Today’s News 5th September 2021

• Is The US Intelligence Community Putting The World At Risk?
  Is The US Intelligence Community Putting The World At Risk?

  Authored by Pete Hoekstra via The Gatestone Institute,

  The recent release of an unclassified summary by the Intelligence Community (IC) of its investigation into China’s role in the COVID pandemic leaves one feeling that there is nothing there. Like Sergeant Schultz in the old TV series “Hogan’s Heroes,” the IC seems to be protesting “I know nothing! Nothing!” The report provided no real substantive insights into the origins of the pandemic. Yet the Intelligence Community’s COVID Summary is dangerous; infinitely more dangerous than it appears.

  

  Without saying so directly, it encourages us to discount China’s significant culpability in this disaster, downplaying its responsibility for the pandemic unleashed on its territory and its role in the deadly spread of COVID around the world.

  The summary comes to three relatively strong conclusions about Chinese actions and motivations.

  • First of all, the IC states its judgment that China did not develop the virus “as a biological weapon.”

  • Second, the IC assesses that “China’s officials did not have foreknowledge of the virus before the initial outbreak.”

  • Third, the report ends with a startling conclusion, stated so matter-of-factly that it could almost go unnoticed; it says that China’s “actions,” its “hindering” of the international investigation, its “resistance” to sharing information and its attempts to blame other countries, “reflect, in part, China’s government’s own uncertainty about where an investigation could lead as well as its frustration the international community is using the issue to exert political pressure on China.”

  The first two findings are probably correct. Taken together, they rule out the worst possible scenario: that China’s leadership developed a biological weapon and knowingly unleashed it on an unsuspecting world. These findings were never really in debate so nothing new. But we should not take undue comfort in that. As Gordon G. Chang outlined in these pages earlier this week, just because they didn’t do it this time, doesn’t mean they will not do it in the future. Chang was correct in identifying COVID was the “ultimate proof of concept.”

  What truly makes the IC summary dangerous is its third conclusion, implying China’s unacceptable behavior since the pandemic was unleashed can be explained away and thus ignored.

  How can the IC seriously believe that China’s active stonewalling of the international community’s attempts to get to the bottom of what happened and thus learn better how to combat the virus can be reduced to its “uncertainty about where an investigation might lead” or its “frustration” about outside political pressure? If our IC insists on promoting this rose-colored view of China, if this wishful thinking really reflects what our IC believes, the world is in deep trouble.

  Let me build on Chang’s exposure of China’s behavior and offer some findings that should have been in the Intelligence Community report:

  • We can assess with a high degree of confidence that China views the U.S. as its primary global adversary. In the short term China wants to achieve near peer status with the U.S. In the long term it wants to be the dominant world power.

  • We can assess with a high degree of confidence that the Chinese Communist Party (CCP) has been actively involved in advanced virus research via improving genetic targeting capabilities.

  • We can assess with a high degree of confidence that the CCP facilitated the global spread of the COVID-19 virus.

  • We can assess with a medium degree of confidence that the CCP used its influence with the WHO to spread a major disinformation campaign.

  • In sum, we can assess with a high degree of confidence that while the origins and initial awareness of the virus by the Chinese government cannot be clearly ascertained, the Chinese government has been intimately involved in most everything since then. It has used the pandemic to further its global economic and political agenda. Its behavior has been ruthless and malicious.

  Americans, our international allies and enemies, and, of course, Chinese and CCP officials themselves, will read this intelligence summary carefully. Thus, the U.S. intelligence community’s whitewashing of China’s culpability puts us all at risk. In documents such as this report, there are no throwaway lines. Every word is weighed and considered. The implication that China is essentially innocent of any ill will is in the report only because some senior official wanted to include it.

  God help us if this signals the beginning of a Biden administration appeasement strategy. Judging from everything we have experienced over the last ten to twenty years, the attempt to placate China by writing off its malicious behavior as lightly as this report does is doomed to failure. It shows weakness. It rewards an aggressive China, and only invites more of the same.

  Tyler Durden
  Sat, 09/04/2021 – 23:30

• As If Millions Of Hollywood Celebs Suddenly Cried Out In Terror: China Bans "Effeminate Men" From TV
  As If Millions Of Hollywood Celebs Suddenly Cried Out In Terror: China Bans “Effeminate Men” From TV

  As if millions of woke effeminate Hollywood voices cried out in terror and were suddenly silenced.

  As part of Beijing’s sudden “neo-cultural revolution“, the Chinese government has issued new orders to its broadcasters in its continuing crackdown on culture, business and social mores. This time, it called for a ban on what it termed “effeminate men,” asking instead that “revolutionary culture” be touted. This, needless to say, is terrible news for an entire generation of woke, Hollywood snowflakes who know everything about virtue signaling – especially if it gets them lucrative Chinese production contracts – and who are absolutely clueless about anything within ten miles of a real of metaphorical revolution.

  

  The edict, as Deadline reported, is part of President Xi Jinping’s call for a “national rejuvenation,” with business and the public under orders to align with his vision for China. In recent months, the regime has expressed official concerns and cracked down on youth online gaming, boy band culture, gambling, cryptocurrency and sports. The moves are part of discouraging what it sees as unhealthy attention to celebrities and certain distracting activities.

  The China TV regulators called for “resolutely put an end to sissy men and other abnormal esthetics,” using an insulting slang term for effeminate men — “niang pao,” or literally, “girlie guns.”

  

  As Rabobank’s Michael Every put it, that’s a move which echoed the call of the “profound revolution” commentary from earlier this week, as did promised crackdowns on property and medical expenses. Interestingly, even the editor of the Global Times, often North Korean in his semantics according to Every, posted about the commentary (in Chinese):

  “I’m concerned that such language will evoke certain historical memories and potentially trigger a degree of ideological confusion and panic.”

  

  One wonders just how long Hollywood’s “sissy men” will continue to signal their “virtue” now if it means that millions of dollars in future movie and TV revenues are at stake as a result of their pandering to the lowest common liberal social denominator, and if – gasp – Hollywood may be on the cusp of turning conservative, because even in Hollywood – especially in Hollywood – money talks and virtue-signaling walks.

  Tyler Durden
  Sat, 09/04/2021 – 23:00

• Vaccine Voodoo
  Vaccine Voodoo

  Authored by James Rickards via DailyReckoning.com,

  Many everyday Americans probably believe that the COVID vaccines will keep them from getting COVID. That’s not true and never has been true.

  The vaccines do not prevent you from being infected with the COVID virus. They do not keep you from spreading the COVID virus.

  There have been many cases of so-called “breakthrough” infections where double-vaxxed citizens get COVID anyway. That’s not uncommon.

  There’s even new evidence that double-vaxxed individuals who get COVID will build up huge viral loads in their noses and sinuses, causing them to become super-spreaders and infect others.

  Do the vaccines do anything?

  

  Yes, they are effective at reducing severe symptoms of COVID.

  They also reduce the death rate among those who get infected.

  That’s advantageous for the most vulnerable, including those over 70 years old and those suffering from obesity, emphysema, diabetes and other conditions closely associated with fatalities due to COVID.

  That said, there’s almost no reason for children, teenagers and otherwise healthy individuals in their 20s or even 30s to take the vaccine.

  Among all individuals, vaccinated and unvaccinated, the global survival rate is 99.2%. Among those under 70, the survival rate is 99.97%. The survival rate for children is 99.995%.

  The Israel Conundrum

  The data indicate that the most vaccinated countries have the most cases and deaths per million people, while the least vaccinated countries have the fewest cases and deaths per million people.

  Israel is providing a useful case study in the effectiveness, or lack thereof, of vaccines.

  Israel is one of the most heavily vaxxed countries in the world, with over 60% of the population fully vaccinated and almost 100% of the elderly. But now Israel is experiencing a massive increase in infections, including cases among the fully vaxxed.

  The government has also determined that the vaccines wear off after six months or less and is recommending a third shot for everyone. The problem, of course, is that the third dose will wear off too, so a fourth, fifth or sixth dose will be needed.

  And with every new dose comes a new risk of dangerous side effects, including the small but real possibility of death. The vaccinated will be getting boosters for the rest of their lives, and the virus still won’t go away.

  How Many Lives Could Have Been Saved?

  Meanwhile, effective treatments, including ivermectin, hydroxychloroquine, vitamin D, zinc and other inexpensive measures, are being suppressed by the medical establishment.

  How many people died because they were denied access to these therapies, especially early on in the disease cycle when treatment is more effective?

  It’s impossible to say, but they could potentially run into the hundreds of thousands.

  A new study by the U.K.’s National Health Service and a Canadian biotech company revealed that a nitric oxide nasal spray slashed SARS-CoV-2 viral load by 95% within 24 hours and 99% within 72 hours.

  If further trials pan out, early treatment with a similar cheap therapeutic could cut serious cases down to almost nothing.

  But it doesn’t matter. The medical establishment will continue pushing the narrative that only universal vaccination will stop the virus.

  Media Spreading Panic

  The media continue to hyperventilate about “cases” but ignore the fact that death rates have declined since January. When one accounts for the 38 million Americans who have survived COVID and already have antibodies, then herd immunity is already here.

  Data indicate that people who had COVID between January and February of 2021 and recovered have 13 times more immunity to the Delta variant than vaccines provide.

  We’re at the stage where we can learn to live with COVID as we do with many other endemic diseases such as the seasonal flu. There’s no reason for fear.

  But the public health authorities insist that these people with natural immunity must also be vaccinated.

  It’s not “science.”

  The zero-COVID policies many governments have pursued are completely unrealistic. The virus goes where it wants. The only real solutions are patience, herd immunity and effective therapies.

  The time has come to stop living in fear and start treating COVID as an endemic disease that will be with us for a long time, like the seasonal flu or diabetes. Unfortunately, government authorities continue to insist they can control the situation with orders and mandates.

  Lockdowns Didn’t Work Before. Why Would They Work Now?

  But the evidence is clear that masks don’t work and lockdowns don’t work (but they do destroy economies — most lost sales were permanent losses, not temporary losses). Lockdowns don’t work to stop the spread of the virus because they keep people indoors where the virus can spread more easily.

  Outdoor activity is essential for fresh air, mental and physical health and exercise.

  People will find a way to gather and interact even with lockdown rules. This means that lockdowns impose all of the economic costs with few of the supposed public health benefits.

  This was recognized in a paper in 2006 by D.A. Henderson, the greatest virologist and epidemiologist of the 20th century who led the successful effort to eradicate smallpox and won the U.S. Presidential Medal of Freedom.

  He said lockdowns don’t work and provided detailed reasons why. Unfortunately, his award-winning work was ignored by politicians eager to appear to be doing something.

  Biden Repeats Trump’s Mistake

  Health officials should never have been put in charge of the economy. That was a huge mistake by Trump, and it’s been made worse by Biden.

  Immunologists saw some benefits from lockdowns, but these would have happened anyway because each viral outbreak runs a predictable eight–10-week course. What the experts ignored were the costs in terms of deaths from suicide, excessive alcohol consumption, drug abuse, domestic violence, depression, anxiety and other dysfunctional behaviors.

  The benefits of public health policy were minimal, but the economic, social and psychological costs were great and are still being paid. Meanwhile, the push for universal vaccination continues, despite the evidence that it’s not nearly as effective and necessary as the government claimed.

  Society is rapidly turning into a two-tier culture of the vaccinated and the unvaccinated.

  On Wall Street, where vaccination rates are as high as 90% in some firms, the unvaccinated are being treated like lepers. One investment banker said, “If you’re someone who is not vaccinated on Wall Street, you’re considered a loser.”

  Even firms that do not require full vaccination to return to work are forcing the unvaccinated to undergo weekly testing, sit apart from colleagues and wear masks while others are maskless.

  Vaccine Voodoo

  These rules are stupid, what might be called Vaccine Voodoo.

  Again, vaccination doesn’t stop infection. It doesn’t stop the spread. A fully vaccinated person can catch COVID and spread it to others. The unvaccinated have as much to fear in terms of catching the disease from the vaccinated as the other way around.

  There are ample reasons not to receive the vaccination, including being among the 38 million Americans who have recovered from COVID and have stronger antibody protection than the vaccinated.

  But they’re being treated like lepers too. This vaccination discrimination will do nothing to slow the spread of the disease, but it will do a lot to tear society apart. Investors can properly understand vaccination discrimination as one more drag on productivity and economic growth.

  But governments will keep imposing worthless mandates, and economies will continue on a trajectory of slow growth.

  Tyler Durden
  Sat, 09/04/2021 – 22:30

• China's Financial Regulators Pledge Tighter Control Of Economy, Closure Of "Loopholes"
  China’s Financial Regulators Pledge Tighter Control Of Economy, Closure Of “Loopholes”

  Over the past week, China has restricted minors to only three hours of video games a week, while erasing one of the country’s most popular actresses to kick off its reformation of China’s entertainment industry, which include reining in obsessive online ‘fandoms’ while asking that, from here on out, men in Chinese media avoid looking too “effeminate” while also avoiding even a hint of political controversy.

  

  Chen Yulu

  Now that the weekend has arrived, the focus is shifting back to the economy, as China’s economy. Chen Yulu, deputy governor of the People’s Bank of China, said at the China International Finance Annual Forum in Beijing Saturday that the PBOC will close loopholes in its financial technology regulation, and include all types of financial institutions, services and products into its prudential supervision framework, Bloomberg reports.

  “We will enhance the effectiveness and professionalism of financial regulation, build all kinds of firewalls to resolutely prevent systemic risks,” Chen said.

  Meanwhile, the China Securities Regulatory Commission will tighten restrictions on companies seeking overseas listings, while enhancing the channel for foreign investors to participate in China’s onshore futures market, Vice Chairman Fang Xinghai said at the same forum.

  Back in July, Chinese regulators proposed rules that would require nearly all companies seeking to list in foreign countries to undergo a cybersecurity review.

  At the same time, Chinese officials expressed a wariness of western capital markets, implying that the central bank’s flood of capital injected into the economy since the start of the pandemic has undermined the strength of the dollar-based financial system. Perhaps this is why China is hedging its bets. While it continues to court international investment in certain markets, China’s banking regulators will focus on protecting the Chinese economy against any risks transmitted via “malicious” cross-border investment flows.

  Chinese assets are extremely unpopular right now, so there must be opportunity for an investor with the right risk tolerance.  Maybe Beijing could find some foreign dupes who might be willing to inject more capital in Evergrande?

  Tyler Durden
  Sat, 09/04/2021 – 22:00

• Rolling Stone 'Horse Dewormer' Hit-Piece Debunked After Hospital Says No Ivermectin Overdoses
  Rolling Stone ‘Horse Dewormer’ Hit-Piece Debunked After Hospital Says No Ivermectin Overdoses

  After Joe Rogan announced that he’d kicked Covid in just a few days using a cocktail of drugs, including Ivermectin – an anti-parasitic prescribed for humans for over 35 years, with over 4 billion doses administered (and most recently as a Covid-19 treatment), the left quickly started mocking Rogan for having taken a ‘horse dewormer’ due to its dual use in livestock.

  Rolling Stone’s Jon Blistein led the charge:

  

  On Friday, Rolling Stone‘s Peter Wade took another stab – publishing a hit piece claiming that Oklahoma ERs were overflowing with people ‘overdosing on horse dewormer.’

  It was suspect from the beginning.

  The report, sourced to local Oaklahoma outlet KFOR‘s Katelyn Ogle, cites Oklahoma ER doctor Dr. Jason McElyea – claimed that people overdosing on ivermectin horse dewormer are causing emergency rooms to be “so backed up that gunshot victims were having hard times getting” access to health facilities.

  

  As people take the drug, McElyea said patients have arrived at hospitals with negative reactions like nausea, vomiting, muscle aches, and cramping — or even loss of sight.

  “The scariest one that I’ve heard of and seen is people coming in with vision loss,” the doctor said. -Rolling Stone

  Except, the article provided zero evidence for McElyea’s claims, causing people to start asking questions.

  Good stock photo though: gun shot victims standing in line at the hospital while wearing winter coates in August. Total horse shit.

  — Dave Collum (@DavidBCollum) September 4, 2021

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  And while neither KFOR or Rolling Stone mention the hospital McElyea worked for, NHS Sequoyah, located in Sallisaw, Oklahoma – just issued a statement disavowing McElyea’s claims, which pops up when you visit their website.

  It reads:

  Although Dr. Jason McElyea is not an employee of NHS Sequoyah, he is affiliated with a medical staffing group that provides coverage for our emergency room.

  With that said, Dr. McElyea has not worked at our Sallisaw location in over 2 months.

  NHS Sequoyah has not treated any patients due to complications related to taking ivermectin. This includes not treating any patients for ivermectin overdose.

  All patients who have visited our emergency room have received medical attention as appropriate. Our hospital has not had to turn away any patients seeking emergency care.

  We want to reassure our community that our staff is working hard to provide quality healthcare to all patients. We appreciate the opportunity to clarify this issue and as always, we value our community’s support.

  

  What about the rest of the state?

  According to Scott Schaeffer, managing director of the Oklahoma Center for Poison and Drug Information, “Since the beginning of May, we’ve received reports of 11 people being exposed to ivermectin,” he told the NY Daily News (which still pushed the ‘ivermectin overdoses’ story despite this fact).

  Meanwhile, this horseshit story has also been picked up by the far-left Business Insider and The Independent, as well as The Guardian, among other notable outlets.

  

  Nobody even bothered to call the hospital where this guy claims to work. https://t.co/rCbgcvOoOa pic.twitter.com/wXjncinhQX

  — jimtreacher.substack.com (@jtLOL) September 4, 2021

  If Rolling Stone had only called the hospital to verify. Shocking.

  — R. W. Evans (@RealAngelof) September 5, 2021

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  And of course, the story was breathlessly parroted:

  

  

  

  

  https://platform.twitter.com/widgets.jsMcElyea is also listed as working at Integris Grove Hospital in Grove, OK as a general family practitioner – not in the ER. A phone call to them provided no insight as to any ivermectin overdoses, however the gentleman who answered the phone sounded quite amused. What’s more, Grove, OK – with a population of 7,129, had just 14 aggravated assaults in all of 2019 according to the FBI’s latest data. We somehow doubt that ‘gunshot victims were lining up outside the ER,’ while just 11 ivermectin related hospital cases have been reported in the entire state since the beginning of May.

  Tyler Durden
  Sat, 09/04/2021 – 21:30

• Chinese Funds Trounce Wall Street Pay, Offer $300,000 To Graduates
  Chinese Funds Trounce Wall Street Pay, Offer $300,000 To Graduates

  With bank after bank rushing to hike its entry-level wages to incoming analysts and associates, Wall Street suddenly finds itself facing a much more aggressive competitor: China.

  Take the case of Peking University graduate Garen Zhou, who deferred his studies in the U.S. because of the pandemic, and instead applied for internships at China’s biggest internet companies. In the end, Bloomberg reports, the computing major chose Ubiquant, a local hedge fund managing $8 billion of assets which is offering top college leavers like Ph.D.s annual salaries of as much as $300,000. After a year, Zhou became a permanent employee, giving up his enrollment at Johns Hopkins University.

  “The benefits of staying in this job far outweigh those of studying in the U.S. both in terms of knowledge and financial return,” said 23-year-old Zhou.

  One doesn’t have to be a PhD to garner the highest wage – for elite undergrads in artificial intelligence and computer science, Chinese funds like Ubiquant offer triple the $100,000 entry price for freshly-minted college graduates on Wall Street, “illustrating a shift in global financial hiring driven by the pandemic and rising emerging market wealth.” As a result, Bloomberg notes that rather than aspire to an education in the U.S. that often leads to opportunities at global companies or even staying in America, some of the nation’s best and brightest are choosing to stay home. And once US grads learn that potential Chinese employers offer as much as 3x more than they could make in the US, they will rush to apply too.

  That said, it’s unclear just how much longer these stellar offers will  last: graduates are in particular demand at quant funds which use computer models to trade, which have been lifted by inflows from rich individuals in the world’s second-biggest economy. Assets at such funds in China have jumped tenfold compared with four years ago to exceed 1 trillion yuan ($155 billion), according to Citic Securities Co. estimates. Of course, now that China is actively hammering its stocks as it pursues a “profound revolution“, the upside for investors may be severely limited, which in turn will also limit how much funds can spend on new hires.

  For now, however, the spice flows, and as quant funds seek the best and the brightest, they are also competing for hires with internet titans from TikTok owner ByteDance to Alibaba and global hedge funds including Bridgewater and Citadel. The battle for talent even transcends business as China and the U.S. make technological superiority important national objectives, channeling increasing amount of support toward research and innovation, as well as data security.

  “It’s very important for us to identify talent early on, because once they go abroad to study, they’ll have more options and we’ll have to compete with global companies,” said Wang Chen, 39, founder of Beijing-based Ubiquant. “Their willingness to join has increased quite a lot compared with a few years ago.”

  Offering much higher wages than Wall Street certainly helps. While for many local students, seeking an elite education abroad is a well trodden path with the number of Chinese students pursuing computer science degrees in the U.S. steadily rising in the past decade, but now with more students deferring their studies as the global pandemic restricts travel, companies like Ubiquant have adjusted their hiring strategy by offering one-year internships.

  No surprise, that tactic is working. Ubiquant has seen an influx of talent, and not just because of the stellar pay but because China’s humbled tech industry is grappling with regulatory change. Applications have jumped six times this year to more than 300 compared with when the company was founded.

  Other Chinese hedge funds have also aggressively ramped up their hiring: Zhejiang High-Flyer Asset Management is also capitalizing on the changing priorities of graduates. The country’s largest quant fund managing more than $10 billion hired about 10 researchers over the past year, many of whom gave up overseas studies amid the pandemic, according to Chief Executive Officer Simon Lu. Shanghai Minghong Investment Co., which manages $8.5 billion in China, hired more than 10 experts in artificial intelligence and natural language processing in recent years, according to founder Qiu Huiming.

  Lingjun Investment, which manages about $7.7 billion, plans to expand its investment and research team by as much as a third to 140 people by the end of the year, the firm said. It plans to boost spending in the area, including salaries, to about 1 billion yuan in the 15 months through March next year, up from an annual average of between 200 million yuan and 300 million yuan in the past three years.

  Of course, getting the high-paying job is not easy: stationed near China’s prestigious Tsinghua University, Ubiquant tests people on everything from coding to statistics and examines their academic research papers, hiring about 10 fresh graduates last year. Wang says he has offered more experienced hires salaries of $1 million a year. The company also gives extra incentives to top staff like one-time bonuses of 10 million yuan or profit sharing from breakout trading strategies, as he gets more comfortable poaching talent from global corporations.

  “If we think someone is worth hiring, we will try to hire them, sparing no efforts,” said Wang.

  At Ubiquant’s headquarters, Zhou and his colleague Nathan Lin, who both joined last year, focused on studying natural language processing and the firm’s existing research for the first four months of their internships.

  “I like the fact that your code and work speaks for itself,” instead of having to socialize and meet clients, said 22-year-old Lin, adding that this combined with the better salary offer from Ubiquant was the reason he joined the company instead of ByteDance or a job in banking. 

  For the successful few, there are other perks, such as a remarkable work pace. Starting at 10 a.m. every day, they work for an hour and a half before heading for a lunch break and getting a quick nap at their desks. They resume at 1 p.m., writing codes and brainstorming strategies till about 7 p.m. or 9 p.m. before hitting the gym. Often they’ll play ping pong in the office with other colleagues.

  “Working here matches the spirit of being a self-branded geek,” said Zhou. “As long I’m still learning, I’ll be staying on.”

  Of course, the (shockingly) higher wages are in line with a broader global trend that goes beyond hedge funds, as business at financial firms is booming. In recent months, entry-level salaries at top investment banks have quickly shot up into six figures, even before bonuses, as executives responded to a rebellion against the demands of Wall Street life as an entire woke generation simply refuses to work hard after 7pm. And terrified of appearing unwoke to the liberal press, their managers have grudgingly rushed to hike wages.  One wonders if now that China’s wages are public, will the US rush to match these two over fears of appearing stingy when compared to their communist peers.

  Tyler Durden
  Sat, 09/04/2021 – 21:00

• Pentagon Won't Name ISIS Terrorists Killed In Airstrike
  Pentagon Won’t Name ISIS Terrorists Killed In Airstrike

  Authored by Zachary Stieber via The Epoch Times,

  U.S. military officials are withholding the names of the ISIS terrorists allegedly killed by an airstrike in Afghanistan that was carried out in retaliation for the suicide bombing attack that left at least 13 U.S. troops dead.

  

  Pentagon spokesman John Kirby twice on Friday declined to provide the identities of the terrorists said to be killed in the strike.

  “I don’t believe we’ve refused to say who they are. We haven’t given you any names,” Kirby told reporters in Washington, responding to a question about the terrorist names.

  “We know who they are. I think at the time, we didn’t release the names because we were in the middle of a very fluid threat environment,” he added later. “Let me see if that’s information that can be provided now. I don’t know. I mean, we know who they are. I don’t know if it’s information that we’re going to be able to provide right now.”

  The Pentagon did not respond to a request for comment.

  The decision to withhold the identities has drawn some criticism.

  “This is bogus. Why not release the names?” former Rep. Jason Chaffetz (R-Utah) said on social media.

  Retired U.S. Army Lt. Col Brian F. Sullivan told the New York Post that the shielding of the names indicates that those who were killed weren’t high up in ISIS.

  “Normally if they get a high-profile guy they like to name him,” he said.

  The strike on Aug. 29 took place in Kabul, hitting what the U.S. military described as “an imminent ISIS-K threat” to the airport there, which was held by U.S. troops at the time.

  “We are confident we successfully hit the target. Significant secondary explosions from the vehicle indicated the presence of a substantial amount of explosive material. We are assessing the possibilities of civilian casualties, though we have no indications at this time,” Capt. Bill Urban, a CENTCOM spokesperson, said in a statement at the time.

  U.S. officials later confirmed that multiple civilians were left dead.

  Relatives of the deceased said 10 civilians were killed by the strike.

  Kirby has since repeatedly defended the retaliatory attack.

  Gen. Mark Milley, the chairman of the Joint Chiefs of Staff, said this week that it was a “righteous strike” that followed proper procedures.

  “We absolutely had solid intelligence that this was ISIS individuals, who were in the act of imminently carrying out a direct threat to the airport and to our people, and potentially to innocent lives outside the airport,” Kirby added Friday.

  “The intelligence was very good. And we took the strike in as timely a fashion as we could to prevent this imminent threat. There’s no question, from the department’s mind, that it was a valid threat, valid target, and it related to ISIS-K.”

  ISIS-K is an affiliate of ISIS. The terrorist group has claimed responsibility for the Aug. 26 bombing of the Hamid Karzai International Airport, which killed 13 American service members and wounded scores of Americans and Afghans.

  The United States withdrew from Afghanistan on Aug. 30.

  Tyler Durden
  Sat, 09/04/2021 – 20:30

• Congress Stealthily Moves Closer To Making Women Register For The Draft
  Congress Stealthily Moves Closer To Making Women Register For The Draft

  On September 1st the House Armed Services Committee joined the Senate Armed Services Committee in voting 35-24 to expand registration for a possible military draft to include young women as well as young men.

  Following this House committee vote and an earlier Senate committee vote in July (before Congress’s summer vacation), the versions of the annual “must-pass” National Defense Authorization Act (NDAA) to be considered later this fall in both the House and Senate will include provisions requiring women to register for the draft within 30 days of their 18th birthday and report to the Selective Service System each time they change their address until their 26th birthday, as young men have been required to do since 1980.

  

  An alternative compromise amendment to suspend draft registration unless the President declared a national emergency and put the Selective Service System into standby was submitted before Wednesday’s committee session, but ruled out of order on the basis of arcane PAYGO procedural rules.

  Under the same rules, the amendment to the NDAA to expand draft registration to women was ruled in order, considered, and adopted without any antiwar opposition from members of the committee.

  Floor amendments may be proposed when the NDAA is considered by the full House and/or the Senate to repeal the Military Selective Service Act, end draft registration entirely, abolish the Selective Service System, or put Selective Service into “standby” as it was from 1975-1980.

  But even if such amendments are proposed and put to a vote, they have little chance of success in either the House or the Senate.

  Now you – including likely 28 GOP House members voting for an NDAA last night to do so – want to draft my daughter and just “trust you” not to put them into combat? All of DC – all of it – can go straight to hell. (9/9) #DontDraftOurDaughters

  — Chip Roy (@chiproytx) September 2, 2021

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  It’s now overwhelmingly likely that the Fiscal Year 2022 NDAA to be adopted in late 2021 or early 2022 will authorize the President to order women to register for the draft at age 18, starting in 2023 with women born in 2005 and after.

  Read the rest of the full report at AntiWar.com

  Tyler Durden
  Sat, 09/04/2021 – 20:00

• China's Marxist "Profound Revolution" Is Here, And Nobody In The West Is Ready
  China’s Marxist “Profound Revolution” Is Here, And Nobody In The West Is Ready

  By Michael Every, global strategist at Rabobank

  Pro-Fund or Profound Revolution?

  Summary

  • Developments in China continue to confound market optimists, with new talk of a “profound revolution” towards a new target of “Common Prosperity”
  • Rather than simply react to these events, we analyze the history of Marxist-Leninist-Maoist Thought to try to put current moves under Xi Jinping Thought in a larger context
  • This also provides a framework of a hypothetical Marxist policy path forwards
  • We briefly discuss the meaning of Common Prosperity over time, and how it is a bellwether
  • We conclude with likely market reactions to an economy not saying “because markets”

  “Profound Revolution”?

  Political developments in China have been front page news in the financial press over the past few months. Beijing’s crackdown on Ant Financial, largely dismissed by Wall Street, then spread to Didi and on to the broader sectors these championed, fin- and transport-tech; then it grew to encompass swathes of the economy, from tech to health to education to property to private equity to gaming.

  In terms of tech, there are now sharp limits on IPOs in the US (mirrored from the US side) and new algo/pricing and data regulations that require Beijing to hold on to it; the private tuition field was made non-profit; there has been a sharp reduction in credit to property developers along with the official message that “houses are for living in, not speculation”, and rental increase caps of 5% annually; under-18s have been limited to just 3 hours of computer gaming a week, in allotted slots; and private equity has been cut off from residential investment.

  Beijing has also called for curbs on “excessive” income, and for the wealthy and profitable firms “to give back more to society.” (Tencent already pledged $15bn.) This is also matched by: a social campaign against excessive business drinking, “unpatriotic” karaoke songs, and celebrity culture; ‘Xi Jinping Thought’ made obligatory at all schools and universities; and, as Bloomberg puts it, controls on social media financial commentary – “China to Cleanse Online Content that ‘Bad Mouths’ its Economy”.

  This has all taken place under the slogan of “Common Prosperity”. (And for those who need the market-facing implications of this first, please see What is to be done?)

  Going further, commentary reposted by Chinese state media on 30 August stressed these changes are a “profound revolution” sweeping the country, warning anyone who resisted would face punishment. It added: “This is a return from the capital group to the masses of the people, and this is a transformation from capital-centred to people-centred,” marking a return to the original intention of the Communist Party, and “Therefore, this is a political change, and the people are becoming the main body of this change again, and all those who block this people-centred change will be discarded.”

  Notably, a WeChat blogger originally made the post, but it was then reposted by major state-run media outlets such as the People’s Daily, Xinhua News Agency, PLA Daily, CCTV, China Youth Daily, and China News Service.

  The author also wrote that high housing prices and medical costs will become the next targets of the campaign –which was backed by an official announcement on 1 September– and that the government needed to “combat the chaos of big capital,” adding “The capital market will no longer become a paradise for capitalists to get rich overnight… and public opinion will no longer be in a position worshiping Western culture.”

  Underlining a geopolitical element, the post also added that if China relied on “capitalists” to fight US imperialism it could suffer the same fate as the Soviet Union.

  Fund pros’ revelation

  Even ahead of the ‘revolution’ talk this had shocked markets – Chinese stocks have notably underperformed their US peers over 2021 despite an ostensibly better economic recovery (Figures 1, 2, and 3).

  

  Indeed, Bloomberg published an op-ed asking: “Is Capitalism Just a Phase? China Struggles With the Math” and investors quoted as asking if Chinese stocks were “uninvestable”.

  George Soros also ran an op-ed in the Financial Times titled “Investors in Xi’s China face a rude awakening”, concluding:

  “Foreign investors who choose to invest in China find it remarkably difficult to recognise these risks. They have seen China confront many difficulties and always come through with flying colours. But Xi’s China is not the China they know. He is putting in place an updated version of Mao Zedong’s party. No investor has any experience of that China because there were no stock markets in Mao’s time. Hence the rude awakening that awaits them.”

  However, thus far MSCI, which sets the benchmark for global portfolio allocation for EM equity investors, has not been moved to revise it China weightings. To them, this is all a technocratic policy adjustment and/or “periodic regulatory compliance measures”. The vast majority of Western market research also attempts to explain away what is happening in a similar fashion.

  Yet China is an unashamedly a deeply political economy with an openly-proclaimed Marxist-Leninist-Maoist–Xi Jinping guiding ideology.

  Reportedly, Western research analysts are now scrambling to read Xi’s past speeches to try to predict which sectors may be hit by a crackdown next. However, this still misses the larger key point: how can one correctly analyse likely future developments in a Marxist-Leninist-Maoist economy properly without having any knowledge of what Marx, Lenin, or Mao argued?

  By contrast, this report will underline the thrust of these political/economic/philosophical thoughts, as the backdrop for Xi Jinping Thought and Common Prosperity.

  This will allow us to:

  1) Frame a Marxist hypothesis of what may be occurring;

  2) Look at the shifting meaning of “Common Prosperity” over time as a bellwether, and what it means in this present context; and

  3) Consider what the global market and geopolitical implications of such a strategy might be.

  Note that this is by its very nature an ideological economic discussion, and that the necessity of doing so is very much in line with our late-2020 report that argued political-economy “-isms”, e.g., communism/capitalism, would soon be the key issue for markets to focus on, rather than the minutiae of fiscal and monetary policy shifts within a default neoliberal capitalism.

  Marx

  

  The collected works of Marx (with posthumous help from Engels) cover 50 volumes, and commentary on it thousands more. However, the relevant arguments today are simple to grasp.

  ‘The Communist Party Manifesto’ lays out a teleological, materialist conception of history: that “the history of all hitherto existing society is the history of class struggles”. In short, societal structures depend on the technology available and have always taken the form of an oppressed majority exploited by a minority.

  We started with “primitive communism”; moved to agricultural and craftsman feudalism; and then to industrial capitalism. Under capitalism, the proletariat engage in class struggle against the owners of the means of production, the bourgeoisie, who only pay workers the bare minimum to survive, and keep the excess profits for themselves – The Labor Theory of Value (LTV). This class struggle will ultimately end in a revolution that restructures society again – to communism. Indeed, the Manifesto proclaims international revolution as its goal: “Workers of the world, unite! You have nothing to lose but your chains!”

  Ironically, most of the policy demands made by it hardly seem radical today: a progressive income tax; abolition of inheritances and private property; abolition of child labor; free public education; nationalization of the means of transport and communication; centralization of credit via a national bank; and expansion of publicly owned land. Indeed, much of early Marxism looks a lot like the de facto policy drift we already see in ‘New Normal’ economies today.

  Notably, however, the Manifesto critiques socially-focused philosophies, noting: “A part of the bourgeoisie is desirous of redressing social grievances in order to secure the continued existence of bourgeois society. To this section belong economists, philanthropists, humanitarians, improvers of the condition of the working class, organisers of charity, members of societies for the prevention of cruelty to animals, temperance fanatics, hole-and-corner reformers of every imaginable kind… The Socialistic bourgeois want all the advantages of modern social conditions without the struggles and dangers necessarily resulting therefrom. They desire the existing state of society, minus its revolutionary and disintegrating elements.”

  In short, Western social-democracy –put forward as a technocratic explanation of Common Prosperity– is fundamentally antithetical to Marxism.

  Marx went into far more detail in ‘Das Kapital’, which is still an important critique of modern economics today, in particular on the circulation of capital.

  At root of neoclassical macro-econometric modelling is the assumption one starts with a commodity (C), exchanges it for money (M), and then buys another commodity (C): the chain of C>M>C means money is only needed as a lubricant, not as an end-goal itself, and overlooks banks’ and central-banks’ ability to create credit.

  By contrast, Marx showed we actually start with Money (M), buy a commodity (C), add value via the ‘means of production’ (MP), creating a value-added commodity (C’) that is sold for M’, with M’-M being the gross profit. This is a realistic economic model that allows profit, money hoarding, (central) bank credit/capital, and *financial crises* to all be accounted for properly within capitalism in a way neoclassical economic and econometric models overlooking money/credit/banks cannot.

  Moreover, Marx went into detail on the various forms of capital that exist, in particular: productive (i.e., making things – by exploiting labor); unproductive (i.e., the managers, accountants, and sales people also needed, etc., who are paid from the profit arising from the exploitation of the workers physically increasing the stock of goods); and fictitious – by which Marx meant financial assets unrelated to physical production, which he saw could become destabilizing, inflationary bubbles, and which were prone to market manipulation by large players, and crashes.

  In short, to understand Marx is to understand the unstable dynamics of financial capitalism better than most capitalist economists even beyond the LTV.

  One other crucial thing needs to be made clear about Marx and communism: he never described what it would look like. In his view, the state would “wither away” after the revolution happened. Communism was also not supposed to co-exist with capitalism, or compete with it: rather, it would supplant it via natural laws.

  So, to very briefly summarise, Marx:

  • Saw all profit as stemming from exploitation of labor;
  • Foresaw dynamic global capitalism as doomed to fail;
  • Dismissed social reformers as subverting revolution; and
  • Explained the use of credit and the qualitative differences between productive and fictitious financial capital under capitalism.

  This all has a key bearing on China’s “profound revolution”.

  Lenin

  

  Lenin, leader of the Russian revolution, made vital contributions to both Marxist theory and practice.

  Crucially, Marx’s view of history meant that the communist revolution would occur in an industrialized economy: he had expected it to be Germany. Instead, it ended up happening in Russia, which was still only just emerging from feudalism.

  An important debate at the time was therefore between the Bolsheviks (“the majority” in Russian), and Mensheviks, (“the minority” – though this did not reflect their actual popular support).

  The Mensheviks believed they needed to develop Russia using capitalism first, in conjunction with more liberal forces and under parliamentary rules, and then have the revolution. Lenin disagreed, as had Marx, and it was his practical ruthlessness that saw the Bolsheviks seize power when it was “lying in the street”.

  Politically, Lenin also added to Marxist thought to create Marxism-Leninism in three ways:

  • A ‘vanguard party’ –the Communist Party– was necessary to raise the level of political consciousness and lead and guard the revolution
  • The (ruthless) Dictatorship of the Proletariat was needed to run the state, the polar opposite of it withering away (but what happens when a revolution occurs and the bourgeoisie fight back); and
  • Late-stage capitalism’s fusion of banks with industrial cartels, excess production, and need for new markets and profits, is a driver not only of revolution, but of geopolitical tensions and then war

  Economically, Lenin introduced War Communism (1918-1921) to win the Russian Civil War, which involved: the nationalization of all industries; strict centralized management; state control of foreign trade; strict discipline for workers, with strikes forbidden; obligatory labour duty by non-working classes; the requisition of agricultural surplus in excess of an absolute minimum from peasants for centralized distribution; rationing of food and most commodities; private enterprise bans; and military-style control of the railways.

  However, once the war was over, Lenin was forced to pivot to the New Economic Policy (NEP), under which there was a return to free market capitalism, subject to state controls, and state-owned enterprises operated on a profit basis -there were even “generous concessions to foreign capitalism.” In short, Lenin took the de facto Marxist/Menshevik position that he had to create “the missing material prerequisites” of modernisation and industrial development by falling back on a “centrally supervised market-influenced program of state capitalism”.

  To summarize, Marxism-Leninism was politically ruthless but economically pragmatic in order to attain the physical means to achieve socialism/communism (used interchangeably by Lenin, as by Marx.)

  Of course, the NEP came to an abrupt end in 1928 when Stalin assumed leadership of the USSR, at which point the traditional model of a Soviet economy, with agricultural collectivization, and a focus on heavy industry and 5-year plans, emerged.

  Notably, Stalin also began to differentiate between socialism, which was painted by him as the imperfect state being built, as the transition stage towards the higher socio-economic goal of communism, which would eventually be achieved. He also shifted the USSR’s foreign policy goals away from Marxist-Leninist global revolution to ‘Socialism In One Country’.

  That such swings in policy direction are possible under a Marxist-Leninist system is itself already a key lesson to be drawn for the present day.

  Mao

  

  Maoism, or Mao Zedong Thought, added to Marxism-Leninism in several ways:

  • It stressed Leninist realpolitik view of the role of a revolutionary party, e.g., with the key quote that “Political power grows out of the barrel of a gun”;
  • The peasantry are the revolutionary vanguard in pre-industrial societies –such as 1940’s China– rather than the industrial proletariat. Mao therefore differed from Marx on the theory of the inevitable cyclicality in the economic system.
  • Rather than waiting for industrial development, Mao’s goal was to unify the Chinese nation in order to realize the communist revolution;
  • Accordingly, Mao’s theory of the ‘mass line’ holds that the Chinese Communist Party must not be separate from the popular masses, like an elite vanguard, either in policy or in revolutionary struggle;
  • Mao’s theory of Cultural Revolution states that the proletarian revolution and the Dictatorship of the Proletariat does not wipe out bourgeois ideology. The class-struggle still continues and even intensifies during socialism, therefore a constant struggle against bourgeois ideologies and their social roots must be conducted;
  • Mao argued contradictions are natural and the most important feature of society. Since society is dominated by a wide range of contradictions, this therefore calls for a wide range of varying strategies, e.g., a revolution, to fully resolve antagonistic contradictions between labour and capital; and ideological correction to resolve contradictions arising within the revolutionary movement to prevent them from becoming antagonistic.
  • Mao also oversaw a Sino-Soviet split in the 1960s following the USSR’s break from Stalinism.

  Economically, Maoism co-opted so-called pro-CCP “Red Capitalists” such as Rong Yiren before embracing Stalinist collectivism and industrial development via 5-year plans – which ended in severe economic damage during the Great Leap Forward. Economic development was further set back by the turmoil of the Cultural Revolution.

  In summary, Maoism represents an extension of Marxism-Leninism to Chinese socio-economic conditions, focused on the link between the Party and the population, as well as resolving bourgeois tendencies and/or ideological contradictions. However, there was no room for Menshevik/NEP-style economic pragmatism.

  Post-Mao

  The starting point for most Western analysts looking at the Chinese political economy is Deng, who emerged as leader of the CCP following Mao’s death in 1976. Mao welcomed US President Nixon to China, but it was Deng who opened China up economically with the proverb that “it doesn’t matter whether a cat is black or white, if it catches mice it is a good cat.” This was a stepping stone to the official adoption of “Socialism with Chinese Characteristics”, a Leninist NEP-style program, where the “primary stage of socialism” required markets and private capital – while still stipulating that China needed growth before it pursued a more egalitarian form of socialism, which in turn would lead to a communist society.

  In 2000, when China joined the WTO, Jiang introduced “The Three Represents” to modernize the CCP’s links to a vastly-changed society. Rather than just the proletariat, the Party was now seen as representing: the development trend of China’s advanced productive forces; the orientation of China’s advanced culture; and the fundamental interests of the overwhelming majority of the Chinese people, which covered far more political bases – including business. In 2003, Hu added “The Scientific Outlook on Development”, pledging scientific socialism, sustainable development, social welfare, a humanistic society, increased democracy, and, ultimately, the creation of a Socialist Harmonious Society, taken by many as further liberalization.

  Xi

  

  So to the present day.

  The now-shocked op-ed writers at Bloomberg and the Financial Times and the stunned Wall Street analysts all clearly regarded the 2000’s era, rapidly-growing, reforming, globalizing China as being either the final stage of its political-economic development or a staging post towards even further liberalization. However, this overlooked the fact that Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, or more commonly ‘Xi Jinping Thought’ (XJT), has been a growing body of work since 2017.

  At the 19th National Congress of the CCP, XJT was incorporated into the Party’s Constitution, and at the First Session of the 13th National People’s Congress in 2018, the preamble of the Constitution of the People’s Republic of China was also amended to mention XJT, underlining its political significance given it joins only Mao and Deng Thought on that list of fundamental national doctrines.

  So, crucially, what does this body of work add to Marxist-Leninist-Maoist Thought?

  There is a simple 14-point basic policy list to follow:

  • Ensuring CCP leadership over all forms of work in China;
  • The CCP should take a people-centric approach for the public interest;
  • The continuation of comprehensive deepening of reforms;
  • Adopting new science-based ideas for innovative, coordinated, green, open and shared development;
  • Following socialism with Chinese characteristics with people as the masters of the country;
  • Governing China with Rule of Law;
  • Practice socialist core values, including Marxism, communism and socialism with Chinese characteristics;
  • Improving people’s livelihood and well-being is the primary goal of development;
  • Coexist well with nature with energy conservation and environmental protection policies and contribute to global ecological safety;
  • Strengthen the National security of China;
  • The CCP should have absolute leadership over China’s People’s Liberation Army;
  • Promoting the one country, two systems framework for Hong Kong and Macau with a future of complete national reunification and to follow the One-China policy and 1992 Consensus for Taiwan;
  • Establish a common destiny between Chinese people and other people around the world with a peaceful international environment; and
  • Improve party discipline in the CCP

  The above combines technocratic goals that would be well-received in all economies, as well as specific honorifics to maintain CCP ideological continuity. As such, it is easy to see how a Western analyst with no interest in political economy or Marxism could, in 2019, see “reforms”, “people-centric”, “rule of law”, “improve livelihoods and well-being”, “energy conservation”, “environmental protection”, “global ecological safety”, and “peaceful international environment”, and feel entirely at ease.

  Yet a key 2013 speech and 2014 ‘The Governance of China’ book series together provide the intellectual spine of XJT – and they focus on China’s place in history, strategic competition with capitalist nations, and a plea to adhere to the goals of communism.

  In particular, it was “Marxism-Leninism and Mao Zedong Thought that guided the Chinese people out of the darkness of that long night and established a New China.” – not Deng or the post-2000 economic reformers. Looking ahead, “the consolidation and development of the socialist system will require its own long period of history… it will require the tireless struggle of generations, up to ten generations.

  Fundamentally, “Marx and Engels’ analysis of the basic contradictions in capitalist society is not outdated, nor is the historical materialist view that capitalism is bound to die out and socialism is bound to win… The fundamental reason why some of our comrades have weak ideals and faltering beliefs is that their views lack a firm grounding in historical materialism.”

  Furthermore, as alluded to in the 30 August commentary quoted at the beginning, a very particular focus on the collapse of the USSR: “Why did the Soviet Union disintegrate? Why did the Soviet Communist Party fall from power? An important reason was that the struggle in the field of ideology was extremely intense, completely negating the history of the Soviet Union, negating the history of the Soviet Communist Party, negating Lenin, negating Stalin, creating historical nihilism and confused thinking. Party organs at all levels had lost their functions, the military was no longer under Party leadership. In the end, the Soviet Communist Party, a great party, was scattered, the Soviet Union, a great socialist country, disintegrated. This is a cautionary tale!”

  As noted, XJT is now the official curriculum at schools and universities across China – meaning that an understanding of its core messages and targets is of the utmost importance to markets.

  Presumably, at some point ahead Common Prosperity will be wrapped into XJT in a more formal manner too.

  

  Marx to Market

  Before looking at Common Prosperity specifically, it is time to “Marx to market”: that is to look at everything we have just shown the reader, and to try to draw out what this implies is now happening in China from a hypothetical Marxist perspective, i.e., the one the markets so clearly lack.

  The 14-point list of course shows which sectors are going to be favored going forward: green, the environment, science, and national security. However, the same list would arguably apply to almost any global economy today, from President Biden’s America to Boris Johnson’s Britain, which makes it far less useful. The 14-point list does not tell us anything about which sectors will not be favored by Beijing, or which will see harsh regulatory crackdowns, or what the overall operating environment for businesses and asset-managers in China will be like.

  Here we must stress that XJT openly draws from Marx, Lenin, and Mao. Using them as a guide, a hypothetical framework can be drawn in some respects.

  XJT holds to Marx’s historical materialism, which predicts capitalism will collapse due to its own internal contradictions, even if it also believes this is not imminent. However, even given the deep-rooted structural problems in most Western economies, it seems unlikely this view is purely based on the debunked Labor Theory of Value. Far more likely, is a Kaleckian critique of the LTV –i.e., falling labor share of GDP– with the circulation of capital –i.e., an addiction to debt– and of productive, unproductive, and fictitious uses of capital – i.e., as the West continues to lean on asset bubbles and QE rather than productive capital investment. Moreover, neoliberal capitalism has seen increasing economic concentration, as Marx predicted. Even much of the West sees this critique as valid, and worries about the future outlook.

  Of course, we could see a burst of OECD ‘Build Back Better’ that reshapes economies and supply chains – but Leninist theory suggests this leads to growing geopolitical tensions and the risk of war. Xi Jinping has openly warned the PLA of the need to be ready for war on several occasions in recent years, as one would from a Leninist perspective.

  For China, this therefore suggests that rather than embracing a destabilizing neoliberal, monopolistic, unproductive financial capitalism, with all of its resultant socio-economic problems, just to build capital stock, it needs to pivot back towards more state-direction within a Leninist-NEP mixed economy – and with a far larger national-security focus at the same time, just in case.

  If that means making for-profit education non-profit to make education cheaper, so be it. If it means to “prevent the irrational expansion of capital” and “barbarous growth” of private monopolies, as Xi Jinping declared on 31 August, then that is a problem for those sectors.

  If that involves telling under-18s they cannot play computer games for more than 3 hours a week, so be it. Children addicted to computer games are not goals of a communist society, or any healthy society.

  If that involves rental caps, then that is what will have to happen too.

  In short, more productive capital, please; less unproductive or fictitious capital, thank you very much. Far more productive consumption (i.e., made in China goods), please; far less unproductive (i.e., “Western” services like gaming), thank you very much.

  This does not mean that market forces are about to be wiped out. Marx argued for their dynamism, and XJT embraces a “socialist market economic system”. However, these need to be corralled into the right areas – which does imply a higher degree of central planning. At the same time, it means accepting the ‘right’ level of return – that ensures a harmonious outcome for Chinese society as a whole, not just that of a portfolio.

  Indeed, as XJT draws from Marx and Lenin, it also draws from Mao. Recent developments point to a thrust to get the CCP back in touch with the masses, not just the several hundred million who have benefited so handsomely from the NEP economy of the past few decades. Moreover, XJT talks about wavering ideological faith in the party, which smacks of the need to overcome contradictions with ideological correction. The same argument –and the 30 August “profound revolution” commentary– suggests the need to deal with ‘bourgeois elements’ in the economy who may reject the necessary medicine.

  So the above is a hypothetical Marxist perspective on what is happening. It may come as a shock to Western investors who assumed China was capitalist, and try to ascribe purely technocratic intentions to every development everywhere.

  However, if they had read Marxist theory or history they would have recognized that ‘NEPs’ are used to help move the economy up the development ladder towards a higher stage of socialism and then to communism; and meanwhile neoliberal capitalism is growing unwieldy, unwelcome, and unpopular even within the West itself, as we see from constant talk of the need to Build Back Better – which China seems willing to act on.

  The Zhejiang example

  But do we have any actual evidence from the ground to support this Marxist theory? Perhaps, yes. Bloomberg recently carried an article looking at the province of Zhejiang (population 65m, and home to Alibaba), which has an existing pilot experiment with Common Prosperity.

  Crucially, what is being seen there is not a tax-and-spend or a welfare state shift, which are again Western, market conceptions of how political-economy should work; nor is it seeing a return to state ownership of the means of production, i.e., nationalization, which is the final stage of communism. Rather we see a strategy to force capital to flow to areas previously starved of it, alongside huge efforts to bring down living costs – which is entirely in line with the Marxist theory just put forward. Specifically, we see:

  • Direct targeting of inequality (of intra-provincial GDP per capita gaps between rural and urban areas);
  • Aiming to increase the labor share of GDP to > 50%;
  • More urbanization;
  • Property taxes (on private housing) and building new state-owned rental properties (i.e., social housing);
  • Letting people without official hukou residence access state services, which is a genuine revolution;
  • More spending on social services – and “donations” from local billionaires collectively worth $236bn;
  • Lower cost business loans for favored sectors, including manufacturing, agriculture, and tourism;
  • SOEs building more infrastructure, “even if it generates low returns”; and
  • Breaking up monopolies.

  As such, we get a ‘Build Back Better’ picture of a “socialist market economic system with Chinese characteristics”: potentially higher growth, but lower returns; less luxury and more mass-market; and far more state regulation. This is something neoliberal markets currently don’t understand and presumably won’t like: they clearly prefer lower growth and higher returns; less mass-market and more “premiumisation”; and far less regulation.

  However, significant obstacles still need to be tackled. Most obviously, even using markets to enforce centrally-planned goals still assumes that such central planning can guide them towards generating the productivity gains that will be needed – an issue non-NEP Marxist economies struggled with in the past in the absence of markets.

  Importantly, the CCP has announced it will hold a key plenum in November – what policy changes this portends against the current backdrop remains to be seen.

  Capital problem to labor with

  Another obstacle to increasing the labor share of GDP to over 50% to boost consumption must also be stressed.

  

  According to most data, China’s labour share of GDP is already over 50% (Figure 4), but this this does not capture China’s very low share of household (HH) spending in GDP, which is even lower than the share to gross fixed capital formation (GFCF, Figure 5).

  

  Does Common Prosperity mean lower investment and higher consumption? That runs counter to the imperative for more “productive” capital and for more lending (at low rates) to new SMEs and sectors. It would also suggest an employment shift towards more “unproductive” sectors.

  Yet if household spending rises and investment spending stays the same, or rises, then national savings will fall, and China will run an external deficit (and debt will rise further). The PBOC recently stressed this was a sign of economic weakness, and it would open the door to major market volatility over time – something that is clearly not desired.

  How can these inherent contradictions be resolved? Logically, only with an unrealistically-high net export surplus, creating major trade/geopolitical problems.

  What is to be done?

  What we need to do now is summarize the major underlying arguments made so far:

  1. First, while many in the West/markets approach China as having a de facto neoliberal capitalist system, this view is not just overly simplistic, it is arguably wrong. While many of the things China says may sound “Western” or easily-recognizable, e.g., “green”, “sustainable”, “people-centred”, etc., this does not mean that the underlying political economy is Western.
  2. Second, while the West considers economic thinkers of the past to be exactly that…of the past…China is not just paying lip-service to Marxism: it is taking cues from the roots of Marxist thought traditions, while adding modern-day interpretations in order to choose its own path. With the Western capitalist system clearly in trouble, China’s leadership feels emboldened to push ahead in this regard.
  3. Third, whereas in the West change is gradual, or non-existent, and usually part of a democratic model in which consensus is required, in China far more dramatic changes can happen suddenly if needed for the perceived greater good. Such changes are happening, and are currently speeding up, not slowing down.
  4. Fourth, while we can perhaps see the ideal destination to Common Prosperity, the journey itself is likely to be extremely bumpy, and involve many more major zero-sum trade-offs. However, the political imperative appears to be there to continue to move down this path.

  So, given this backdrop, what does it mean for the economy? What does it mean for markets? What does it mean for geopolitics?

  In terms of the economy:

  1. The current policy shift may add to pre-existing downward pressures on Chinese growth by reducing business confidence and scaring off foreign investors, while also failing to square the circle between the needs for a trade surplus, higher household spending, and sustained high investment.

  2. …or it may lead to sustained high growth of a more balanced kind, e.g., more social housing and less private housing; more high-tech/green manufacturing jobs, and fewer gig economy/services jobs.

  3. Western exporters to China focused on the higher-income/luxury sectors may be unhappy in either case.

  In terms of markets:

  4. Chinese equities may continue to struggle to keep up with those of the US, particular in sectors the government focuses its sights on. Risks to the housing sector also loom large if comments about too-high prices are followed up on.

  5. It is an ironic positive for global bonds, and most so government bonds in China – although as a one-way street for those who get in early to the latter, and with realization that they are there for the duration of the political and FX ride, wherever it eventually leads.

  6. On balance, it is more likely to be a long-run negative for CNY than a positive. In the short-run, however, the rhetoric on capital markets suggests no appetite in Beijing for FX volatility. If we were to see a universal move in USD higher ahead, e.g. by Fed tapering, then CNY will move lower – while staying largely unchanged against every currency except the Dollar, no doubt; and

  7. While the Fed and ECB have not made any mention of developments in China so far, this is going to matter to the US and EU economies too. It may mean even more “fictitious capital” (QE) for them, just as China tries to focus on the “productive” side even more.

  In terms of geopolitics:

  8. Geopolitical and trade tensions, which flow back to the economy and markets, are only going to worsen.

  9. For the West, this poses a major challenge. The risks for investors in China are clear, and to Western net exporters if China sees slower growth, or more domestically-focused and sourced growth. However, a whole different set of political-economy problems would be created if China’s new state intervention policies work well – on what basis would a struggling West be able to then reject them at the ballot box?

  So, “Pro-Fund” or “Profound”?

  To conclude, this report represents an opinion that deliberately steers away from a traditional ‘Street’ view to try to present an alternative way of seeing things. There are of course many other views: yet the one here would have prevented a lot of concern and surprise among Western investors in China this year, and may yet prove a guide for what comes next.

  Is the ultimate future of China pro-fund or profound revolution? It depends – and perhaps ultimately on if one sees there are observable laws to the progress of history or not!

  Tyler Durden
  Sat, 09/04/2021 – 19:30

• Biden Orders Declassification Of 9/11 Documents & Possible Saudi Links
  Biden Orders Declassification Of 9/11 Documents & Possible Saudi Links

  Amid ongoing pressure from the families of 9/11 victims, President Biden on Friday ordered the declassification of FBI documents related to the September 11, 2001 attacks, now set to be released over a period of the next six months.

  The families have long moved through US courts to seek accountability for the Saudi government. They accuse multiple US administrations of seeking to cover up close US-ally Saudi Arabia’s involvement in supporting the al-Qaeda hijackers. 

  

  The ordered declassification comes just days before the 20th anniversary of the 9/11 attacks which took the lives of almost 3,000 Americans in New York, Washington D.C., and over Pennsylvania with the downing of United Airlines Flight 93.

  Last month about 1,700 family members of the victims wrote a scathing letter to President Biden urging him to skip 9/11 memorial events unless he’s willing to release the documents immediately. “Since the conclusion of the 9/11 Commission in 2004 much investigative evidence has been uncovered implicating Saudi government officials in supporting the attacks,” the letter said.

  Biden’s Friday executive order stated that “Information collected and generated in the United States Government’s investigation of the 9/11 terrorist attacks should now be disclosed, except when the strongest possible reasons counsel otherwise.”

  “When I ran for president, I made a commitment to ensuring transparency regarding the declassification of documents on the September 11, 2001 terrorist attacks on America. As we approach the 20th anniversary of that tragic day, I am honoring that commitment,” Biden said in announcing the move.

  “Today, I signed an executive order directing the Department of Justice and other relevant agencies to oversee a declassification review of documents related to the Federal Bureau of Investigation’s September 11th investigations. The executive order requires the Attorney General to release the declassified documents publicly over the next six months.”

  The language of the executive order still leaves room to potentially restrict some documents or sections…

  You will have a better chance of striking it rich by panning for gold in your bathtub than having any substantial 9/11 documents declassified and released to the public. https://t.co/iubx5XfwqR

  — NYC EMS Watch (@NYCEMSwatch) September 3, 2021

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

  Previously in 2016, Trump had declassified the so-called “28 pages” – a reference final section of the December 2002 report of the Joint Inquiry into Intelligence Community Activities before and after the Terrorist Attacks of September 11, 2001 – which had long remained classified.

  The contents of those pages pointed further the Saudi Embassy foreknowledge as well as contacts and monetary support to some of the terrorists who conducted the attacks.

  Tyler Durden
  Sat, 09/04/2021 – 19:00

• DHS's E-Verify Authorizes Thousands Of Illegal Immigrants To Work In US
  DHS’s E-Verify Authorizes Thousands Of Illegal Immigrants To Work In US

  Via JudicialWatch.org,

  The government’s pricey system to verify that employees are authorized to work legally in the U.S. is somewhat of a joke that has approved thousands of illegal immigrants and hundreds of thousands of foreigners without using its own photo-matching process to confirm identities. Additionally, the system, which is operated by the Department of Homeland Security’s (DHS) U.S. Citizenship and Immigration Services (USCIS), deemed around 4,000 foreign-born applicants as “employment authorized” based on employer-sponsored visas without verifying that candidates were actually hired by the employers that sponsored them.

  

  The famously inefficient program is known as E-Verify, a costly database that screens new employees using records from various government agencies to confirm the candidate is in the country legally. It is a web-based system that supposedly matches information provided by new hires against DHS and Social Security Administration (SSA) records. USCIS operates it because the agency is responsible for administering the nation’s lawful immigration system. The program is available to employers in every state as well as the District of Columbia, Puerto Rico, Guam, the U.S. Virgin Islands, and Commonwealth of Northern Mariana Islands. For private businesses it is voluntary but federal contractors and subcontractors must use it to vet workers.

  The government claims E-Verify is “currently the best means available to electronically confirm employment eligibility.”

  That is distressing considering the lapses that have been well documented over the years. The most recent E-Verify problems are the focus of a lengthy federal audit published just a few days ago by the DHS Inspector General. In its report, the watchdog blasts USCIS, identifying “deficiencies” that illustrate the program needs “additional capabilities” to “more effectively confirm that individuals are eligible for employment in the United States.” The document identifies weaknesses in E-Verify’s process for confirming identity during employment verification and discloses that the system’s photo-matching mechanism is not fully automated, but rather, relies on employers to confirm individuals’ identities by manually reviewing photos.

  “We also determined that in fiscal year 2019, E-Verify returned an ‘Employment Authorized’ result for about 280,000 non-U.S. citizens without using the photo-matching process to confirm their identities,” the report says.

  “Additionally, although the majority of individuals submit a driver’s license to prove identity, E-Verify’s process does not use photos to ensure that individuals match the license submitted.”

  It gets better. Investigators reveal they “found errors in E-Verify’s license verification process that resulted in E-Verify deeming about 613,000 individuals ‘Employment Authorized’ without meeting USCIS’ own identification system use requirement.”

  The probe further determined that E-Verify returned an “Employment Authorized” result for almost 3,000 non-U.S. citizens who did not meet USCIS’ verification requirements. Those are considered illegal immigrants. E-Verify also authorized 4,000 non-U.S. citizens to work based on an employer-sponsored visa without verifying that the individual was hired by the employer that sponsored them. “Lastly, USCIS has not completed full testing of E-Verify’s capabilities to determine whether the system can handle the projected increase in users,” the report states, attributing the problems to USCIS’s failure to develop or evaluate internal controls necessary to detect, track and investigate system errors.

  “Until USCIS addresses E-Verify’s deficiencies, it cannot ensure the system provides accurate employment eligibility results,” the watchdog writes.

  Since it was launched in 1996, E-Verify’s efficiency has come under fire despite receiving generous funding from Congress. This fiscal year, the system got $118.7 million from American taxpayers. Around 909,000 employers throughout the nation use it to verify the employee work authorization of more than 40 million hires, making it an important tool to curb illegal immigration since jobs are a huge lure for migrants. For years undocumented immigrant workers have been able to pass an E-Verify check with fake identification documents. In fact, an audit conducted for the federal government more than a decade ago revealed that around 54% of illegal immigrants workers are approved by E-Verify to work legally in the U.S. It seems that little has changed to assure the system is more efficient.

  Tyler Durden
  Sat, 09/04/2021 – 18:30

• India Approves World's First DNA-Based COVID Vaccine
  India Approves World’s First DNA-Based COVID Vaccine

  Shortly after Taiwan announced that it had successfully produced its own vaccine as it seeks to bolster its domestic COVID response, India has followed up on its promise to create its own homespun DNA-based COVID jab.

  

  The DNA vaccine uses circular strands of DNA to prime the immune system against a virus – in this case, SARS-CoV-2. Researchers welcomed news of the first DNA vaccine’s approval, saying it could be a major step forward in the battle against COVID. The jab, called ZyCoV-D, is administered into the skin without an injection, and has been found to be 67% protective against symptomatic COVID-19 in clinical trials.

  Now that India has approved the jab and manufacturing is ramping up, ZyCoV-D will likely start to be administered in India later this month. Although the efficacy is not particularly high compared to that of many other COVID-19 vaccines, the fact that it is a DNA vaccine is significant, say researchers.

  Close to a dozen DNA-based vaccines against COVID-19 are in clinical trials globally, and at least as many are in earlier stages of development. To be sure, DNA vaccines are also being developed for many other diseases. They have many advantages over mRNA vaccines that make them particularly useful in environments like India.

  

  While mRNA vaccines were quicker to show strong immune responses in clinical trials, DNA vaccines are better suited for many economies because they are easy to produce, and the finished products are more stable than mRNA vaccines – allowing them to be stored at higher temperatures.  They also don’t need to be injected deep into the muscle tissue.

  “If DNA vaccines prove to be successful, this is really the future of vaccinology” because they are easy to manufacture, says Shahid Jameel, a virologist at Ashoka University in Sonipat, India.

  The urgency of combating COVID-19 has fast-tracked the development of vaccines that use more experimental genetic technology, such as mRNA and DNA vaccines.

  The only question now is will India’s DNA vaccine exhibit fewer rare (but harmful) side effects than the mRNA and adenovirus-vector jabs?

  With that in mind, we’d just like to note: at this point in the pandemic, tampering directly with DNA and RNA is totally fine, but taking a drug that has been approved by the FDA since 1998 (ivermectin) is blasphemy.

  Tyler Durden
  Sat, 09/04/2021 – 18:00

• Oregon Police And Firefighters Sue Governor Over Covid Vaccine Mandate
  Oregon Police And Firefighters Sue Governor Over Covid Vaccine Mandate

  By Tom Ozimek of the Epoch Times,

  A coalition of Oregon police officers and firefighters have sued Gov. Kate Brown over a COVID-19 vaccine mandate for state employees.

  

  The plaintiffs—including the Oregon Fraternal Order of Police and the Kingsley Firefighters Association—argued in a lawsuit filed Friday in a Jefferson County court (pdf) that Brown’s executive order violates a number of laws and want it blocked.

  “Plaintiffs seek an order declaring EO No. 21-29 is unenforceable because it conflicts with Oregon statutes, would result in a common law wrongful discharge of the Plaintiffs, conflicts with the Oregon Constitution’s guarantee of free expression, and conflicts with the United States Constitution guarantee of equal protection, free exercise, and due process,” the complaint states.

  Brown issued an executive order (pdf) on Aug. 13 that imposed a mandatory vaccine requirement on all executive branch employees. In the order, Brown said that, to date, around 70 percent of the state’s executive branch employees had taken the vaccine voluntarily, prompted in part by state efforts like organizing onsite vaccine clinics and financial incentives.

  Citing the rise in COVID-19 infections and noting that both private and public employers across the United States have imposed mandates, Brown said it was time for tougher measures in Oregon.

  “With the Delta variant raging in Oregon, with the state’s ability to fully return to in-person work continuing to be hampered by the risks from COVID-19, having implemented a series of incentives aimed at achieving voluntary compliance, and with full FDA approval of the COVID-19 vaccine expected within weeks, the time has come for any remaining state employees and those who work alongside them in state government to get vaccinated,” she wrote in the order.

  The order gives Oregon state workers until Oct. 18 to provide proof of vaccination or face consequences that could include dismissal.

  Ten days after Brown’s order, the Food and Drug Administration (FDA) gave full regulatory approval to the Pfizer-BioNTech COVID-19 vaccine.

  The plaintiffs argued in the complaint that enforcement of the order would result in wrongful termination, and they have asked the court to declare it unlawful and block its enforcement.

  “The individual plaintiffs are Executive Branch employees … who want to exercise control over their own medical treatment and are being forced to choose between their rights privileges and liberties as citizens on the one hand and their employment, careers, and financial futures on the other,” the complaint states.

  The Epoch Times has reached out to the governor’s office for comment on the suit.

  Brown’s spokesperson Liz Merah defended the executive order in a statement to The Associated Press.

  “Given the seriousness of the situation, employer vaccine requirements have become an important tool, and state government plays a part. It’s critical to protect state workers, workplaces, and facilities, as well as members of the public who use state services,” she told the outlet.

  The lawsuit comes as Oregon has faced a sharp rise in COVID-19 infections in recent weeks, with a seven-day average of 2,222 daily cases on Sept. 2, compared to fewer than 500 in mid-July, according to state health authorities.

  Tyler Durden
  Sat, 09/04/2021 – 17:30

• One Bank Spots A Bizarre Market Divergence: Stocks Are At All Time Highs Yet Investors Are Bracing For Crisis
  One Bank Spots A Bizarre Market Divergence: Stocks Are At All Time Highs Yet Investors Are Bracing For Crisis

  Something strange is going on.

  On one hand stocks are trading at all-time highs, levitating every day without an apparent care in the world, with traders seemingly complacent that any air pocket in the market will simply mean more accommodation by the Fed which may not taper and which, according to some, may even to more QE. On the other, traditional bear-market signals such as the CNN fear and greed indicator, are deep in neutral territory, having dipped in “fear” territory as recently as one month ago…

  

  … while the SKEW index which many view as an indicator of crash preparation, is near all time highs, prompting a warning from none other than Goldman Sachs.

  

  Picking up on this apparent schism in the market, last observed just last August when a marketwide gamma-squeeze orchestrated by SoftBank spooked traders who were fearful that the economy was nowhere near enough to support the market’s epic ramp, SocGen strategist Arthur Van Slooten and Alain Bokobza ask if what we are seeing is a “qarning signal or excessive caution?” 

  As the SocGen duo puts it, the bank’s Multi Asset Risk Indicator (SG MARI) is currently hovering just above deep risk off territory despite ever rising markets, which raises several questions:

  • Are investors really deeply risk off?
  • How unusual is the latest low?
  • How did we get here?
  • Was it equities, bonds, FX or commodities that triggered the dip?
  • Most importantly, what’s the ‘message’ – a warning signal of major trouble ahead (= Sell) or are investors being overly cautious (= Buy)?

  The SocGen strategists then cover each point one by one:

  Risk on or Risk off? With the S&P 500 up +20.4% year to date and Euro Stoxx 50 at +19.2%, investors appear to be bristling with confidence, “perhaps even to the point of complacency” which was SocGen’s first impression when its market strategist came back from vacation and took the pulse of the markets. But surprisingly, the bank’s SG MARI tracker of investors’ risk positioning in futures and options is giving exactly the opposite signal, indicating that investors are remarkably risk off (see chart below). Just three days before Jay Powell’s ‘tapering’ speech at Jackson Hole, SG MARI touched the lower bound of its normal trading range at -1.06, almost one standard deviation below its long-term average.

  

  How unusual is the latest SG MARI reading? Very. SocGen has only seen such a low reading in just 9% of all observations since 2000. In the past, any drop below the current SG MARI level has been typically trigged by a major crisis such as the TMT bubble, the subprime crisis and the ‘taper tantrum’. The current level is below even the Covid-19 blighted March 2020 reading! Conversely, whenever SG MARI has bounced back from current levels, it has typically heralded the start of a more positive tone, which is good for risky assets such as equity and commodities but not for rates.

  How did the shift into risk off mode transpire? Since the COVID-19-induced lows at end March 2020 (-0.85, after a sell-off that lasted only 14 weeks), quick policy initiatives sent SG MARI higher, peaking at 0.56 on 15 January 2021. Since then, the indicator has gradually moved deeper into risk off territory, with the drop moderately accelerating in the last three months. The two charts below indicate that the current low (LH chart below) is far more unusual than the latest drop (RH chart).

  

  Did any asset class in particular move the dial? No. SG MARI’s current low is the result of relatively weak readings from each of its four components – the weighted average of indicators for equities, bonds, FX and commodities – without a single metric standing out. Arguably, this is exactly what a good aggregate indicator should do: highlight a trend that is not immediately obvious from simple observation of its underlying variables.

  Cautious signals from equities and bonds. For SG MARI, net shorts from the bank’s equity positioning indicator (SG EPI) come into the equation directly but net longs from the rates positioning indicator (SG RPI) are inverted first. Hence, the latest rise in SG RPI contributes to SG MARI’s low reading – which makes sense as SG RPI signals increasingly strong expectations of a further fall in rates, implying a bearish outlook for growth that would justify investors taking a risk-off stance.

  

  Also cautious FX and Commodities positioning. The latest drops in SocGen’s Foreign Exchange Positioning (SG FXPI) and Commodity Positioning (SG COPI) indicators have fed directly through to the SG MARI multi asset risk indicator, albeit with lower weightings than for equities and bonds. The drop in SG FXPI indicates generally shorter positions in cyclical currencies versus USD. In the case of the Australian dollar (AUD), this is largely explained by the drop in copper prices related to the slowdown in China’s economic growth. But as copper is not formally part of the bank’s commodity indicator, the latest drop in SG COPI is 100% due to the equilibrium between crude oil and gold.

  Does a low SG MARI reading spell major trouble ahead? According to SocGen, “the jury is still out.” The chart below shows the longest available history of SG MARI, with arrows indicating periods of major financial crisis. An important observation is that crisis can arise regardless of the level of SG MARI just before they are triggered. In all cases, SG MARI then corrects strongly, with the length of correction indicating the severity of the crisis at hand. By extension, the current low level does not necessarily spell major trouble ahead… but it very well could.

  

  Alternatively, are “spooked” investors sending a clear Buy signal? No. Here SocGen tries to preempt any accusations (ostensibly from its clients) that it is starting a market panic, noting that as illustrated by the chart above, whenever SG MARI’s shifts -1 standard deviation below its normal trading range – a point it has just crossed – it signals the start of a decent bounce higher, and the bank asks “Barring major trouble ahead, is there any reason why this is not the case now? If so, the latest drop in SG MARI could be interpreted as a Buy signal.” Well sure… but the problem is that usually by the time its risk index is at -1, markets are tumbling. Only this time they are at all time highs. So extrapolating the past to the present situation seems naive at best and manipulative at worst.

  Spin aside, SocGen is correct that after many months of exceptional market performance, we are now on the brink of an important shift, however gradual it may turn out to be in practice. The bank thinks that the pace of policy change that includes monetary and fiscal adjustments could be largely dependent on how fast COVID restrictions can be lifted, including in emerging markets. Meanwhile, peak growth has already been reached, first in China, where less restrictive policy may even be needed later this year.

  In short, the French bank summarizes that “as markets transition from ‘goldilocks’ territory and heady valuation levels to a more testing environment with the prospect of decelerating earnings and rising bond yields, this is hardly the appropriate time to conclude that SG MARI is giving an outright Buy signal. Indeed, the relief over the announced gradual nature of Fed tapering and the decoupling with rate hikes thereafter may prove short-lived.” And that’s the non-spun version of reality.

  Tyler Durden
  Sat, 09/04/2021 – 17:00

• Buchanan: Cacophony And Confusion In Foreign Policy
  Buchanan: Cacophony And Confusion In Foreign Policy

  Authored by Pat Buchanan,

  When President Franklin D. Roosevelt addressed Congress on Dec. 8, 1941, the day after the Japanese attack on Pearl Harbor, the country was united behind him.

  The America First Committee, the largest anti-war movement in our history, which had the backing of President Herbert Hoover and future Presidents John F. Kennedy and Gerald Ford, was closing its doors and enlisting.

  When President George W. Bush stood atop the ruins of the twin towers of the World Trade Center in lower Manhattan after the attack of 9/11, the country was united behind him.

  President Joe Biden, however, knows no such unity. Any foreign policy coalition he once had, any consensus he enjoyed, is gone.

  Following the evacuation of 6,000 Americans and 118,000 Afghans from Kabul airport — a remarkable feat over two weeks by the U.S. military — Biden and his foreign policy team are taking fire from all sides.

  Interventionists in both parties believe Biden’s decision to pull out all U.S. forces by Aug. 31 precipitated the collapse of the Afghan army and regime, which led to disaster and defeat in the “forever war.”

  To the War Party, Biden “lost Afghanistan.”

  Though the Trump wing of the GOP favored an earlier pullout, it has seized on the debacle of the withdrawal to inflict maximum damage on the president and party that “rigged” the vote and “stole” the election of 2020. Among the major media, Biden has sustained major defections.

  Demands are being heard for the resignation or firing of his entire security team: Secretary of State Antony Blinken, Secretary of Defense Lloyd Austin, Chairman of the Joint Chiefs of Staff Gen. Mark Milley, national security adviser Jake Sullivan.

  Their credibility is shot. Yet, as the country still supports the pullout from Afghanistan, what shattered the foreign policy consensus?

  Answer:

  • The initial panic at Karzai International Airport.

  • Afghans clinging to the sides of departing planes.

  • A teenage boy caught in the wheel well.

  • Desperate Afghan friends trying to crash the gates.

  • The U.S. reliance on the Taliban to vet our citizens and allies at the airport.

  • The ISIS massacre of 13 American soldiers and wounding of 20 others, and the deaths of 150 Afghans by a suicide bomber.

  • Video of Biden checking his watch as coffins of the fallen were carried out of the plane at Dover. The U.S. drone strike on ISIS-K that killed 10 members of an extended Afghan family.

  • Finally, the “left behinds” — hundreds of U.S. citizens and tens of thousands of Afghans, all now potential hostages of a triumphant Taliban, with the Afghans facing the prospect of torture and murder.

  All these stories, photos and videos are indelibly fixed in America’s mind and inextricably linked to Joe Biden. They will forever define his legacy. And they have created a coalition of opponents and critics that may be sufficient to block or impede any bold foreign policy decision Biden chooses to take.

  This coalition, and what lies ahead for America, could cripple Biden’s capacity to conduct foreign policy and so discredit his team as to make it unable to speak for America on the world stage.

  Has the ongoing Afghan debacle, by shattering the consensus on which Biden depended, induced a foreign policy paralysis?

  Consider. Should al-Qaida or ISIS, energized by the U.S. humiliation in Afghanistan, choose to attack the 900 U.S. troops in Syria, or the 2,500 in Iraq, what would Biden do?

  Retaliate? Send in more troops as needed if the fighting escalates? Or get out and end the U.S. involvement in these other forever wars?

  What decision would be acceptable to Biden and his critics?

  The shock of the U.S. defeat and retreat in Afghanistan has surely shaken Ukraine and Taiwan, if they believed they had some guarantee from America to come to their defense.

  But would the American people be prepared to intervene militarily and assist Ukraine in a war with Russia over the Donbas or Crimea?

  

  Would we be willing to face down China over its claim to Taiwan?

  We are not obligated by treaty to come to the defense of either of those nations. And many Americans do not believe either cause is worth the cost of a war with a nuclear power such as Russia or China.

  Bottom line: If Joe Biden, as commander in chief, draws a red line, what reason is there to believe the country will back him up if it comes to enforcing it?

  President Barack Obama drew a red line against Syria’s use of chemical weapons in its civil war. When Syrian President Bashar Assad appeared to cross it, Obama called on the country to back him up in enforcing his red line.

  Country and Congress refused. They wanted no part of Syria’s civil war, no matter what Assad was doing while fighting it.

  And Obama? He did nothing.

  August in Afghanistan may have shattered irredeemably the foreign policy consensus and coalition Biden could rely upon.

  There is no guarantee today that the country will back up its commander in chief in doing what he deems necessary to the national security.

  Tyler Durden
  Sat, 09/04/2021 – 16:30

• Facebook Apologizes After Labeling Black Men As "Primates"
  Facebook Apologizes After Labeling Black Men As “Primates”

  Facebook rushed to apologize on Friday after it labeled black men as “primates”. A Facebook spokesperson told The New York Times, which first reported the story, that it was a “clearly unacceptable error” of its auto-generated recommendation system and said the software involved was disabled.

  “We apologize to anyone who may have seen these offensive recommendations,” Facebook – whose senior management team is completely white – said in response to an AFP inquiry. “We disabled the entire topic recommendation feature as soon as we realized this was happening so we could investigate the cause and prevent this from happening again.”

  Facebook users in recent days who watched a British tabloid video featuring Black men were show an auto-generated prompt asking if they would like to “keep seeing videos about Primates?“

  A screen capture of the recommendation was shared on Twitter by former Facebook content design manager Darci Groves, who said a friend sent her a screenshot of the video in question with the company’s auto-generated prompt. The video, dated 27 June 2020, was posted by UK’s Daily Mail.

  It contained clips of two separate incidents, which appear to take place in the US. One shows a group of black men arguing with a white individual on a road in Connecticut, while the other shows several black men arguing with white police officers in Indiana before being detained. “This ‘keep seeing’ prompt is unacceptable,” Groves tweeted, aiming the message at former colleagues at Facebook. “This is egregious.”

  Um. This “keep seeing” prompt is unacceptable, @Facebook. And despite the video being more than a year old, a friend got this prompt yesterday. Friends at FB, please escalate. This is egregious. pic.twitter.com/vEHdnvF8ui

  — Darci Groves (@tweetsbydarci) September 2, 2021

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

  ​In response, a Facebook product manager said the company was “looking into the root cause”. The company later said the recommendation software involved had been disabled.

  “We disabled the entire topic recommendation feature as soon as we realised this was happening so we could investigate the cause and prevent this from happening again,” a spokesperson was cited by The New York Times as saying.

  Twitter users were split in their response to the AI-generated Facebook prompts. Some were shocked at how the platforms continued to fail addressing the issue.

  Again?! How did we not learn this after Google?! They have a much larger data set, are they not training it any better?! Argh

  — Bulbul Gupta (@bulbulnyc) September 4, 2021

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

  And to think, this is the same AI that Zuck says will replace human content moderators…

  — Chelsea 🙌🏻 (@thatchelseagirl) September 3, 2021

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

  ​Others proceeded to directly accuse Facebook of being racist, incompetent and evil.

  They’re apologizing because their AI tagged Black men as primates,
  even though they won’t rewrite the system? They keep making it obvious that the whites are coding and training the AI to be as racist as they are.

  — TaryntheRealtor (@TaryntheR) September 4, 2021

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

  Facebook is equal parts incompetent and evil.

  — Chilly Freezesteak (@freezesteak) September 4, 2021

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

  A third group saw nothing wrong with the AI algo that triggered the outrage.

  This doesn’t happen because Facebook or any other tech company is racist. It happens because AI still isn’t very “smart”. I do this for a living and the tech is getting better, but it’s not there yet, which is why I still don’t own an auto driving vehicle.

  — anton (@perchedfalcon) September 4, 2021

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

  Humans are primates biologicaly. So what’s wrong on it? pic.twitter.com/NWPwYjPa9b

  — David Michal (@DavidMi52138016) September 4, 2021

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

  This is not the first time facial recognition software and “racist” AI has gotten in trouble. The latest AI fiasco comes as tech companies have come under fire for perceived biases displayed by their artificial intelligence software, despite the companies’ solemn pledges to the woke cause. Last year, Twitter investigated whether its automatic image cropper may be racially biased against black people as it selected which part of a picture to preview in tweets.

  A faculty member has been asking how to stop Zoom from removing his head when he uses a virtual background. We suggested the usual plain background, good lighting etc, but it didn’t work. I was in a meeting with him today when I realized why it was happening.

  — Colin Madland, PhD(c) (@colinmadland) September 19, 2020

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

  ​In 2015, Google’s algorithm reportedly tagged two Black people’s faces with the word “gorilla”, prompting the company to say it was “genuinely sorry that this happened,” in a statement to The Wall Street Journal.

  Tyler Durden
  Sat, 09/04/2021 – 16:00

• Why All The Fuss About Ivermectin?
  Why All The Fuss About Ivermectin?

  Authored by Brian C. Joondeph via AmericanThinker.com,

  First hydroxychloroquine, now ivermectin, is the hated deadly drug de jour, castigated by the medical establishment and regulatory authorities. Both drugs have been around for a long time as FDA-approved prescription medications. Yet now we are told they are as deadly as arsenic.

  As a physician, I am certainly aware of ivermectin but don’t recall ever writing a prescription for it in my 30+ years’ medical career. Ivermectin is an anthelmintic, meaning it cures parasitic infections. In my world of ophthalmology, it is used on occasion for rare parasitic or worm infections in the eye.

  Ivermectin was FDA approved in 1998 under the brand name Stromectol, produced by pharmaceutical giant Merck, approved for several parasitic infections. The product label described it as having a “unique mode of action,” which “leads to an increase in the permeability of the cell membrane to chloride ions.” This suggests that ivermectin acts as an ionophore, making cell membranes permeable to ions that enter the cell for therapeutic effect.

  

  Ivermectin is one of several ionophores, others including hydroxychloroquine, quercetin, and resveratrol, the latter two available over the counter. These ionophores simply open a cellular door, allowing zinc to enter the cell, where it then interferes with viral replication, providing potential therapeutic benefit in viral and other infections.

  This scientific paper reviews and references other studies demonstrating antibacterial, antiviral, and anticancer properties of ivermectin.

  This explains the interest in this drug as having potential use in treating COVID.

  Does ivermectin work in COVID?

  I am not attempting to answer that question, instead looking at readily available information because this drug has been the focus of much recent media attention. For the benefit of any reader eager to report this article and author to the medical licensing boards for pushing misleading information, I am not offering medical advice or prescribing anything.  Rather, I am only offering commentary on this newsworthy and controversial drug.

  What’s newsworthy about ivermectin? A simple Google search of most medications describes uses and side effects. A similar search of ivermectin provides headlines of why it shouldn’t be taken and how dangerous it is.

  

  YouTube screen grab

  The Guardian describes ivermectin as horse medicine reminding readers considering taking the drug, “You are not a horse. You are not a cow”, saying it’s a medicine meant for farm animals. The FDA echoed that sentiment in a recent tweet, adding “Seriously, y’all. Stop it,” their word choice making it obvious who the tweet was directed to.

  Perhaps the FDA didn’t realize that Barack and Michelle Obama often used the term “y’all” and that some might construe the FDA tweet as racist.

  The FDA says ivermectin “can be dangerous and even lethal,” yet they approved it in 1998 and have not pulled it from the market despite it being “dangerous and lethal.” Any medication can be “dangerous and lethal” if misused. People have even overdosed on water.

  It is true that ivermectin is also used in animals, as are many drugs approved for human use.

  This is a list of veterinary drugs with many familiar names of antibiotics, antihypertensives, and anesthetics commonly used by humans. Since these drugs are used in farm animals, should humans stop taking them? That seems a rather unscientific argument against ivermectin, especially coming from the FDA.

  And healthcare professionals are not recommending or prescribing animal versions of ivermectin as there is an FDA-approved human formulation.

  Does ivermectin work against COVID? That is the bigger question and worthy of investigation, rather than reminding people that they are not cows.

  A study published several months ago in the American Journal of Therapeutics concluded,

  Meta-analyses based on 18 randomized controlled treatment trials of ivermectin in COVID-19 have found large, statistically significant reductions in mortality, time to clinical recovery, and time to viral clearance. Furthermore, results from numerous controlled prophylaxis trials report significantly reduced risks of contracting COVID-19 with the regular use of ivermectin. Finally, the many examples of ivermectin distribution campaigns leading to rapid population-wide decreases in morbidity and mortality indicate that an oral agent effective in all phases of COVID-19 has been identified.

  To my knowledge, these 18 studies have not been retracted, unlike previous studies critical of hydroxychloroquine which were ignominiously retracted by prestigious medical journals like The Lancet and the New England Journal of Medicine.

  Yet the medical establishment refuses to even entertain the possibility of some benefit from ivermectin, castigating physicians who want to try it in their patients. 18 studies found benefit. Are they all wrong?

  Podcaster Joe Rogan recently contracted COVID and recovered within days of taking a drug cocktail including ivermectin. Was it his drug cocktail, his fitness, or just good luck? Impossible to know but his experience will keep ivermectin in the news.

  Highly unvaccinated India had a surge in COVID cases earlier this year which abruptly ended following the widespread use of ivermectin, over the objections and criticism of the WHO. In the one state, Tamil Nadu, that did not use ivermectin, cases tripled instead of dropping by 97 percent as in the rest of the country.

  This is anecdotal and could have other explanations but the discovery of penicillin was also anecdotal and observational. Good science should investigate rather than ignore such observations.

  The Japanese Medical Association recently endorsed ivermectin for COVID. The US CDC cautioned against it.

  There is legal pushback as an Ohio judge ordered a hospital to treat a ventilated COVID patient with ivermectin. After a month on the ventilator, this patient is likely COVID free and ivermectin now will have no benefit, allowing the medical establishment to say “see I told you so” that it wouldn’t help.

  By this point, active COVID infection is not the issue; instead, it is weaning off and recovery from long-term life support. The early hydroxychloroquine studies had the same flaw, treating patients too late in the disease course to provide or demonstrate benefit.

  These drugs have been proposed for early outpatient treatment, not when patients are seriously ill and near death. Looking for treatment benefits in the wrong patient population will yield expected negative results.

  Given how devastating COVID can be and how, despite high levels of vaccination in countries like the US, UK, and Israel, we are seeing surging cases and hospitalizations among the vaccinated, we should be pulling out all the stops in treating this virus.

  Medical treatment involves balancing risks and benefits. When FDA-approved medications are used in appropriate doses for appropriate patients, prescribed by competent physicians, the risks tend to be low, and any benefit should be celebrated. Instead, the medical establishment, media, and regulatory authorities are taking the opposite approach. One has to wonder why.

  Tyler Durden
  Sat, 09/04/2021 – 15:30

• Young Girls Forced To "Marry" Older Men To Escape Afghanistan Are Alleging Sexual Assault And Rape
  Young Girls Forced To “Marry” Older Men To Escape Afghanistan Are Alleging Sexual Assault And Rape

  Buried deep in the ongoing mess that is the Afghanistan evacuation, another ugly problem is rearing its head: older Afghan men have reportedly been admitted to intake centers with young girls they have claimed as their “brides”.

  The problem has surfaced at intake centers in the United Arab Emirates and in Wisconsin, a new report from AP says. There have been “numerous” incidents where Afghan girls have been presented to authorities as the “wives” of much older men, the report says. Some girls at a transit site in Abu Dhabi have even told authorities they had “been raped by older men they were forced to marry in order to escape”, the report says.

  A cable sent from the United Arab Emirates to Washington described allegations by girls that they had been sexually assaulted by their “husbands”.

  The normalcy of child marriage in Afghanistan stands at odds with strict child trafficking laws that the U.S. has, catalyzing the State Department to seek “urgent guidance” on how to handle the situation, specifically in Fort McCoy in Wisconsin.

  

  Some of the men being taken in at Fort McCoy claim to have more than one wife, the report says. 

  “Intake staff at Fort McCoy reported multiple cases of minor females who presented as ‘married’ to adult Afghan men, as well as polygamous families,” an August 27 situation report sent to all U.S. embassies and consulates abroad as well as military command centers in Florida read. 

  No immediate action has been taken by the military or the departments of homeland security and health and human services, AP noted. 

  The State Department didn’t offer a comment, except to say that many allegations “are anecdotal and difficult to prove”.

  Tyler Durden
  Sat, 09/04/2021 – 15:00

• College Graduate Starting Salaries At All-Time High Despite Pandemic: Report
  College Graduate Starting Salaries At All-Time High Despite Pandemic: Report

  Authored by Katabella Roberts via The Epoch Times,

  Starting salaries for college graduates are at an all-time high despite the COVID-19 pandemic, according to a recent report from the National Association of Colleges and Employers (NACE).

  

  The average starting salary for the college class of 2020 was $55,260, a roughly 2.5 percent increase from the starting salary of $53,889 for the class of 2019, according to NACE’s Summer 2021 Salary Survey (pdf). The report also shows that the new average represents a gain of about 8.5 percent from the class of 2018’s final average starting salary of $50,944.

  Technical majors were the highest-paid among the 2020 graduates earning bachelor’s degrees, with the list of the 10 majors offering the highest average starting salary being dominated by those in technical areas.

  Petroleum engineering came out on top with an average starting salary of $87,989, followed by computer programming at $86,098, computer engineering at $85,996, computer science at $85,766, and electrical, electronics, and communications engineering at $80,819.

  The figures reported are for base salaries only and don’t include bonuses, commissions, fringe benefits, or overtime rates. The data is based on the 249 schools that provided salary data by specific program or major.

  “In some cases, salary increases most likely reflect these unique times,” said Shawn VanDerziel, NACE executive director.

  “For example, the increased demand for nurses as frontline workers during the COVID-19 pandemic may have fueled the 2.1 percent increase in the average starting salary for registered nursing majors from $57,416 for these graduates from the class of 2019 to $58,626 for class of 2020 registered nursing graduates.”

  The report comes despite many employers facing work shortages and hiring difficulties as the pandemic upended job market dynamics, even as 8.7 million people are officially unemployed.

  U.S. employers posted a record 10.1 million job openings at the end of June, the most ever recorded by the Bureau of Labor Statistics since it began tracking job openings in December 2000.

  The National Federation of Independent Business jobs report in July found that 49 percent of small-business owners reported job openings that couldn’t be filled—a 48-year record high.

  Lack of affordable child care, pandemic-related retirements, fears of contracting COVID-19, and generous federal pandemic unemployment benefits have all been cited as reasons behind the disconnect.

  However, with pandemic restrictions being eased, COVID-19 vaccines being rolled out, and federal pandemic unemployment benefits set to expire on Sept. 6, labor shortages could potentially ease.

  In an effort to counteract shortages and attract workers, numerous companies, particularly those in the dining and hospitality sector, as well as small-business owners, are increasing pay for employees.

  “Small-business owners struggled to find qualified workers for their open positions, which has impaired business activity in the busy summer months,” NFIB chief economist Bill Dunkelberg said in a statement. “Owners are raising compensation to the highest levels in 48 years to attract needed employees.”

  Companies such as McDonald’s, Chipotle, and Walgreens Boots Alliance—which will see its starting pay rise to $15 per hour beginning in October—have all opted to raise salaries.

  In August, Pittsburgh-based PNC Bank, one of the country’s largest financial services companies, said it was raising its minimum wage to $18 per hour, while also giving higher-paid workers a bump in pay, in what the company described as an “accordion effect” across its branches.

  Tyler Durden
  Sat, 09/04/2021 – 14:30

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