Today’s News 7th March 2021

• Kissinger: Biden Must Uphold Trump Administration's "Brilliant" Policy In The Middle East
  Kissinger: Biden Must Uphold Trump Administration’s “Brilliant” Policy In The Middle East

  Authored by Katabella Roberts via The Epoch Times,

  Former secretary of state Henry Kissinger has advised President Joe Biden’s administration to continue to uphold the “brilliant” policy in Middle Eastern politics achieved under the Trump administration.

  

  Kissinger, who was secretary of state under the Nixon and Ford administrations, made the remarks during a seminar from the Richard Nixon Foundation focused on national security and foreign policy on March 3.

  Former secretary of state Mike Pompeo, former national security adviser Robert O’Brien, Rep. Mike Gallagher (R-Wis.), and former deputy national security adviser Matt Pottinger also participated in the seminar.

  Kissinger likened Donald Trump’s diplomatic achievements in the Middle East to Nixon’s opening of China in 1972, and warned that the Biden administration should continue the tough Trump policy on Iran.

  He also called the Trump administration’s Abraham Accords a breakthrough in Arab-Israeli relations.

  “I think that one of the great successes of the previous administration was that they had lined up, that they had achieved two things in the Middle East,” Kissinger said.

  “One, to separate the Palestinian problem from all of the other problems so that it did not become a veto over everything else.

  He added:

  “Secondly, of lining up the Sunni states in actual or potential combination against the Shiite states, which is Iran, that was developing a capacity to threaten them. I think that this was a brilliant concept. We were just at the beginning of it.”

  The Abraham Accords, brokered by former President Donald Trump, established new cooperation and normalization between the United States, Israel, and Arab countries such as the United Arab Emirates (UAE), Sudan, and Morocco.

  

  (L-R) Bahrain Foreign Minister Abdullatif al-Zayani, Israeli Prime Minister Benjamin Netanyahu, U.S. President Donald Trump, and UAE Foreign Minister Abdullah bin Zayed Al-Nahyan hold up documents after participating in the signing of the Abraham Accords where the countries of Bahrain and the United Arab Emirates recognize Israel, at the White House in Washington on Sept. 15, 2020. (Saul Loeb/AFP via Getty Images)

  It also opened up economic, social, and cultural ties between the Arab world and the Jewish state and strengthened the Gulf states’ and Israel’s defenses against Iran, earning the former president Nobel Peace Prize nominations.

  “This was a brilliant concept. We were just at the beginning of it. It was like the beginning of the China opening. The evolution of it was just beginning,” Kissinger said.

  Kissinger urged the Biden administration to uphold the current policy in the Middle East cemented by Trump.

  “We should not give up the pressures that exist on Iran until we know where they are heading,” Kissinger said.

  “If we break out the Iranian issue from the overall Middle Eastern issue, we run the risk of losing the two achievements, namely of separating the Palestinian issue, which removes it as a veto over everything else, and the Sunni cooperation with Israel, which is unique in its openness.”

  Elsewhere during Wednesday’s seminar, Former secretary of state Mike Pompeo likened Trump’s “unique” approach to international affairs and foreign policy to President Nixon’s.

  

  Former Secretary of State Mike Pompeo addresses the Conservative Political Action Conference held in the Hyatt Regency in Orlando, Fla., on Feb. 27, 2021. (Joe Raedle/Getty Images)

  “This was a president that came at foreign policy problems in a unique way,” he said of Trump.

  “I wanted to make sure the senior people, at least I brought around to the team, understood the environment which we were going to be working in and how we were going to effectively deliver operationally President Trump’s foreign policy. So, I wanted to make sure—while we know Washington is occupied by a lot of folks and a lot of big egos—there were people who were prepared to make sure they were working as part of the team that President Trump wanted to deliver on foreign policy he had put forward to the American people.”

  The United States on Feb. 25 launched airstrikes against militants in eastern Syria, targeting sites connected to Shia militias groups backed by the Iranian regime believed to be involved in recent attacks against U.S. targets in Iraq.

  Biden has also announced that the United States is rejoining or moving to rejoin the pact with Iran, the Paris climate accords, and the United Nations’ Human Rights Council, among other international agreements or entities.

  Tyler Durden
  Sat, 03/06/2021 – 23:30

• Robocop? Las Vegas Apartment Complex Deploys Human-Sized Robot To Fight Crime 
  Robocop? Las Vegas Apartment Complex Deploys Human-Sized Robot To Fight Crime 

  It was inevitable that security robots would one-day patrol low-income neighborhoods around the clock to ensure everyone was abiding by the rules. This dystopic future is becoming a reality for one apartment complex in Las Vegas. 

  Robotics maker Knightscope deployed a human-sized autonomous robot to a noisy northeast Las Vegas Valley apartment, said the Las Vegas Review-Journal. “Westy” has been patrolling Liberty Village Apartments near Craig Road and Lamb Boulevard since October 2020. 

  

  Westy employs an array of cameras, four in total, along with facial recognition technology, license plate reading, verbal warnings, and internet connectivity to human security officers if an incident occurs. 

  “It’s been very useful in several ways,” said complex manager Carmen Batiz.

  “It can advise people when they are out past the 10 p.m. curfew, and the four video cameras tend to make people avoid it. When we have vandalism reports, we can go through the video and get a time frame of when it happened. It has a button so people can get human help quick in an emergency.

  “People don’t want to get caught on the cameras so they will avoid it,” Batiz said.

  Liberty Village Apartments was one of the top three northeast Las Vegas residential living areas for 911 calls. Many of the folks are working-poor Americans, situated in an area known for crime and vandalism. 

  Westy has had some success over the last several months as 911 calls have dropped and crime is lower. Batiz said, “We have eight other properties, and we’re going to bring on more robots, and even the Wynn had people come check it out.”

  “Every resident has the right to live in a crime-free, safe and clean environment, and Westy helps contribute to that,” said Batiz.

  Here’s KSNV News 3 Las Vegas’s report on ‘robocop’ as it patrols the apartment complex 

  More or less, private companies who manage residential multi-family complexes are resorting to automation and artificial intelligence to deter violence, theft, and murders as the post-pandemic world become a more dangerous place. 

  Changes are coming to metro areas as well. The working-poor will feel more oppressed as big brother will continue to monitor their every move through innovative ways such as human-sized autonomous robots. 

  It’s only a matter of time before local governments and municipalities, and even state governments employ fleets of human-sized autonomous robots to maintain law and order. 

  We should remind readers NYPD’s Boston Dynamics robot dog for ground surveillance of low-income neighborhoods is already underway… 

  What’s next is the unveiling of predictive policing via artificial intelligence that will monitor low-income neighborhoods if there’s a potential flare-up in a crime or social disobedience. Maybe by that time, the Federal Reserve could instantly reload people’s bank accounts in those troubled areas with Fedcoin (digital US dollars) to keep the impoverished at bay. 

  Tyler Durden
  Sat, 03/06/2021 – 23:00

• When IBM Was The Center Of Gravity
  When IBM Was The Center Of Gravity

  By Byrne Hobart of The Diff substack

  When IBM Was The Center Of Gravity

  Learning about IBM in the context of the early history of the computer industry has the same shock value as watching Star Wars: A New Hope for the first time: “That’s no moon. It’s a space station.”

  Consider:

  • In 1953, UNIVAC was basically the only company selling computers commercially. By 1956, IBM’s market share in computers was 85%.

  • In the late 70s and early 80s, after several industry transitions, the entry of smaller and more agile competitors like DEC and Control Data as well as larger and more resourceful ones like GE and Exxon, IBM’s market share was still 70%.

  • IBM “bet the company” on one product in the 1960s, with a total budget that exceeded twice the cost of the Manhattan Project. In this time, they didn’t report a loss, and they didn’t even report a sequential decline in annual earnings.

  • In fact, IBM reported positive annual earnings growth every year from 1952 through 1979.

  In “Adam Smith”‘s wonderful book, The Money Game, the concept of a growth stock is illustrated with a five-year table of some high growth companies’ earnings per share; IBM is at the top of the list. More interesting is an earlier section on investor psychology, which has a bit called “IBM as Religion: Don’t Touch, Don’t Touch.” It’s a story about someone who invests in IBM’s predecessor, Computing-Tabulating-Recording Company, and holds the stock for his entire life. His $20,000 becomes millions of dollars, and he insists that his heirs never sell the stock. They don’t, and they make the same stipulation to their heirs. One reason for the company’s marvelous performance is, of course, that it retains most of its earnings and pays low dividends. When he dies, the stock is split up between his heirs, who also hold and never sell, and who also end up as millionaires, as do their heirs. But the dividends remain modest:

  In short, for three generations the Smiths have worked as hard as their friends who had no money at all, and they have lived just as if they had no money at all, even though the various branches of the Smith family all put together are very wealthy indeed. And the IBM is there, nursed and watered and fed, the Genii of the House, growing away in the early hours of the morning when everyone is asleep.. It is a parable of pure capitalism, never jam today and a case of jam tomorrow; but as any of the Smiths will tell you, anyone who has ever sold IBM has regretted it.

  How did IBM get so dominant? How did “Nobody ever got fired for buying IBM,” become a catchphrase among corporate IT buyers and investors? And what changed?

  Origins: Promoters and Punch-cards

  In 2021’s SPAC-saturated financial universe (and in light of the last few weeks’ SPAC drawdowns), it’s interesting to note that IBM was born as an act of financial engineering. In the early 1900s, the market was enamored by trusts, and promoters realized that merging a few semi-related companies together could create a combined entity that was a) big enough to issue stock, and b) could tell a plausible story that it would monopolize its industry. (Monopolies were technically illegal, but in practice weren’t heavily prosecuted. The existence of the Sherman Antitrust Act told investors that a monopolist could charge exploitative prices; its lax enforcement told them that it wouldn’t be shut down for this reason.)

  Charles Flint was one of many stock promoters who merged together small companies and took them public. In 1911, he cobbled together a new firm called Computing-Tabulating-Recording Company. CTR was an odd mix, including an industrial scale manufacturer, a company that made timecards for hourly workers, and The Tabulating Machine Company. The last was a quirky niche product: founded by a German inventor, Herman Hollerith, it built mechanical devices that could tabulate information if it was encoded on punched cards. The company had only a handful of customers; railroads, for example, could save money and better track their business using punched cards. The company’s most important client was the US Census, but one big contract every ten years did not indicate much business potential.

  As it turns out, the company made one other key acquisition: hiring Thomas J. Watson as President. Watson had a somewhat mixed reputation: he’d worked for National Cash Register, a company that was famous for rapid growth, technical sophistication, and an excellent sales organization. On the other hand, he’d been recently convicted of antitrust violations for some of his work at NCR, and faced jail time. Flint, perhaps operating on the assumption that he’d sell out of the stock before the case was fully resolved, hired Watson anyway.

  Watson had a natural flair for sales and strategy, and had developed his sales technique at NCR. NCR deployed armies of salespeople, held them all to strict personal standards (good grooming, no alcohol consumption whatsoever), and used this standardized approach to scale fast. Watson’s CTR adopted the same model, and even borrowed some of the same mottos:

  

  One realization Watson came to was that CTR was a clunky name, and, as trusts went out of fashion, was sending the wrong signal to the market (and to the FTC). So, in 1924, he renamed the company International Business Machines. Watson also insisted on reinvesting in the business, even though other executives like board chairman George W. Fairchild were more concerned with maintaining dividends.

  He came to another important realization about one of those business machines in particular: Hollerith’s punched-card tabulators were more exciting than they looked, especially for an organization that specialized in sales. The machines themselves had unimpressive margins, but making stacks of perforated cardboard and selling them to a captive market was a very high-margin business indeed. And this sticky, high-margin revenue source grew with usage, not just the unit volume of tabulators. If IBM could embed its salespeople in companies, and have them relentlessly THINK about ways to replace clerks with cards (or about new functions that could be economically performed by cards but that wouldn’t be worth an employee’s time), they could continuously grow sales.

  By the 1930s, cards routinely represented a third of sales, and presumably a much larger share of profits. IBM’s sales were flat early in the depression, as cuts in corporate spending were offset by growth in government use. During the Second World War, IBM continued to grow its top line—profits were compressed by higher taxes—but it also reinforced a virtuous cycle. More tabulated data meant more legible data; the Social Security Administration was a big client, but also a client whose existence gave every American a unique numerical identifier, and whose implementation meant that their employers had to track who them employed and how much each one was paid. Heavy war spending required more data tracking, and this meant that manufacturers also needed to invest in business machines to meet their end of the bargain.

  Even later, when IBM was less dependent on cards, it liked the model of having a long tail of revenue. As IBM evolved, it preferred to lease its products rather than sell them, and to offer peripherals that would increase revenue per customer. Even after cards were irrelevant, a card-like model was a core part of IBM: each year, they started with a baseline of high-margin recurring revenue from existing clients. New sales would just add to that sum.

  Dominance

  IBM was not the first company to build computers, although Thomas Watson Jr., who took over from his father in 1952, was certainly interested in them. Sperry-Rand’s subsidiary UNIVAC (which survives today as Unisys) introduced the first commercially successful computers in the early 50s.

  IBM had the largest R&D department of the business machines industry in the 40s and 50s, and Watson had read Norbert Wiener’s Cybernetics. IBM quickly caught up, and had dominant market share in computers by the late 1950s. Some of this was because of their research—they were able to introduce cost-competitive computers a few years after UNIVAC. And a lot of it was because of their sales organization: IBM sales reps didn’t have to introduce themselves to potential corporate customers, who had been buying other IBM products for years or possibly decades.

  IBM added another tactic around this time, which would be called “paper machines” then and “vaporware” today: if a competitor’s product was selling well because it reached a price or market segment that IBM didn’t touch, the company wouldn’t hesitate to announce a competing product (and start taking orders for it) long before it was available. Meanwhile, IBM kept news about upgrades to its existing products well-hidden.

  This sort of behavior led to one of what would be a long series of unpleasant interactions with the Justice Department, leading to a decree in 1956 that required IBM to divest some of its punched-card business and start selling as well as leasing computers. This is an early case study of a common phenomenon: antitrust cases take so long—in part because the companies being sued are not especially cooperative—that by the time they’re resolved, the industry has changed, and the remedies don’t have much of an impact. IBM had to divest a rapidly-shrinking segment that was quickly being rendered obsolete by the company’s other products.

  It’s hard to overstate how powerful IBM was in the computer industry by this time. A big order from IBM revived Texas Instruments’ fortunes in the late 50s, for example, and every computer company worried that if their product worked too well for too long, it was only a matter of time before an army in a uniform of starched white shirts, blue suits, clean shaves, and high quotas was marching on their customers and offering a more expensive, but much more defensible, choice.

  Both IBM and its competitors acknowledged that the company excelled at sales. As the CEO of UNIVAC’s parent company put it:

  It doesn’t do much good to build a better mousetrap if the other guy selling mousetraps had five times as many salesmen.

  And in a revealing comment from Watson, Jr., he once explained that the company’s release cadence was dictated in part by the needs of its sales team:

  You have to keep feeding them new things to keep their morale up.

  One of the biggest New Things IBM fed to its salesmen in the 60s was the 360. This product, announced in 1964 and first sold the next year, was IBM’s most intensive development project in history, costing, according to one estimate, twice as much as the Manhattan Project. The 360 was a series of machines that had compatible code, so customers could easily upgrade from one to the next as they scaled without needing to rewrite their software. It was, in other words, another way for IBM to replicate the negative dollar churn model of the punched card business. IBM needed the 360 in part because its sales team was entirely too good: the people responsible for selling IBM’s low-end machines were cannibalizing the sales of high-end ones by convincing buyers that the more affordable option could handle all of their needs. While the 360 represented a technological advance, it was partly an organizational one—a way to give the company a strict hierarchy of products and use cases so it could charge what the market would bear. IBM had to repeatedly turn to the capital markets to fund this, although the company kept reporting growing profits throughout the development process.

  The launch of the 360 represents Peak IBM in terms of influence and ability to shape markets, although their financial peak was a long way off. IBM’s computers were so successful that they spawned two separate ecosystems: the first “IBM compatible” devices were produced in the 1950s, when smaller manufacturers sold peripherals that functioned alongside IBM machines.

  More worrisome for the company was the trend of computer leasing companies, whose business model was straightforward: IBM depreciated its computers over five years, and priced them accordingly. Leasing companies depreciated computers over ten years, and were able to undercut IBM and report (accounting) profits doing it. These leasing companies would have slightly worse cash flows than IBM, since their higher reported profits entailed a higher tax burden. But they were able to show good profits, and as long as they grew fast enough, any misguided optimism about the useful life of a computer would be hidden. (If a leasing company grows its assets 50% each year, and the IBM depreciation number is correct, then the computers they start to write down in year six are just a fifth of assets, and they’ve had five years of profitable growth before then.) Paradoxically, the leasing companies (some of which were much hotter stocks than IBM in the 60s) were a bet on growth but against technology. An investor buying IBM instead of Leasco was betting that the 360 was not the last word in computing (and that whatever the last word was, it would be spoken in the vicinity of Armonk, New York). A buyer of Leasco was implicitly claiming that the computer trend had been an interesting one, and had fully run its course by the mid-60s, with deployment rather than new technology as the main source of growth.

  In a sense, the company painted itself into a corner: by creating a new standard, and ensuring that future releases would be backwards-compatible, IBM plausibly did increase the useful life of its computers. The company could either cut leasing rates (which would cut into revenue) or accept that its model was shifting from leasing computers to customers over to selling them to middlemen.

  IBM did adjust its pricing, but this entailed still more problems.

  Decline

  In 1968, Control Data accused IBM of assorted antitrust violations, which the US government followed up on the next year. IBM spent over a decade in litigation, hiring armies of lawyers and producing millions of documents. (The joke at the time was that the real winner of the case was Xerox.) The case ran on long enough that IBM could accurately argue that more than half of the companies that accused it of anticompetitive behavior had been founded after the original lawsuit was filed. Some companies bet their future on IBM in yet another way; the CEO of one company, Calcomp, joked that his company’s most valuable asset wasn’t patents, equipment, or employees, but their ongoing lawsuit against IBM.

  The suit was ultimately dropped, but IBM’s defense was all too accurate: the computer business was getting too competitive, and other companies were adapting faster than IBM itself was. Over the course of the 70s, IBM’s annual profits still tripled, but by the end of the decade, the stock hadn’t gone up at all.

  The story of IBM’s long-term collapse was not the result of any one decision; if there was one bad decision, it was the way they structured their MS-DOS deal, which allowed Microsoft to license it to other PC manufacturers. But that choice was more symptomatic. IBM’s sales centric approach naturally assumed a slower industry cadence than the one that developed in the 80s. Rapid growth in low-end computers reduced the relevance of their competitive advantage in large-scale, long-term deals, and as those computers got more powerful, software started to matter more. A pure software company has higher margins, and thus more ability to take risky bets, than a software-and-hardware company, particularly one that’s constantly adjusting its overhead in light of lower and lower market share.

  IBM was the most profitable company in America in 1985, but by the early 90s, IBM was losing money. It reported what was then a record annual loss for any US corporation in 1992. The company eventually stabilized, by divesting some money-losing businesses and focusing more on corporate clients. (It also started to focus more on buybacks, even though an early buyback program in the 80s was one reason IBM was somewhat capital-constrained at the dawn of the PC era.)

  It’s exceptionally hard for a company to adjust to no longer dominating its industry. That’s especially difficult when the nature of the industry changes; caring about PCs was low-status relative to worrying about mainframes until the growth of the PC market was impossible to ignore.

  Relative to the other stories of compounders-gone-bad, IBM ends up being the most impressive of the lot. It had an incredible stretch of nonstop growth, and that stretch started after the company pivoted from one sector it was influential in, punched-card machines, to a completely new one it had to catch up in. IBM’s ability to keep growing while disrupting itself, and juggling antitrust restrictions, is simply astounding. While it’s not nearly as influential as it once was, there was indeed a good reason that, for a very long time, nobody got fired for buying IBM.

  Tyler Durden
  Sat, 03/06/2021 – 22:30

• New York Exodus Sparks Buying Frenzy For Greenwich Mansions
  New York Exodus Sparks Buying Frenzy For Greenwich Mansions

  What happens when thousands of New York millionaires suddenly realize their hometown has gone back in time to the 1970s in terms of both crime and taxes, and it is finally time to get the hell out? Why neighboring Greenwich, long an enclave for the ultra rich, throws a party.

  After years of stagnant demand growth for its multi-million dollar mansions as a result of the secular decline of in “active” asset management, the hedge fund capital of the world is having a real estate renaissance. And it only took a pandemic.

  According to a new report from Miller Samuel and brokerage Douglas Elliman, In February, 14 contracts were signed to buy single-family houses priced at $5 million to $9.99 million, a 600% jump from just two a year earlier, before Covid-19 swept across the U.S., Bloomberg reports. It wasn’t just the ultra luxury segment enjoying the influx: the report found that across all price points, single-family contracts in the posh Connecticut town soared 157% to 108..

  

  Those with a taste for the ultra-luxury have turned their attention to Greenwich’s older estates outside the town center, which had fallen out of favor in recent years. Two homes listed at $20 million or more found buyers last month, compared with none in February 2020.

  With most people still working from home, “the location of the office is not holding you back,” Scott Durkin, president of Douglas Elliman, said in an interview. “The whole family can live there, work there, play there, educate there.”

  One reason prices are soaring is the plunge in supply: new listings for single-family houses dropped 23% from a year earlier as Greenwich’s homeowners stay put.

  “They’re not selling,” Durkin said. “They have an apartment in Manhattan, they have a home in Greenwich and they have a home in South Florida.”

  The suddenly tight inventory of single-family houses in Greenwich has forced buyers to move fast and often pay above list price.

  As Bloomberg notes, this is yet “another sign that well-off New Yorkers tired of being confined to tight quarters during the pandemic are seeking relief among the backyards and spacious homes of the city’s nearby suburbs.”

  Of course, all those millions who would also like to flee the Big Apple but don’t have the funds to do so are stuck, ensuring that New York’s descent into socialist paradise started by mayor Bill de Blasio is only just starting.

  Tyler Durden
  Sat, 03/06/2021 – 22:00

• Iranian Militia Group Claims to Have Active Cells in Washington DC: Report
  Iranian Militia Group Claims to Have Active Cells in Washington DC: Report

  By the Epoch Times

  A Telegram channel affiliated with Iran-backed militia groups in Iraq posted in English claiming to have a resistance cell with the capacity to target American troops inside the United States, according to a report.

  “The axis of resistance today is stronger than before. Resistance cells are rooted even in America and its capital,” read the alleged social media post, according to the Middle East Media Research Institute, which posted a screenshot of the message.

  The post, which included a casket containing American soldiers, was made by the Kawtheryoon Electronic Team, a Telegram network that is said to be used by Iranian militia groups and supporters.

  

  The Epoch Times has reached out to the Department of Defense regarding the post’s claims.

  The Telegram channel post also claimed that terror factions associated with Iran are growing ever stronger and gaining more support, while it called on U.S. forces to withdraw from not only Iraq, but the Middle East entirely.

  The group also appeared to threaten Israel, referring to it as the “Zionist enemy,” saying “I will summarize for you in words only the horror of the south, which is stronger than before, and we have thousands of men like Imad Mughniyeh.” Mughniyeh is believed to have been the Iran-aligned Hezbollah chief of staff in Lebanon.

  “Do not think that you and the Americans, by killing Qassem Soleimani and Abu Mahdi al-Muhandis, will survive the torment of the resistance,” the post added, referring to the Iranian commander and the Iraqi militia commander who were killed in an airstrike last year. “We lie in wait for you evil (sic) and the next thing is worse.”

  Last week, President Joe Biden warned that Iran cannot act with impunity and warned the state to “be careful” when asked what message he was sending the country with the U.S. airstrikes in Syria.

  “You can’t act with impunity. Be careful,” Biden told reporters in Texas.

  The United States carried out airstrikes authorized by Biden against facilities belonging to Iranian-backed militia in eastern Syria on Thursday, in response to rocket attacks against U.S. targets in Iraq.

  Tehran has denied being behind recent attacks, whether those in Iraq, against shipping in the Gulf, or on Saudi installations by Yemen’s Iran-backed Houthis.

  On Wednesday, rockets were again fired at an Iraqi base that holds U.S. troops, according to U.S. and Iraqi officials. The Pentagon stated the missile defense system at the Al Asad airbase “engaged in defense of our forces” before adding: “We extend our deepest condolences to the loved ones of the individual who died.”

  Tyler Durden
  Sat, 03/06/2021 – 21:30

• "Profiteering Off Poverty" – The Side Of Baltimore The Media Won't Show You
  “Profiteering Off Poverty” – The Side Of Baltimore The Media Won’t Show You

  Before President Trump and Republicans focused their energy on Baltimore City, showing how decades of liberal-run leadership transformed the once-thriving metro area into a “hell-hole,” readers may recall our reporting (see: here & here & here) showed a side of Baltimore that many hardly knew, except if they watched the crime series “The Wire.” 

  From the opioid epidemic to homicides to gang warfare to violent crime to failing infrastructure to abandon rowhomes to massive wealth inequality – we were some of the first to shed light on the side of Baltimore traditional media never wanted you to see. 

  Picking up the torch is Daily Caller’s Caity McDuffee, who walked the streets of Baltimore with former congressional Republican nominee (MD-District 7) Kimberly Klacik. 

  Klacik famously said during the 2020 election season: 

  “Democrats don’t want you to see this. They’re scared that I’m exposing what life is like in Democrat-run cities. That’s why I’m running for Congress Because All Black Lives Matter Baltimore Matters And black people don’t have to vote Democrat.”

  McDuffee spoke with Klacik and her campaign manager, Markus Trend Anderson, both explained how “all around Baltimore” there are thousands of vacant homes. He said most of the federal money designated for these neighborhoods never hits the streets. 

  

  The reporter then spoke with a local paster by the name of Rodney Hudson, who said the whole system is corrupt. He said it’s not just the school system that is broken, it’s families, the economy – and “the entire community” – it’s all broken.

  Around the 3 minute mark, Klacik points out that balloons tied to things on the city street usually mean someone was murdered at that spot. On a per-capita basis, Baltimore is one of the most dangerous metros areas in the country. 

  At the 5 minute mark, Hudson told McDuffee that people are “profiteering off the poverty” across the city. 

  Klacik’s campaign manager ends with the notion that many people on the streets “don’t want to sell drugs,” but when there are “no career-based opportunities,” – then their only option is to sell drugs. 

  None of this should be surprising to readers who have followed our commentary over the years. Actually, we’ve provided some of the best insight into the chaos unfolding in Baltimore after the 2015 riots.  

  After listening to us chatter about the Baltimore subject – some questions should be swirling around your head on how to fix this mess. Well, it sure as hell won’t be universal basic income checks – the city needs a plan to start from scratch – start with rebuilding infrastructure, schools, supporting families, and most importantly, provide value-added careers – not service sector jobs like bartending. Baltimore was once an industrial powerhouse – perhaps, the city can thrive again but will take more than a decade to turn around. 

  And one more thing, where is Kevin Plank and his ambitions to transform Baltimore? Maybe he is hiding out at his multi-million dollar horse farm? 

  Watch The Full Video Here:

  Tyler Durden
  Sat, 03/06/2021 – 21:00

• There Is No Such Thing As "White" Math
  There Is No Such Thing As “White” Math

  Via Common Sense with Bari Weiss substack,

  I am not at all qualified to introduce today’s guest writer, Sergiu Klainerman.

  I barely eked out a C+ in high school calculus, while Sergiu is a professor of mathematics at Princeton who specializes in the mathematical theory of black holes. He’s been a MacArthur fellow, a Guggenheim fellow and is a member of the National Academy of Sciences 

  Mathematics allowed a young Sergiu, who came of age in Ceausescu’s Romania, to escape to a world where right and wrong couldn’t be fudged, and, ultimately, to a life of freedom in the United States. Without math, his life quite literally would not have been possible.

  In the piece below he explains how activists are destroying his discipline in the name of progress. Worse, they are robbing poor children of the opportunity to raise themselves up by mastering it — with untold effects on all of us.

  Math, with its seemingly unbiased tools — 2 + 2 always equals 4 — has presented a problem for an ideological movement that sees any inequality of outcome as evidence of systemic bias. The problem cannot be that some kids are better at math, or that some teachers are better at teaching it. Like so much else, the basic woke argument against math is that it is inherently racist and needs to be made antiracist. That is accomplished by undermining the notion of right and wrong answers, by getting rid of the expectation that students show their work, by referring to mathematical testing tools as racist, and by doing away with accelerated math classes.

  If that sounds like a caricature, I urge you to read this whole document, funded by the Bill and Melinda Gates Foundation, which Sergiu writes about below. As the linguist John McWhorter put it in a powerful piece published yesterday: “to distrust this document is not to be against social justice, but against racism.”

  Sergiu wrote me in an email that the situation in his field reminds him of this line from Thomas Sowell:

  “Ours may become the first civilization destroyed, not by the power of enemies, but by the ignorance of our teachers and the dangerous nonsense they are teaching our children. In an age of artificial intelligence, they are creating artificial stupidity.”

  This week, as promised, is education week. Like Shark Week! But dorkier. And, I hope, far more important. This is our first installment.

  

  I’m pleased to publish Sergiu Klainerman:

  In my position as a professor of mathematics at Princeton, I have witnessed the decline of universities and cultural institutions as they have embraced political ideology at the expense of rigorous scholarship. Until recently — this past summer, really — I had naively thought that the STEM disciplines would be spared from this ideological takeover.

  I was wrong. Attempts to “deconstruct” mathematics, deny its objectivity, accuse it of racial bias, and infuse it with political ideology have become more and more common — perhaps, even, at your child’s elementary school.

  This phenomenon is part of what has been dubbed “The Great Awokening.” As others have explained powerfully, the ideology incubated in academia, where it indoctrinated plenty of bright minds. It then migrated, through those true believers, into our important cultural, religious and political institutions. Now it is affecting some of the country’s most prominent businesses.

  Unlike the traditional totalitarianism practiced by former communist countries, like the Romania I grew up in, this version is soft. It enforces its ideology not by jailing dissenters or physically eliminating them, but by social shaming, mob punishment, guilt by association, and coerced speech.

  When it comes to education, I believe the woke ideology is even more harmful than old-fashioned communism.

  Communism had a strong sense of objective reality anchored in the belief that humans are capable of discovering universal truths. It forcefully asserted, in fact, the absolute truth of dialectic materialism, as revealed by its founders Marx, Engels and Lenin. Communist ideology held science and mathematics in the highest regard, even though it often distorted the former for doctrinal reasons. 

  Mathematics was largely immune to ideological pressure, and thus thrived in most communist countries. Being skilled in math was a source of great societal prestige for school children. And it was a great equalizer: those from socioeconomically disadvantaged families had a chance to compete on equal footing with those from privileged ones.

  Like children all over the world, I was attracted to mathematics because of its formal beauty, the elegance and precision of its arguments, and the unique sense of achievement I was able to get by finding the right answer to a difficult problem. Mathematics also granted me an escape from the intoxicating daily drum of party propaganda — a refuge from the crushing atmosphere of political and ideological conformity. 

  The woke ideology, on the other hand, treats both science and mathematics as social constructs and condemns the way they are practiced, in research and teaching, as manifestations of white supremacy, euro-centrism, and post-colonialism.

  Take for example the recent educational program called “a pathway to equitable math instruction.” The program is backed financially by the Bill and Melinda Gates Foundation; it counts among its partners the Lawrence Hall of Science at UC Berkeley, the California Math project, the Association of California School Administrators, and the Los Angeles County Office of Education, among others; and it was recently sent to Oregon teachers by the state’s Department of Education.

  The program argues that “white supremacy culture shows up in the classroom when the focus is on getting the ‘right’ answer” or when students are required to show their work, while stipulating that the very “concept of mathematics being purely objective is unequivocally false”. The main goal of the program is “to dismantle racism in mathematics instruction” with the expressly political aim of engaging “the sociopolitical turn in all aspects of education, including mathematics.”

  In the past, I would have said that such statements should be ignored as too radical and absurd to merit refutation. But recent trends across the country suggest that we no longer have that luxury.

  So let me state the following for the record: Nothing in the history and current practice of mathematics justifies the notion that it is in any way different or dependent on the particular race or ethnic group engaged in it.

  For historical reasons, we often discuss contributions to the field of mathematics from the Egyptians, Babylonians, Greeks, Chinese, Indians and Arabs and refer to them as distinct entities. They have all contributed through a unique cultural dialogue to the creation of a truly magnificent edifice accessible today to every man and woman on the planet. Though we pay tribute to great historical figures who inform the practice of mathematics, the subject can be taught — and often is — with no reference to the individuals who have contributed to it. In that sense it is uniquely universal. 

  Schools throughout the world teach the same basic body of mathematics. They differ only by the methodology and intensity with which they instruct students. 

  It is precisely this universality of math — together with the extraordinary ability of American universities to reward hard work and talent — that allowed me, and so many other young scientists and mathematicians, to come to this country and achieve success beyond our wildest dreams. 

  The idea that focusing on getting the “right answer” is now considered among some self-described progressives a form of bias or racism is offensive and extraordinarily dangerous. The entire study of mathematics is based on clearly formulated definitions and statements of fact. If this were not so, bridges would collapse, planes would fall from the sky, and bank transactions would be impossible.

  The ability of mathematics to provide right answers to well-formulated problems is not something specific to one culture or another; it is really the essence of mathematics. To claim otherwise is to argue that somehow the math taught in places like Iran, China, India or Nigeria is not genuinely theirs but borrowed or forged from “white supremacy culture.” It is hard to imagine a more ignorant and offensive statement. 

  Finally, and most importantly, the woke approach to mathematics is particularly poisonous to those it pretends to want to help. Let’s start with the reasonable assumption that mathematical talent is equally distributed at birth to children from all socio-economic backgrounds, independent of ethnicity, sex and race. Those born in poor, uneducated families have clear educational disadvantages relative to others. But mathematics can act as a powerful equalizer. Through its set of well-defined, culturally unbiased, unambiguous set of rules, mathematics gives smart kids the potential to be, at least in this respect, on equal footing with all others. They can stand out by simply finding the right answers to questions with objective results. 

  There is no such thing as “white” mathematics. There is no reason to assume, as the activists do, that minority kids are not capable of mathematics or of finding the “right answers.” And there can be no justification for, in the name of “equity” or anything else, depriving students of the rigorous education that they need to succeed. The real antiracists will stand up and oppose this nonsense.

  Tyler Durden
  Sat, 03/06/2021 – 20:30

• Bitcoin Could Soon Run Head First Into U.S. Money Laundering Laws
  Bitcoin Could Soon Run Head First Into U.S. Money Laundering Laws

  Among the challenges in regulating bitcoin will be the Biden administration’s handling of recent anti-money laundering laws put into place by the Trump administration pertaining to bitcoin and cryptocurrencies. 

  The rules, implemented at the last-minute by the Trump administration, seek requirements for financial services firms to report identities of cryptocurrency holders, according to Bloomberg. The point of the rules is to stop attempts to use crypto as a means of transferring money illicitly. 

  Lobbying against the regulations are “heavyweights from both K Street and Wall Street”, according to Bloomberg, including Fidelity and the U.S. Chamber of Commerce. The Chamber of Commerce has said the rule would have “unintended long-term consequences” on the virtual currency industry.

  Also lobbying against the rule have been “Republican lawmakers, including former Representative Cynthia Lummis, who is now a Wyoming senator; Arkansas Senator Tom Cotton and Democratic Representative Tulsi Gabbard of Hawaii”. 

  

  The rules were implemented by the Financial Crimes Enforcement Network or FinCEN, after President Trump lost the 2020 election. The move drew criticism and even the threat of lawsuits from pro-crypto trade groups. The rule would require filings to the Treasury every time a customer moves at least $10,000 worth of virtual currency into a wallet not hosted at an exchange. These are similar to the reports that banks already send under existing AML laws when customers take out $10,000 or more in cash. 

  The regulation would also require banks and exchanges to keep records of customers who send $3,000 or more of virtual currencies to someone else’s unhosted wallet. 

  Obviously, such regulation would maim one of bitcoin’s biggest “assets”: the ability to transfer money anonymously and “outside the system”. Should Treasury Secretary Janet Yellen move forward with the rules, crypto services could wind up becoming more expensive – and some cryptocurrencies could even disappear altogether. 

  Additionally, if the rules are adopted, they could cause a “sharp fall” in crypto prices, according to Bloomberg. Matthew Maley, chief market strategist for Miller Tabak & Co., said: “Bitcoin is very risky and very volatile and it’s going to continue to be that way. If you add something like a new regulation, it’s going to be very vulnerable to a correction.”

  FinCEN published the rule December 18 and rushed through a 15 day comment period where more than 7,600 public comments were received. 

  As of today, there’s no timetable on when the Biden administration will decide on the rule.

  Of course this is just the latest in “the death of bitcoin”-esque worries. In fact, as 99Bitcoins notes, Bitcoin has died 402 times since inception.

  

  Tyler Durden
  Sat, 03/06/2021 – 20:00

• California’s Energy Policies Hurt Minority Citizens The Most
  California’s Energy Policies Hurt Minority Citizens The Most

  Authored by Jude Clemente via RealClear Energy (emphasis ours),

  In 2020, some 9 million Californians were unable to pay their energy bills. The California Public Utilities Commission (CPUC) reports that customers of the major investor-owned electric and gas utilities accumulated $1.15 billion in unpaid bills during the year.

  

  As a “clean energy” climate leader, California seeks to achieve a carbon-free economy before 2050, ensuring that its electrical system can withstand extreme weather events and supply affordable energy to 40 million people.

  That last goal might be the biggest challenge. The wind and the sun may be free, but deriving electricity from them is anything but.

  California’s residential electricity price in 2020 was $20.50 per kWh, or 55% higher than the national average of $13.20 – an expensive energy problem that is only getting worse (see Figure).

  The latest iteration of California’s Renewable Portfolio Standard (RPS), the 100% Clean Energy Act, was enacted in 2018. It requires California utilities to use 100% clean energy by 2045, with an interim requirement of 60% by 2030.

  The costs are immense.

  Experts at the University of Chicago’s Energy Policy Institute reported in November that “electricity prices increase substantially after RPS adoption,” adding $30 billion in extra costs after just seven years.

  Here are just some of the numbers, according to new research from UC Berkeley’s Energy Institute at Haas:

  • Average residential prices per kWh in San Diego Gas & Electric’s (SDGE) service territory are about double the U.S. average.

  • Pacific Gas and Electric’s (PG&E) rates are 80% above the U.S. average.

  • Southern California Edison’s (SCE) prices are 45% higher than the U.S. average.

  • Since 2013, rates at San Diego Gas & Electric have risen nearly 50%, with customers of PG&E paying almost 40% more.

  

  A new report from UC Berkeley attributed California’s high prices to huge fixed costs for generation and grid investments that simply get passed on to customers.

  For example, costs for rooftop solar and wildfire mitigation are quickly mounting.

  Experts at UCLA found that California’s clean energy programs are benefitting the rich and leaving vulnerable families behind.

  As wealthier residents install rooftop solar systems to reduce their electricity bills, lower- and middle-income households bear a bigger burden for covering those fixed costs.

  California’s expensive electricity problem will only get worse.

  From 2020-2022, the state’s big three investor-owned electric utilities (PG&E, SCE, and SDGE) plan to spend $22 billion on hardening their systems by cutting back vegetation and pursuing other measures to fight wildfires, along with the high costs of transmission and other network upgrades.

  CPUC concedes that this could increase bundled residential rates 10-20% above the rate of inflation.

  Fitch Ratings has praised the credit-worthiness of the Los Angeles Department of Water and Power (LADWP) because it has a “very strong ability to raise revenue.”

  No kidding.

  A few years ago, the city lifted the caps on adjustment factors and made other changes to ensure that rising costs could be seamlessly passed on to customers.

  LADWP has a revenue-decoupling feature in its electric rates, so when sales decline, prices can be raised the following year to compensate for the losses.

  In other words, if power usage falls, whether from a shrinking population or businesses leaving, LADWP can simply up its rates to compensate.

  Indeed, many criticize California’s cap-and-trade system as a disguised tax, because higher costs just get pushed onto captive consumers.

  Hurts Minority Citizens Most

  From Hewlett-Packard to Occidental Petroleum to Tesla, the list of businesses leaving California is growing. These departures represent lost job opportunities for the state’s residents. And higher energy prices disproportionately affect minority communities.

  Already battered by Covid-19, the last thing minority communities need is regressive taxes, such as those imposed by California energy policies:

  • After controlling for factors such as income and household size, experts at UC Berkeley conclude that African-American renters pay $273 more each year than their white peers. African-American homeowners annually pay $408 more for energy than white homeowners.
  • UCLA’s sustainability group recently showed how these disadvantaged communities in Los Angeles could be left behind in the transition to renewables, electric cars, and energy-efficient technologies.

  Experts are telling officials that California’s exorbitantly high electricity prices could block the goal of electrification and even turn public sentiment against renewables. 

  As an input for everything, higher cost energy increases the costs of everything, particularly devastating for food, water, heating/cooling, and other necessities that hold mostly inelastic demand. 

  More laws across the state are banning natural gas hookups in favor of more expensive electricity, even as gas prices are at their lowest levels in decades.

  On an energy-equivalent basis, gas-banning in California is forcing homeowners and renters to pay four times as much for their energy as they would if they were consuming natural gas directly.

  Simply put, the goal to “electrify everything” is a de facto energy tax on low- and middle-income Californians that could add more instability to an already proven unstable state power grid. 

  Minority communities are understandably fighting back.

  A coalition of Latino civil rights leaders has sued California over the state’s energy and housing policies. A mandate to force rooftop solar on new homes is expected to worsen the state’s affordable housing problem, adding costs of $12,000 per home.

  The California Restaurant Association has also sued the city of Berkeley for its gas ban: according to the Census Bureau’s American Community Survey, 60% of all restaurants in California are owned by minorities.

  This is why civil rights leaders like Revs. Al Sharpton and Jesse Jackson are actively supporting natural gas.

  The recent Texas energy crisis showed that policies to ensure affordable and reliable energy truly are a matter of life and death. California should take heed of that lesson.

  Tyler Durden
  Sat, 03/06/2021 – 19:30

• Kroger Opens Fully-Automated Ohio Fulfillment Center As Fears Mount Of Rising Technological Unemployment 
  Kroger Opens Fully-Automated Ohio Fulfillment Center As Fears Mount Of Rising Technological Unemployment 

  With demand for shipped products soaring during the COVID-19 pandemic and foreseeable future, the transition to warehouse automation is already underway – likely to displace warehouse workers and result in rising technological unemployment. 

  Supermarket chain Kroger opened its first automated warehouse in Bulter County, Ohio, last week, reported Hamilton JournalNews. The massive 335,000-square-foot customer fulfillment center is entirely run by robots and artificial intelligence that can put together an order of about 50 items in six minutes compared with 30 to 45 minutes it takes a Kroger employee to pick items from shelves. 

  

  The new $55 million automated facility is known as the “shed” and is the first of 20 planned. 

  The Cincinnati-based grocer completed its first order at the facility last Wednesday. Rodney McMullen, Kroger’s chairman and CEO, told investors during Thursday’s call:

  “This marks the soft opening of the facility, and we look forward to our grand opening in early April.

  We continue to be excited about the elevated experience that this will bring to our customers in the tri-state area and across the country as we continue to open additional facilities,” McMullen said. 

  Kroger’s partnership with U.K.-based Ocado has been an essential part of leveraging advanced robotics technology to run the supermarket chain’s e-commerce segment. 

  An Ocado “shed” helps Kroger achieve faster delivery times compared to the in-store experience. It also lowers costs for the grocer. 

  The growing demand for grocery e-commerce by Kroger comes at a time when Instacart, otherwise known as the “personal shopper” app, mulls over robo-driven warehouses as they come to the same realization as Kroger that robots are more efficient and faster in fulfilling orders than humans. 

  The main takeaway is that fulfillment centers will one day be operated by robots and artificial intelligence no matter what the products are. Millions of working-poor Americans, mostly young and less-educated, have joined the ranks of Amazon and other e-commerce retailers as “pickers” in giant warehouses. Many of these jobs will be displaced in the coming years by automation as technological unemployment is set to soar. Maybe if Amazon employees unionize there would be a slower effort by the e-commerece giant to automate its warehouses. 

  This note is a warning to all warehouse workers that robots are coming for their jobs – perhaps now is the time to find a new occupation that will be less impacted by the economy’s technological transformation in the 2020s.   

   

  Tyler Durden
  Sat, 03/06/2021 – 19:00

• Ditch The Afghanistan Experts
  Ditch The Afghanistan Experts

  Authored by Daniel L. Davis via RealClear World (emphasis ours),

  U.S. President Joe Biden is coming under heavy pressure to abandon the May 1 deadline to withdraw U.S. combat troops from Afghanistan. The push to move the deadline might come from a former secretary of state, the congressionally mandated Afghan Study Group, or even NATO’s secretary-general. Opposing the pleas of these popular figures are 20 years of unbroken strategic failure. There is ample evidence to suggest that 20 more years of failure await, should the president give in to the wishes of these personalities.

  

  In February, former Secretary of State Madeline Albright argued Biden should ignore the May 1 withdrawal date and instead adopt a series of five new steps. The Afghan Study Group likewise advocated to abandon the withdrawal date and offered its own objectives. Meanwhile, NATO Secretary-General Jens Stoltenberg said the May 1 date was a “conditions-based” deal and declared the Taliban hadn’t met the conditions, and therefore NATO should continue the war.

  All of these advocates ignore that every tactic and objective they advocate has been tried over the past two decades, usually multiple times, and uniformly they have failed.

  When Barack Obama came into office, Secretary of Defense Robert Gates, Secretary of State Hillary Clinton, and Commander of U.S. Central Command David Petraeus convinced the new president that they had a better strategy than that employed by Obama’s predecessor. They advocated for a dramatic troop increase and the adoption of a counterinsurgency strategy. Obama listened. He authorized a surge of 17,000 troops to Afghanistan in February 2009, and another surge of 30,000 that December.

  Obama was himself unsure the strategy would work. According to Jonathan Alter, however, Obama pressed all his senior officials before making the final decision on Nov. 29 of that year, and he pointedly asked whether they could complete the mission in the 18 months they had promised. All said yes. “If you can’t do the things you say you can in 18 months,” Obama demanded, “then no one is going to suggest we stay, right?” All agreed.

  And yet as I personally observed — I was one of the surge troops from 2010-2011 — it was obvious from even a cursory observation on the ground that the mission wouldn’t be successfully completed in 18 months, or even in 18 years. Instead, Obama prosecuted eight more years of inconclusive war in Afghanistan. Donald Trump campaigned on ending endless wars and won the 2016 election. Unfortunately, as president he also came under enormous pressure by supposed experts against ending the war.

  Then-National Security Advisor H.R. McMaster and Secretary of Defense James Mattis – both heavyweight former generals with combat experience – sought to sway Trump against following his instincts and ending the war. In August 2017, Trump announced that not only would he not be ordering a withdrawal, but he would reluctantly increase the number of troops.

  “My original instinct was to pull out, and historically I like following my instincts,” the president explained. The turnaround, the New York Times reported, was “a victory of sorts” for Mattis and McMaster, who had successfully pressured Trump to order the troop increase. Again the “new” strategy didn’t work, and the result was merely to add four more years to the failed war.

  Now it is Biden who is coming under pressure, again by men and women that seem to have great credentials on paper, to seek yet another so-called new strategic roadmap. Again, they advocate against ending the war and withdrawing. If Biden proves to be the fourth straight president to listen to these experts and choose to cancel the withdrawal and continue the war, it is likely he too will be passing off the war to his successor – as the futile and wasteful adventure reaches 24 or 28 years.

  I warned in 2010 and 2012 that the war in Afghanistan was unwinnable. The fundamentals that led me to make that conclusion a decade ago have not changed. So long as Pakistan continues to secretly help the Taliban, the Afghan government remains one of the most corrupt in the world, the Taliban remains committed to fighting, and the Afghan Security Forces remain of limited capability, it won’t matter how many troops Biden orders to Afghanistan, how long they remain there, or what strategy he adopts: We will continue losing the war.

  The best thing President Biden can do for America’s national security and the health and wellbeing of our troops is to end the war and withdraw our troops, on schedule, by May 1. Anything else will needlessly extend the futility into perpetuity.

  Daniel L. Davis is a Senior Fellow for Defense Priorities and a former Lt. Col. in the U.S. Army who deployed into combat zones four times. He is the author of “The Eleventh Hour in 2020 America.” Follow him @DanielLDavis1. The views expressed are the author’s own.

  Tyler Durden
  Sat, 03/06/2021 – 18:30

• How Tokyo Is Using 1,350 Ton Pendulums To Earthquake-Proof Older Buildings
  How Tokyo Is Using 1,350 Ton Pendulums To Earthquake-Proof Older Buildings

  After 2011’s Tohoku earthquake in Japan, the country has been working diligently to “earthquake-proof” itself. The 2011 quake resulted in the deaths of over 22,000 people, including those who died in the subsequent tsunami, according to Nikkei. 

  The quake also caused the Fukushima power plant meltdown. 

  In Tokyo, the quake wasn’t catastrophic, but it was noticed. “The shaking gradually became bigger and bigger, and we didn’t know when it would stop. It was very frightening,” one resident said. Shaking his building lasted 10 minutes. 

  For some parts of the Tokyo skyline, earthquake-proofing buildings means installing 1,350 ton “pendulums” that can help buildings become more resistant to shaking caused by seismic movements. One of Japan’s biggest general contractors, Kajima, is carrying out the installations.

  

  They are part of a broader stroke of retrofits and building upgrades as the country looks to manage earthquake risk moving into the future. Haruhiko Kurino, a senior group leader with Kajima, said: “Many people in high-rise buildings felt uneasy. The earthquake brought home to us that we should take actions to make people inside buildings feel safe and secure.”

  Atsuomi Obayashi, a risk management expert and professor at Tokyo’s Keio University, said: “The 2011 Tohoku earthquake spurred many more companies to tighten their earthquake countermeasures.”

  Even before the quake, however, buildings were constructed specifically to be able to withstand earthquakes. Buildings are meant to be flexible and absorb the shock of such natural disasters. Few buildings suffered direct damage or collapse since the Great Hanshin-Awaji Earthquake in 1995.

  

  Now, instead of just focusing on buildings not collapsing, the focus has turned to reducing their sway, Nikkei reports:

  Earthquakes create two types of seismic motion: short-period and long-period. Long-period seismic motion creates large, slow shaking that can make high-rise buildings sway violently for a long time. The epicenter of the 2011 earthquake was far from Tokyo, but the long-period seismic motions did not weaken much, even far from the epicenter.

  As a result many people in Greater Tokyo were injured by falling objects and fixtures. The swaying in tall buildings often lasts for more than 10 minutes in a big earthquake and can make people feel seasick.

  The pendulums that are installed on rooftops help solve this problem by swinging along with the building, but with a slight delay. They help absorb the vibrations of the building. 

  

  And while demand for office space may be slowing due to Covid, demand for retrofitting buildings with these pendulums is still firm. Tetsuya Hanzawa at Shimizu’s center for safety and reliability engineering told Nikkei: “It is becoming more important for corporate Japan to adopt more earthquake-resistant ceilings, in terms of business continuity.”

  Ohigashi concluded: “Buyers are picky now. As buyers seek more quality and safety, it is crucial for owners of old buildings to update their quality to stay competitive.” 

  Tyler Durden
  Sat, 03/06/2021 – 18:00

• Gigafactory Demand Leads To Price Explosion In Battery-Grade Lithium
  Gigafactory Demand Leads To Price Explosion In Battery-Grade Lithium

  Via Mining.com,

  Domestic Chinese battery-grade lithium carbonate prices assessed by Benchmark Mineral Intelligence are on a tear in 2021 after bottoming out in the second half of last year, following a lengthy slump. 

  

  Ex-works lithium carbonate in China (≥99.5% Li2CO3) jumped by 68% to its highest since June 2019 in the first two months on the back of high battery demand, particularly for lithium iron phosphate (LFP) cathode, and a slower-than-anticipated transition to high nickel chemistries, according to Benchmark. 

  Benchmark’s megafactory tracker points to the extent of the rise in demand reflected in China’s battery production figures, which totalled 12 GWh in January, an increase of nearly 320% compared to the same month last year when the country was in the first stages of the pandemic.

  The surge was led by production of LFP batteries which is growing at a breakneck speed, up nearly 500% year- on-year.

  Surging Chinese lithium carbonate prices, which now hold a premium over hydroxide prices for the first time since April 2018, helped push the Benchmark Lithium Price Index up by 14.4% in February 2021, its second-largest move on record after January 2021, the London-headquartered research and price reporting agency said.

  While the most rapid gains were in China, Benchmark’s global weighted average lithium hydroxide prices are up 8% year-to-date and ex-Chinese carbonate prices up by an average of 17.1% in February:

  

  In fact, all 11 of Benchmark’s lithium prices registered increases in February 2021 as producers of both spodumene and lithium chemicals worldwide have begun to sell out inventories and fill order books through until the end of Q2 2021.

  While lithium’s majors are beginning to reengage in expansion plans, three years of falling lithium prices have failed to incentivise sufficient investment into the supply chain, leading to greater risks of price volatility as battery demand ramps up.

  Tyler Durden
  Sat, 03/06/2021 – 17:30

• Red-Hot Freight Market Sends Used Container-Ship Values Soaring
  Red-Hot Freight Market Sends Used Container-Ship Values Soaring

  No one predicted that the global shipping container industry would be on fire in the last couple of quarters, considering China’s robust economic rebound following the virus-induced downturn. Container rates have soared since last spring as there are few signs of immediate cooling. 

  Container shipowners are capitalizing on the red hot ocean freight market by flipping older ships. Monaco-based International Maritime Enterprises sold its container ship Crete I for $46 million, more than four times its 2016 value ($11 million), according to Bloomberg, citing a new industry report via TradeWinds. 

  

  The market for second-hand ships is soaring as the sale of new vessels has sunk in the last couple of years. A typical container ship takes more than one year to build – so boosting new ship supply cannot be readily done – hence why demand increase and value explosions are being observed on the secondary markets. 

  Clarkson Research Services Ltd. said a 10-year-old container ship with the capacity to haul 6,600 steel boxes fetches about $41 million today – that’s a considerable jump from its $9.5 million value back in 2016.

  

  “The recent price increases have happened far more quickly than previous sales and purchase cycles,” said Stephen Gordon, managing director at Clarkson Research. “Recent prices trends for 10-year-old vessels have more than doubled in less than six months, whereas in 2016-17 and 2004-2005 it took nearly 18 months for similar percentage price increases.”

  “February was the second-highest activity on record for transactions measured in ship container capacity,” Gordon said.

  Time charter rates for a 6,800-box container ship have erupted. 

  

  Container shipping data from Freightos and Harper Petersen & Co show container rates have been surging since April-June of 2020.

  

  Demand for freight containers and the heavy flows from China to the US East/West Coast has resulted in a shipping container shortage in Asia. 

  In September, we first noted that demand for ocean freight out of China was “leading to equipment shortages in Asia.”

  “The surge in volumes is leading to equipment shortages in Asia. Some shippers are paying premiums on top of spiking rates to guarantee containers and space. The imbalance is also putting pressure on overwhelmed US ports and importers to process and return empty containers quickly.”

  While the buying frenzy for second-hand container ships continues – we suspect this trend will last until the global economic rebound stalls – with China’s credit impulse already peaking – this could be in the second half of this year. 

  

  From used cars to used private jets to now used container ships, real asset prices are exploding higher. But how long will this madness last? 

  Tyler Durden
  Sat, 03/06/2021 – 17:00

• Israel Updating Plans To Attack Iran, Ready To 'Act Independently' 
  Israel Updating Plans To Attack Iran, Ready To ‘Act Independently’ 

  Authored by Dave DeCamp via AntiWar.com,

  Israeli Defense Minister Benny Gantz told Fox News in an interview published Friday that the Israeli military is updating its plans to strike Iran’s nuclear program and is prepared to act independently.

  Gantz falsely portrayed Iran’s recent steps to advance its civilian nuclear program as the Islamic Republic racing to develop a bomb, something he said Israel would stop. “If the world stops them before, it’s very much good. But if not, we must stand independently and we must defend ourselves by ourselves,” he said.

  

  Gantz cited nuclear activity that Iran is willing to quickly reverse if the US lifts sanctions and returns to the nuclear deal, known as the JCPOA. But Gantz, like most Israeli officials, is opposed to a revival of the agreement.

  Israeli officials have been making veiled threats about attacking Iran if President Biden rejoins the JCPOA. Other incidents in the region that are being blamed on Iran are causing some to fear that Israel might be preparing an attack sooner rather than later.

  Without providing evidence for the claim, Israel blamed Iran for an explosion on an Israeli-owned cargo ship in the Gulf of Oman that happened last week. No crew members were hurt, and the ship was back at sea a few days after the incident. When asked about possible retaliation, Israeli Prime Minister Benjamin Netanyahu said Israel was “striking at” Iran throughout the region.

  “This is a target map. Each one of them has been checked legally, operationally, intelligence-wise and we are ready to fight,” Gantz told the FOX correspondent while handing him a classified map.

  EXCLUSIVE: Israeli Defense Minister Benny Gantz shows Fox News a classified target map, revealing Hezbollah missiles amid civilian infrastructure https://t.co/fPisnRjtjs pic.twitter.com/fm4nOQ5yLm

  — Trey Yingst (@TreyYingst) March 4, 2021

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

  On Wednesday, Israel blamed Iran for another incident in the region. Israeli Environmental Protection Minister Gila Gamliel claimed Iran was responsible for a large oil spill that hit Israel last month.

  Surprisingly, Israeli military and intelligence officials doubted Gamliel’s claim, as did other officials in the Environmental Protection Ministry.

  

  Regardless of whether Iran was responsible or not, Israel could be planning a strike against the Islamic Republic over the two incidents. Sources told Business Insider that the Biden administration and its European allies are fearing that Israel is planning a “substantial” attack on Iran.

  Tyler Durden
  Sat, 03/06/2021 – 16:30

• JPMorgan Estimates Up To $316 Billion In Forced Month-End Selling
  JPMorgan Estimates Up To $316 Billion In Forced Month-End Selling

  Friday’s post-European close ramp notwithstanding…

  

  … stock markets, and especially growth stocks, had a rude awakening this week as rising rates finally hammered high duration stocks, shown in this chart which we have been posting ever since November to warn readers of who will get hammered first.

  

  For those who hope that the worst is now over, JPM has some bad news.

  In one of his latest Flows and Liquidity reports, JPM quant Nick Panigirtzoglou writes that as we approach quarter-end, the equity rebalancing flow question is resurfacing in client conversations. As we notes, “the equity rally and the bond sell-off during the current quarter is naturally creating a pending rebalancing flow for multi-asset investors away from equities into bonds for pension funds and balanced mutual funds. How much of equity/bond rebalancing flow should we expect into current quarter-end?”

  To answer this question, the Greek strategist applies a familiar framework and looks at the four key multi-asset investors that have either fixed allocation targets or tend to exhibit strong mean reversion in their asset allocation. These are balanced mutual funds, such as 60:40 funds, US defined benefit pension plans, Norges Bank, i.e. the Norwegian oil fund, and the Japanese government pension plan, GPIF.

  For those curious about the details, below is a more detailed summary of the considerations behind the four key investor classes ahead of month and quarter-end.

  1. Balanced mutual funds including 60:40 funds, a close to $7.5tr AUM universe globally, tend to rebalance over 1-2 months or so. The lesson from last Nov/Dec is that balanced mutual funds exhibit flexibility and they do not necessarily rebalance every single month. During the previous quarter, they appear to have postponed rebalancing for Nov-end or Dec-end and to have waited until January to de-risk/rebalance. JPM believes that funds de-risked in January, as a result of the tumble in balanced MFs equity beta…

  

  .. and since it would have been too soon to rebalance again in February, the quant believes that they have likely postponed any pending rebalancing to March. Assuming they were fully rebalanced at the end of January, which is a reasonable hypothesis given the reduction in their betas in January and by taking into account the performance of global equities and bonds since then, JPMorgan estimates around $107bn of equity selling by balanced mutual funds globally into the end of March in order to revert to their 60:40 target allocation.

  2. US defined benefit pension plans are a similarly big universe with AUM of around $8tr. They tend to rebalance more slowly over 1-2 quarters or so. Assuming they were fully rebalanced at the end of December, and by taking into account the QTD performance of US equities and bonds, JPM expects that the pending equity rebalancing flow by US defined benefit pension plans into the current quarter-end is negative at around -$110bn: “In other word, US defined benefit plans would need to sell $110bn of equities towards the end of the current quarter and buy a similar amount of bonds for their allocations to revert to end-December levels.” Making matters worse, and given the improvement in their funded ratios, Panigirtzoglou notes that it is possible that they would seek to take advantage of this improvement to de-risk, “which could pose some upside risk to this estimate.”

  3. Norges Bank, a $1.3tr AUM entity as at the end of 2020, is calculated to see negative $65bn in rebalancing (out)flows. This, according to JPM, incorporates also the fact that the Norwegian government looks set to continue to rely on net transfers from its fund to finance part of its budget deficit and assumes that the equity weight would be returned to its target of around 70%. In the second half of 2020, the Norges Bank allowed its equity weight to increase to nearly 73%, and in the event it would simply seek to keep its equity weight unchanged at 73% would imply around $22bn of equity sales, which JPM thinks of as a lower bound estimate.

  4. The Japanese government pension plan, or GPIF, a $1.7tr AUM entity, is also set to sell: JPM estimates that the pending equity rebalancing flow by the GPIF into the current quarter-end based on current equity and bond returns is also likely negative at around $34bn.

  Putting these together, we get:

  • Mutual -$107BN
  • Defined Pension -$110BN
  • Norges Bank -$65BN (could be -$22BN)
  • GPIF -$34BN

  … a grand total of $316BN.

  To be sure, this number will likely be lower following last week’s selloff which followed the original JPM analysis, and may be some $40BN less based on assumptions about forced Norwegian selling, we are still talking about selling in the $100BN+ range in the days before quarter end, which is why JPM concludes that “in all, we see some vulnerability in equity markets into quarter-end from pension funds entities as well balanced mutual funds selling equities and buying bonds to rebalance towards their target equity/bond allocations.“

  And while JPM’s last forced selling forecast was a dud, with the bank’s Nov 2020 prediction of a similar number ($310BN) in year-end selling never materializing (as JPM now acknowledges) and stocks shooting higher by the end of last year, the reality this time is that with markets suddenly far more jittery many whale investors will not risk testing if JPM is wrong twice in a row and may simply frontrun the potential selling, creating a self-fulfilling prophecy as fears of possible selling spark waves of actual selling. The only question we have is when does the frontrunning officially begin?

  Tyler Durden
  Sat, 03/06/2021 – 16:00

• Tulsi Gabbard Calls Out The US Dirty War On Syria That Biden & Aides Admit To
  Tulsi Gabbard Calls Out The US Dirty War On Syria That Biden & Aides Admit To

  Via Pushback with Aaron Maté at The Grayzone,

  While Joe Biden has faced some mild Congressional pushback for bombing the Iraq-Syria border, Tulsi Gabbard says her former colleagues are ignoring the larger issue: the ongoing US dirty war on Syria.

  After a decade of proxy warfare that empowered Al Qaeda and ISIS, the US is now occupying one-third of Syria and imposing crippling sanctions that are crushing Syria’s economy and preventing reconstruction.

  Watch: Featuring video clips from — Tulsi Gabbard, former Democratic Congressmember; President Joe Biden; Brett McGurk, National Security Council coordinator for the Middle East and North Africa; Martin Dempsey, former Joint Chiefs chairman; Rob Malley, Special Envoy for Iran; John Kerry, Special Envoy for Climate & former Secretary of State; former President Donald Trump; Alena Douhan, UN Special Rapporteur on Sanctions; Dana Stroul, Deputy Assistant Secretary of Defense for Middle East; Vice President Kamala Harris.

  While Gabbard has been vilified for her stance on Syria, many top White House officials – including Joe Biden himself – have already acknowledged the same facts that she has called out.

  Aaron Maté plays clips of Biden and some of his most senior aides admitting to the horrific realities of the US dirty war on Syria, and argues that Gabbard only stands apart in being wiling to criticize it.

  * * *

  

  Tyler Durden
  Sat, 03/06/2021 – 15:30

• Pope Pleads For Peace In Historic Meeting With Powerful Shiite Cleric In Iraq
  Pope Pleads For Peace In Historic Meeting With Powerful Shiite Cleric In Iraq

  On Saturday Pope Frances traveled to the Shia holy city of Najaf while on his four-day papal visit to Iraq – the first ever such trip by the head of the Roman Catholic Church. There he held a historic and somewhat controversial meeting with the country’s top Shiite cleric, Grand Ayatollah Ali al-Sistani, amid a massive security presence. 

  The 90-year old Sistani is among the most senior Shiite clerics in the world, whose quiet but powerful influence has helped shaped post-US invasion Iraq. The months in the making meeting was held in Sistani’s own home. 

  

  Pope Francis’ main message to the top Islamic cleric during the 50-minute meeting reportedly emphasized the importance of peaceful coexistence between Muslims and Christians of Iraq.

  Sistani likewise “affirmed his concern that Christian citizens [who] should live like all Iraqis in peace and security, and with their full constitutional rights,” according to a subsequent press release.

  And a Vatican statement further said the Pope thanked al-Sistani for having “raised his voice in defense of the weakest and most persecuted.” The dialogue itself during the meeting was kept quiet. 

  The meeting took place in close vicinity to the golden-domed Imam Ali Shrine, among the most revered sites in Shiite Islam. The shrine was target of a major twin car bombing in August of 2003 which killed 95 people, and later claimed by al-Qaeda in Iraq.

  Video of @Pontifex visit to Sayed Sistani today pic.twitter.com/z2oOgeDjzi

  — Sajad Jiyad سجاد (@SajadJiyad) March 6, 2021

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  According to AFP, Sistani’s office “published an image of the two, neither wearing masks: Sistani in a black turban with his wispy grey beard reaching down to his black robe and Francis all in white, looking directly at the grand ayatollah.”

  The significance of the meeting is sure to reverberate across borders, given “The 90-year-old al-Sistani has been a consistent counterweight to Iran’s influence. With the meeting, Francis is implicitly recognizing him as the chief interlocutor of Shiite Islam over his rival, Iranian Supreme Leader Ali Khamenei. News of the meeting heightened long-standing rivalries between the Shiite seminaries of Najaf and Iran’s city of Qom over which stands at the center of the Shiite world,” an AP report previously explained. 

  Tyler Durden
  Sat, 03/06/2021 – 15:00

• Newsom COVID 'Equity' Plan: Vaccinate 2 Million Latinos Or California Won't Reopen
  Newsom COVID ‘Equity’ Plan: Vaccinate 2 Million Latinos Or California Won’t Reopen

  Authored by Victoria Taft via PJMedia.com,

  California Governor Gavin Newsom has completely changed his response to COVID – again – this time leveraging opening the state for all Californians on the backs of low-income Latinos living in the areas with the highest rates of the illness.

  In the name of “equity,” Newsom announced Thursday that 40% of all the state’s available vaccines will go to Latino communities in the Central Valley and in pockets of LA because Latinos have suffered the most death and illness from COVID.

  

  And there’s a catch: Until the Latinos in these areas take the vaccine in higher numbers, California will stay locked down.

  State Health and Human Services Director Dr. Mark Ghaly said once the shots are in the arms, the state can reopen.

  “As we achieve higher levels of vaccine in the hardest hit communities, we feel more confident that more and more activities across the state can occur,” he said in a briefing Thursday.

  […]

  Once 2 million vaccine doses are given out in those neighborhoods, the state will make it easier for counties to move through reopening tiers that dictate business and school reopenings. With 1.6 million shots administered, he said he expects to hit that target in the next week or two.

  Once the state gives out 4 million doses in those neighborhoods, state officials will revise the metrics for reopening sooner.

  The new plan swaps out the current color-based tier plan with a person-of-color-based plan.

  The Associated Press reported that the governor said getting the vaccines into the arms of Latinos is a “race against exhaustion,” whatever that means.

  “It is a race against the variants. It’s a race against exhaustion. It’s a race to safely, thoughtfully open our economy, mindful that it has to be an economy that doesn’t leave people behind, that is truly inclusive,” Newsom, a Democrat, said at a news conference. He also encouraged people to wear two masks.

  State lawmaker Lorena Gonzalez, the woman who’s responsible for AB 5, which largely killed the freelance worker economy in California on behalf of her union pals, wondered how the change in the plan would affect the governor’s previously announced plan to get teachers in the classroom.

  The changes announced Wednesday are “kind of not fair” to those who negotiated the deal, Assemblywoman Lorena Gonzalez said.

  “If we are going to change the tiers and suddenly everyone is in red tier, that changes the classes that have to be open, the number of classes and the testing cadences,” the San Diego Democrat said Thursday just before the Legislature voted on the bill.

  “So, if you get calls from your teachers union a little upset, they have the right to be upset. You don’t negotiate a deal and change the parameters of that deal on the day we are voting on it.”

  The Sacramento Bee reports that the executive director of the California Teachers Association, Joe Boyd, is a bit whipsawed at how confusing Newsom’s COVID response has been.

  He said the governor’s change to the definition of the red tier makes things more complicated.

  “We’ve changed the meaning of what it means to be in a tier now three times,” he said Thursday, speaking on a panel with the Public Policy Institute of California. “At some point, we have to have some consistency of what to expect.”

  The governor also announced that he was advising people to wear double masks.

  This is after Newsom criticized Texas Governor Gregg Abbott for halting his mask mandate, making it voluntary. He called Abbott reckless.

  Of course, Newsom has broken his own coronavirus rules very publicly at least twice, at one point putting a Fresno Mexican restaurant in danger of being closed down because Newsom visited inside, against county COVID rules. The other example was Newsom’s double-standard dinner at the French Laundry with people from all different families, nearly all of whom were lobbyists.

  👀👀 pic.twitter.com/C3dEkYfvA2

  — Bill Melugin (@BillFOXLA) March 2, 2021

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  ABC News 7 reported that Newsom was going all-in with giving out vaccines based on equity, which is to say, “color.”

  Gov. Gavin Newsom has called equity the state’s “North Star.” Yet community health clinics focused on serving low-income and vulnerable Californians say they haven’t been getting enough doses. Ghaly said Thursday that Newsom’s administration will work with communities to make sure the vaccine actually ends up in the arms of those patients, not to day-trippers from wealthier ZIP codes who have the time and tech savvy to schedule appointments online.

  The Sacramento Bee reported that “tying reopening to vaccination equity metrics was cheered by representatives of the legislative Black and Latino caucuses, as well as social justice and equity groups. Latinos make up roughly half of cases and deaths in California even though they are 39% of the population. […] Data show that of shots given, only about 17% were administered in vulnerable communities that have been disproportionately affected by the pandemic.”

  Holding the rest of the state hostage to the vaccination rate of Latinos in certain zip codes seems an odd way of approaching the issue. The governor is apparently hoping that others will pressure Latino citizens to take a vaccine they may or may not want. If you like mask-shamers, just wait until vaccine-shaming becomes a cottage industry in the Golden State.

  This plan may meet Newsom’s definition of “equity,” but certainly won’t enhance comity between Californians.

  Tyler Durden
  Sat, 03/06/2021 – 14:35

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