrictions
Authored by GQ Pan via The Epoch Times,
A group of high school athletes in Southern California are suing Gov. Gavin Newsom over the statewide ban on indoor youth sports during the CCP virus pandemic.
Five student athletes from Orange County – two volleyball players, a basketball player, a wrestler, and a cheerleader – filed a joint lawsuit against Newsom, seeking a temporary restraining order that would allow them to return to competition under the same guidelines used by college or professional sports.
Caleb Graham, who’s a junior on Anaheim’s Canyon High School basketball team, told Fox 11 LA that the governor’s decision is fundamentally unfair to younger athletes.
“It’s been a little bit annoying considering I’ve been working hard all this quarantine and then we just keep getting cancelled, it’s just frustrating,” Graham said.
The lawsuit argues that the Democratic governor’s youth sports rules violated the equal protection clause of the 14th Amendment, since college and professional athletes in California have been allowed to compete indoors while high school athletes are prohibited from playing indoors unless in a “yellow tier” county, where the CCP (Chinese Communist party) virus situation is least severe and public health measures are least restrictive.
“They can’t say that it’s okay for college to play and not okay for the high school kids to play,” one of the students’ fathers said, reported Fox News.
“The time to move forward is now, there’s not a huge risk to these kids, especially if we follow the same protocols that colleges and pros follow.”
The suing students are represented by the same attorneys who recently won a temporary restraining order against Newsom’s indoor sports guidelines in a similar case filed in San Diego County.
Stephen Grebing, one of the attorneys, told Fox News that they “plan to spread this victory throughout California.”
The DATA says it all.. LET THEM PLAY 🏀#LetThemPlay pic.twitter.com/Vq00T2GtpE
— Jeff Berokoff (@BerokoffBall) March 2, 2021
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Last month, a judge in San Diego ruled in favor of two high school football players, granting a temporary restraining order against the state rules and allowing all youth sports in the county to resume, as long as they “follow the same or similar COVID-19 protocols imposed for competition in professional and/or collegiate sports within the county.”
The lawsuit came amid an effort to force Newsom into a recall election. Organizers of the recall movement recently announced that they’ve collected more than 1.8 million signatures, far more than the 1.5 million they needed before the March 17 deadline, although a portion of the signatures may not be deemed valid.
If the recall effort gets all the needed signatures, two questions will be added to the ballot in an election that will take place near the end of this year. The ballot will ask voters if they want to recall the governor, and who should replace him in that case. Hundreds of candidates could be on the list, since California doesn’t place a cap on the number of candidates for recalls, and a candidate only needs a relative majority to win.
Tyler Durden
Wed, 03/03/2021 – 20:40 - Tokyo Olympics Poised To Ban Foreign Spectators On Fears Of 'Superspreader' Event
Tokyo Olympics Poised To Ban Foreign Spectators On Fears Of ‘Superspreader’ Event
Now it appears that even the Olympics is the next to become a ‘spectator-less’ sporting event due to the global pandemic, following over nine months of games played in empty arenas and stadiums when it comes to professional sports from America to Europe.
While it’s clear there will be significant ‘social distancing’ restrictions placed on any spectators admitted to summer Olympic venues, Japan and the International Olympic Committee are now reportedly strongly considering having no foreign fans attend at all.
Getty Images An anonymous government official notified a prominent Japanese newspaper of the “debate” ongoing inside the committee, saying, “In the current situation it is impossible to bring in foreign spectators,” a government official told the Japanese newspaper Mainichi.
The Associated Press on Wednesday details in its latest reporting:
The Japanese newspaper Mainichi reported Wednesday that the decision had already been made to exclude foreign fans. It cited only unnamed sources “involved in the discussions.”
“If the situation is tough and it would make the (Japanese) consumers concerned, that is a situation we need to avoid from happening,” organizing committee president Seiko Hashimoto said.
But speaking of “consumers” this is certain to result in a blow of at least hundreds of millions of dollars lost in the absence of foreign fans. AP underscores further that, “The absence of fans could cost the games as much as $800 million more than the already billions of dollars of revenue lost.”
“We will focus on the essentials,” another Olympic officials was cited as saying this week. “That means mainly the competitions. This has to be the clear focus. In this respect we may have to set one or another priority.”
Critics of moving forward with the games in the first place are calling it a ‘super-spreader’ event, noting that “Even without foreign fans, there will still be thousands at the Olympics when you include players, coaches, judges, media, sponsors and VIPs.”
New Tokyo Olympic organizing committee boss hints that fans from abroad unlikely https://t.co/K3ujr8CcbQ
— CBC Olympics (@CBCOlympics) March 3, 2021
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Given the mulling of this drastic action we might naturally ask: what then is the point?
To review, the hasty rapid global rollout of vaccines being developed by various countries was touted as paving the way for ‘returning things to normal’ by at least summer of 2021 (something which Western politicians have constantly pushed back in terms of timeline). Furthermore, a large number of summer Olympic sporting events actually happen outside and often spread out over large distances… will foreign spectators be barred even from these?
The argument appears to primarily rest on the Japanese public not wanting a large wave of foreign travelers and tourists entering the country. A final decision over the issue is expected by the end of March.
Tyler Durden
Wed, 03/03/2021 – 20:20 - Mike Rowe: Everyone Is Essential
Mike Rowe: Everyone Is Essential
Authored by John Stossel via PJMedia.com,
Politicians have too much power over our lives.
Many used the pandemic as another excuse to take more.
Early on, politicians declared that they would decide who was “essential.” Everyone else was told to stay home.
Much of the economy stopped. Millions were laid off.
Then politicians relaxed the rules for industries that they deemed “essential.”
“You can’t just call somebody essential without implicitly suggesting that half the workforce is not essential,” points out Mike Rowe, host of the surprise hit TV series, “Dirty Jobs.”
That’s a big problem, says Rowe, because people find purpose in work.
Now the Biden administration is eager to give money to people not working. It’s pushing a new stimulus package that would pay the unemployed an additional $400/week.
Since states like mine tack on as much as $500/week in unemployment benefits, many people learn that the $900/week. leaves them with more money if they don’t go back to work.
So, many don’t.
But staying home imposes costs, too. Calls to suicide hotlines are up. Domestic violence is up.
“It’s happening because people simply don’t feel valued,” says Rowe.
Politicians claim they save lives when they order businesses to close. When Governor Andrew Cuomo announced a lockdown, he said, “If everything we do saves just one life, I’ll be happy.”
Rowe mocks that in my new video this week.
“Let’s knock the speed limit down to 10 miles an hour… make cars out of rubber… make everybody wear a helmet,” he says.
“Cars are a lot safer in the driveway… ships a lot safer when they don’t leave harbor, and people are safer when they sit quietly in their basements, but that’s not why cars, ships and people are on the planet.”
Rowe points out that working and accomplishing things are big parts of what makes life worth living. He runs a foundation that gives scholarships to people to help them learn trades like construction.
Of course, construction is dangerous. Some people get killed. Cuomo, should we stop building things?
Rowe likes the phrase, “Safety third!” as a response to people who constantly preach, “Safety first!”
“The ones who really get it done — they’re not out there talking about safety first. They know that other things come first… Every single time I’ve hurt myself, it’s always been in that fraction of a moment where I take my eye off the ball and I start to think that maybe somebody somewhere cares more about my well-being than me,” he says.
Rowe says COVID-19 challenges us “to figure out how to live in a dangerous world. But guess what? That that’s always been the case.”
He cites C.S. Lewis’ essay, “On Living in an Atomic Age,” in which Lewis asks:
“How are we supposed to live in a world with atomic weapons when everything could be over like that? … (Lewis answered,) the same way we lived in a world when the Vikings could land on the shore a thousand years ago and raid villages.”
There’s more to life than worrying about our death, writes Lewis: “We must resolutely train ourselves to feel that the survival of Man on this Earth… is not worth having unless it can be had by honorable and merciful means.”
COVID-19 is “just different,” says Rowe. “We’d be well-advised to understand where the risks are. And then we’d be better advised to go about the business of living the only life we have.”
Tyler Durden
Wed, 03/03/2021 – 20:00 - Grimes Just Made $5.8 Million In 20 Minutes Selling Digital Art
Grimes Just Made $5.8 Million In 20 Minutes Selling Digital Art
Elon Musk’s baby-mama/love interest Grimes recently made a $6 million score in only 20 minutes by selling digital artwork in an online auction.
The art comes with a digital asset called an “NFT” that proves its authenticity, according to The Daily Mail. She told 10 items from a collection she is calling “WarNymph” (of course), which included “dramatic illustrations of winged baby goddesses battling in apocalyptic skies” (of course).
The non-fungible token that the works come with is encrypted with the artist’s signature and authenticates the art as original. It relies on blockchain to verify authenticity.
The collection went on sale on Sunday and had roped in $5.8 million within 20 minutes of being launched. There were up to 100 copies of some pieces being sold, while other works were limited to just one copy.
Grimes sold, for instance, a video piece called ‘Death of the Old’ and another item called “Newborn 2”. Newborn 2 has already been listed for resale, as of Monday, with a $2.5 million asking price. The baby in the drawings is – wait for it – “described as belonging to a ‘Grimes narrative universe’ and will continue to ‘evolve’ in subsequent works”, the Daily Mail wrote.
Not quite our style of art… Grimes made the artwork with her brother Mac Boucher, an advertisement for the collection said. She is currently worth about $3 million and the auction marked her first foray into NFTs and selling artwork. The NFTs have “surged in popularity” since the beginning of Covid, as have pieces of digital art and digital assets.
Other NFTs have been used for items like land in virtual environments or exclusive use of cryptocurrency wallet names. The tokens are unique and cannot be exchanged on a like-for-like basis. Blockchain enables them to be publicly verified.
NFT marketplace OpenSea says it has seen monthly sales volume grow to $86.3 million in February, as of Friday, up from $8 million in January. OpenSea’s co-founder Alex Atallah said: “If you spend 10 hours a day on the computer, or eight hours a day in the digital realm, then art in the digital realm makes tonnes of sense – because it is the world.”
Art collector Pablo Rodriguez-Fraile, who, according to The Daily Mail recently sold a 10-second video for $6.6 million, said: “You can go in the Louvre and take a picture of the Mona Lisa and you can have it there, but it doesn’t have any value because it doesn’t have the provenance or the history of the work.”
“The reality here is that this is very, very valuable because of who is behind it.”
Tyler Durden
Wed, 03/03/2021 – 19:40 - Why The SLR Is All That Matters For Markets Right Now
Why The SLR Is All That Matters For Markets Right Now
One of the biggest buzzwords in finance right now is the three letter acronym SLR, which stands not for a discontinued and particularly expensive Mercedes model, but for Supplemental Liquidity Ratio – a limit on how leveraged US banks can get – and whose fate could mean the difference between a stabilization in the bond market a violent, marketwide crash.
Here’s what’s going on.
Back on April 1, 2020, just as the market was crashing and one week after the Fed unleashed its bazooka to avoid a total systemic collapse, the Fed announces temporary change to its supplementary leverage ratio (SLR) rule “to ease strains in the Treasury market” and “increase banking organizations’ ability to provide credit to households and businesses.” Specifically, the Fed change would exclude U.S. Treasury securities and deposits at Federal Reserve Banks from the calculation of the rule for holding companies. The change would be in effect until March 31, 2021.
By adjusting the SLR, the Fed enabled enabled banks to hold more “no-risk” securities such as Treasuries without having to add the assets to calculations of how indebted they are. In doing so, the Fed effectively permitted banks to massively expand their leverage and hold as many Treasurys and deposits on their books as the market demanded without punishing them for being in breach of various SLR thresholds. This was critical because at roughly this time, the Fed also unleashed $3 trillion in QE as Helicopter Money was launched in the US, as a result of which banks would end up holding far more bonds and deposits than usual. In total, the SLR adjustment cut the capital demand on big banks by an estimated $55 billion and allowed more than $1 trillion in additional activity.
The problem however, is that in four weeks this temporary adjustment to the SLR is set to expire. This comes at an extremely sensitive moment for banks and the bond market.
We first explained why one month ago in our post explaining why “Mind-Boggling Liquidity” was about to be unleashed on the markets: “Nobody Is Paying Attention To The $1.1 Trillion Flood About To Hit Markets.” As a reminder, as a result of reduced US funding needs, the Treasury forecast that its cash balance held at the Fed (also known as the TGA or Treasury General Account) would plunge by $800 billion, from $1.729 trillion at Dec 31, 2020 to just $800 billion.
At the time, we also said that “the plunge in short-term debt (Bill) issuance – since there will no longer be an urgent need to keep cash balances in the $1+ trillion range – will compress short-term spreads (effective FF through 3M) to zero – or even negative – as there is suddenly a flood of liquidity which could prompt the Fed to engage the fixed-rate borrowing facility or even nudging the IOER higher.” Sure enough, last week the Overnight General Collateral Repo rate did dip negative for the first time since last year’s covid turmoil, a harbinger of the reserve deluge that is set to hit the market.
And while the Treasury has been slow in draining the cash held at the Fed, the pace is starting to pick up and on Tuesday the TGA declined by $38 billion to $1.463 trillion…
… meaning that there is still some $663 billion to go until march 31, when the Treasury previously indicated it intends to have a cash balance of $800 billion.
Ok fine, but what does the SLR have to do with any of this?
The answer was given by former NY Fed repo market guru (currently at Credit Suisse), Zoltan Pozsar who wrote last week, “Banks don’t have the balance sheet at the bank operating subsidiary level to add $1 trillion of deposits, reserves, and Treasuries: J.P. Morgan can’t grow more due to G-SIB constraints; Citibank flat-lined its balance sheet growth already; Bank of America has the capacity to add only $150 billion of deposits and HQLA; and Wells Fargo’s $500 billion capacity is constrained by its asset growth ban.”
The market-clogging expert elaborated further:
Unless we get SLR relief at the bank opco. level, or Wells Fargo’s ban is lifted, banks will have to turn away wealthy households’ and institutions’ deposits, which will then go to money funds. But money funds will face a constraint too: the marginal asset they will direct inflows into – the o/n RRP facility – is capped; each money fund can place only $30 billion into the facility, which is too little.
Banks’ balance sheet constraint becomes a collateral constraint for money funds, and collateral constraints may surface in both the spending and paydown scenarios. Collateral supply from coupon issuance will absorb this cash over time, but money markets react to what happens now, and with $1 trillion of new cash, there may be many pockets of collateral scarcity as these flows play out in real time.
Then, pointing to a cautionary slide from JPM’s Q4 presentation deck which warned very clearly that negative deposit rates are coming in 2021 should “excess liquidity” and “higher capital” become a fixture – which is about to be the case…
… His conclusion dealt with the impact the SLR cap would have on rates:
If U.S. banks are full and money funds can’t take new money either, foreign banks will warehouse reserves at rates below those of J.P. Morgan but above those available in the bill market – and both are negative. The price of warehousing is a fee, i.e. a negative rate…
All this took place ahead of last week’s rate rout (some say Pozsar’s explanation of what is going on may have in fact precipitated it). So, in a follow up note on Thursday just as the 10Y blew out to 1.61%, Pozsar explained why the SLR is also critical to alleviate the Treasury market crunch – simply said without SLR relief, banks will not only be capped to accepting new money, but will be forced to sell even more Treasurys:
Fed Chair Powell and Governor Quarles passed up two opportunities this week to offer much needed clarity on the SLR treatment of reserves and treasuries.
- If SLR relief is made permanent, banks can go ahead and buy more treasuries, and they can also resume buying back their own stock. That’s clear and simple.
- If SLR relief ends and the buyback ban stays in place until the pandemic is over, banks have no choice but to buy treasuries. That’s pretty clear and simple too.
- What’s not clear and simple is the current state of affairs: the Fed already lifted the buyback ban but has still not provided any clarity on SLR relief, and if SLR relief does not happen, buybacks mean that banks will trim their balance sheet on both sides, shedding deposits, reserves, and also treasuries.
Accumulating low-yielding reserves and treasuries is dilutive to banks’ RoE, so buybacks are a top priority for banks’ management teams, and buybacks that come with trimming balance sheet are best done with light duration “loads.”
We are agnostic about whether the SLR relief will be made permanent or not, or if the buyback ban gets reinstated. Both will provide more balance sheet, but the former without a cost to shareholders and the latter at their expense. Regardless of the starkly different outcomes to bank shareholders, the system would end up with more balance sheet to fund the coming rounds of stimulus and both would offer clarity and direction to the rates market. Uncertainty does not.
His punchline was clear enough: “We’ve fielded many calls from clients during the day asking whether the sell-off in rates will force the Fed’s hand regarding SLR. That would be a terrible precedent but we need clarity regardless. And if the Fed’s choice is SLR relief, it needs to clarify whether reserves only or both reserves and treasuries will be exempt – concerns that only reserves will be exempt could also weigh on treasuries.”
And here is where Zoltan shines: while pointing out that “for every macro narrative that explains why U.S. treasury yields are rising, there is also a plumbing narrative that can explain things with equal persuasion.” And, as we noted earlier today, the treasury curve is now steep enough for most FX-hedged foreign investors to step in and harvest the slope….
FX-hedged TSYs are now more attractive than Bunds and JGBs pic.twitter.com/7joyFZeJq4
— zerohedge (@zerohedge) March 3, 2021
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… But as Zoltan puts it vividly, “no one likes to step in front of a freight train.”
His conclusion is simple enough that even Fed president will get it:
For long-term treasury yields to stabilize, either the dollar has to weaken so foreign central banks buy or the Fed has to talk rates down, do operation twist (selling $1 trillion of front-end paper and buying $1 trillion of long-term paper), or provide closure on SLR relief. If there’s stability, carry traders will do the rest…
Well, with risk assets sliding and financial conditions suddenly tightening – in large part as a circular result of the lack of SLR clarity which has led to even more forced Treasury selling – the dollar has been rising (as a reminder, the dollar is first and foremost a barometer of systemic funding stress, and it always goes up when the market sniffs out a plumbing issue). Which leaves the Fed with three options:
- Talk rates down, which it has tried and failed to do for the past two weeks, so this is unlikely to work
- Announce that Operation Twist is coming, taking the opportunity during his video conference tomorrow to say something like “the Federal Reserve might consider extending the average maturity of bond purchases and will discuss this at the next FOMC meeting” or
- Announce that the SLR exemption will be extended, either for another 6-12 month, or permanently.
Which, if any, of these will Powell pick?
Earlier today we presented a case first made recently by BofA rates strategist (who like Zoltan also worked at the NY Fed) Mark Cabana, and who warned that “the Fed is simultaneously losing control of both the U.S. front end and back end rates curves for different reasons” and that the Fed “should” revive the Operation Twist to effectively address key issues dealing with market functioning. According to Cabana, a new operation Twist “kills three birds with one stone: It pulls up front end rates, it stabilizes back end rates, and it does so in a reserve neutral way that lessens bank SLR pressure to hold more capital.“
However, there are challenges: launching Operation Twist, would prompt question just how fragile is the financial system if the Fed panics after a modest 50bps move higher in yields. After all, the 10Y yield is still well below where it was one year ago before the Covid crisis erupted. Second, a Twist 3.0 – which is effectively Yield Curve Control – would remove the last bullet the Fed has left for when yields really spike, not to mention would mean full-blown nationalization by the Fed of the entire yield curve (although neither the ECB nor BOJ have any concerns about being permanently cornered).
As for SLR there are mounting political challenges. Last week, Senators Elizabeth Warren and Sherrod Brown urged U.S. regulators to reject lenders’ appeals to extend the SLR exemption. In a joint letter to the Federal Reserve, Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency, the Democratic Duo argued that the banking industry is taking advantage of the coronavirus crisis to “weaken one of the most important post-crisis regulatory reforms.” Warren of Massachusetts and Ohio’s Brown, who took over the Senate Banking Committee this year, said granting the extension would be a “grave error.”
Perhaps, but a bond market crash and deeply negative short-term yields would be a far more grave error, especially to the Democrats who are demanding that the Fed monetize trillions in debt in 2021 to fund Biden’s trillions in fiscal stimulus bills, something the Fed would not be able to do if the SLR exemption was not indefinitely extended.
Curiously, as Warren and Brown urged the Fed to let the SLR provision expire as scheduled on March 31, Republican lawmakers repeated encouragement during Fed Chairman Jerome Powell’s congressional testimony last weeks that the Fed do the banks’ bidding.
“Banks have taken very large reserves against losses and so have proven themselves pretty resilient,” Powell said to Brown during the Feb. 23 Senate hearing, citing intervention to limit bank dividend growth and share buybacks. “And the result, what you see now, is a banking system that has higher capital than it did going into the pandemic, and particularly for the largest banks.”
Meanwhile, Bloomberg reports that as the biggest banks lobby urgently for a deadline extension while the pandemic’s economic headwinds continue, Brown and Warren argue that if they need more of a safety cushion, the banks can find it by retaining some of the capital they’ve been returning to shareholders.
Ultimately, Powell declined to say whether the Fed favored the current expiration date, saying the Fed is still considering it.
“It’s something we’re in the middle of thinking about right now … we’ll be making a decision and announcing it pretty soon”
Alas, with Treasurys selling off every day and now dragging stocks lower with them, Powell’s time for consideration is now up.
And since we appear to have two opposing views – one from Zoltan who favors an immediate SLR extension and one from Cabana who urges a new Operation Twist, we give the final word to another repo guru, Curvature Securities’ Scott Skyrm, who in his latest repo market commentary wrote:
We are waiting to hear from the Fed about two pending issues right now: the SLR and an IOER/RRP rate increase. US Treasurys are currently exempt from the SLR at the large SIFI banks and that exemption ends on March 31. This month!
Our guess is the exemption will be extended between 3 and 6 months and announced at the March 17 FOMC meeting statement.
We believe there’s a good chance of an IOER and/or RRP rate hike on March 17. We believe the Fed SHOULD raise the rates and the decision not to raise the rates is only due to political considerations. Ultra low GC rates are a consequence of too much QE for too long. Too many Treasurys were removed from the market and placed on the Fed’s balance sheet. This is reminiscent of May through July of 2013. Back then, the Fed’s QE buying created a shortage of Treasurys in the market. That August, the Fed began the RRP program as a mechanism to put collateral back into the market. It seems like it’s time to start using the RRP program again!
Bottom line: Powell will extend the SLR exemption by 6 months at the March 17 FOMC meeting... and while the Fed may hold off on launching Operation Twist 3.0, it will hike IOER rates and also reactivate the Reverse Repo program to “put collateral back into the market.” Of course, since the Fed is likely to proceed with tapering QE later in 2021 (absent another major financial crisis which triggers more QE instead), Powell will still have to launch Operation Twist ahead of the first taper hint or else suffer a historic Taper Tantrum which could lead to a loss of control over the long-end.
In any case, at this very moment, the SLR remains the most important variable for both the stock and bond market, and since Powell now has no choice but to unveil his thoughts on the matter on March 17 (when he will extend its exemption by another 3-6 month), he may very well hint at what will happen tomorrow during the Wall Street Journal virtual event set to begin tomorrow at noon. Needless to say, any favorable mention of the SLR exemption will spark marketwide short covering and send both stocks and Treasurys soaring.
Tyler Durden
Wed, 03/03/2021 – 19:20 - What Lies Ahead? The Grand Solar Minimum
What Lies Ahead? The Grand Solar Minimum
Submitted by Luke Eastwood
We are all aware of the environnmental crisis that humanity (and all life on Earth) faces, characterised by the term ‘climate change’. Much of the current thinking in the scientific community is promoting the idea that our planet is rapidly warming due to excess CO2 (carbon dioxide) gas produced by humans in the last few centuries, and the last 70 years in particular.
While there is a very strong and hard to deny case to suggest that human activity is the main cause of environmental destruction, the premise that it is due primarily to CO2 emissions is beginning to look somewhat flawed. I am well aware that the previous sentence is likely to draw a lot of negative attention and criticism, with accusations of ‘climate denier’ being thrown at me. However, the situation is not that simple as to be a case of ‘global warming’ being the main influence or no influence at all.
The reality of the situation is complex. In my opinion the main drivers of the environmental crisis are many, but put in simple terms – destruction of wild habitats, pollution due to industrialisation, over-use of soils, over-population, erosion of soils leading to desertification or barren, infertile landscapes, monoculture agriculture and climate fluctuations. Notice that I did not use the term ‘climate change’ which in the current scientific norm implies warming.
While the planet has undoubtedly warmed up, in part due to human activity and CO2 production, the current popular thinking completely ignores historical CO2 levels beyond the last millennium and also the primary input on temperatures on this planet and all eight of the planets in this solar system. That input, although largely ignored at the moment, is of course our sun, which on average generates 3.8 x 1026 Joules (energy) per second. Human energy usage per year is around 5 x 1020 Joules, which is about 1 million times less than the Sun produces during 1 second! In fact, in the whole of human history we have used less energy that the Sun produces in that 1 second.
So, given the above, it stand to reason that the energy of the Sun must have a significant effect on the energy available on this planet and the heat energy (temperature) that is captured by it, as it rotates around the Sun. If we look at the history of Earth, particularly through the use of ice-core samples, we can see that the temperatures on our planet follow a very distinct pattern. On a macro level this can be observed as a huge cycle of glacials (ice-ages) and interglacials, with the ice ages lasting many times longer than the interglacial (warm) periods. We are currently in an interglacial, which began approximately 11,500 years ago and it is estimated that it will end some time within the next 50,000 years.
On a micro level, the Sun undergoes cycles of around 11 years known as the solar magnetic activity cycle, which has been studied and recorded by humans for approximately 400 years. During each cycle the number of sunspots peaks and falls in a recognisable pattern. However, this pattern of approx. 11 years is itself part of a much longer solar pattern of solar minimums and solar maximums. For instance the Medieval maximum (grand solar maximum) lasted from 1100-1250 (warm period) and the famous Maunder Minimum (grand solar minimum) lasted from 1645-1715 (cold period). The later was known as a mini ice age due the particularly drastic drop in global temperatures that affected crop-growth and led to bitter winters for a period of 70 years.
Scientists that study the sun are well aware of these periodic cycles both on the 11 year scale and on the larger scale of 70–100 years, known as the Gleissberg cycle. We have just finished a solar maximum cycle of around 70 years and are now heading into a both a new 11 year cycle and a new grand solar minimum cycle that will reach its lowest (coldest) point some time between 2030 and 2040. You don’t need to take my word for it – this has been confirmed by NASA and by the National Oceanic and Atmosphere Administration (NOAA). NOAA predictions of sunspot and radio flux appears to show a ‘full-blown’ grand solar minimum (GSM) which will last from the late-2020s to at least the 2040s.
This means that the coming solar minimum is going to be not only a grand solar minimum, but perhaps the worst one since the Maunder Minimum in the 1600s. One would expert this to have been front-page news, but outside of the scientific community this information is virtually unheard of and little understood. One must ask – why is this the case? The simple answer to this question is that the solar predictions destroy the current scientific and cultural narrative of ‘Climate Change’ in the form of warming.
There will indeed be climate change in the coming decades, but for the next 10 to 40 years it is going to get colder, not warmer! The same thing will happen on the 7 other planets in this solar system, because the main factor affecting planetary temperatures is the activity of the Sun. Given that so much time, effort and money has been invested in ‘global warming’ as a premise for change in how human society is run, it is very much an “inconvenient truth” that is beginning to arrive just at the time when we are beginning to take more affirmative action on environmental issues.
The controversial news that the Earth (and all 7 other planets) will cool down in the next 10-40 years is politically highly inconvenient and that is why it is being kept quiet. Getting rid of fossil fuels, caring for our environment, lowering industrial output, ending industrial farming and reducing livestock, plus a gradual reduction in the human population are all excellent goals. Unfortunately the rationale for doing this, that has been sold to the public, is most likely entirely misguided. The net effect of this false premise may well be that environmentalists and main-stream public scientists will look like fools by the end of this decade. The cooling of planet Earth may well be seen as justification to abandon environmental concerns and reform of our economic systems, which would be a terrible tragedy.
In order to avoid this highly likely total embarrassment, world governments and the scientific community need to admit that the coming dip in solar energy output is going to lead to the cooling of our planet for at least 2 decades, possibly 4 or 5 or even 7 decades! This is not conspiracy, this is not mis-information or propaganda – this is proven, verifiable fact which can be validated by current solar observation, previous observation of sun cycles for 400 years and ice-core samples stretching back millions of years.
As someone who has been involved in the environmental movement since I was 16, when I joined a conservation group at college, I am very concerned about how this plays out. If the public feels that they have been lied to it may lead to a backlash and a disinterest in environmental issues. The reasons I outlined at the beginning of this article are more than sufficient for humanity to change its modus operandi. One does not need to concoct highly improbable narratives about the world ‘burning up’ within decades to justify environmental activism. In fact the coming GSM is likely to produce similar negative effects to predicted ‘global warming’, such as habitat loss, loss of farming land, a drop in food availability, migration, social unrest and possibly other problems too.
It is time that the whole ‘climate change’ theory was re-assessed and the known solar activity cycle as observed by NOAA and NASA taken into account. To fail to do so is total folly and only creates another problem, that will come back to haunt us if the grand solar minimum is ignored. We do need to take better care of our world and learn to live far more harmoniously within it, but we need to base our actions on good science and not on misleading or inaccurate information.
Tyler Durden
Wed, 03/03/2021 – 19:20 - Watch Real, Not Nominal Yields
Watch Real, Not Nominal Yields
In his daily note this morning, Deutsche Bank’s chief credit strategist Jim Reid writes that he “donned his credit hat” and looked at the relationship between yields and credit spreads (and by extension risk assets) given how topical the yield discussion is. The charts below look at a long-term 2-year rolling correlation between the two for nominal and real yields. As can be seen there is no “one-size-fits-all” relationship. However, some important trends have occurred.
Reid observes that for nominal yields, the correlation between yields and spreads for most of the last 70 years has been negative. This makes some sense as “if yields are rising it normally is indicative of a stronger economy which in turn should be good for corporates and visa-versa.”
However, this long-term inverse correlation was weakening before the pandemic. With the Fed having broken bond markets, the DB strategist tactfully notes that “QE and negative rates had perhaps created an offset to the traditional relationship as QE lowered yields even in a positive economic outlook.” As such, he adds, “any reversal of QE or risk to it might lead to higher yields and spreads.” Clearly, the market agrees with this.
Of course, the pandemic has taken the inverse relationship back to the extremes though as spreads have massively tightened since March in a period where nominal yields have steadily moved higher, especially since July. So normal long-term service has been resumed “but with spreads close to cyclical tights there’s a limit to how much this could continue if yields rose further.” It now appears that 1.50% of 1.75% – depending on whom you ask – is the tipping point.
Interestingly, the correlation with real yields has become more positive over the last decade and stayed this way during the pandemic. In the massive tightening since last March, 10 year US real yields fell -150bps while nominal yields rose. Since mid-February though, real yields have risen 30-40bps and credit spreads have drifted wider, supporting the more positive modern day correlation.
As Reid summarizes, “with such a heavily indebted financial system, real yields probably matter more than nominal ones. If nominal yields rise but inflation rises more (i.e. lower real yields), this would no doubt cause some volatility but it should help those with high debts (e.g. corporates) assuming the economy wasn’t suffering.”
However, the worst case would be “if real yields rise notably from here, then all risk assets will likely suffer given the debt load the financial system has. So the correlation between real yields and credit will likely be strong going forward.”
That’s why last week’s move was important but for now real yields are still very low, “just not quite as low as they were. This is what to watch.”
Tyler Durden
Wed, 03/03/2021 – 19:00 - Flaming Phallus: Starship SN10 Makes Spectacular Landing… Then Explodes
Flaming Phallus: Starship SN10 Makes Spectacular Landing… Then Explodes
Update (1845ET): After initial delays, SpaceX successfully landed a Starship prototype after a high-altitude flight test for the first time on Wednesday, marking a major step forward for Elon Musk’s company in the rocket’s development.
That’s the good news.
But minutes after softly landing on a concrete pad, the prototype rocket exploded. The cause of the explosion, or whether or not it was intentional, was not immediately clear.
lmfaoooo pic.twitter.com/0fxIPakTmd
— ben k (@Benshooter) March 3, 2021
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We don’t think that’s supposed to happen…
* * *
Update (1543 ET): About a half-hour after Elon Musk tweeted to his 48.4 million followers: “5 mins to Starship test flight attempt” – 30 minutes later, he follows up the tweet with an explanation behind the aborted launch:
“Launch abort on slightly conservative high thrust limit. Increasing thrust limit & recycling propellant for another flight attempt today.”
Launch abort on slightly conservative high thrust limit. Increasing thrust limit & recycling propellant for another flight attempt today.
— Elon Musk (@elonmusk) March 3, 2021
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Musk does say another launch could happen later today.
* * *
Update (1524 ET): NASASpaceFlight.com’s commentators on the “LIVE: Starship SN10 Flight Test” live stream launch of the SpaceX’s Starship said an “auto abort” has occurred. The reason has yet to be determined.
ABORT. SpaceX’s Starship test flight was aborted at engine start.
SpaceX is evaluating whether it can try again today to launch the Starship test flight from South Texas.
Watch live: https://t.co/1pJHg7dtIz pic.twitter.com/vnZyVHtsDQ
— Spaceflight Now (@SpaceflightNow) March 3, 2021
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Here are images of the aborted test flighted.
* * *
SpaceX is preparing to launch another high-altitude flight of Starship.
“SpaceX is set to launch the Starship SN10 prototype to an altitude of approximately 10 kilometers. A launch attempt is possible between 9 am and 6 pm Central time on Wednesday. However, as with testing, there is always a chance that teams could decide to stand down and try again on a different day,” said NASASpaceFlight.com
5 mins to Starship test flight attempt
— Elon Musk (@elonmusk) March 3, 2021
Watch Live Here:
Tyler Durden
Wed, 03/03/2021 – 18:53
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